KEEP PACE WITH THE CUSTOMER
As marketing and sustainability converge, the relationship with the customer is changing. For marketers, focusing on increasing sales may not be consistent with wider sustainability commitments.
“It’s the role of marketing to communicate a value proposition to our customers in which environmental and societal content has a prominent role — that’s new to marketing” says Filip Engel, vice president, sustainability, public affairs and branding at Ørsted.
But can they do it?
“Most marketers are incentivised to sell by volume, and that gives them very little incentive to consider whether what they are being tasked to sell is appropriate from a sustainability perspective or, once it has been sold, what sort of responsibility they have for the lifecycle of that product,” says John Elkington, founder and chief pollinator at Volans.
MARKETERS NEED A DEEPER UNDERSTANDING OF CUSTOMER REQUIREMENTS
“We need marketers who fundamentally understand our customers,” says Engel. “You may say ‘That’s old news’, but I would argue that if you need to understand a customer’s sustainability pain points, then you need to go a couple of steps deeper than before and then bring that insight back into the organisation.”
This requires a deeper, ongoing dialogue with the customer.
“Sustainability marketing is about talking and listening in equal measure,” says Dr. Arlo Brady, CEO of Freuds. “And that’s very difficult for a conventionally educated marketer because they are not set up to do that.”
“Sustainability marketing is about talking and listening in equal measure”
Dr. Arlo Brady CEO, Freuds
REACHING CUSTOMERS NOW MEANS ENGAGING WITH MULTIPLE STAKEHOLDERS
To communicate with customers, marketers need to talk to the wide range of additional stakeholders who now influence the sustainability message.
“If you want to talk to consumers directly about almost anything other than sustainability, you can do that,” says Brady. “Whereas in sustainability, there is a whole ecosystem of opinion formers and stakeholders, who are like gatekeepers. And in order to get through to consumers, you’ve got to engage with those people first.”
“We had always been accustomed to talking about the qualities of the product, but not qualities of the product that were based on sustainability.”
Filip Engel Vice president, sustainability, public affairs and branding, Ørsted
COMPANIES WANT SUPPLIERS AND PARTNERS WITH STRONG SUSTAINABILITY CREDENTIALS
Part of the pressure to purchase more sustainably comes from a need to get to grips with so-called Scope 3 emissions (the portion of carbon footprint that relates to suppliers and customers). In future, companies are likely to have to report on these in their emissions statements.
“In B2B, the world’s largest companies are driving sustainability simply because they have the power to select partners and so can impose those standards on them.”
Professor Ioannis Ioannou Associate professor of strategy and entrepreneurship, London Business School
But there has also been a big change in how buyers select suppliers and what they look for in partners.
Recent research suggests that sustainability could be more important for corporate buyers than consumers:
of corporate buyers say they are much more likely to buy from a firm that scores highly on socio-political issues they think are important, compared with just 29% of consumers 4
of companies have already switched suppliers or business partners at least once because their provider did not have adequate ESG credentials and commitments 5
Footnotes: 4. https://www.amanewyork.org/landing/techlash/ 5. https://fleishmanhillard.co.uk/wp-content/uploads/sites/27/2022/04/FleishmanHillard-UK-B2B-Buyers-Guide-2022.pdf