The Marketing Executives Group International

By: John A Burshek, President, The Arthur Group
Linkedin URL:  http://www.linkedin.com/pub/john-burshek/1/262/b68

If you ask today’s marketer what their greatest challenge is, the vast majority reply, “staying in front of the digital customer.” This is no surprise.   Fueled by the explosive growth of social media and mobile technology in just the past two years alone, the digital customer is marketing’s current bright shiny object as well as a serious challenge.   The possibilities make it feel as if marketing must harness chaos itself.    

Digital challenges are indeed the current poster child for mainstream business press.  However, lurking in the background is a burgeoning movement that threatens to bring marketing’s effectiveness to its collective knees, again. 

This quiet giant is the marketing challenge presented by green or sustainability initiatives within companies of all sizes.

Background:
Over six years ago, we believed corporate America was missing a major consumer trend.  We were right.  We discovered a significant percentage (23%) of consumers very likely to change their product purchase from their current brand to a competitor offering a green message.  An additional 24% were very likely to consider a competitive brand with a green message. 

And so began round one of green marketing.

What happened?  The expected knee-jerk response:  re-wrapping old product in green packaging (no, really), slapping numerous and meaningless certification labels on packaging, outlandish use of green jargon in messaging, and attempting to sell severely inferior product as the green alternative.   The inevitable result from this was, well . . .  expected:  market failure combined with Federal investigations concerning false product claims.  This was followed by marketing groups walking away from the business table wiping their hands of “this green thing.”

Problem was, even though the consumer said they would switch, or consider switching, the rest of our report definitely stated that consumers will not check their brains at the door for a green alternative.  A marketer still needed deep understanding of differing consumer segments.  Optimized messaging for specific segments was still required for market success.

In other words, while obvious product and pricing flaws were passed to marketing, as an entity marketing refused to hold the line on required processes.  Processes that would have brought to light many flaws and minimized both company embarrassment and market confusion.   Shall I say it plainly?  Processes involving understanding the product and company’s customer audience and that customer’s experience – basic research 101.

However, there was an even larger outcome.  One which marketing departments, communications and advertising agencies alike did not see.  As they walked away from the business table disowning “this green thing,” executives watching them leave shook their heads in disappointment.   Once again, marketing made itself irrelevant in meaningfully addressing a business challenge.  This time, the challenge of becoming a sustainable company.

Green Today:

Currently, corporate conversations surrounding green and sustainability are taking place in the Boardroom and at the highest executive levels.   Subsequent actions focus on the operational side of business.  In case you missed it, the following initiatives are well underway:

1) Kaiser Permanente, Proctor & Gamble, IBM and many other Fortune 1000 companies are establishing sustainability indexes across their entire supply chains. 

How suppliers and vendors score on implementation of sustainability and green initiatives within their own company are a direct check-the-box determination of who wins the business.  The effects of this are felt among the obvious - manufacturers for these companies. 

However, the unseen impact is affecting entire industries.  Requirements for entire industries such as travel, hospitality, advertising and marketing force them to face a daunting task.  That task is one of defining why one brand is selected over another in their industry, based on sustainability metrics.

Literally billions of business-to-business purchasing is soon driven by;  energy and water use, waste disposal, chemical content, green house gas emissions, recycled content, packaging, assurance of supply, product quality performance, and green innovation.

2) Wal-Mart’s sustainability scorecard, while rudimentary in its current form, helped force the above-mentioned rush of major companies developing their own sustainability indexes.  There is no misconception that what began at a very slow pace by the world’s largest retailer will soon become a requirement used for ranking shelf space allocation.   

3) Timberland and Safeway are just two of several leading companies bypassing marketing and taking sustainability’s brand impact straight to their customers. 

Timberland has a green product line of course.  Less well known, is its eco-labeling (similar to nutritional labeling) which demonstrates the entire company’s climate impact.  This is accomplished through an “our footprint” label on its product.  This label represents to the consumer what the entire company is doing to mitigate its climatic impact.  This “our footprint” labeling is audited and approved by a few select companies worldwide and can be applied to many industries.

Safeway stores recently made news as the first U.S. grocery retailer to join the Wal-Mart founded and funded Sustainability Consortium.  This Sustainability Consortium is a banding together of leading edge companies to address all aspects of green and business.  As an outcome of Safeway’s green private label success, Safeway is leading in many ways that are significant.   Leapfrogging the concept of simply LEED (a sustainability ranking and rating system for new construction) certified buildings; they are testing entirely new merchandising schematics for in-store optimization of green products.   

The attempt is to implement a holistic approach toward green in a retail setting.  Rather than simply wrapping non-green product in a quasi-green LEED certified building, they are considering the green impact of the entire retail environment, which of course, includes all those products offered on the store shelves.  Kudos to Safeway, you remembered the basic premise that your customers do not check their brain at the door.

What is the reason for this sudden growth in supply chain requirements and new consumer-facing efforts?  Not surprisingly, it is driven by a couple of common motivators:  fear and money.  Fear of staving off government regulation.  Government regulation is already setting product and company requirements in non-U.S countries. 

And money.  The Great Recession made the concept of changing operational structure or purchase patterns to drop a few million to the bottom line in vogue once again.  As one CEO of a Fortune 100 company put it, “If changing the light bulbs throughout my entire corporation saves the company $30 million in energy expense annually AND gets me green credit somewhere else – what’s not to like about that?”

Green and sustainability has become today’s TQM (Total Quality Management) movement.   Right now, the movement is fully into the cost containment, cost control, cost reduction phase.  Much like TQM in its early days, it is all about picking the low-hanging fruit from the tree of opportunity.

Green Tomorrow: 

Programs such as LEED are commonplace now in the building community.  However, as great as LEED is at helping an architect and building client implement meaningful green design and product usage for new buildings, it is not a consumer understood nor meaningful consumer-facing brand.  This is the same for all of the certifications out there.  They may serve a good purpose, and even indicate a very good move on the company’s part, but meaning anything to the consumer of the business’ products, eh, not so much. 

Much like the old days of TQM, the challenge soon to face Marketing is a bit tricky.  If you just simply tell someone you’re doing a better job at making something “better” or in a manner that saves you money, the typical response is “Well, good for you.  Why weren’t you doing that all along again?”  Not a lot of brand traction. 

Remember Ford’s “Quality is Job One” slogan?  Great right?  Yet during that same time period a formerly smallish vehicle manufacturer called Toyota grew to dominance winning top honors in every JD Power consumer quality study thrown at them.  Obviously, you saying you are doing it – something already tried in early green efforts – did not work then for quality and will not work in this next go around for green either. 

You cannot just say you are green and have it believed by your audience.  Your audience needs to say you are green. 

Marketing is going to get another shot at developing, testing, and implementing green and sustainable messages for companies.  A shot at redemption, a story well told. That is the good news.  The opportunities are coming very soon.  The downside is the potential for another fiasco of jargon shot from the hip.  Something that is absolutely avoidable. 

Here then are the facts for next generation successful green marketing:

1) The GREEN movement is not going away and neither is sustainability.  Too much is at stake globally.  Governments are squeezing on one side.  The supply chain across industries is being rank ordered on it. The consumer has outrun companies in their inherent demand.  Without this mindset, you will not have the drive to deliver on the next facts.

2) It is very complex.  It is a major challenge to communicate green messaging correctly.  There is no easy fix for marketing to accomplish what it will be tasked to do.    In some cases, you may feel like you are back in school!

You need to learn, really learn, a new language.  Recognize that, yes, this is a complex issue full of scientific jargon.  But if you do not fully understand the benefits to your company’s consumer of a product line moving from LCA to PCR to EPD – you have lost before you started.  So learn it! 

3) Pick up the gauntlet and meet the challenge head on this time.  Use the power of research and connect with your consumer, whether b2b or b2c.

If you need help, admit it and get it.  Just like the early internet days, experts are being created overnight after laboring at the bleeding edge of this adoption curve for several years.  They already paid the price and learned from the hard knocks.  No need for you to reinvent the wheel.

By all means, remember what Marketing is supposed to OWN in the first place – your customer and potential customers.   Use the processes we are supposed to be expert at.  Segment, analyze, create, test, refine and then deliver meaningful brand impact.

Just like the winners in the digital race, the winners in the green race will be those who:

 - know the language,

 - develop and deliver core measurement success to their key audiences,

- understand and implement research and metrics, metrics and research, and then more metrics,

 - most importantly, focus on optimizing the entire customer experience.

Not only has your customer not checked their brain at the door on this topic.  They want to be included in your marketing decisions.

By: John Burshek, President, The Arthur Group

Linkedin URL:  http://www.linkedin.com/pub/john-burshek/1/262/b68