Sustainability marketing is a booming industry. As the carbon footprint expands globally, companies are racing to incorporate environmentally friendly practices. Saving the planet may be a necessary pursuit but building market share is real business. The $16 billion-dollar green technology and sustainability industry of 2022 is expected to grow into an $80 billion dollar business by the year 2030.
Dr. Suzanne Shelton, a leading environmental marketer and CEO of the Shelton Group, spoke on The Decarbonization Race podcast about how she helps companies communicate their sustainability stories. She identifies the steps that resonate with customers. Suzanne believes the best brands are co-created. When companies and consumers engage together, they build loyalty, better products, and a long-term future.
Companies offering environmentally friendly solutions reap huge financial upside. Consumers consciously support brands that align with their values and mitigate the planetary impact. In fact, 34% of Americans channel their spending to “good” companies with a positive impact on climate change. These consumers are active proselytizers with the ability to multiply and build brands.
“I think the messaging from corporate America needs to be clear,” Dr. Shelton shared. When we’re talking about reducing carbon footprints, we’re talking about protecting the planet. We’re talking about either using less energy or using cleaner energy. Make sure everybody understands that message.”
“We see a lot of corporate clients very focused on their ESG report. They spend a lot of money and time on it, but they approach it as if it’s the end as opposed to a means to the end,” says Suzanne. “The outcomes we are trying to drive through communicating about ESG are driving brand preference, driving sales, driving investor outcomes, and attracting and retaining the best and brightest employees. Those are the four outcomes we can drive through ESG communication.”
Suzanne’s Tips for Businesses Communicating on Sustainability
Step 1: Do all the things you have to do to be credible. Take care of your employees – because that’s what people care about most – and check all the boxes the SEC is looking for.
Step 2: Measure and get a handle on your greenhouse gas emissions – Scope 1, 2, and 3.
Step 3: Set up a roadmap for reducing all of them.
After you’ve done all three steps, build a story around it with a key message, a key story, pillars, and proof points, says Suzanne. “You have to have the proof points. Not every consumer’s going to look for them, but you have to have them so that you’re credible and get that story out there on a steady basis.”
The Consumer Dilemma
“What we’ve heard from consumers repeatedly is a combination of three things. Half of us go, ‘You know what? I don’t need energy efficiency. My home is already efficient,’ which is largely false. Unless we have a recently built, net zero energy or net zero energy-ready home, our homes are not very energy efficient.”
Part of the problem, per Suzanne, is building codes haven’t kept up with public health and climate goals. State and local governments have tremendous power to determine which codes are adopted and enforced. Politics often plays a role.
For example, the National Association of Home Builders (NAHB) recently opposed updated residential codes supported by insurers, safety groups and the federal government in order to keep building costs low (or profitability high – depending on which side of the fence you stand). But codes related to insulation, roofing, wall thickness, and electrification can cut costs significantly in homes and businesses and support the transition to a decarbonized future.
Utility companies were ordered to put energy efficient programs in place by public utility commissions. “They created complicated schemes to get paid for their energy efficiency programs,” explains Suzanne. They collected money from customers through often oddily-named fees that “don’t sound like what they are at all.” But in the end, millions were collected and used to fund energy efficiency programs incentivizing residential and commercial building upgrades.
“The general scheme is,” says Suzanne, “we’re going to ascribe X amount of kilowatt savings for every high efficiency – heat and air unit or for every high efficiency water heater. Those savings get ascribed. If we can get rebates out there and motivate people to do those things, then we’ll just add up the savings and go back to our utility commission and say, yes, we achieve those savings.”
The bottom line is people want their homes to be safe, comfortable, and have good air quality. “If we’re going to get people to take action, to be more energy efficient and, frankly, to decarbonize, it ain’t about decarbonization and it’s really not about price. It’s about [tapping into] these other drivers.”
Ocean Plastics Vs. Climate Change
When the Shelton Group tested a focus group on environmental issues, their top concern was plastics in the ocean. Climate change was in second place, at a distance, when the threat is much more acute.
It’s a matter of marketing. “Plastics in the ocean are the hot button for a lot of reasons,” says Suzanne. “Number one, we see the images on social media of wildlife strangled in plastic bags. Very graphic. So emotionally evocative. We just instantly look at that and go, oh, it shouldn’t be. I have to do something. But the other thing is there is some part of us, maybe it’s totally unconscious, that goes, Oh my God. That could be my six-pack ring. That could be my straw. That could be my plastic. I’m an accomplice to the crime. So that makes it deeply, deeply personal.”
People generally are more aware of the plastics issue. “But for the most part, the average American goes clean is good. Solar is good. Wind is good. Why wouldn’t we make energy from that?” says Suzanne. Renewable energy is easy to understand. “People can picture a solar panel. They can picture a [wind turbine]. It’s not some [abstract] thing, like a greenhouse gas. How do I picture that?”
The challenge is making decarbonization as sexy an issue as ocean plastics. Reducing carbon emissions in buildings isn’t sexy, but buildings represent 40% of carbon emissions. If the focus turns to incentives and showing decarbonization as a better value than fossil fuels, we may have a chance to change the conversation.
“When you’re talking about clean and renewable energy,” says Suzanne, for most of us, it’s a winning story.
Tune in to the full episode with Lincoln Payton for more of the story.