Sustainability is now a driving force for brands everywhere. Years ago, only select niche brands offered eco-friendly options yet now, leaders understand how imperative ESG practices are for both reducing carbon footprint and improving operational efficiency.
According to recent analysis from McKinsey, 63% of ESG propositions have a positive impact on equity returns, boosting investment and top-line growth. There is no denying the opportunity presented by sustainable practices.
However successful ESG practices are often difficult for B2B brands to implement. Ambitious targets and good intentions, confronted with organizational and cross value-chain supply barriers, result in missed commitments.
Customers want to see evidence of change, and not just hear empty promises. To ensure commercial and financial success, leaders must return to the fundamentals and comprehend what customers want, and when they want it.
A sense of purpose is vital
In the past, environmental goals have been perceived as ‘nice to have’ but costly to implement. In reality, business and ecological goals are not mutually exclusive. Marketing with purpose can bring significant benefits to profitability as well as the planet.
In a study conducted by Edelman, 71% of participants agreed that ‘companies which place profits over people will lose their trust forever’ (Edelman Trust Barometer, 2020). Partnering with or using a company with vague environmental governance rings alarm bells, with a media storm only a tweet away.
That being said, it’s human nature and good business to want to see evidence. Leaders are under pressure to be bold and showcase their wins and need the right tools to do this effectively. When customers, investors and employees see positive pay-off, motivation for change becomes far easier. Then, sustainability becomes an intrinsic part of every planning conversation, not tagged on as an afterthought.
Sharon Curr is Brand Experience Strategy Director at Merkle B2B.
It's not just Gen Z who care about climate change
It’s true that climate anxiety is particularly rife for Gen Z, impacting attitudes to work and personal life as a result. A study conducted by Bupa highlighted that 64% of 18 – 22 year olds felt it was important for their employers to act on environmental issues.
But what we are seeing now is widespread adoption of this attitude across generations. A survey conducted across 3,622 buyers and users of B2B products across the world found that across age groups, “softer” decision drivers were of elevated importance. Key decision drivers for B2B buyers today included “takes care of its suppliers, partners, and communities,” “is committed to reducing its environmental impact,” “is known as being a good employer,” and “has a culture of diversity and inclusion.”
Importantly, these decision drivers were found to be significantly more important to a winning outcome in 2023 versus 2022. The “be-kinder” legacy of lockdown, coupled with generational shifts in global business culture has meant that emotional experiences are fusing with brand identity. B2B buyers are closer to consumers in attitude, where decisions are highly impacted by personal values and ethics.
Achieving ongoing relevance can seem daunting when the average B2B buying journey takes 350 days on average and is highly complex. Leaders can look to technologies such as AI, next-best action tools, and integrated experience clouds for insight. Harnessing all that new tech has to offer will allow businesses to not only create connected customer journeys, but also recognize trends.
Honesty is the best policy
An over-saturated online space means that competition for B2B brands has never been more intense. One misstep and a buyer’s faith in a brand could be lost forever. In 34% of decision journeys, the incumbent lost out in 2023 versus only 29% in 2022. Even leading brands cannot rest on their laurels. They need to be honest about areas for improvement and draw up ESG plans that are transparent and scalable.
That’s especially true given the number one most important factor influencing brand success this year. Safety. B2B buyers are placing the most importance on being made to feel safe when signing a contract. Feeling safe is an outcome and is achieved as the result of actions and behaviors.
So, lack of visible strategies when it comes to sustainability could send a buyer elsewhere. The introduction of recent legislation, such as the EU’s Corporate Sustainability Directive, has only increased buyer nervousness as every decision is held up to the light.
When businesses are empowered with meaningful insights, they gain a forensic understanding of what buyers are looking for. Equipped with insights, leaders can understand service models needed to deliver on customer expectations and ensure messaging is tailored to particular buyers.
This year and moving toward 2030, one thing is certain: doing good things for the planet and its people is good business. But this will only be successful if sustainable practices are adopted with authentic desire for change. When businesses empower themselves with knowledge, their ability to meet and even surpass buyer needs becomes limitless. Resulting in long-standing and profitable buyer relationships.
