In late April I had the opportunity to speak at the CMO Club Summit in New York. This event brings together several hundred Chief Marketing Officers from around the country to discuss best practices, share ideas and focus on marketplace trends that are impacting businesses. The group is about evenly split between B2B companies and B2C, and while the attendees represented some of the biggest names in business like Microsoft, IBM, ESPN and Wells Fargo, there are a slew of smaller and medium sized businesses there as well.
The panel I had the opportunity to speak on was titled, Sustainability: The New Marketing Imperative for Growth. In an effort to get the audience involved, we started out by asking some "raise your hands" questions. The first was "How many of you have someone in charge of sustainability at your company". About 5 out of 75 hands went up. This surprisingly low number changed the entire tenor of the conversation. While there were some smaller companies in the audience, the fact that there were so many large companies attending as well, led the panelists to agree that most CMO's hadn't reached the point where they were engaged in the sustainability effort and it was likely they didn't know that there was an individual focused on it.
Why would this be the case? There are a number of potential reasons, but the discussion revolved around one key possibility. Sustainability has not risen to a sufficiently strategic level inside of most organizations for the CMO to be involved. The facility managers, IT team and others may be looking for ways to cut energy costs and drive efficiencies, but has it risen to a board-level issue that the CMO is helping to drive? Not in most cases. Sure, the PR team is always happy to tout a green story about some aspect of their product, or an energy saving initiative the company undertook, but - at least within this audience - the marketing team is not really engaged at a strategic-level.
Marketing and Sustainability - A Strategic Approach
Every marketer I know has one primary directive: Attract and Retain More Customers. Using this lens when it comes to sustainability should not scare marketers away. However, if their company is not walking the talk on sustainability, they are going to have a very hard time creating opportunity with green (greenwashing anyone?). When a company makes a strategic commitment to sustainability and is focused on embedding it in the culture and every phase of the business, the marketer's job gets a lot easier and the marketing team must play a key strategic role in driving this effort. Marketing should capitalize on this real commitment to sustainability as a way to drive innovation, revenue, savings, customer engagement, employee engagement, market awareness and risk mitigation.
Marketing and Sustainability - Creating Opportunity
Product and Revenue: In many ways this is the top of the pyramid. When businesses start capitalizing on their core competencies and embedding sustainability in every phase of product development the results can be tremendous. For example, GE is investing $10 Billion in its Ecomagination initiative between 2010-2015, and has generated $85 Billion of revenue in its first five years. At CA, a more modest example is leveraging our software expertise and commitment to sustainability to launch our CA ecoSoftware product line to help our customers manage, track and improve their own internal sustainability efforts. Marketers need to be involved in identifying and positioning these opportunities.
Brand Enhancement: When the commitment to sustainability is real and on-going, the opportunity for marketing to parlay that into enhanced brand reputation exists. Thought-leadership articles, social media, speaking engagements, advertising for sustainable products, the products themselves, messaging, positioning....all of these can lead to improved marketplace perception, stakeholder engagement, customer appreciation and buzz.
Internal Engagement: Who is going to be better at making sure there is an ingrained corporate culture dedicated to sustainability than the marketing team? Messaging to internal and external constituents should be telling a consistent and authentic story. The internal branding around sustainability should match the external positioning.
Attracting and Retaining Talent: This is something we are seeing the fruits of now at CA Technologies (stay tuned for a blog post on this topic shortly). Marketing should play an important role in this via internal employee engagement efforts and brand enhancement. It leads to a healthier company and to positioning the organization as a place that top people want to work.
Marketing and Sustainability - Proactively Addressing Risk
Customer Demand: Don't think that customers are demanding it? Just ask anybody that sells a product to Wal-Mart. When lack of a focus on sustainability starts costing you business, marketing had better pay attention and turn things around.
Demographics: The millennials are entering the work force and ‘green' is in their DNA. Ditto for a big chunk of the population and the corporate world. The trend is towards sustainability and while it may slow down on occasion (like during major recessions), it isn't going to stop. Marketers need to be in the forefront of addressing this change for their business.
Rising Energy Prices: If (when) prices continue to rise, products that marketers sell become less profitable. Product Marketers need to be innovating and driving sustainability improvements to ensure their products stay competitive.
Government Action: It may seem like our government is incapable of action these days, but at some point there will be legislation to address climate change. It's already in place in other countries. Marketers need to be a big part of the effort to enhance corporate sustainability and mitigate the impacts on the company, its products and its employees.
So what did I take away from this conference? Not enough companies have made sustainability a strategic focus and therefore not enough CMO's are involved. This needs to change, and when it does, marketing will play a key role in creating opportunity for their organizations and mitigating marketplace risks.
You can hear more of my thoughts from the conference in this video interview.