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Our Insights 21 Sep 2010

Sustainable Brands 2010: “The Power of AND”

By Patrin Watanatada

Mark Lee emcees the last day of Sustainable Brands 2010. Photo by Gustavo Fernandez for Sustainable Life Media http://bit.ly/ar4l5Z.

“The opportunity to make our planet smarter is both real and measurable on one hand, and truly inspiring on the other.” – Sam Palmisano, CEO, IBM, quoted by Lee Green, VP Innovation, IBM at Sustainable Brands, Monterey, California, June 2010

For us, this captures the Sustainable Brands 2010 conference in a nutshell: the sustainability efforts most likely to succeed are those that are both robust and data-driven on the one hand, and joyful, surprising, delightful and principles-driven on the other.

Sustainable Life Media and its flagship conference Sustainable Brands, founded by KoAnn Skrzyniarz in 2007, brings together the brand, design and sustainability communities to catalyze sustainable innovation.

SustainAbility has been a part of the Sustainable Brands community since its early days: executive director Mark Lee serves on the advisory board and has given plenary presentations at the event the last three years, and team members Chris Guenther and Preetum Shenoy have both participated in the conference. This year, Jennifer Biringer facilitated a panel organized by Patrin Watanatada on “Restoring ‘Places and Faces’ to the Global Value Chain”.

Below are the seven key themes we heard at this year’s conference. The first three are perennials – they are why so many of us believe strongly in the connection between sustainability and brands (see, for example, our Five Principles for Sustainable Brands) – while the last four are more recent insights, reflecting lessons learned by brands along the way.

  1. What we value as a society is changing – and the companies that respond will be the companies that win.
  2. Sustainability is (really) good for brands.
  3. Brands are (really) good for sustainability.
  4. Sustainable brands connect supply and demand in innovative ways.
  5. Sustainable brands meet consumers where they are.
  6. Sustainable brands “create the crowd.”
  7. Sustainable brands rely on lots of data – but not too much.

Read on for more on each of these themes.

1. What we value as a society is changing – and the brands that respond will be the brands that win.

Success for global companies means responding nimbly to global megatrends and societal drivers. What market research and consumer insight experts are seeing now is a slow, but sure, shift in what consumers value.

Tom Forge of Coca-Cola said, “There are two big macro-forces now: environmental and social justice, and a better understanding of behavioral psychology. Yesterday’s brands were about quality and safety, today’s brands are about identity, and tomorrow’s brands will be about society.”

Asked Kirsi Sormunen of Nokia, “How are we still stuck in a mindset where more stuff equals more happiness? Businesses are scared of sustainable consumption because they see it as consuming less. Think of it as consuming smarter instead.”

For tomorrow’s brands, responding to what society wants and needs is now about creating value, rather than merely securing the license to operate. As Jason Saul of Mission Measurement sees it, “We are moving from a social contract to a social capital market.”

2. Sustainability is (really) good for brands.

Speakers from companies as different as Coca-Cola, Ford, IBM, Timberland and Williams-Sonoma told stories of using sustainability to “redefine themselves for the future,” as Dorothy MacKenzie of brand strategy agency Dragon Rouge put it, explaining in her talk that “sustainability has become synonymous with modernity and quality.”

Timberland Chief Brand Officer Mike Harrison told the story of creating their highly successful Earthkeepers line of green boots and clothing, which he credits with helping Timberland return, profitably, to its roots: “We had allowed our brand to be defined by others, rather than being the authentic outdoor brand we’d always been.”

IBM’s Lee Green noted that their Smarter Planet campaign has been a key platform for IBM’s continuing strategic move away from commodity products towards services.

3. Brands are (really) good for sustainability.

Big multinationals may not be as nimble as social entrepreneurs, but what these companies have in earth-scale abundance is brand, deep insight into consumers and the power to shape our aspirations, values and behavior.

“Your brand is not just a passive observer – you have the opportunity to change these societal forces,” said Coca-Cola’s Tom Forge. Bruce MacGregor of IDEO suggested that brands can “create desires around points of pressure.” Marc Mathieu of BeDo, Eric Park of Ziba Design and John Creson of Addis Creson unveiled a project to explore how brands can “recapture the American Dream by out-storytelling and out-innovating those that continue to keep the old dream alive.” (See their presentation here.)

4. Sustainable brands connect supply and demand in innovative ways – saving resources and creating story.

For us, the best stories were told by enterprises that connect the earth’s supply and society’s demands in unexpected and resourceful ways, tapping into assets hidden-in-plain-sight and, in doing so, creating powerful stories to engage consumers .

  • Ford’s John Viera described how Ford uses waste streams from other industries to make seats and doors (saving Ford some $4.5 million). Brooke Betts Farrell’s start-up, RecycleMatch, aims to create an ecosystem of similar relationships via a website that matches “companies that have waste with companies that can use the materials productively.”
  • Mike Yohay of San Francisco urban agriculture start-up Cityscape Farms (and one of our Restoring Faces and Places panelists) described his venture as “connecting unused rooftops and people who want local food,” while former Nike director Phil Berry connects brands with stories and rural communities with good local jobs through his consultancy Sustainable Product Works, which builds small-scale, green factories in rural areas of developing countries.
  • In one of the most popular talks, mushroom guru Paul Stamets demonstrated his Life Box – recycled cardboard shipping boxes studded with tree seeds that can be planted by the consumer, “creating forests for future generations” and connecting the companies who ship products in these boxes with their customers – and their customers with their future generations.

Several speakers advised taking the global ecosystem as business model inspiration, with Gregory Unruh of the Thunderbird School of Management and author of Earth, Inc. pronouncing the earth “our only true model of sustainable production,” Gil Friend of Natural Logic pointing out that nature represents “a million years of open-source R&D,” and designer Summer Rayne Oakes describing her textiles inspired by the steely strength of spider webs. (For more on this line of thinking, see the work of Janine Benyus’s Biomimicry Institute and Michael Braungart and William McDonough’s classic Cradle to Cradle: Remaking the Way We Make Things.)

5. Sustainable brands meet people where they are.

One of the biggest themes for the conference was this: how do companies engage the mainstream consumer on sustainability? As Yalmaz Siddiqui of Office Depot pointed out, “The biggest opportunity to move the needle is with the light- or mid-green consumers” – those who care about sustainability, but who also place a high premium on price and convenience. (See this report for more insight.)

How do you meet people where they are? Mike Harrison of Timberland put it memorably: “Think of sustainability as a ‘gift with purchase’.” As many speakers suggested, brands need to understand what consumers care about, make taking action fun and compelling, and make the next step clear.

  • Speak to what consumers care about. For Starbucks, disposable cups might not be their most material issue from a life-cycle analysis perspective. But cups matter for Starbucks consumers – it’s their main touchpoint with the Starbucks brand. As Ben Packard of Starbucks noted, “Working on packaging gives us a license to storytell about the rest of our value chain.” (Starbucks is working with systems thinker Peter Senge in a series of Cup Summits com/2010/04/22/live-from-the-2010-cup-summit-jim-hanna/ to design a fully recyclable cup in collaboration with local municipalities and consumer behavior experts.) Travelocity’s Alison Presley described the intensive consumer insights work that went into developing their Green Hotels program, saying “We started with understanding our target customers and found ways to speak to them. We found that the number one search term was ‘green friendly hotel’, so we used the word ‘green’ even though we didn’t like it.“ John Marshall Roberts of Worldview Learning, who has conducted intensive research into psychological attitudes to sustainability, spoke compellingly on forming messages to match different audience attitudes and level of optimism. (See a 5-minute clip of John speaking on the psychology of sustainability here.)
  • Make it fun and compelling. “Earnest messages like ‘Tread lightly’ didn’t work,” said Mike Harrison of Timberland, showing a clip from their new (and hilarious) “Nature Needs Heroes” campaign. Describing eBay’s campaign to encourage consumers to buy secondhand fashion, Amy Skoczlas Cole quipped,“Consumer benefits are the new guilt. Cool is the new green. Think trade-up, not trade-off.” Travelocity created a gnome as the mascot for their Travel for Good campaign, while Yahoo!’s Erin Carlson described how they learned after trial and error that the most popular ‘green’ article postings were either practical (“How to save money on your energy bill”) or surprising and delightful (“Read about polar bear babies!”).
  • Make the next step clear. Customers overestimate the cost of a hybrid by $12,000 on average and assume they assume they can’t afford it, said Annie Longsworth of Cohn & Wolfe. So informing and persuading away customer fears is a crucial role for brands. A highlight of Cohn & Wolfe’s 2010 ImagePower Green Brands research was the emergence of enabling brands – in other words, “the ‘help me’ brands as well as the ‘in me, on me, around me’ brands” traditionally considered most green by consumers. John Viera described Ford’s sustainable mobility strategy as a journey: the first step is plugging hybrid engines into Ford’s existing mainstream, high-volume platforms, rather than creating a separate line.

6. Sustainable brands mobilize their customers, staff and business partners.

Peer pressure can be far more powerful than even the biggest global brand. As IDEO’s Bruce MacGregor put it, sustainable brands “create the crowd” – whether it’s a crowd of consumers, employees, or business partners. Fittingly, the theme of the conference was “The Power of AND.”

  • Build a “tribe” of sustainable consumers. Kirsi Sormunen of Nokia described their “Power of We” campaign, built on the idea that “the more than one billion people using our devices [can] connect and work together in different ways to protect the environment.” Patrick Glinski of Idea Couture said, “The individual consumer feels they are market takers, not market makers. We can fill this gap” by bringing consumers together to achieve a common goal – and this in turn reflects well on the brand that creates those experiences. Dara O’Rourke of GoodGuide advocated not only for “getting sustainability information to consumers at the decision point” but also helping it to spread through social networks.
  • Business partners are crucial too. For eBay, one of the world’s largest aggregations of small and medium enterprises, their selling partners are at the heart of their strategy: creating a culture of re-use. Travelocity encourages all of its hotel partners to go green, as the more choice, the better.
  • The power of your workforce is immense. “Greening your business is something you do with your people, not to them,” said Gil Friend of Natural Logic. Travelocity’s Alison Presley said, “We originally started with only PR and merchandising – but we soon realized we had to involve everybody. Our employees are our biggest assets.” Yalmaz Siddiqui of Office Depot agreed, saying that “we sell green via our employees.”

7. Sustainable brands rely on lots of data – but not too much.

Finally, a subtle but crucial theme was the importance of data and measurement. A good story isn’t enough – you need to get the performance right, and to do that you need good data. SAP, whose external sustainability reporting we consider groundbreaking, uses monthly internal reporting to make mid-course corrections and to encourage their business units to compete on environmental performance. Sustainable Product Works’ sustainable factories rely heavily on carefully chosen social and environmental metrics both to drive improved performance and to support the story that accompanies each factory.

Learn more about SustainAbility’s work on Consumers & Brands.

On Thursday 7 October 2010 in London, SustainAbility is co-hosting two sessions with leading branding firm Dragon Rouge to examine how brands are integrating sustainability into their business and communication strategy. Information and registration details can be found here.

Sustainable Brands 2010 Panel: “Innovations in Food Supply: Restoring ‘Places and Faces’ to the Global Value Chain”

Stephanie Daniels, John Scharffenberger and Arlin Wasserman. Photo by Gustavo Fernandez for Sustainable Life Media http://bit.ly/9njfdo.

Although today’s “placeless and faceless” industrial model of global food supply has produced vast amounts of calories at relatively low cost for many, it has become associated with problems such as obesity, malnourishment, food waste, food safety breakdowns, degraded environmental resources and a growing crisis of consumer trust.
If one of the sustainability mantras for the transportation sector is “electrification of transport,” a similarly fundamental mantra for food might be “decommoditization of commodities” – or, as we’ve dubbed it, “restoring places and faces to the food value chain.” Much sustainability-related work in the food sector seems to come back to this notion somehow – from certifications to farmers’ markets to local brands to direct purchasing – all attempt to connect farmers to consumers more closely.

The “Place and Faces” panel featured a rich range of perspectives on restoring some of the “places and faces” to the food value chain: through linking small producers to global value chains, making use of previously untapped local resources, and improving information flows. In doing so, these re-designed value chains are creating economic opportunity, delivering nutrition more sustainably, and generating consumer value through better quality, provenance and traceability.

Here’s some of what they had to say:

John Scharffenberger of Scharffen Berger Chocolate (now owned by the Hershey Company) and Stephanie Daniels of the Sustainable Food Lab are working together on the Ghana Fine Flavor Project. This initiative aims to “bring fine flavor varieties of cocoa to West African farmers to improve production practices and increase farmers’ incomes from the sale of these highly valued beans” (www.sustainablefoodlab.org). This means creating a direct connection between bar and farmer – in other words, restoring the face.

“We chose Ghana because they were doing the best job on good cacao, growing plant varieties that people actually want to eat,” said John. “I’m a producer – I don’t position. When we started Scharffen Berger Chocolate, we didn’t need certifications. We just made it delicious, and we were transparent about our buying practices.”
Stephanie ended on a great note, saying: “Sustainability used to be a divisive concept. This conference is about “the power of ‘and’” – we need to stop thinking divisively. It’s critical to sell into the global market and to diversify.”

Arlin Wasserman of global food services company Sodexo observed that they are increasingly concerned with consumer branding – and that ‘place-based branding’ is a great way to create a connection.

“We used to sell to [institutional] customers. We now have millions of [individual] customers because people are more and more interested in where their food comes from. There’s now a real opportunity to differentiate ingredients based on place [where it comes from] as well as on process [e.g. the fact that it was grown organically or traded fairly]. But this means we also need to beware of ‘place-washing’.”

On the role of certifications, Arlin noted that “There are 900 certification schemes in the US now. We need to make it simple. People don’t have time to consider all the choices they need to make every day.”

Mike Yohay is the founder and CEO of urban agriculture start-up Cityscape Farms, which builds aquaponics greenhouse systems on vacant lots and rooftops. (Cityscape Farms won the audience’s choice award at the Sustainable Brands Innovation Open – go, Mike!) Mike’s business model is based on place.

“We create value by spoiling the consumer with delicious product – and lots of information,” said Mike. “Our value comes from being hyper-local.”

Finally, Ralph Jacobson of IBM talked about their Smarter Food work. IBM sees a crucial role for information technology in collecting data, enhancing transparency and spreading information about best practices.

Thanks to our wonderful panel for making the trip to Monterey – we look forward to continuing the conversation.

Panelists: Stephanie Daniels, Program Manager, Sustainable Food Lab; Ralph Jacobson, Global Consumer Products Industry Marketing Executive, IBM; John Scharffenberger, founder of Scharffen Berger Chocolate; Arlin Wasserman, VP Sustainability, Sodexo; Mike Yohay, CEO, Cityscape Farms; Jennifer Biringer, Director, SustainAbility (moderator)

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