[Editor's note: In this exclusive excerpt from Joel Makower's new book, "Strategies for the Green Economy, we look at the easy steps to tell your company's green story. You can read a previous excerpt here.]
How do you create a green strategy that is pitch perfect and tuned for long-term success? It's not easy, based on the efforts I've seen. Companies executives -- and their advertising, marketing, and public relations partners -- are prone to make broad, sweeping statements about their environmental commitment or the green attributes of their products or services, statements and claims that often pose more questions than answers.
In other cases, companies simply seem uninspired. (How many more times can we stand yet another takeoff on Kermit the Frog's plaintive proclamation, "It's not easy being green." Kermit first crooned that song lyric in -- Would you believe? -- 1970, and nearly four decades later it still seems to be the best copywriters can come up with. (In mid-2008, I conducted a Google search of the phrase "easy being green," which yielded 1,570,000 returns. By contrast "til death do we part" yielded only 17,500 returns, while "check is in the mail" garnered 20,500 returns.) Moreover, each new slogan or press release quoting or paraphrasing Kermit seems to revel in its cleverness, as if its creators were the first to have thought it up.) Is it any wonder that the public is skeptical about companies' environmental commitments?
It's not just Kermit, of course. Too many green strategies, and the messages behind them, are variously vague, vapid, or vacuous.
How do you avoid this fate? To answer this, I turned to my colleague Andrew Shapiro, founder and CEO of GreenOrder, the sustainable business strategy firm with which I am affiliated. I've learned a lot hanging around Shapiro, managing principal Nicholas Eisenberger and their team for the better part of a decade, but what sticks most is GreenOrder's framework for crafting green strategies and messaging that work. It's called CRED.
GreenOrder -- whose blue-chip clients have included Allianz, BP, DuPont, General Electric, General Motors, Office Depot, and Pfizer -- isn't the first consulting firm to come up with a multipart strategy acronym. Over the years, as I've encountered or worked with some of the leading consulting, PR, and marketing firms, I've seen my share. They all have value.
CRED evolved from GreenOrder's experience working on C-suite executive strategy and implementation, including creating the metrics companies must use to measure success and make their environmental initiatives thoughtful, effective, and believable. After all, it's no use having a green strategy and message if they don't work or if they don't drive value and fit with a larger vision -- the story the company would like to tell about itself, both today and over the longer term. And telling a green story that isn't rooted in real-world accomplishments amounts to little more than arm waving.
This is only part of the problem. An equally vexing challenge is how to stand out in the crowd, to be heard amid the growing cacophony of green messages. Therein lies the green-strategy paradox: As green becomes increasingly mainstream, it gets harder to be heard. The louder the noise, the more people tune out. And the more companies boast, the greater is the risk of backlash.
GreenOrder's CRED strategy is aimed at mitigating this risk. It is comprised of four key parts: Credibility, Relevance, Effective messaging, and Differentiation. Let's take a look at each.
CREDIBILITY
Why should people believe you? To be effective, your strategy and messages need to be convincing. This means that they must be backed by facts and figures. This is not to say that everything you say on the topic needs to be laden with dense data. Far from it. But you need a solid foundation of proof points, if only to have in your back pocket.
Credibility also begs larger questions. Does your company's performance match its green rhetoric? Can you prove it? How does your company or its products compare, whether with competitors' best products, the installed product base, what the government requires, or even the historical performance of past generations of the same product? You'll be credible if you can show that you've done your homework. It needn't appear in ads, product labeling, or point-ofpurchase information, but it should be available somewhere, whether on product fact sheets, Web sites, customer service lines, or some other place. "GE has done that well with ecomagination," says Shapiro. "They've had very detailed information about the environmental and operating performance of ecomagination products on a dedicated Web site, even though the advertisements on television, for example, haven't overwhelmed consumers with factoids."
The volume and nature of data may depend in part on your sector, as well as on how well your company is regarded from an environmental perspective. An eco-hip and well-regarded brand such as Patagonia, the maker of outdoor apparel, or Method, which makes cleaning products, may have a lower burden of proof than a company that lacks a green image or history. (Then again, maybe not. Informed, eco-conscious customers such as Patagonia's and Method's can be among the toughest audiences in the world in terms of questioning and challenging green claims.) Business and institutional buyers likely will have much deeper information needs and may not spend a lot of time hunting it down. Also, you may want to dial up or down the amount of information to reflect the importance you're placing on a product's green attributes and how aggressively you want to promote them. Sometimes, less is more.
The point is that it's important to assess what your customers and other audiences -- activists, regulators, the media, etc. -- know, need to know, and want to hear to ensure that you are meeting or exceeding their expectations. And then you must marry whatever environmental attributes you are promoting with all the other attributes customers expect for that product. "We call this 'twinning the benefits,'" explains Shapiro. "You're trying to talk about the environmental benefits while also emphasizing whatever else is appropriate -- quality, durability, price, performance, style."
By the way, the principal reasons for doing this may not be your customers at all but rather your employees. They're the first group that needs assurance that any claims you make hold water and the first to become cynical if they find out otherwise. Thus, supporting data can be important to getting your number one constituency on board.
RELEVANCE
This is using green to create value with key stakeholders. How do you craft a strategy that's not only going to meet your immediate business objectives -- to move product, increase revenue, and be seen as a "good" company, for example -- but also is going ensure that your efforts have staying power internally because they are generating business value for the firm? In other words, how do you ensure that they are sustainable from a business perspective?
Companies that don't leverage their environmental achievements and commitment in a way that produces business value often find that green is the first thing to go when times get tough -- when there's a change in leadership, when shareholders raise questions, or when your company otherwise finds that being seen as an environmental leader is no longer convenient. On the other hand, if you can say, "Our sustainability initiatives have reduced costs and boosted revenue by creating new markets, adding new products, and deepening loyalty with customers," this creates a long-term justification for a sustainability strategy and for environmental issues broadly.
"It's critical that a company figure out the difficult task of aligning its sustainability initiatives with its core business objectives and its growth trajectory," says Shapiro. "If a company is in a product-introduction mode or a geographic-expansion mode or a cost-cutting mode -- whatever mode the business cycle requires -- it can leverage and use sustainability as a source of value creation, as opposed to simply something that is a marker of good corporate citizenship."
Companies run into trouble when they get too far ahead of themselves or too far away from their core business goals. Bill Ford, when he was president and CEO of the car company his great-grandfather, Henry Ford, built, took his eye off the prize partly in the name of building a greener image. Bill Ford was, arguably, one of the most committed environmentalists among CEOs of major companies and certainly within his sector. Under his leadership, he placed a major emphasis -- and a lot of his political capital -- on greening his company's historic manufacturing site, including increasing the building's energy efficiency, putting on a green (planted) roof, and transforming the surrounding site from an industrial eyesore to a community gem.
What about his company's cars? During this same period, Ford made and then retracted a commitment to achieve a 25 percent improvement in fuel efficiency in the company's light truck fleet, including sportsutility vehicles (SUVs); backed off from a pledge to build 250,000 hybrid vehicles a year by 2010; and terminated the company's ongoing electric vehicle program as impractical and unaffordable.
The obvious question: How relevant was the grass on the roof of the Rouge River manufacturing facility to the end customer compared with creating more fuel-efficient cars, producing more energy and environmental innovations, and marrying green attributes with high style, performance, and technology? Ford's financial woes aren't based entirely on the company's green focus, of course, but the timing suggests that the company's particular green focus and messaging weren't relevant to the marketplace.
Again, the relevance of your green strategy may not necessarily be to sell more stuff. It could be to attract and retain talent. "As companies start to think about their various constituencies, they may come to learn, 'We didn't realize that a huge number of our employees, as well as our recruits, are interested in working for a company that excels in green leadership,"' says Shapiro. "And they could actually reduce the cost of turnover and the cost associated with hiring and retraining people by demonstrating their green leadership. So the relevance factor could be, 'Is this something your customers want to buy?' But it could also be, 'Is this something you'll be rewarded for by your employees, or by investors, or by other actors in the marketplace?"'
EFFECTIVE MESSAGING
How can you translate complex information into distinctive, compelling messages? Few companies do a good job at making sense of what often can be mystifying and mind-numbing facts and transforming them into a compelling story.
It's not that companies don't try. It seems like every other energy- or climate-related advertisement or press release I've seen in recent years offers some comparison with taking cars off the road. "In 2005, HSBC purchased carbon offsets equivalent to 125,000 tons of carbon emissions -- the same as taking 29,000 cars off the road," says the bank's Web site. Xerox prevented the emission of 87,000 metric tons of carbon dioxide in 2006, "the equivalent of taking more than 18,000 cars off the road," according to a company press release.
There's nothing wrong with either of these, of course. I'm assuming that the authors of each of these claims did the math correctly -- that a typical late-model sedan emits about 5 tons of carbon dioxide gas in a year. The point is: Is an impressive number of eliminated cars -- or planted trees, electrified homes, conserved Olympic-sized swimming pools of water, Eiffel Tower heights of reduced waste, trips to the Moon of saved driving, or other comparative metrics -- even meaningful to consumers, especially after they've heard similar statistics from myriad other companies? (I sometimes wonder whether adding up all the cars-taken-off-the-road marketing claims would yield a number that exceeds the actual number of cars on the road. But I digress.)
So figuring out an effective way to translate environmental data is key.
It's also about figuring out the right channels. What are the appropriate media? What are the best moments to reach people on these issues? Are advertising and PR the answer? Not always. "We're hearing more and more that consumers and activists are pointing out the irony that a company may spend twice as much promoting a green achievement as they did on the achievement itself," says Shapiro. "An effective message is not always one that's marketed with the most dollars." Rather, the effective message may be the one that's done cleverly, virally, or humorously. Or it may be one that's tied to a partnership or delivered through nontraditional means.
In other words, it's the medium as well as the message.
DIFFERENTIATION
Are you doing something that's unique and distinct? Does your strategy sound like you're truly committed or simply mimicking or mirroring what others have done?
Differentiation is difficult because the bar continues to rise. Just a few years ago, only a handful of companies had prominent green initiatives. Now you'd be hard pressed to find a major company that doesn't. So differentiating is getting harder than ever.
This is one place where smaller companies may hold an advantage. Small, local firms have been slower to the green scene because they lack both the human and financial capital needed to make changes and the prodding from activists, customers, employees, investors, and others. Because of this, it's easier for, say, a local printer, travel agent, or retailer to distinguish itself as an environmental leader. They don't have a lot of green competition, and environmental expectations of them typically are lower than for larger companies. A small company could distinguish itself simply through a single action -- encouraging employee volunteerism with environmental groups, for example, or locating in a certified green building.
Even for larger companies, differentiation can have a lot to do with the competitive environment. For example, in the information technology arena, where Dell, Epson, Hewlett-Packard, IBM, Lexmar, and other hardware manufacturers have engaged in a race to see who can be greenest -- with equipment that is energy-efficient and can be recycled easily, for example -- it's harder to stand out.
"Differentiation doesn't necessarily mean that you're doing more than everybody else," says Shapiro. "It's doing something that is distinct in signature, so that people can identify you and what you do as green in a particular way."
Credibility. Relevance. Effective messaging. Differentiation. These are the components from which a successful green strategy are made.
The order of these four components may change for some companies. For example, it may be more appropriate to begin with relevance, identifying the value proposition that's appropriate for your customers and company culture, and then thinking about how to go about messaging it in a manner that's credible, differentiated, and effective.
"We've had this interesting debate internally about the right place to start -- which of these four factors," says Shapiro. "I have come to the conclusion that it depends on where you are as a company. A company that is newer to sustainability may want to start with credibility, since that's most important for them. But if you're more evolved -- say, Patagonia -- you're going to be in a different place; you might start with differentiation."
Bottom line: You can start anywhere. The important thing is to cover all the bases.
Joel Makower is executive editor of GreenBiz.com.
Excerpted with permission from Strategies for the Green Economy, by Joel Makower, published by McGraw Hill. © 2008 Joel Makower.