Green Executives are from Mars, Consumers are from Venus
Green Executives are from Mars, Consumers are from Venus
Who’s the greenest of them all?
Each month, the Green Confidence Index asks 2,500 ordinary Americans to name a green company. Americans answered resoundingly: Walmart.
We also asked the same question of the GreenBiz Intelligence Panel, a slightly larger group of business executives along with nonprofit leaders, academics, and others, which we poll monthly on a range of topics. They responded similarly: Walmart.
It appears to be unanimous.
But it’s not so simple. Digging a little deeper reveals significant differences between who consumers see as green and who is admired by business executives. Only eight companies show up on both groups’ top 20 lists. One significant difference between the two groups was that while consumers look close to home in naming green companies, the firms green executives admire most might be characterized as environmental activists.
Consumers See Green at the Store and On the Road
Every month, GreenBiz.com, along with our partners at Earthsense and Survey Sampling International, ask Americans a simple but profound question: “What company, if any, do you think of as being green?” It’s an unaided question, meaning no list is provided. Respondents simply name companies that are top of mind.
Or they don’t. An average of 64 percent of Americans seem incapable of naming a single company they consider to be green. This isn’t due to cynicism or the high standards of committed activists; the survey results comprise a representative sampling of the U.S. adult population. It’s just that most consumers don’t associate companies with being green.
Less surprising is that when consumers pick a green company, it is typically those offering products or brands they know and likely buy, or stores where they shop. Of the top 20 companies consumers identify as green, four sell groceries (Publix, Trader Joe’s, Walmart and Whole Foods), eight sell household products (Clorox, Johnson & Johnson, Kashi, Method, Pepsico, Procter & Gamble, SC Johnson and Seventh Generation), five make automobiles (Ford, GM, Honda, Subaru and Toyota), and one makes iPods (Apple, of course). (The remaining two companies are General Electric and Waste Management.)
Curiously absent from consumers’ minds are apparel and technology companies. The most likely explanation: Environmental issues rank low in purchase criteria relative to fashion (in the case of apparel) and price (in the case of technology). Apple stands out by making the list, exhibiting a convergence of fashion and technology that consumers seem to perceive as green.
Walmart Reigns but Performance Rules
What about the execs? In March we asked the more than 2,800 members of our GreenBiz Intelligence Panel questions to list up to five companies they consider to be green. Again, it was an unaided question and no selection list was provided. More than 500 panel members responded and 28 percent of those placed Walmart on their ballot. (Notably, more than a few amended their vote with a “sigh” or a comment -- e.g., “Walmart, oddly enough.”)
In our Green Consumer Index research, Walmart and Clorox, the second-place company, are separated by less than two tenths of a percentage point. But among the business executives, there’s a 12-point gap between Walmart and second-place vote getter Patagonia. Certainly, scale and reach -- not to mention a ginormous ad budget -- have a lot to do with being in the top spot for a company that generated revenues of more than $404 billion last year. But if scale and reach were all it took, we would have seen at least one vote for ExxonMobil, Chevron or ConocoPhillips, but not one of those companies received a mention.
While the consumer top 20 focused mainly on cars, retailers, and cleaning products, the companies identified as green by our executive panel reflect a wider range of industries. Consumers identified only one technology company as green, whereas business people placed Dell, Hewlett Packard and IBM on the list. And where consumers couldn’t connect green with apparel, our green execs picked Nike, Patagonia and Timberland.
Patagonia, with revenue of less than one tenth of one percent of Walmart’s, is admittedly a niche brand. While getting less than a handful of votes from consumers, the company is widely admired by its business peers. And just behind them, in third and fourth place, are Interface (with revenues of just over $1 billion) and Seventh Generation (with revenues well under $1 billion.
Interface and Seventh Generation are led by activist (and author) CEOs -- Ray Anderson and Jeffrey Hollender, respectively -- whose thought leadership might account for their influence and high ranking. But these leaders bring more than a loud voice and a hardcover to the conversation, evidenced by their companies’ collective history of aligning green business with product innovation.
The efforts of large companies are recognized as well. While HP sits at No. 6 on our overall Intelligence Panel list, it jumps to the No. 2 slot when considered by panel members from the companies with revenues over $1 billion. Starbucks also jumps from 12th to 6th when only the votes of large-company panelists are considered. One possible explanation is that these two companies have been telling their green stories for many years. But if that was the only criteria, I’d expect a bigger jump up the list from IBM who has been promoting their environmental initiatives since the early 1970’s.
(A word about the tables accompanying this article. While Walmart is a clear leader on both of these lists, we’ve only identified the top five companies on each list as clearly being ranked. The reason for this is that the difference between No. 6 and No. 20 are not as statistically relevant as the fact that a given company was included in the top 20.)
More Potter Stewart than Edwards Deming
One thing that seems clear of both consumers and business execs is that their views are more aligned with Potter Stewart -- the former Supreme Court Justice who famously admitted he didn't know how to define something, "But I know it when I see it" -- than W. Edwards Deming, the father of statistical process control and the modern quality movement, who knew it only when he measured it. While consumers will likely remain fickle, naming whatever company they just read about or saw on TV, it is clear from the daily stories on GreenBiz.com that there are a lot of companies systematically embracing environmental sustainability to achieve significant business results. That’s who their executive peers admire.
Green stories are inherently difficult to tell and many of the companies that our GreenBiz Intelligence Panel members named have been focused on a green journey for quite some time. For the companies selected by the Intelligence Panel, it seems that there’s an important role for storytelling here -- those who have found ways to get past the difficulty of telling their story find that they can break through the clutter to garner a green image. “Tales, you win,” as my friend Joel Makower likes to say.
Consumers, on the other hand, are more mercurial. As a recent article in New Scientist points out, what consumers perceive as green doesn’t necessarily reflect knowledge of a companies’ environmental performance. In fact, in our surveys price is still the most important factor in consumer decisions. But companies like Walmart and Clorox are beginning to demonstrate that when price is taken off the table, a company’s green story can make a difference.
John Davies is vice president, GreenBiz Intelligence, at Greener World Media and directs the Green Confidence Index and GreenBiz Intelligence Panel.
Image CC licensed by Flickr user mahalie.