Reputation to Revenue

Carrotmobs make my night

Triple Pundit almost always brings a smile to my face, and for that reason is one of my favorite blogs by far. The group blog highlights the three "p's" of sustainable business -- people, planet, and profits -- and highlights a steady stream of optimism-inducing stories about both creative startups and long-established corporations doing well by doing good.

Tonight's read inspired an extra-big smile: the story of Virgance, "a venture-funded startup that calls itself a platform supporting Activism 2.0" What this means, in essence, is that Virgance is integrating social media tools and a save the world mentality into some really creative business opportunities. Jujst a year old, the company has already launched two interesting social power ventures:

• 1 Block Off the Grid (1BOG) brings neighbors together to purchase and install solar panels collectively, negotiating hefty discounts and keeping a share of the savings
• SunRun, another solar purchasing program, installs solar panels but retains ownership and lets homeowners pay a reduced rate for power

Several Facebook-centered initiatives are in the works as well, including one to help companies distribute social responsibility funds by encouraging Facebook members to choose the recipients.

My clear favorite, though, is Carrotmob, which actually predated and inspired the formation of Virgance. Triple Pundit calls it an "anti-boycott," and the idea is to convince people to shop at a certain store if that store agrees to invest some of the proceeds to improve energy efficiency.

Powered by Facebook and other social media outreach efforts, the first Carrotmob in San Francisco brought hundreds of people to a small market in the Mission neighborhood, and brought the market almost $10,000 in purchases which yielded almost $2,000 in green upgrades.

 

But the more important result, as Triple Pundit notes, "was the buzz this Carrotmob generated. Consumers are drawn to the notion that they can influence a business to become more sustainable, and not by boycotting it but by patronizing it--essentially giving it the funds to make sustainability improvements."

Along with San Francisco, Carrotmobs are now active in New York, Chicago, Kansas City, London, Helsinki, Bristol, England, and more.

I'm usually skeptical when people talk about "shopping for change," but Carrotmob brings a lot more to the table. And it sounds really fun!

What do you think?

Smarter marketing at IBM: Big Blue's latest green consulting launch

Pardon me for talking about IBM yet again, but the company continues to impress me with its ability to ride the green wave with intelligent and high-potential offerings. The latest example is last week's announcement of a new Sustainable Procurement consulting offer. 

According to IBM, the offer is designed to help companies set cost, efficiency, and sustainability goals and metrics for their entire set of procurement activities, including "all supplies, materials, ingredients, components, finished goods and services they purchase to run their operations and to develop, manufacture and deliver their own products or services." 

The potential scale of this is enormous, covering just about every aspect of the world's supply chain. And IBM is certainly thinking big, outlining coverage of six main Corporate Social Responsibility aspects of supply chain management:

• Environment -- reducing energy and water usage, minimizing waste and the use of potentially hazardous chemicals and materials, increasing recycling and recyclability, and improving efficiency;
• Community -- ensuring suppliers support and contribute to the communities they operate in;
• Health and safety -- promoting safe workplace practices as well as ensuring safety in products and services;
• Ethics and financial accountability -- ensuring suppliers practice appropriate business ethics and adhere to applicable standards for financial accounting and transparency;
• Diversity -- encouraging diversity and inclusiveness throughout the supply chain;
• Labor practices -- ensuring suppliers adhere to local, national and internationals laws, rules and standards for labor practices.

To back up the offer, IBM points to its own efforts developing Supplier Conduct Principles for its own supply chain, which includes some 30,000 supplier locations in 60 countries. 

If the practice grows, and I'm certainly hoping it does, the benefits for companies, communities, workers, and the environment can be enormous.

Marketing Lessons

At the same time, the initiative points to a powerful reminder for B2B marketers in today's challenging economy. At a time when so many companies and marketers are obsessing over which tactics are most likely to deliver short-term revenue, broader strategy remains absolutely essential. My own takeaways from the IBM launch including the following:

• Now is the time to identify new sources of revenue that leverage existing capabilities and assets
• Tap into the green wave; it's big and getting bigger
• Always reinforce the larger corporate brand and story
• Always back up the offer with credible proof points

In these ways, IBM's new offering reflects the best of strategic marketing -- focused on how to drive growth for the company in responsible and intelligent ways, with great potential for short- and longer term success. I'll be curious to follow the tactical side of the initiative, as well as the results, of course, but this is already another good example of how "big M" Marketing can and should the foundation for corporate direction.

Do you agree?

 

*For more on IBM's new offering, check out these resources:

• IBM podcast on the new offering
• IBM consulting and thought leadership resources on green and Corporate Social Responsibility
• The Challenges and Opportunities of Sustainable Procurement 
• Heather Clancy at ZDNet

Phone companies racing to the top in sustainability

Tom Schueneman of the indispensable TriplePundit blog on corporate social responsibility has a great review today of AT&T's holistic approach to sustainability. The lede is the phone giant's new $500 million commitment to put 15,000 alternative fuel vehicles on the road in the next decade. It's a great example of how big companies can aim to do good and do well at the same time. The program should save the company money in the long run while winning useful public plaudits, and, as important, make a real impact in reducing greenhouse gas emissions, provide clean energy jobs, and support the expansion of the alternative fuel infrastructure.

The clean car initiative represents a big splash in sustainability, but it also reflects a much broader and more comprehensive approach at AT&T. Schueneman's interview with Beth Shiroshi, AT&T's assistant vice president for Citizenship and Corporate Responsibility, tells the larger story, and it provides some useful lessons for any company looking to strengthen its sustainability approach:

• Look comprehensively across the company: Even thought AT&T had a long history of environmental and corporate social responsibility initiatives, the company brought in an outside agency, the nonprofit Business for Social Responsibility, to conduct a systematic review of the issues most important to employees and stakeholders.
• Demonstrate commitment at the executive level: Following the new review, AT&T elevated oversight and management of sustainability efforts to the officer level. 
• Balance strategic focus with multiple entry points: AT&T now highlights six priority initiatives while allowing a great deal of flexibility for divisions, local offices, and employees to contribute in different ways. You can see details of the initiatives and program examples in AT&T's recent report, Connecting for a Sustainable Future.

"AT&T isn't in the business of sustainability," as Schueneman notes, "but to the degree that they and other corporate 'giants' make it a part of their (triple) bottom line, the business of sustainability fights the natural resistance to change, moves forward, and creates ripples of transformation." Not to mention positive movement on the reputation needle, stronger employee interest and loyalty, and important new business opportunities.

 
Nokia, meanwhile, is similarly making sustainability waves, most recently at the World Mobile Congress in Barcelona last month. As Lucas Daniel recounted in Sustainable Life Media the other day, Nokia is now embedding a set of applications and services in some of its mobile phones to bring users green tools, community, and information. 

Working with several large environmental organizations, Nokia is rolling out:

• we:offset: an online tool that helps travelers calculate their carbon emissions on the road and buy offsets right from the phone
• Green Explorer: a web-enabled widget that highlights green travel options, including restaurants and hotels, with room for users to provide their own recommendations  
• Eco Zone: a phone app that provides information and video from WWF
• Mobiledu: a mobile app available in China that promotes environmental awareness and education  

As with AT&T, Nokia's recent splash is just part of a larger sustainability story. As Daniel explains, Nokia's larger environmental effort, "the power of we," includes efforts to build mobile devices with healthier materials and packaging, a push for new sources of energy, support for recycling old phones, and partnerships with groups like WWF.

It's a smart strategy, and Nokia's comprehensive approach to greening its products, supply chain, communications, and customer experience provides another useful template for companies looking toward sustainability as an opportunity to strengthen the entire reputation-to-revenue cycle. 

What do you think?

SAP's sustainability site: Will they come?

Business software giant SAP launched an online collaboration site last week to promote dialogue with stakeholders on a range of social, economic, and environmental concerns. The site sits on SAP's new collaboration workspace platform, which enables registered users to post content, communicate with SAP officials and each other, and set up public and private workspaces. 

To get the dialogue going, SAP's vice president of corporate citizenship, James Farrar, has launched a new blog, a stakeholder survey, and, most important, the company's first global report on sustainability.

It's a great idea, and it plays directly to the mission-oriented marketing I wrote about with IBM recently. As noted by Sustainable Life Media, it follows similar efforts by companies including Cadbury and IKEA Canada. 

SAP has a good story to tell on sustainability, and the report does a nice job of telling it. Befitting the company's role as a leading software provider, the report has a dual focus, covering both SAP's internal responsibilities to operate in a sound, ethical, and environmentally responsible manner, and external opportunities and obligations to provide solutions that help clients operate in a similar fashion. 

Even more, providing a real platform for collaboration gives credence to Farrar's claim that SAP sees its sustainability report (itself an important step) as simply the beginning of an ongoing dialogue with stakeholders.

The question now is will they come. Nine days after the launch, the site is pretty thin. One blog post, two documents, and just a few outside comments. The sustainability report has received a number of views, but the dialogue has yet to really begin. 

It's a common problem, of course. You can't just build it and hope they will come. Clearly SAP put enormous effort into creating its first sustainability report and building the collaboration space. The challenge now is to put similar energy into generating interest and traffic to the site, and lively interaction once people get there.

Nice marketing touch from Plow & Hearth

I ordered some fatwood kindling for my wood stove last night from Plow & Hearth, and wanted to pass along a nice touch from the end of the transaction. 

With my purchase, the company commits to planting several trees as part of its Campaign to Reforest America, in partnership with the National Forest Foundation. It's a good cause, and pretty easy and relatively inexpensive to do. Lots of companies do similar things; the rest probably should. 

But the execution is actually what made me pause: A nice separate email (in addition to my purchase confirmation), a simple vote so I could pick which of three national forests to support, and links to additional information about the campaign, the partnership, the specific forests, and the issues at stake. It was nothing earth-shattering, but a good reminder that a few extra touches can go a long way toward making your customers feel better about you.

Supporting the environment is good; doing it with engaging and educational content is even better.

Deloitte says CSR and green can boost M&A value

Many discussions about the business value of corporate social responsibility and "going green" highlight benefits such as brand distinction, customer loyalty, and employee morale -- and, increasingly, potential cost savings. A new white paper from Deloitte adds deal value in mergers and acquisitions to the list.

According to the authors, "companies that have strong corporate responsibility and sustainability (CR&S) programs in place are likely to be rewarded for their efforts. Those that don’t have such programs can expect to face increasing regulatory and marketplace demands for change."

The trend is driven by increasingly tight environmental regulations as well as broader trends toward greater transparency and accountability around potential social and financial risk. Energy companies are obviously front and center here, but the trend affects many industries, according to Deloitte, including manufacturing, transportation, and retail.

As CR&S wields growing influence on the strategy and operations of companies, so will it become an increasingly important aspect of M&A. Acquiring companies will want to know whether they are taking on sustainability problems or opportunities. Divesting organizations will want to know whether their sustainability profile will contribute to a premium or discount price.

Looking ahead, the Deloitte authors provide several useful suggestions for executives looking to buy or sell:

• Know your own backyard: Understand how well your organization is addressing sustainability issues
• Begin to incorporate CR&S metrics, goals, and targets into the deal valuation process
• Consider the potential economic impact of changes on consumer preferences, legislative changes, significant variations in energy prices and other supplier prices
• Plan for evolving regulatory conditions
• Engage in a formal alternative future/risk assessment scenario planning exercise
• Consider the people aspects

 

IBM, Obama, and marketing with a mission

Sam Palmisano, IBM's CEO, went to the Council on Foreign Relations this morning to lay out an ambitious program of technology-driven social change and economic recovery. IBM's "Smarter Planet" initiative is a seriously big idea; in Palmisano's words, it's about "infusing intelligence into the way the world literally works—the systems and processes that enable physical goods to be developed, manufactured, bought and sold… services to be delivered… everything from people and money to oil, water and electrons to move… and billions of people to work and live."

Practically speaking, this means investing heavily in technology-based systems and processes to address fundamental global challenges such as energy waste, transportation gridlock, supply chain inefficiency, water shortages, antiquated health care systems, and, perhaps most urgent right now, unmonitored and out of control financial markets.

The initiative is of course self-serving. The more governments invest in technology-based solutions, the more industry leaders like IBM stand to gain. But self-serving doesn't mean it's wrong. In fact, I'd like to suggest that this is actually the best kind of marketing, and the kind that we need to be emphasizing right now:

• It's mission-driven, focused on applying business know-how to clearly felt social problems
• It's inspirational, inviting people to think big
• It's provocative, challenging people to debate the premise, the approach, and potential alternatives
• It's solution-oriented, looking more toward designing sophisticated solutions than pitching specific products or services
• It's believable, because IBM has done the research, is already investing heavily in green technology and services, and has credible offers and capabilities to address at least some of the problems.

My main point here is not to praise IBM, although obviously I do think the effort is praiseworthy. IBM is far from a perfect company and other firms are doing similarly valuable work in these areas. Rather, it's to raise the question about how we go to market in this difficult time.

Most of the marketers I talk to these days are shortening their time horizons, shifting resources (to the extent they still have them) toward lead generation, and doing whatever possible to accelerate immediate sales. This is understandable, and yet...

We've just completed a remarkable election in the US in which a majority of Americans chose a candidate who stared calmly at enormous problems facing our country and the world and said now is the time to think big, to set our sights high, and to be the change. Self-serving? Of course. But it also excited and inspired and mobilized millions of people previously too cynical or disengaged to actually believe that getting involved could make a difference.

Marketing candidates is clearly different than marketing business services and solutions. But exciting and inspiring cynical and disengaged people is actually a pretty good description of the challenge we business marketers are facing right now too.

Palmisano summed it up nicely this morning: "Over the next couple of years, there will be winners, and there will be losers. And though it may not be easy to see now, I believe we will see new leaders emerge who win not by surviving the storm, but by changing the game."

Green reporting on the rise, but accountability lags

Forty of the Fortune 50 companies now showcase reports on their sustainability performance, but many focus more on promoting their green credentials than on providing real accountability to the public, according to a new study by the PR measurement firm KDPaine & Partners. You can download the full report here (PDF).

The good news is that most of the largest companies have begun to take seriously the need to report on their own environmental impact, and most of them present information on their environmental goals and policies, energy consumption, waste disposal and recycling, and air emissions. Most also highlight the environmental awards they have won. The numbers are up significantly from even a few years ago.

On the other hand, far fewer of the companies provide real context for their reporting to help readers understand how well the companies are actually doing, and only a minority involve third party stakeholders in the reporting process, which would tend to add credibility to their efforts. As the study authors noted, "environmental sustainability reporting is still being used as a public relations tool to position companies favorably on environmental issues, rather than to hold companies accountable to stakeholders for environmental performance."

For those interested in improving their own environmental reporting, the report provides a useful Environmental Reporting Transparency Scorecard which outlines a wide array of factors used in ranking the Fortune 50. (Many more useful resources are available from the Global Reporting Initiative, the leading international network for corporate sustainability reporting.)

Preaching what you practice: IBM's green consulting offer

A proven track record is one of the first things that business buyers look at when considering potential providers of high value services and solutions. Where have you done this before? Hence the importance of providing credible references, case studies, and testimonials.

All well and good, but how do you get those first clients before you even have a track record? At IBM, one of the most effective answers has been to use yourself. The IT giant's new Green Sigma consulting offer is a great example.

Like many IT services providers, IBM is preaching the virtues of green computing, and now wants to help clients reduce both costs and environmental impact by applying Lean Six Sigma principals to energy and water usage throughout their operations. It's a timely offer, and made credible at least in part by IBM's internal track record saving energy and cutting costs through the approach -- some $310 million in energy costs saved since 1990 with a corresponding reduction of more than three million metric tons of CO₂, according to company calculations.

In a world of skeptical buyers, practicing what you preach is table stakes. Practicing it first to work out the kinks, and then beginning to preach (with all the appropriate Web 2.0, conversational approaches, of course), is the better way to go.

Reaching new buyers with cause-related marketing

I've always been a big fan of cause-related marketing, so perked right up when I saw mention of Patagonia's new Vote the Environment campaign (see also here, here, and here) The premium outdoor clothing dealer has always put a strong environmental sensibility at the center of the business, but typically has marketed itself to the over-30 crowd. In a new push at younger consumers, Patagonia is taking a strong cause-related approach and the campaign deserves mention for several reasons.

First, of course, it's true to the brand. Lots of companies attach themselves to worthy causes (in this case, getting young people to vote in the upcoming US elections and providing them with information about environmental issues), but it's difficult to do this well if you don't have a credible record and story about the cause to begin with.

Second, it's a nicely integrated campaign, geared appropriately to the audience -- combining traditional advertising, Web presence, and in-store promotion with youth-oriented social media initiatives on YouTube, Facebook, MySpace, blogs and other relevant platforms.

Third, it puts useful and interesting content way above promotion. Pushing product in all the right places for the audience might sell a few more items near-term. But getting people engaged in the issues as brought to you by an enlightened sponsor is far more likely to build buzz, enhance reputation and pave the way for more substantial sales a bit later on.

Finally, the company is taking a stand that may be controversial among some customers, partners, or other stakeholders. It's easy to shy away from controversy as a business, but, if done well, the benefits of standing out from the crowd and giving your advocates more reason to spread the good word  can more than outweigh the potential downside.