Community Updates

From CEOs to purchasing managers, business decision makers are people, too

Published 10 years ago | About a 4 minute read

January 21, 2014 – A recent study found personal belief drives business decision makers as much, if not more than stated corporate sustainability goals and objectives. And, while some are driven by their own personal commitment, owners and CEOs, overall, are not sold on sustainability as a competitive advantage. “In order to get more CEOs to drive sustainability through their organizations, we need to cause more CEOs to have personal epiphanies,” said Suzanne Shelton, president and CEO of Shelton Group. “Based on our data, many CEOs don’t believe sustainability will create a competitive advantage. And though we could certainly argue with them and try to help them see the business value, the insight from our study tells us we should be appealing to a CEO’s heart, passion, and desire to do the right thing and leave a positive legacy. That will get more companies on the sustainability train than simply trying to make the business case alone.” When it comes to purchasing managers, on the other hand, the study, Shelton Group’s B2B Pulse™, found that sustainability is more likely to be viewed as a competitive differentiator. And while purchasing managers are less willing than others to pay a price premium for sustainable products, sustainability is actually more personally important to them than others in purchase decisions (81 percent, compared to 71 percent overall). “Purchasing people get a bad reputation for only caring about up-front costs in their purchasing decisions. And it’s true, they don’t want to pay extra for sustainable products or product features” said Shelton. “But sustainability is more personally important to them than many others in the business decision making chain. And when you compare the sustainable features that drive their purchasing decisions to corporate initiatives, you can quickly see they’re buying based on what’s important to them personally, not just their companies’ sustainability goals.” In addition, the study found that only 11 percent of companies have or are developing a sustainability scorecard to guide purchasing, so most decision making is happening without formal guidelines. “If you were looking to leverage your sustainability story in the B2B space, you would likely start with an examination of your potential customers’ corporate sustainability reports, presuming those would be the initiatives companies care most about – but you would often be wrong,” said Shelton. “When sustainability drives decision making it’s often as much, if not more, about the decision maker’s personal bias as the company’s stated initiatives,” said Shelton. The study also found that not all industries are created equal in regards to sustainability: • Education leads the way, with far more sustainability initiatives than other sectors (8.2 initiatives on average, compared to 5.3 for businesses overall). • While energy savings/cost reductions are the primary decision drivers, there are interesting differences by sector. For example, the health care sector is driven more by health and wellness, but product efficacy is critical; education cares more about local sourcing; etc. • Construction/renovation is significantly more likely to believe that sustainability offers an opportunity for competitive differentiation. • Sectors don’t always reflect their leaders. The retail sector, for example does not particularly prioritize renewable energy initiatives and actually lags behind other sectors in the development of sustainability scorecards. • Over half of hospitality industry decision makers acknowledge that their facilities are inefficient. “To leverage sustainability in the B2B space, don’t look only at your prospects’ CSR reports, and don’t assume all industries feel the same way about sustainability,” said Shelton. “Keep in mind that you are still dealing with people who have personal values in addition to their concern for ROI.” For more information about B2B Pulse, go to www.sheltoninsights.com/product/b2b-pulse. Visit www.sheltongrp.com to learn more about the agency. ABOUT SHELTON GROUP Shelton Group is the nation’s leading marketing communications agency entirely focused in the energy efficiency and sustainability space. The Knoxville, Tennessee-based firm works with many of America’s leading utility, building products and consumer goods companies to develop differentiated communications campaigns to leverage their sustainability stories for a market advantage. That campaign work is informed by insights and perspectives extracted from Shelton’s quarterly polling of American attitudes and behaviors about energy efficiency and sustainability. For more information about Shelton Group, visit www.sheltongrp.com. ###