February 27, 2016
Sustainability is top of mind for companies as the effects of climate change accelerate and oil prices continue to yo-yo. Marketing academics are studying not only how companies can best adopt sustainable practices, but how marketers can make those sustainable practices stick in their own organizations. At the AMA’s 2016 Winter Marketing Educator’s Conference in Las Vegas, researchers presented on how companies can become more sustainably driven and how social media affects the adoption of sustainable practices.
According to “Toward a Conceptual Framework for Sustaining Organizational Sustainability: Enabling Marketing’s Contribution to the Cause,” presented by Julien Schmitt from Aston University, firms are increasingly integrating sustainability into their overall strategy but it’s difficult for them to maintain that sustainability orientation over time because of factors including cost pressure, competition pressure and changes in leadership. Further, the study found that the low level of managers’ knowledge about the environmental impact of their activity as they focus on the core of their job, most likely output and cost cutting. The key issue addressed is how to better allow for sustainability strategies to be sustained organizationally over the long term.
Schmitt laid out four key actions that will help companies sustain that organizational sustainability:
• Definition of the product/service life cycle: Raw material extraction, manufacturing, transport, use, and end-of-life. One respondent commented, “Sustainability became part of everything: annual budgets, capital expenditure analysis and decisions, and day-to-day purchasing and at our weekly purchasing meetings which discussed everything from towels to flooring, including synthetic carpeting versus natural and renewable options.”
• Indicators of team/individual performance: One respondent commented, “At the beginning we were organizing seminars to sensitize managers to the sustainability issue. These were not greatly changing the practice. Then, we decided to give quantified objectives with incentives based on the percentage of their products that would be eco-conceived. This proceeded to change things quickly and more efficiently.”
• Changing the organizational structure: The most important components of making this change stick are the presence of sustainability champions in the C-suite, facilitate both top-down and bottom-up communication, and address the tendency of middle management to ignore sustainability goals and instead focus on productivity and output.
• Build a firm identity consistent with sustainability: Affirm sustainability as a core element of the firm’s DNA, develop staff training and awareness on sustainability, and don’t limit sustainability to a few projects but extend it to the full range of products and services.
• Orientation toward long-term profitability associated with sustainable practices: Companies should accept initial investments and allow time for them to return profits, proving the profitability of sustainability using key stakeholders’ benefits indicators, and avoiding clashes with short- and middle-term objectives of core activities.
Marketing plays an important role in implementing this model in a few key ways: the marketing team must be an advocate for sustainability, it must build up a corporate identity around sustainability and it must communicate with key stakeholders.
In “The Influence of Social Network on a Company’s Adoption of Sustainability Initiatives,” Ying Zhu from the University of British Columbia discusses how business networking affects a company’s adoption of sustainability practices. This research posits three questions:
• How does a social network facilitate a company’s decision on sustainability initiatives?
• Does the business density of a region (i.e. how many similar businesses are clustered in a certain geographic area) moderate the impact of social networks on sustainability adoption decisions?
• What are the marketing-related factors that influence a company’s adoption of sustainability efforts?
In sampling 311 Oregon-area wineries, the study evaluates data including how active on social media each winery is, whether the winery grows its own grapes, and whether it has a tasting room or a wine club. According to analysis of the data, Zhu says there is one large takeaway: that the more centrally located a winery is in a concentrated business area, the more active it has to be in social media with customers and competitors and therefore the more sustainably minded the company is. The more aware a company is of its internal processes and external perception, the more sustainability can be top of mind for its marketers.