BfG News Issue 16 - Editor's Column: The Greening of US Politics

16 Oct 2008|Added Value

Joanne-McDWith volatile gas and energy prices and the dreary financial outlook of the US, this year’s fight for the White House received more attention than remembered in past decades.  There are high expectations that the next 4 years will show marked progress towards refocusing and redirecting policies related to energy, climate change, the environment and social responsibility.

President-elect Barack Obama has been a vocal supporter of green initiatives throughout his campaign.  He promises funding for ‘climate friendly’ measures like increasing fuel economy requirements for vehicles and developing alternative energy sources like biofuels, wind/solar power and clean coal technology. He also supports the carbon cap-and-trade as the best way to control rising carbon emissions as well as a strategy to reduce emissions by 80% by 2050.

Brands in turn will now have to take a more aggressive look at the way they conduct business and their ‘green strategy’ overall.  Understanding core points of difference and points of parity will help brands to focus on future opportunities to develop products and services that support sustainability while remaining true to their DNA. 

For example, Toyota was a pioneer in the introduction of hybrid vehicles – first released in Japan in 1997 and later rolled out worldwide in 2001.  Several auto-makers have since followed suit, introducing comparably fuel efficient autos. Given Obama’s goal to have more than 1 million plug-in hybrids on the road by 2015, all automakers will have to consider their core strengths and their credibility when making the decision to enter into this new market environment. Can Porsche maintain its position in performance with a hybrid sports car offering?

As President, Obama hopes to implement a $7000 tax credit for purchasing hybrids. With this initiative, not only will consumers have the opportunity to help the environment, but they will also gain from the tangible benefit of a tax break – delivering both rational and emotional benefits. Today’s consumers are more informed, more demanding, and are asking harder questions. So, they are taking their time to make choices, weighing up both the value benefits … and sustainability. As we’ve said before, building sustainability into a brand’s value equation could mean survival over the short term and an opportunity to gain competitive leadership and brand loyalty over the long term.

So as Americans look forward to a future of change, what lies on the sustainable horizon for brands? We predict there will be more collaboration, partnership and even amalgamation to gain expertise and learnings. Some brands may shift from a product strategy to a broader product/service strategy, adding value to their proposition and longevity to their products. Conversely, others may strip right back to basics, concentrating on what they do best.  Experience gained from sustainable projects has shown us that a country’s history and culture drives different sustainable agendas for consumers. For instance, in Turkey it’s about being close to nature; Italians treasure solidarity; medical charity is high on the agenda in Russia, while healthy products are top priority for the Chinese. Brands need to consider the wider impact of their product – from construction and delivery, right through to consumer use.

Over the past three decades, brands have spanned a range of commitment levels towards social responsibility with few legislative mandates to do so.  Some brands have taken a lead in defining themselves as ‘socially responsible’ through their values and actions while others have taken a fast follow approach.  With more legislation and public awareness, businesses across all market sectors should be prepared to meet new expectations and have long-term plans to address the ever increasing focus on the business world’s impact on the environment.  Brands who tackle this new landscape by investing in the long term and exploring the positive feelings and emotional levers that inspire consumers to support a sustainable brand or buy ‘green’ products will have the upper hand.

Joanne McDonough
Snr Vice President
Added Value North America

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