This is third-party content written by Sharon Curr, Brand Experience Strategy Director at Merkle B2B.
Sustainability is now a driving force for brands everywhere. Years ago, only select niche brands offered eco-friendly options yet now leaders understand how imperative ESG practices are for both reducing their carbon footprint and improving operational efficiency.
According to recent analysis from McKinsey, 63% of ESG propositions have a positive impact on equity returns, boosting investment and top-line growth. There is no denying the opportunity presented by sustainable practices.
However successful ESG practices are often difficult for B2B brands to implement. Ambitious targets and good intentions, confronted with organisational and cross value-chain supply barriers, result in missed commitments. Customers want to see evidence of change, and not just hear empty promises.
And time is running out. Not long ago it was revealed that global warming is set to break the key 1.5C limit for the first time in the next five years. A thorough understanding of the B2B industry is necessary for under-pressure businesses to find the proper balance between ecological, social and financial sustainability.
In order to win commercially and reputationally, leaders must return to the fundamentals and comprehend what customers want, and when they want it.
Goals are essential
In the past, environmental goals have been perceived as ‘nice to have’ but costly to put in place. In reality, business and ecological goals are not mutually exclusive. Marketing with purpose can bring significant benefits to profitability as well as the planet.
In a study conducted by Edelman, 71% of participants agreed that ‘companies which place profits over people will lose their trust forever’ (Edelman Trust Barometer, 2020). Partnering with or using a company with vague environmental governance rings alarm bells, with a media storm only a tweet away.
That being said, it’s human nature and good business to want to see evidence. Leaders are under pressure to be bold and showcase their wins and need the right tools to do this effectively. When customers, investors and employees see positive pay-off, motivation for change becomes far easier. Then, sustainability becomes an intrinsic part of every planning conversation, not tagged on as an afterthought.
Eco-attitudes are affecting all generations
It’s true that climate anxiety is particularly rife for Gen Z, impacting attitudes to work and personal lives as a result. A study conducted by Bupa highlighted that 64% of 18 – 22 year olds felt it was important for their employers to act on environmental issues.
But what we are seeing now is widespread adoption of this attitude across generations. Merkle B2B surveyed 3,622 buyers and users of B2B products across the world, and found that across age groups, ‘softer’ decision drivers were of elevated importance. Key decision drivers for B2B buyers today included “taking care of its suppliers, partners, and communities”, “is committed to reducing its environmental impact”, “is known as being a good employer” and “has a culture of diversity and inclusion”.
Importantly, these decision drivers were found to be significantly more important to a winning outcome in 2023 versus 2022. The ‘be-kinder’ legacy of lockdown, coupled with generational shifts in global business culture has meant that emotional experiences are fusing with brand identity. B2B buyers are closer to consumers in attitude, where decisions are highly impacted by personal values and ethics.
To succeed in this space, businesses need to create experiences to match. They need to anticipate what all buyers, with differing roles within the decision-making unit, will think and feel ahead of time, offering buying journeys that are genuinely personalised and relevant.
Achieving ongoing relevance can seem daunting when the average B2B buying journey takes 350 days on average and is highly complex. Leaders can look to technologies such as AI, next-best action tools, and integrated experience clouds for insight. Harnessing all that new tech has to offer will allow businesses to not only create connected customer journeys, but also recognise trends. In a world where expectations are constantly shifting, real-time data provides much-needed insights into buyer psychology.
Be truthful, be transparent
An over-saturated online space means that competition for B2B brands has never been more intense. One misstep and a buyer’s faith in a brand could be lost forever. In 34% of decision journeys, the incumbent lost out in 2023 versus only 29% in 2022. Even leading brands cannot rest on their laurels. They need to be honest about areas for improvement and draw up ESG plans that are transparent and scalable.
That’s especially true given the number one most important factor influencing brand success this year: Safety. B2B buyers are placing the most importance on being made to feel safe when signing a contract. Feeling safe is an outcome and is achieved as the result of actions and behaviours.
So a lack of visible strategies when it comes to sustainability could send a buyer elsewhere. The introduction of recent legislation, such as the EU’s Corporate Sustainability Directive, has only increased buyer nervousness as every decision is held up to the light. Added to this, B2B buyers are traditionally cautious of change, and won’t feel confident in decisions unless they are educated.
When businesses are empowered with meaningful insights, they gain a forensic understanding of what buyers are looking for. Strategy without data is just an opinion. Equipped with insights, leaders can understand service models needed to deliver on customer expectations and ensure messaging is tailored to particular buyers.
Tracking customer satisfaction and loyalty over time enables improved interactions at key touchpoints during the customer journey, but also create a bird’s eye view of perceptions and product performance overall. It’s as simple as this: Without understanding the buyer, you can’t win their trust. You need to know what motivates them, but this goes beyond a simplistic grasp of trends.
This year and moving toward 2030, one thing is certain: Doing good things for the planet and its people is good business. But this will only be successful if sustainable practices are adopted with authentic desire for change. B2B brand experiences will be unable to keep pace with the rapid evolution of global business culture if they cannot meet rising customer demands. Utilising data technologies that make it easier to grasp what customers want minute by minute will be essential if you want to keep up in an environment that is becoming more and more demanding.
The B2B buyer of today wants to see transparency, evidence of change and alignment with their own personal values and ethics. When businesses empower themselves with knowledge, their ability to meet and even surpass buyer needs becomes limitless. This can only result in long standing and profitable buyer relationships.