ana green marketing roundtable 2010.02

‘Green Marketing’ Case Study Roundtable

February 2010

Association of National Advertisers

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What does it mean to be ?


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Case Study: Customer ‘A’

Working Hypotheses:

•  Environmental considerations are having a greater impact on building materials purchase decisions. Opportunity exists for Company A to drive growth and strengthen its competitive advantage by positioning itself to satisfy these emerging requirements

•  ‘Green’ is NOT a one-size-fits-all proposition. ‘Green’ means different things to different buyers, and the market can be segmented based on how attitudes differ toward ‘Green’

Company A:

•  A large, “super-regional” supplier of building materials for the commercial construction industry


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Project Objectives

•  To understand how builders/contractors define ‘green’ and their motivation to pursue/not pursue green building materials/solutions

•  To identify the key drivers of ‘green’ purchase decisions and dimensionalize their relative importance

•  To identify and prioritize distinct segments of ‘green’ based primarily on differences in attitudes toward green

•  To identify a ‘green-oriented’ value proposition that is compelling and distinctive to the target segment


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Target Selection ‘Green’ Research Planning & Prep

High-level Project Approach

Value Proposition Development

Target Selection

Customer/Contractor Segmentation

•  What are the distinguishing attitudes, behaviors, and firmographics of builders and contractors in the marketplace?

•  How many distinct ‘green’ segments are there?

•  How similar or different are attitudes, needs, and behaviors across segments?

•  Which segments are the largest in terms of pure numbers and “incidence?”

•  Which segments are the most economically attractive?

•  With which segments do we currently perform best?

•  What primary benefit should serve as the foundation for a green value proposition?

•  Is the foundational benefit motivating, credible, and differentiated?

•  What are the interrelationships between benefits (how do they link)?


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Attitudes “What’s Relevant?”

Benefits “What Motivates?”

Segmentation

Target Selection “Who do we chose to go after?”

Value Proposition

25 different attitudes were used to segment the marketplace

14 benefit statements and purchase behaviors were captured to determine what drives buyers to purchase

•  Who will be most responsive? •  What do the want? •  How do they want it to benefit them? •  How do we prove it?

High-level Project Approach


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Attitudinal Segmentation

‘Green’ Attitudinal Segments

Green Lovers Green for Me

•  Believe ‘green’ building materials have an impact on the environment

•  See value in ‘green’ building materials for commercial construction

•  Believe ‘green’ is worth the investment

•  Least price sensitive segment

•  Also believe ‘green’ building materials have an impact on the environment

•  Believe government regulation is increasing

•  More dependent on manufacturers for knowledge, expertise and compliance

•  Looking for help in understanding ‘green’

Partially Green Green Rejecters

•  Believe that ‘green’ building is important in the commercial construction space

•  Not necessarily looking for assistance


•  Do see the value in ‘green’ building and believe it has a notable impact on environment

•  Do not see the business benefits in ‘green’

•  Not willing to pay more for ‘green’ offerings

•  Most skeptical about the validity/efficacy of ‘green’ building

•  Do not believe ‘green’ building has a notable impact on the environment

25% 23% 34% 18%

Green Lovers

Green for Me

Partially Green

Green Rejecters

155

92 85 63

Distribution of Respondents Spend Indices – ‘Green’ Segments

Green Lovers

Green for Me

Partially Green

Green Rejecters


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Target Selection Primary and secondary targets were chosen to serve as the foundation for the company’s future ‘green’ strategy

Green Lovers Green for Me Partially Green Green Rejecters

Primary Target Secondary Target

•  Believe ‘green’ building materials have an impact on the environment

•  See value in ‘green’ building materials for commercial construction

•  Believe ‘green’ is worth the investment

•  Least price sensitive segment

•  Also believe ‘green’ building materials have an impact on the environment


•  More dependent on manufacturers for knowledge, expertise and compliance

•  Looking for help in understanding ‘green’

•  Believe that ‘green’ building is important in the commercial construction space

•  Not necessarily looking for assistance


•  Do see the value in ‘green’ building and believe it has a notable impact on environment

•  Do not see the business benefits in ‘green’

•  Not willing to pay more for ‘green’ offerings

•  Most skeptical about the validity/efficacy of ‘green’ building

•  Do not believe ‘green’ building has a notable impact on the environment


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Value Proposition Development

Analysis of key drivers of customer behavior (likelihood to recommend) highlighted a few distinct benefits that could serve as the core for the company’s future value proposition

To further assess the validity of these benefits, we developed Pathway Models to understand what functional and higher-order benefits “ladder up” to these key drivers (next page)

Benefits Index

Safe work environment 120

Help demonstrate commitment to environment 115

Superior knowledge & expertise 110

Enhance productivity 109

Improves company image 108

Increase satisfaction 106

Comprehensive solutions 105

Industry thought leader on environmental issues 104

Reduce operating costs 101

Certified green 98

Reduce fines 95

Supports competitive advantage 95

Credibility 89

Maintain property value 88

Reduce financial liability 86

Conserve energy 80

Derived Importance Analysis


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Pathway Modeling

Conclusions

Help demonstrate commitment to environment

Healthy work environment

0.41

Improves company image

Credibility

Reduce financial liability

Enhance productivity

Reduce costs

0.47

0.32 0.48

0.54 0.38

0.52 0.36

0.42 0.43

Pathway Model

For Green Lovers, the most effective way to help customers demonstrate their commitment to the environment is to show the real financial and operational benefits associated with ‘green’ building. Image by itself is not enough


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Foundation for ‘Green’ Value Proposition Development

Green Lovers

Commercial construction material provider

‘Green’ Results •  Safe work

environment

•  Improves image

•  Enhanced productivity

Cost savings Credibility

Productivity Thought leadership

a demonstrated commitment to environment

Offer materials that provide real business value to customers in terms of showing tangible, financial benefits that can result from ‘green’ building – image by itself is not enough

Target

Frame of Reference

Primary Benefit

Proof Points

ana green marketing roundtable 2010.02

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