New research documents that green products and meaningful brands deliver increased sales plus financial performance that outperforms the stock market. Havas Media just released an analysis on the financial performance of their top twenty global meaningful brands. The stocks for this portfolio of companies outperformed the stock market by 120 percent! The 2013 Small Business Sustainability Report just released by Green America, Association For Enterprise Opportunity and EcoVentures International reports that for small businesses defined as having five or fewer work associates (representing 88 percent of all U.S. businesses) the sale of green products outpaced their sale of conventional products.
Here are three compelling examples that selling green products is a path for winning superior revenue growth:
- Organic food sales grew 238 percent during 2002-11 compared to a 33 percent growth in overall food sales
- From 2006-11 the green building segment grew 1,700 percent while overall construction shrank 17 percent
- Renewable energy sales grew 456 percent from 2002-2011 while non-renewable fuel sales fell 3.2 percent
The bottom line is that 75 percent of the businesses that sell green products (as surveyed through the 2013 Small Business Sustainability Report) achieved an increase in sales during the 2008-11 economic recession.
Brands are dead! Long live meaningful brands
Havas Media’s research has found that only nine percent of U.S. consumers believe brands actually improve people’s lives. Tellingly, only about a third of consumers believe brands “communicate honestly about commitments and promises.” Is it a surprise, then, that 93 percent of U.S. consumers would not care if brands disappeared?
Marketing strategies that position branded products as commodities sold through endless price promotion coupons are major contributing factors in the mass destruction of brands. Product designs that fail to sustainably improve human and environmental welfare are the other major contributing factor. Consumers are increasingly losing their trust in 20th Century brands representing products ranging from sodas to cars with V-8 engines as the human and environmental “externality costs” of these brands demonstrate measurable impacts upon human heath and our warming climate.
From this marketing disruption, a new branding formula is emerging. This brand formula is, at its core, creating a measurable and meaningful difference in people’s lives. These brands seek to forge customer relationships that advance human potential and a collective well-being. Havas Media labels them “meaningful brands.”
ROI of meaningful brands outperform stock hedge funds
Havas Media has identified 25 global meaningful brands. Their top five are:
Havas Media conducted a financial analysis on the stock performance of their basket of 25 global meaningful brands. The stocks of these meaningful brands showed a financial performance that “exceeded those of top hedge funds.” Havas Media’s research conclusion was that, “Being a Meaningful Brand is not only good for your market and the community at large, it’s also good for your bottom line.”
Comparing dead brands to meaningful brands
Consumers are moving on from brands that focus on these 20th Century attributes:
Super-size-me fast food no longer aligns with consumer concerns over weight-related health impacts. Cheap is still a value in this slow growth economy but consumers now have expectations that a brand aligns both value with values. Consumers are also increasingly perceptive that the ramifications of “now” or instant gratification can be unsustainable credit card balances and poor credit ratings.
Consumers are searching for meaningful brands that have these attributes:
Technology companies now account for half of the global meaningful brands identified by Havas Media. The reasons for this appear obvious. Search engines are making us more informed (smarter) which enables us to make wiser decisions. Social media has enabled people to engage with their social community at any time. Smartphones are enabling this to happen from any location. Digital technology has increased the efficiency of our offices, appliances, cars and behaviors. These technologies are displacing 20th Century technologies’ larger environmental footprints.
Exclusive video interview with Havas Media’s Global Head of Data Insights
The following exclusive video with Havas Media’s Amy du Pon, Global Head of Data Insights, taken at Sustainable Brands 2013, expands on the attributes of meaningful branding and outlines the steps a business can take to become a meaningful brand:
Bill Roth is an economist and the Founder of Earth 2017. He coaches business owners and leaders on proven best practices in pricing, marketing and operations that make money and create a positive difference. His book, The Secret Green Sauce, profiles business case studies of pioneering best practices that are proven to win customers and grow product revenues. Follow him on Twitter: @earth2017