3p Contributor: Greg Andeck
Recent Articles
Is the Customer Always Right? Yes, When it Comes to Sustainability.
Greg Andeck manages Corporate Partnerships for the EDF Innovation Exchange, a dynamic global network facilitating the widespread adoption of environmental innovation in business. The EDF Innovation Exchange is also a 3p sponsor.
The world’s leading companies all conduct extensive research to determine what their customers want and how they want it. Whether they hire firms like Synovate or Millward Brown, or do consumer research in-house, companies know the value of crafting products that fit their customers’ needs and desires.
This is why it’s so perplexing that companies don’t do the same when developing substantive sustainability strategies. All too often, companies launch campaigns that are later accused of greenwashing or limit their efforts to indirect efficiency improvements, when it’s their core product that really needs the greening. It turns out that by paying more attention to their customers, companies can unlock solutions for true environmental innovation and get richly rewarded for doing so.
How EDF Harnesses Market Power
Greg Andeck manages Corporate Partnerships for the EDF Innovation Exchange, a dynamic global network facilitating the widespread adoption of environmental innovation in business. The EDF Innovation Exchange is also a 3P sponsor.
At Environmental Defense Fund (EDF), we look for market based solutions to environmental problems. As the guy in charge of managing our partnership pipeline process, I’m constantly on the lookout for new win-win environmental and business solutions we can pioneer with companies. I’m often asked how we identify the companies that we partner with. And increasingly the word I use is LEVERAGE.
Examples of Leverage
We didn’t partner with FedEx just because it was a big company; we partnered with it because it has 36% market share in the package delivery industry. This meant that it was in a prime position to leverage its supply chain – in this case to build the first ever hybrid delivery truck (see Marc Gunther’s recent post).
Similarly, EDF has two project managers in Bentonville not because Walmart is the second largest US company by revenue, but because it has 71% market share in big box retailers and 17% grocery share. For some of its suppliers, Walmart represents a third of their business or more. They’re not going to do everything that Walmart asks them to do, but they’ll sure try. They can’t afford not to. The most highly visible example of this was Walmart’s effort to drive the detergent business towards a concentrated, less resource intensive product. Nearly every large retailer now offers a similar product.
Although both of these examples focus on influencing a company’s suppliers, the same can be true in the opposite direction – leveraging a company’s size to offer customers environmental solutions. We worked with one of the largest fleet management companies – PHH Arval – to develop the first-of-its-kind service that helps large companies with car fleets reduce their greenhouse gas emissions. All of PHH Arval’s major competitors now advertise a greenhouse gas management program.
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