SUSTAINABILITY Enigma
SUSTAINABILITY Enigma
BakingBusiness.com, July 01, 2008
by FoodBusinessNews.net Staff

These days it’s next to impossible to miss the ambush of "green" marketing. Perhaps your company was one of 21,008 businesses that participated in the worldwide Earth Hour and voluntarily turned off nonessential lights and electrical appliances for one hour. Designed to highlight the benefit of small changes on climate change, Earth Hour is one example of the growing awareness of people’s effect on the environment. But for some, the idea of green still hasn’t lost its connection to the hippie movement and environmental initiatives that took root in the 1970s. Once practiced mainly on the fringe, green initiatives have progressed from the periphery to the mainstream.

Green now incorporates ideas of sustainability and stewardship of the environment, and these initiatives apply to individuals, communities, companies and the global population. The US Environmental Protection Agency (EPA) defines sustainability as "meeting the needs of the present without compromising the ability of future generations to meet their own needs."

While not yet compulsory or regulated, companies are exploring sustainability initiatives that can benefit the company and garner influence with consumers. Although sustainability can be good for business, difficulties arise when individuals attempt to combine the elements of sustainability in regards to the company, its customers and stakeholders. Using definitions such as those provided by EPA, bakeries can explore a personalized approach to sustainability and discover the opportunities a well-executed sustainability program can provide.

"Sustainability will become the most significant social moment of our time," predicted the National Marketing Institute (NMI), Harleysville, PA, and Mintel, Chicago, IL, during the April Fancy Food show in Chicago, IL. Their joint presentation emphasized that sustainability will permeate every aspect of consumers’ lifestyles, business infrastructures and other societal constituencies.

If that weren’t enough, don’t forget that sustainable practices are critiqued by individuals who judge products by nutritional content, production methods and packaging, and finally by the impact on the earth.

A recent survey from Chicago,IL-based Information Resources, Inc. (IRI) found half of US consumers consider at least one sustainability factor when selecting brands to buy or stores to shop. The IRI study determined four key sustainability features: organic, eco-friendly products, eco-friendly packaging and fair treatment of employees and suppliers. The research group defines sustainability using the EPA definition.

While something touted with such importance is bound to garner attention, how can the concept be drilled down to what it means to the individual, a company or stakeholders? Wary of a one-size-fits-all approach, companies are checking the consumer pulse with blogs, consumer observation and recognition of past "green" failures.

Depending on a company’s stance on the environment and sustainability initiatives, consumer and media focus has either encouraged or forced companies to define what sustainability specifically means to their suppliers, manufacturers and customers.

The Hartman Group, Bellevue, WA, a market research organization specializing in one-on-one analysis and observations of consumers in their natural environments, found consumers adopt sustainability in an evolutionary way.

"They don’t necessarily jump in with both feet; they just sort of dip their toe in the water," said Laurie Demeritt, president and c.o.o., The Hartman Group. "It’s important to understand what point consumers are at so we aren’t ostracizing them, speaking over their heads or speaking to something they were doing a few years ago."

That being said, a sustainability initiative cannot be solely based upon organics, packaging or good company relations. Instead, it must incorporate multiple elements that can address consumers at many different levels — making this an initiative that cannot be taken lightly. Therefore, it is critical companies speak the same language(s) as the consumer they are trying to reach.

MOTIVATED MIGHTY. Drilling down to the consumer level, companies that are looking to map their route toward sustainability need to look no further than the lifestyles of health and sustainability (LOHAS) consumer group who is in the forefront of adopting new ideas, foods and initiatives that encompass elements of health and sustainability. According to Nielsen Co., Schaumburg, IL, these marketplace predictors are often top purchasers of consumer packaged goods including cereal, eggs, pasta and nuts.

"One in five US consumers are LOHAS consumers — passionate, environmental, socially responsible stewards," said Patti Marshman-Goldblatt, senior vicepresident, NMI. "These consumers are early adopters, loyal to companies whose values match their own, and validated by our research, willing to put their money where their mouth is."

Joint research from Nielsen and NMI found LOHAS consumers purchase organic and better-for-you foods with health claims of gluten-free, multigrain and probiotics. According to the report, LOHAS consumers also spend more than twice as much on sprouted grain and GMO-free products.

LOHAS consumers exhibit a bond between purchases and lifestyle, and The Hartman Group’s research and observation also uncovered a connection between "consumer motivations and beliefs that radiate out from concern for personal and family health and extend through to concern for one’s community and finally outward to a larger global or earth concern."

MAGIC COMBO. Recognizing that no human or company can remain an island, Cargill of Minneapolis, MN, chose to couple social responsibility and stewardship with sustainability in its Corporate Citizenship initiative. Cargill defines corporate citizenship as the company’s total impact on society and the environment. The initiative is based upon business practices people practices environmental practices and community involvement.

"Corporate citizenship is not a single goal, an award we can win or the responsibility of a special department," said Greg Page, chairman and c.e.o., Cargill. "It is part of everything we do, every day — as employees, as businesses and as a global company. It is a process of continually improving our standards, our actions and our practices. It is a journey."

Initiatives behind Cargill’s corporate citizenship include ensuring access to safe and wholesome food, food safety, animal health, welfare and surveillance, handling GMO crops, responsible sourcing, promotion of economic security and stability, responsible labor practices and addressing the costs of rising health insurance and education costs for US farmers.

Sara Lee, Downers Grove, IL, practices a 3-prong approach of wellness and nutrition, environment and social responsibility to conduct "business that supports the well-being of people and our plant." The company will finalize its sustainability report in September. In the meantime, the company strives to offer products that recognize the consumer’s well-being while supporting sustainable, environmental and social improvements in the company’s global community.

"Our consumers increasingly expect us to think beyond today’s needs and take into account future generations," said Brenda Barnes, president, chairman and c.e.o., Sara Lee Corp.

The International Dairy-Deli-Bakery Association (IDDBA) looks at three legs of sustainability: environmental protection, economic development (enhancing individual economic opportunities) and social responsibility. According to the group’s report, Environmental Sustainability — The Power of Green, IDDBA members believe sustainability will bring a "fundamental change in the way retailers, distributors and manufacturers do business." Many IDDBA members cite sourcing raw materials and global competition for those supplies as current limitations affecting sustainability initiatives.

On a positive note, new methods of energy production, government-sponsored tax breaks and incentives, and growing evidence consumers are increasingly willing to support companies able to prove their sustainability efforts can become great advantages to pursuing these programs. The report complied results of its online survey of 157 member companies along with sustainability information from 30 companies and trends from more than 200 sources. The report also shared that seventy percent of IDDBA’s survey respondents are considering or already under way with sustainability plans.

FIRST STEPS. Considering the buzz, maybe your company is interested in learning more about sustainability. This is an excellent time to discuss with your peers what they are doing and whether it works. Learn from them, and consider their benchmarks and goals against your company’s situation and needs.

Online resources also offer everything from step-by-step lists to examples from companies who are making sustainability work for their business. The Food Marketing Institute (FMI) offers its "Sustainability Starter Kit" at www.fmi.org/sustainability/. The guide shows both large and small businesses how to integrate sustainability initiatives into business plans.

IDDBA also encourages businesses to include brand perception, consumer education via advertising and public relations, responsiveness to consumer sustainability needs and an authentic "green" response when marketing sustainability. The organization’s sustainability report contains a Microsoft Office Excel-based sustainability calculator that allows companies to appraise efforts for industrial materials recycling, alternative lighting sources, fuel savings, biofuels or aggregate savings. Finally, don’t forget to publicize this progress through newsletters, e-mail, annual reports and trade shows. GREEN LIGHT. In the end, publicity can ultimately determine the success of any sustainability initiative. Case in point, a recent article from ProgressiveGrocer.com quoted NMI, saying that consumers are finding it increasingly difficult to distinguish those companies who are sincere in their sustainability initiatives as opposed to those who use the movement purely for marketing gain.

"While numerous companies are attempting to gain credibility as good corporate citizens, consumers are overwhelmed by the myriad of communications and are at times, unable to distinguish the legitimacy," said Steve French, managing partner, NMI.

This serves as a good reminder that while a little of something can be good, a lot of the same thing doesn’t necessarily make it great. Take the time to fully research how sustainability affects your company, suppliers, distributors and customers. Perhaps you’ll discover changes that can benefit this generation and beyond.