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David Steuer, VP, Client Strategy, Saatchi & Saatchi S

July 27, 2009

Sustainability: Why Bother?

Assess &Imagine

Focus &Design

Implement &Measure

Deliver End-to-End Sustainability Strategy and

Implementation

• LCA measurement/ reporting• Supply chain innovation• Public Relations• Creative• Shopper marketing

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Corporate Strategy

Strategy diagnostic

“North Star” goal-setting

Strategy refinement

Organizational

Strategy

Organizational opportunity assessment

Sustainabilityengagement strategy

Personal sustainability certification

Brand Strategy

Brand positioning

Lifecycle opportunityanalysis

Stakeholder Communicationand Channel Strategies

Cause marketing

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Sustainability is much more than “Green”

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SOCIETY, TECHNOLOGY, RESOURCES

Legislation is Mandating Change

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$100 Billion Stimulating—Energy Sector

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Social

Issues that affect all members of society, including poverty, violence, injustice, education, health care, and labor and human rights

59%

Cultural

Issues surrounding how communities manifest identity and preserve and cultivate traditions and customs from generation to generation

36%

Environmental

Issues that affect Earth's ecology, including climate change, preservation of natural resources, carbon footprint, and conservation

58%

Economic

Issues that affect how humans meet their basic needs, including employment opportunities, access to health care, and safe housing

53%

Social and Economic concerns are just as important to individuals as Environmental ones.

Global shopper importance ratings:

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2007 2009

11%

27%

54%

8%

11%

<1%

68%

19%

Light

Blues

Dark

Blues

Core Blues

Disengaged

Pure Blues <1%Pure Blues

Core Blues

Light Blues

Disengaged

Increased Consumer Demand

Sustainability fast becoming mainstream, increasing from 12% to 36% in 2 years.

My Lifestyle is Blue

Dreams of a world where she can ALWAYS buy sustainable products

Views sustainability is part of her identity

Believes she is leveraging consumerism to participate in a larger cause

Incorporates sustainable products into her life at all levels, from asparagus to shampoo to solar panels

My Actions Are Blue

…for Me, My Family, My Community and the Planet

Possesses confidence and pride around her depth of knowledge and engagement in the world of sustainability

Sees the regular purchase of green products as taking better care of her family

Understands the environmental impact of some of her actions and teaches her children about it

Considers herself a spokesperson for the mission of sustainability

The Health and Wellbeing of My Family Comes First

Believes in global warming and is intrigued by “going-green”

Isn’t often familiar with the term “sustainability”

Has purchased the “low hanging fruit” like green cleaners, compact fluorescent light bulbs

Needs to encounter green products at her regular retailer at an affordable price

Sees sustainability as shrouded in mystery, and doesn’t think she’ll ever understand

Dark Blues

Light Blues

Core Blues

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Source: Datamonitor's Product Launch Analytics

Sustainable products are stillthe fastest growing sector

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Retailers are Challenging Manufacturers

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Establishing New Standards and Measurements

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…And Innovating for Competitive Advantage

Increasingly, They Are Using Their Position as the Sustainability “Gatekeepers” to Win the Voice of the Consumer.

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Yet in almost all cases, sustainability is not top-of-mind in the store.

Globally, 22% of shoppers think about sustainability when shopping.

91% of shoppers would like to be reminded more about sustainability while shopping.

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Only 55% believe the media.

Few (14%) trust themselves to determine actual sustainability of products.

Only 19% believe they have enough information to evaluate sustainable claims.

Who can they trust to help them?

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48% of shoppers say that greater availability of sustainable products would increase their purchases – they struggle to find these options.

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Do Something

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Nothing: No Longer an Option

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Nothing: No Longer an Option

Extract

ProductFormulation

Manufacture

Distribute

Use

Recycle

Dispose

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WHAT’S YOUR STORY?

Across the globe, people want to feel like they are doing something to help. An altruistic feeling drives purchasing.

Feel like I’m helping 1 1 3 2T 1 1 1 1

Sends message to companies that we want better products

6 3 6 2T 5 2 2 3

Reduce packaging waste

4 2 2 4 6 7 3 4

Make my home safer

5 7 7 1 2 4 7 7

Save Energy 3 5 1 7 4 3 6 6

Save money 2 4 4 6 7 5 5 5

Teach children conservation

7 6 5 5 3 6 4 2

Ranking of Reasons for Wanting to Purchase Sustainable Products:

Q. What is your primary reason for wanting to buy sustainable products? Rankings based on % selecting each response of 7 options.

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Consumer Values: Ways in to Sustainability

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Consumer Values: Ways in to Sustainability

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Focus Areas for Values Groups

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Use TENTransparencyEngagementNetworks

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You can run, but you can’t hide.

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Nearly half of all shoppers (48%) strongly agree/agree with the statement:

“I always research the products I buy on my own to evaluate how sustainable they are.”

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Transparency: Addressed the Warning?

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45% of shoppers say that more ingredient/materials information motivates them.

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http://findthefarmer.com/details.php?lotCode=15JAN10&FarmID=12

Transparency: Traceability at FindtheFarmer.com

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Employee Engagement: Walmart Personal Sustainability Project

Results

• More than 500,000 Associates voluntarily adopted Personal Sustainability Projects

• Over 19,000 employees quit smoking for $34 million in estimated annual savings

• Almost 185,000 pounds of weight lost by Associates

• 1,243,000 miles walked, swam, and biked

• Created over 16,000 “Idea Groups” around Personal Sustainability

• More than 4 million pounds of materials recycled

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http://www.youtube.com/watch?v=XOraijjCHLA

TEN Integrated: Frito Lay

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Networks: Waste = Food

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Networks: SVN (Sustainable Value Network)

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Networks: NGOs

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