Why marketers should stop emphasising ESG in creative

While important to consumers attitudinally, new Forethought research points suggests environmental, social and governance isn't a major driver of brand choice

A new research paper by Forethought advisory is encouraging marketers to leave environmental, social and governance messaging and stories to the corporate affairs or PR teams and focus instead on attributes truly driving consumer brand choice.

The overarching question posed by Forethought team leaders and report authors, Ken Roberts and Darren Stein, was: Are ESG considerations a primary or even minor driver of consumer choice? To do this, the report authors took their cues from a study of advertising campaigns from Australian supermarket giants, Woolworths and Coles, in August and September.

In the spotlight was whether corporate reputation for sustainability is actively driving consumer behaviour and choice, as well as if it overrides deficits in price drivers such as the total price at the checkout, and quality drivers such as fresh fruit and vegetables.

While the evidence presented is largely based on the supermarket results, Forethought said its work across other categories shows a similar conclusion can be reached across other sectors and brands. And the overarching finding? Consideration of environmentally sustainable policies is an exceedingly small driver of consumer choice.

“Indeed, there are many more important choice attributes for CMO’s to select from, deliver on and communicate about than the ‘purpose du jour’,” the report authors stated.

The evidence

Forethought’s supermarket study surveyed 800 Australian grocery shoppers as well as a separate 400-strong quote of gen Z consumers between 18 and 25 years old. It also took into account both rational and emotional drivers for category choice.

There’s no doubt many consumers are chronically concerned about their environmental footprint as well as the need to act for the sustainability of the planet, particularly those under 25 years old. Forethought’s own research also shows Gen Z respondents as rating ESG higher in their concerns list.

Yet in a comparison of ESG concerns with the freshness of products, fruit and vegetables presented by the supermarkets, the advisory found Gen Z rate the latter 19 times higher than supermarkets having environmentally sustainable practices (13.7 per cent versus 0.7 per cent).

The advertising used were Woolworths Group’s reimagined ‘Today’s Fresh Food People’ campaign, primarily centred around the freshness and quality of their products, and Coles Group’s ‘Together to Zero campaign’ showcasing its commitment to ambitious targets to reduce CO2 emissions and ‘to become Australia’s most sustainable supermarket’.

Forethought’s figures were devised using econometric modelling and Forethought’s Prophecy Thoughts and Feelings methodology and incorporated top of the funnel brand building as well as bottom of the funnel performance marketing drivers. The equation also predicted three-month leading indicator changes in market share.

According to Forethought, the low importance placed on ESG was also apparent in its work in superannuation, where it produced a predictive choice model of superannuation for Job Starters, Career Changers, Pre-Retirees and Retirees. Those embarking on their first job were found to consider environmentally responsible investment policies as a minor driver of choice. Yet that driver did not factor in for the other cohorts at all, the firm said.

The Forethought research also pointed to the whopping gulf between attitudes and consumer behaviour as further argument for why sustainability should be less of a focal point for marketing creative right now. As an illustration, it noted Qantas’s Fly Carbon Neutral program. In 2019, about 10 per cent of passengers booking flights chose to pay to offset their carbon emission. Yet this number is only one-fifth of those who state they will purchase carbon credits when asked in a survey.

Marketing and sustainability

Given ESG is not a primary driver of choice among supermarkets, for purely commercial reasons it should not have a central role in marketing communications, Forethought argued in the research.  Instead, ESG is better positioned as a matter for corporate affairs and public relations-based communications.

“No matter how terrific the Coles creative was, if attitudinal change leading to sales, or driving sales itself was a desired outcome, the impact of the campaign would be limited in that regard,” Forethought global CEO and report author, Darren Stein, commented. “Even for Gen Z Australians – an especially environmentally-conscious cohort – pledges to sustainable practices don’t translate into driving purchase behaviour.”

To further quantify these findings, Forethought asked its 800 consumers to choose from a list of five alternatives which was the most important output a company should undertake, as well as the least important output. Least important was businesses using advertising to project community standards such as sustainability. The most important output was producing safe, well-priced, quality goods and services (43.9 per cent).

“The broader question is whether it is fair to task CMOs with the dual agenda of driving sales and market share growth, as well as position the brand on non-sales driving purpose motives such as environmental sustainability, all within a finite budget?” Stein asked.

“This research would suggest that in many cases, marketers could find themselves being caught between a rock and a hard place – working and spending on important, meaningful and essential programs and messages that don’t drive sales, despite being measured ultimately on sales growth.”  

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