Instinct: Marketing strategies for sustainable businesses
At Greenblut, we have been working for many years with sustainability-oriented entrepreneurs who put a lot of heart, energy and commitment into developing and building their brands or services. Although the framework conditions for sustainable business concepts seem to be optimal, we come across the same problem again and again:
More and more consumers are looking for green and sustainable alternatives to conventional products. Various studies show that almost 90% of all consumers in industrialised countries would like to buy fair and sustainable products and services. This is actually great news, were it not for the contradiction that in practice many consumers give priority to the conventional range of goods, even though comparable sustainable products or services are better in many respects.
So why is it so difficult to sell green and sustainable products and services that do good?
Read the following introduction to a marketing concept that is specifically relevant for sustainable enterprises.
Let us dive into the research world of Daniel Kahnemann on the topic of "Economics & Behaviour". Daniel Kahnemann is one of the leading researchers and scientists in the field of behavioural economics. In 2002, he was awarded the Nobel Prize in Economic Sciences for his work on "Judging and Making Decisions". His empirical findings challenge some of the basic assumptions about human rationality that are addressed in many modern economic theories. In his famous book "Thinking Slow and Fast". Kahneman describes 2 systems that our brain uses to make decisions. In the following, we will examine these two consumer decision-making systems in the area of tension between "slow" and "fast".
How we make decisions:
Making decisions seems easy at first glance. Most people would agree that this is how the decision-making process plays out:
- we try to get as much information as possible
- we match the information with our preferences
- we weigh the options very carefully against each other
Based on this, we make the best possible decision. This model easily leads to the assumption that one only has to produce a comparatively better product, present its positive characteristics well and the competition with the competitors would be won. It is not that simple! Dr. Kahnemann was able to prove that our decision-making processes rarely run according to this described and very elaborate principle. The reason for this is simple: every day we have to make many thousands of small decisions. It starts in the morning when we get up:
- Should I jump right out of bed or rather activate the "snooze" function?
- which socks do I wear?
- what do i eat for breakfast?
We make countless decisions like this every day. If we had to think intensively about every single decision, our brain would be totally overtaxed and we would get nowhere.
Think about it.... Does it really make sense to run all these little decisions through this complicated decision-making process? Certainly not! We need shortcuts, rituals and automatisms to avoid overwhelm. In his book, Dr. Kahnemann describes that we have two different systems at our disposal for decision-making:
System 1 (FAST): thinks quickly and automatically, intuitively, involuntarily and without effort. Example: this is how we usually steer a car as a practised driver. We also read the facial expression of a person facing us in this intuitive way.
System 2 (SLOW) corresponds to the multi-stage and time-consuming decision-making process described at the beginning of the text. System 2 is particularly suitable for solving complex problems. We are always focused and concentrated. We compare data thoroughly and avoid drawing hasty conclusions. Let's hold on:
Depending on the situation, we use either the fast inzuitive system 1 (Fast) or the slow rational system 2 (Slow).
Business strategists and clever marketeers are aware of the existence of these two systems. They do everything they can to activate their customers' System 1. Remember? System 1 reacts quickly, effortlessly, automatically and without much work. That is why advertising and marketing strategists try to encourage buying habits and automatic decisions in customers. Once product-related habits are established, System 1 automatically takes over and intuitively controls buying behaviour from then on. Look at the diagram and name the brands on the left and the plants on the right. Which system do you use in each case to solve the task?
If you are not a pharmacist or botanist, you will most likely first intuitively and automatically think of the right brand name for the corresponding logos (=System1). In order to be able to name the corresponding plants, most city dwellers who are far removed from nature nowadays have to activate system 2: They try to remember biology lessons or botanical textbooks. They recall stored knowledge about characteristic leaf features, make comparisons between leaves, etc., until they approach a possible result.
In contrast, a large part of our everyday decisions are dominated by the energy-saving system 1. Evolutionarily, we are designed to act efficiently in order to save energy. You can certainly observe this in your own buying behaviour. For example, once a brand of coffee has won our sympathy and convinced us of its quality, it is very likely that we will reach for this product again and again over a longer period of time. This is especially true for everyday products. However, many consumers remain loyal to a particular model or brand for a long time, even with luxury products. Some only buy a Mercedez car, others always go to the South of France in the summer or only book "AIDA" cruises.
Another example would be Steve Jobs, whose "everyday uniform" consisted of a black turtleneck, jeans and sneakers. This allowed him to avoid having to spend energy on his wardrobe decisions every day. What do these findings mean for the marketing strategy of sustainable companies? Stay tuned for the answer in the 2nd part of this series. Learn what is most important in marketing concepts for sustainable businesses to make your brand successful and competitive in a targeted way.