1. © 2009 by Strategic Business Insights. All rights reserved. Connecting Consumer Motivation and Green Behavior 18 November 2009 David Sleeth-Keppler, PhD Senior Consultant www.strategicbusinessinsights.com

2. 2 Traditional Assumptions about Consumers Consumers don’t think about how their consumption will affect their children’s and grandchildren’s future (their “Consumption Footprint”)

3. 3 Understanding and Encouraging Green Behavior as Business Strategy Concerns for children’s future drive some consumers’ choices Signal of Change No.178: “The Carbon-Conscious Consumer” See also:

4. 4 Traditional Assumptions about Consumers Consumers don’t care about where products come from or how products are made

5. 5 Understanding and Encouraging Green Behavior as Business Strategy Food and agriculture are under increased scrutiny with more consumers demanding healthy and organic options Signal of Change No. 250: “Provenance in the Spotlight”

6. 6 Traditional Assumptions about Consumers Consumers just care about their bottom line

7. 7 Understanding and Encouraging Green Behavior as Business Strategy Some consumers are willing to pay more for green products. Others make savings from green products part of their bottom line (with higher up front investment) Signal of Change No. 337: “Green Motives”

8. 8 Traditional Assumptions about Consumers Consumers just want to get ahead and show off their success

9. 9 Understanding and Encouraging Green Behavior as Business Strategy Conspicuous conservation is becoming a key lifestyle among some segments Signal of Change No. 305: “Conspicuous Conservation”

10. 10 Traditional Assumptions about Consumers Consumers just want to have fun Business Implication = Business As Usual

11. 11 Understanding and Encouraging Green Behavior as Business Strategy Consumers increasingly want to be part of a responsible solution to environmental problems Signal of Change No. 347: “The U.S. Consumer and Global Warming”

12. 12 Broad Opportunities for Change Financial Services Food and Agriculture Healthcare Manufacturing Real Estate Restaurants and Dining Retail and Consumer Goods Telecom and Information Technology Transportation

13. 13 Understanding and Encouraging Green Behavior as Business Strategy Consumers are driven by diverse motivations: “Work is important. But my family and friends is what I live for” “I feel a strong passion to help make this a better world” “I’m interested in the latest trends and fashions” “I crave a lot of excitement in my life” “Oh, I had that dining table built for us at Linden Street” “I’m concerned about the effects of pollution on my family’s health”

14. 14 属性・行動 Demos & Behaviors ハイブリッド 車に 乗っている 33 歳 iMac を持ってい る 女性 見ていなくても いつも TV がついてい る 態度・関心・意見 Attitudes, Interests, & Opinions 暢気に暮らしたい 好きなチームのためなら 、弾丸ツアーも辞さない 野菜は毎日摂るべきだ 心理的特徴 Psychological Attributes 新しいもの好き 衝動的 情報収集志向 What Why A Validated Approach To Understanding Consumers

15. 15 The VALS System What is VALS? -A lens to distinguish consumers -Empirical -Replicable -Validated

16. 16 The Approach: Understanding Consumer Motivation S A T P Pragmatic L Laggard Traditional Achievement Self-Expression CL Change Leading The Basic Contrasts in Motivation Around the World: Basic Question: How do these contrasts translate into effective appeals that promote green behavior?

17. 17 The US VALS System S A T P Pragmatic L Laggard Traditional Achievement Self-Expression CL Change Leading

18. 18 Japan-VALS TM Innovator Early Majority Follower Early Adopter Integrator Sustainer Low Pragmatic Traditional Innovator Traditional Adopter Ryoshiki Innovator Ryoshiki Adopter Self Innovator Self Adopter High Pragmatic Achievement Tradition Self Expression

19. 19 How VALS Can Help Companies: Strategic Marketing: - Birds-eye view of the market - Target selection/position (including new product development) - In-depth profiling/Personas - Messaging (appeals framing, channels, geo location) Multiple Areas of Application

20. 20 Motivational Characteristics of Types Traditional AchievementSelf-expression Are Make Seek Pursue Resist Ask what action-oriented choices that emphasize individuality adventure self-reliance authority do I feel like doing? goal-oriented choices to enhance position approval from valued social group self-improvement risk are others like me doing? information seeking choices based on principles Understanding self-development impulse “should” I do?

21. 21 Motivation & Green Behavior: Some Illustrative Examples Measures electricity one appliance at a time Cost: about $25.00 Monitoring = Information Sell (Traditional) Kill-A-Watt™

22. 22 Motivation & Green Behavior: Some Illustrative Examples The initiative is supposed to promote energy-saving behavior through competition with neighbors Incentives/Competition = Achievement Sell

23. 23 Motivation & Green Behavior: Some Illustrative Examples Young, trendy, action-oriented Sustainable Clothing @ Target = Self-Expression Sell Kill-A-Watt™

24. 24 Recent VALS Studies on Green Topics 2006The American Environmental Values Survey 2007 Calif. Depart. of Conservation Recycling Campaign 2008The American Climate Value Survey 2008Sacramento Municipal Utility Study 2009 Eco-Japan 2009 Program

25. 25 2006 -How Can Environmentalists best message to the public (as opposed to themselves) about eco? -What avenues exist for the diffusion of eco-awareness? (similar to innovation diffusion with products)

26. 26 Definitions of “Environment” Vary: Excitement outdoors Hunting habitat City parks and playgrounds State historical park Global concerns Excitement outdoors Hunting habitat Family fun outdoors

27. 27 2006 Insights Change Leaders (Innovators) can be motivated to solve environmental problems with sophisticated messaging about financial and lifestyle trade-offs —The “Rest of America” (ROA) requires a different approach that represents an incremental adaptation of their familiar lifestyles—and for some a “slow” adaptation of tradition Achievers are the weak link in the chain because they don’t emotionally connect with the problem (and have too many competing priorities) —Have softer, less committed positive environmental attitudes —Follow the status quo; give more credit to big business —Don’t really get the health connection

28. 28 2006 Insights For Thinkers consumer behavior is the easier path; stronger hurdle with political behavior —Motivated by “Total Cost of Ownership” regardless of party affiliation —Willing to make incremental changes; new evidence provides motivation to reevaluate Experiencers have an erratic profile consistent with their personalities —The least motivated to engage in mainstream green behavior because lots of people do it and it’s ‘slow’ —Want to be inspired

29. 29 2007 PROJECT GOALS Raise the curb-side recycling rate from 65% to 80% OBJECTIVES Identify drivers for recycling Match VALS consumer segments with recycling drivers Identify and prioritize strategic options Develop 1-3 specific actions for implementation

30. 30 Survey Finding: Achievers Recycle Primarily from the Car Percent INTHACSVEXMKSUBE This makes sense relative to the time they spend on the road with family. Here, too, most groups could improve their recycling.

31. 31 Target = Achievers 31 Seek positive evaluation from their peers Status conscious

32. 32 “Brothers” MAN: My brother and me…not too much alike. Like the other day when he was visiting, he was shocked to see me carry the recycling bin out to the curb. He asked if I had turned over a new leaf. I said no — I’m still the yin to your yang, brother. I just don’t like seeing all those empty bottles and cans sit there and become nothing. So I toss ‘em into the bin. Then I suggested he hop in there, too. And pointed out that he might actually become something one day. ANNCR: Recycle. It’s in your hands. To learn more, visit bottlesandcans.com. Ad created by For CA Dept of Conservation Radio Ad:

33. 33 How Would You Target Action-Oriented Consumers?

34. 34 2008 PROJECT GOALS Diagnose global warming attitudes specifically OBJECTIVES Identify appeals to message about global warming to different consumer types Identify and prioritize strategic options

35. 35 Key Findings The ACVS showed that only 18% of U.S. consumers strongly agreed that global warming is happening, is harmful, and is caused by humans. Why such low levels of support? -The “Partisan Divide” -Cultural Gender

36. 36 A Frame of Reference Feminine 女性的 やさしい Masculine 男性的 タフな High Status Low Status Positive Attitudes Towards Global Warming Problem Negative Attitudes Towards Global Warming Problem

37. 37 What Was Missing? Maker lifestyles Many males work in trades as carpenters, electricians, plumbers, and repair people The epitome of “do-it-yourselfers” Enjoy being helpful to neighbors and buddies Spend time in nature camping, hunting, and fishing Many live outside of urban areas where home prices are lower, home lots are larger, and where they can “build” the type of life they enjoy Prefer country music (story) and rock (masculine) music over classical music or public radio

38. 38 ecoAmerica Responded:

39. 39 The Alliance for Climate Protection Responded:

40. 40 California Department of Conservation Campaign: “Stand For Less” Target = Thinkers

41. 41 California Department of Conservation Campaign: “Stand For Less” Target = Achievers

42. 42 2008 Identify Targets for Energy Efficiency Programs

43. 43 2009 Eco Japan Diagnose Environmental Attitudes (including Global Warming) in Japan Identify Appeals to Message to Different Consumer Groups about the Environment Find Opportunities for Green Business Growth

44. 44 Trendy Trad High Status Low Status Global warming is a traditional issue in Japanese society 日本の文化の中では、「地球温暖化」はトラッドな課題

45. 45 女性的 やさしい 男性的 タフな High Status Low Status 日米双方の文化の中で、 「地球温暖化」は女性的な課題 Global warming is culturally feminine in Japan, too

46. 46 Motivational Contrasts: Integrators 革新創造派 Can be actively green but hard to target as they constantly pursue change 積極的な「グリーン活動」を行う 可能性はあるが、常に変化を追い 求めるので、ターゲットには向か ない Ryoshki Innovators 社会達成派 Strongly motivated by green ideals and novel eco-living solutions 「グリーン活動」の理想や、新し いエコ生活の方法等によって、強 く動機付けされる Self Innovators 自己顕示派 Self-interest is a strong barrier (e.g. I can’t be bothered with this stuff); emphasize ‘new and exciting’ 自分の興味関心がエコ活動への障 壁。（そんなことに関わっていら れない） 新規性と刺激を強調す るのが鍵。 Traditional Innovators 伝統尊重派 Their “ideas” of being green are stronger than their behaviors グリーン活動への「思い」の方が 、実際のグリーン行動よりも強い 。

47. 47 Agree to: Sorting out garbage is an annoying chore 6/29 The constant reminders about sorting out garbage are driving me crazy 3/16 I am tired of being told to do good things for the environment 5/20 I get bored when people talk about environmental issues 5/20 EcoJapan, Winter 2009 Stop Bugging Me! うるさく言うのはやめてくれ ゴミの分別は面倒な雑用だ。 6/29% いつもいつもゴミ分別をするように言わ れると、イライラする。 3/16% 環境に良いことをしなさいと言われるの に、飽き飽きしている。 5/20% 環境問題についての話を聞くのは、飽き 飽きしている。 5/20%

48. 48 Percent Base = 25% of adults Note: The graph represents the top 25% of the factor score distribution by JVALS EcoJapan, Winter 2009 Self Innovators are more likely to reject being told what to do 革新 | 伝統 | 伝 A | 社会 | 社 A | 自己 | 自 A | 同調 | 雷同 | つましい

49. 49 CSR Items: Company funds the planting of trees to protect mountains and rivers Company has reduced CO2 emission at their offices and factories. Company uses clean energy to power their shops and/ or factory Company spends money on innovation for environmental solutions Company restrict itself with higher quality control standard than the regulation requires Company collaborates with local community for eco-friendly activities. Company currently donates money to environmental causes EcoJapan, Winter 2009 山や水源の保護のための植林に資金を 提供している。 自社のオフィスや工場でＣＯ２の削減 を行っている。 自然エネルギーを店や工場で使ってい る。 環境対策の革新のために、資金投資し ている。 法律で規制されているよりも高い品質 管理基準で、自社を管理している。 地域コミュニティと協力して環境活動 を行っている。 環境のために寄付をしている。 Pro-Active and Environmentally Focused 1/2

50. 50 EcoJapan, Winter 2009 CSR Items (continued): Company collaborates with customers for eco-friendly acts (for instance, asking customers to bring their own eco-friendly bag) Company has no regulation violations Company uses less natural resources in their manufacturing than competitors Company contributes funds to people in need (for instance, poor or sick) Company funds/support environmental education for children Company creates jobs for their local communities お客様と協力して、環境に優しい活動 をしている（たとえば、お客様に自分 のエコバックを持ってくるようにお願 いする）。 法律（規範や規則）を守ることを徹底 している。 競合企業よりも、製造工程で天然資源 を少なく使っている。 困っている人たちに資金支援を行って いる（貧困や病気など）。 子供を対象とした環境教育を支援・資 金提供している。 地域の雇用創出に貢献している。 Pro-Active and Environmentally Focused 2/2

51. 51 Percent Base = 25% of adults Note: The graph represents the top 25% of the factor score distribution by JVALS EcoJapan, Winter 2009 RI’s most strongly relate to Pro-Active CSR, RA’s follow their lead High Prags needs a reason to care. 革新 | 伝統 | 伝 A | 社会 | 社 A | 自己 | 自 A | 同調 | 雷同 | つましい

52. 52 Agree to: I believe that prevention of global warming and comfortable temperature at home go together 15/64 Exporting green technology is the best way for Japan to get ahead in the global economy 25/57 Environmental jobs will boost the economy 12/56 Environmentally friendly lifestyle sounds like a good way to live, not a sacrifice 12/54 EcoJapan, Winter 2009 地球温暖化への対応と家で快適に暮ら すことは両立できると思う。 15/64% 環境技術（太陽電池、風力発電など） を世界に広めることが、日本が世界経 済で先んじるための最善の道だ。 25/57% 環境関連の仕事が、経済を活性化させ るだろう。 13/56% 「環境に優しい生活スタイル」とは、 犠牲を払うことではなく、気分良く生 活することだと思う。 13/54% No Sacrifice/No Compromise 妥協なし / 犠牲なし

53. 53 No Sacrifice is polarizing; TI, RI and Integrators lead on seeing the upside Percent Base = 25% of adults Note: The graph represents the top 25% of the factor score distribution by JVALS EcoJapan, Winter 2009 Likely SI’s will relate to this perception if packaged in way they can uniquely own. 革新 | 伝統 | 伝 A | 社会 | 社 A | 自己 | 自 A | 同調 | 雷同 | つましい

54. 54 Current Plans for Eco Japan 2010 Multi-Client effort with private workshops Follow-ups and refinements of 2009 data and insights Open Questions: -Which of the appeals/strategies implemented in your company worked? -Are companies gaining further momentum with green activities? -Anticipating future eco needs and consumer attitudes -Developing deeper profiles of lifestyle contents that are in competition with green behaviors

55. 55 Appendix

56. 56 Innovator Lifestyles Engage in a wide range of activities Committed to life-long learning; avidly read literary, scientific, and business magazines Travel frequently for pleasure and business Support the arts and public-funded media Contact public policy makers and elected officials

57. 57 Equally smart but less sophisticated than Innovators Value substance over aesthetics; less concerned about fashion and style than utility and value Enjoy process, discussion, and debate Avid readers of non-fiction books, scientific, and topical magazines Listen to, and support, public radio Volunteer and contribute to social organizations Exercise for health Thinker Lifestyles

58. 58 Achiever Lifestyles Set goals and have agendas; run everything right on time Buy products that increase efficiency and productivity of work and family life Dress fashionably but not fashion-forward

59. 59 Experiencer lifestyles Youngest VALS group; over half are single Have large social networks Want to look good—personal packaging; form over substance Can express themselves “loudly” Are impulsive buyers Look for settings and activities that are unusual, fun, or exciting Want to be first