Research Spotlight: Dr. Stefan Wuyts and Dr. Özge Pala

Have you ever wondered if sustainability drives value for business customers and if emphasizing climate-related benefits actually pays off in terms of increased new product sales? Or how those environmentally jargoned messages are landing with business customers?

Sustainability and an environmentally conscious approach to business practices are on the rise, not only in Business-to-Consumer markets but also in industrial Business-to-Business (B2B) markets. When marketing their offerings, B2B firms face the question of whether and how to make climate-related claims. Some customers may not care. Others do care, but are they willing to put their money where their mouths are?

A research project from Dr. Stefan Wuyts and Dr. Özge Pala, Environmental Impact as Value Driver: Customer Preferences for Eco-Friendly Value Propositions in Business Markets, has been granted a fund from the Center for the Business of Sustainability in the amount of $3,000 for collecting survey data to answer these questions and more.

According to Dr. Wuyts, we currently know little about business customers’ perceptions of environmental claims in customer value propositions (CVPs) – most research in marketing has focused on consumer markets while most research in operations management has focused on the supply side rather than the demand side. B2B marketing is uniquely placed to examine how buyers react to environmental claims in CVPs.

In bringing together literature streams on sustainability, organizational purchasing behavior, and value propositions, this research looks to guide firms to develop CVPs that enable them to turn environmental challenges into profitable business opportunities.

Thus far, the research has finalized the qualitative phase and conducted a total of 35 qualitative interviews with managers and executives at B2B companies. The goal of these interviews was to learn more about the value of climate related claims in value propositions, both from the seller’s and buyer’s perspectives.

Preliminary insights from interviews with sellers include what drives sellers to incorporate environmental claims in value propositions – supply chain pressures, institutional context (industry and regulation), their own sustainability goals, and promising downstream business opportunities.

From a buyer’s point of view, answers varied. According to Wuyts, “Some buyers try to lead by example and select suppliers focusing explicitly on sustainability claims (while voicing difficulties overseeing 2nd and 3rd tier suppliers) while other buyers consider sustainability claims in the suppliers’ value propositions merely as justifiers, and they are not willing to make any tradeoffs with price or quality.” Results also found that buyers have different views on the short- and long-term costs or benefits of purchasing environmentally friendly products.

These findings, mixed with reports from literature reviews, allowed Wuyts and Pala to narrow their scope of research. Phases moving forward will look toward using their defined scopes of value – value framing, value claiming, value creation, value delivery, and value appropriation – to decipher alternative approaches for sellers to draft sustainability-focused CVPs and to capture buyers’ tendencies to act upon said CVPs.

To learn more about Dr. Wuyts’ and Dr. Pala’s research, follow along with their project as they develop models for CVP construction in B2B companies.