How B2B market research can influence your ESG strategy

Key takeaways: B2B market research can inform and shape your ESG strategy in several ways. Internal research highlights what key stakeholders and talent are looking for, while customer research helps you tailor an ESG strategy to their wants and needs. In this guide, we share best practices for ESG strategy research in B2B.

There are many reasons why B2B companies need to get their environmental, social, and governance (ESG) strategy right. A strong ESG strategy can influence B2B buyers’ behavior and decisions.

Most (73%) would pay more to firms with a strong purpose, compared to 48% of B2C buyers, reports the American Marketing Association in its Future of Marketing report.

The best ESG performers see faster growth and have at least 10% higher company valuations, claims McKinsey.

It’s not just customers who care. Increasingly, employees focus on ESG, with talent retention and acquisition at stake.

A recent study from Marsh McLennan found that employers with the highest staff satisfaction had significantly higher ESG scores than their competitors.

But developing a successful ESG strategy is a challenge, with many ready to scrutinize it and express scepticism – particularly younger B2B buyers. In the US, 88% of Gen Z say they don’t trust brands’ ESG claims, according to McKinsey.

Using market research to develop—and crucially, test—your outputs when creating an ESG strategy increases its chances of being embraced by B2B buyers and internal stakeholders. 

It also gives the target audience opportunities to see their views represented in a meaningful, purposeful way.

What is an ESG strategy?

A common trap is to only think about ESG efforts in terms of one aspect – often environmental sustainability. ESG represents three areas promoting the sustainable development of companies, with PWC providing a helpful breakdown for an ESG framework:

Environmental:

• Carbon emission reduction
• Energy savings
• Circular economy

Social:

• Customer satisfaction 
• Employee satisfaction
• Human rights
• Equality
• Diversity

Corporate governance:

• Body structure
• Compliance
• Risk management

Also, the UN provides another framework to base ESG metrics on. It has 17 sustainable development goals including areas such as education, equality, global poverty, human rights, health, infrastructure, and work opportunities.

To simplify this, many businesses prioritize the 3Ps – planet, profit, and people:

• Planet – environmental concerns including pollution and using up resources
• Profit – economic concerns including poverty and job creation
• People – social concerns such as labor practices, staff welfare, and fair trade

For a broader model, the 6P framework is a simpler way to think about ESG: Planet, people, product, packaging, profit, and promoting green practices.

In the next sections, we’ll explore two different overall approaches you can take with ESG market research

1. Informing your ESG strategy through stakeholder research
2. Tailoring your ESG strategy to customers’ views and needs

Informing your ESG strategy through stakeholder research

Interviews in market research often have a broad focus at the outset before diving into more specific topics in much greater detail.

While a successful ESG strategy has many parts, it’s challenging to gain meaningful insights into many different topics simultaneously.

Here are three examples of the approach you could take to collect feedback from key stakeholders internally, but there will be others too:

• Draft ESG strategy creation and testing
• Employee satisfaction research
• Diversity, equity, and inclusion (DEI survey)

The first is the broadest option for informing overall ESG strategies but may provide less detail on specific elements. The second and third examples each explore one aspect of ESG in great detail.

#1 Draft ESG strategy creation and testing

In-depth interviews explore senior stakeholders’ views in detail, helping B2B companies create ESG strategies that encompass what they expect to see.

Once you have the draft ESG reporting guidelines, you could use structured interviews to seek stakeholder feedback and validate the strategy.

Again, in-depth interviews may be the best way for key individuals to evaluate the policy rigorously.

To collect feedback from a large group of stakeholders, a survey can provide the validation you need to vote the strategy through.

Internal surveys work well to explore one-off developments with an ongoing impact, such as policy changes.

#2 Employee satisfaction research

Employee satisfaction falls under the scope of ESG criteria, but some stakeholders overlook this in favor of other social aspects.

However, studies like this one show that satisfied staff are up to 20% more productive – while a satisfied sales team can improve sales by up to 37%.

Topics to cover include satisfaction with

• Their role
• Their department
• Company culture
• Management
• Salary
• Career progression

It’s important to seek participation company-wide, ensuring you hear from everyone and that the feedback is truly representative.

#3 Diversity, equity, and inclusion (DEI survey)

Understanding to what extent your employees feel included and treated fairly at work is an important part of ESG.

Following on from an earlier point, there’s also a clear link between a company’s employee satisfaction and financial results.

Companies in the top 25% for diversity outperform others in terms of profitability, according to research from McKinsey.

Businesses running a DEI survey tend to do so once a year. Views on representation, equality, decision-making, hiring, promotions, and leadership are important topics to include.

Tailoring your ESG strategy to customers’ views and needs

Here, questioning should focus on how your buyers’ attitudes toward providers’ ESG influence their supplier choice, purchase process, product usage habits, etc.

Similar to how you might research customers’ buying process to inform your B2B ecommerce strategy, you can do the same to inform ESG strategies.

You could also explore how ESG progress impacts brand reputation in your sector. In financial services, a perception tracking study may find a link between brand health and your ESG investing stance, for example.

For customer ESG research, while age in B2B research isn’t always a segment that matters, to develop an ESG strategy, there’s a strong case to include it. 

As covered earlier, younger age groups are the toughest customers to impress in this area, and Millennials may represent up to 70% of employees by 2025, Oban International claims. 

With many in these age groups in decision-making roles, including age breaks in customer ESG research may provide important context for the results

Best practices for ESG strategy market research in B2B

#1 Consider regression analysis to identify overstated ESG claims

Regarding ESG principles, some people will overstate how important they actually think it is to ‘look good’ in front of peers. 

And in addition, buyers can’t always articulate accurately how they really make purchase decisions. Sometimes, they over-rationalize the importance of specific criteria.

To get around this, you can run regression analysis on quantitative research to see statistical connections between answers to different questions.

Then you can analyze the trade-offs and derived importance of purchase criteria, including ESG metrics, on supplier or product choice.

#2 Explore the role of emotions in B2B decision-making

Traditional research often focuses on respondents’ logic or reason in their decision-making processes, because that’s what they’re more aware of.

Using projective questions in qualitative research helps respondents describe what matters most to them indirectly—for example, by asking them to imagine future or ideal scenarios. 

By giving instinctive, unfiltered answers, respondents often reveal their true motivations, biases, and emotions.

There’s plenty of evidence that emotions affect B2B buying behavior. For an emotive topic such as ESG, it’s useful to get insights into how their subconscious impacts decisions.

#3 Look for different views among decision-makers and end-users

A typical B2B purchase can involve several different stakeholders. If that’s the case in your sector, you may need to account for their different priorities in your research.

For example, end-users may prioritize the quality of service far above any other purchase criteria. However, the lead decision-maker who signs off the purchase may have a target to reduce their company’s carbon footprint significantly.

Therefore, they prioritize the service with the most environmentally friendly credentials. If that’s the case, consider conducting sustainability research to learn more.

Sometimes in B2B, you could be trying to convince a broad set of stakeholders to choose your company over others:

• Lead decision-maker
• Decision influencers
• Purchaser/procurement
• End-user

But in other cases, the purchaser and end-user may be the same person, simplifying things.

Knowing which roles are involved in your buyers’ decision-making units is important. For customer ESG research, ensure the right roles participate to inform your next steps.