This article will examine Green USPs for SMEs, which stands for Green Unique Selling Points for Small and Medium Enterprises.

Recently, environmental and sustainability issues have been elevated throughout society. This has fundamentally changed the marketing environment where enterprises of all sizes operate. ‘Green marketing’ is a wide-ranging process that ranges from outward-facing, environmentally friendly branding to elemental product development. It is relevant throughout industries, with sustained societal pressure as well as governmental regulation and incentivisation. 

Organisations and brands that are or claim to be environmentally conscious ultimately represent a spectrum. This spectrum ranges from holistic green products/services to recyclable material labelling. Some brands participate in and promote green initiatives and/or support green causes with direct financial support from sales.

Businesses now recognise the benefits of green USP (Unique Selling Point).

Green Marketing: Exclusive to Big Brands?

The conventional view of environmental sustainability was that it was an expensive preserve for large companies that could absorb additional costs. Some SME operators still hold this view. However, there is long-standing evidence that embracing sustainability can increase profits and productivity even in smaller operations.   

In recent years, various environmental and sustainability-related measures have been adopted across industries, particularly more significant businesses. Moreover, there has also been the emergence of an expanding green economy, with several sectors, including renewable energy. 

But environmentalism’s reach is far more wide-ranging than this, with most large companies endeavouring to undertake systemic environmental reviews. This involves carrying out environmental impact assessments across these businesses’ operations and supply chains. Businesses often use these environmental assessments to understand where environmentally friendly alternatives can be instituted.

Further, it also enables businesses to balance output with environmental harm. This can alter business operations, processes, and supply chains. Amazon is a central example of this, emphasising a climate pledge for energy usage, sustainable operations, improved packaging, and an ethical supply chain. The brand then uses these environmental measures as central to its communications strategy.

A further example of this environmental focus is McDonald’s plant-based meat alternatives. Like Amazon, McDonalds uses these ecological measures as a central part of its marketing strategy. This is complemented by communications around organic sustainability concerning its meat-based product offerings. 

These ever-growing sectors have impacted more traditional industries, such as the fossil fuel industry, which must evolve through consumer and regulatory demand. This has provided a backdrop for SMEs, with suppliers and buyers moving more sustainably. Although, typically, SME operations don’t have the environmental footprint of larger entities, they still can have a notable impact. The recognition of such an impact can provide SMEs with significant commercial opportunities, as exemplified by big brands such as Amazon and McDonalds.

Consumer Attitudes and Demands

Alongside increased governmental regulation and incentivisation, there are increasing consumer demands on brands relating to environmental responsibility. In 2020, Deloitte UK released a report on ecological attitudes among consumers. It found that 43% of consumers chose brands due to their ecological values. Moreover, the same study found that 38% of consumers have reduced the amount of products and goods they buy. 

These findings assert that many consumers consider the environmental profile of a brand they engage with. SMEs must consider how they can project environmental profiles that facilitate capturing this consumer base. As such, SMEs need to consider streamlining their marketing towards these consumers who spend less freely.  

SMEs: What is Developing a Green USP?

The consumer context in which SMEs operate has changed in recent years. Established multinational brands dedicate large portions of their marketing budget to projecting a sustainable and environmentally conscious image. Therefore, it is important that SMEs engage in similar activities, albeit at a far smaller scale, to effectively engage modern consumers. This can be achieved in several ways. At a basic level, simple measures like eliminating unnecessary single-use plastic can help change a small brand’s image.

Further, spending slightly more on packaging to ensure it’s fully recyclable can elevate products in the minds of some consumers. Moreover, general recycling incentives among staff can help project a sustainable image and efficiency. This staff environmental incentivisation is particularly relevant, as it encourages staff to act as environmental ambassadors within SMEs. This is then projected into interactions with customers. 

Furthermore, a simple measure like an SME investing in renewable energy can be harnessed to save money in the long term and act as an effective marketing tool. Fundamental to SMEs developing green USPs is a willingness to use simple environmental steps in their operations and use them as a central part of their communications. A key part of this strategy is effectively harnessing digital platforms to engage a younger demographic and educate them on issues of the environment and sustainability.

Green SMEs in the Hospitality Sector 

The hospitality sector is a broad, international industry encompassing businesses and brands of varying scales. The industry has a significant environmental impact through high food consumption and energy usage. An essential move within the sector has been towards brand differentiation through environmentalism and sustainability. Consumers increasingly consider environmental factors when purchasing in the hospitality sector, particularly younger demographics. A 2020 IBM study found that 41% of consumers look for brands that use organic ingredients. This gives an insight into the utility of elevating the sustainability of ingredients for SMEs to engage consumers. 

Furthermore, recent years have seen the emergence of the ecotourism industry. This sub-industry is centred on boasting environmental credentials as a fundamental USP of individual businesses. It encompasses corporate and independent enterprises and is an outgrowth of the increase in emphasis on corporate social responsibility. 

Heckfield Place – Hampshire

A key example of the ecotourism industry is Heckfield Place in Hampshire, England. This hotel’s USP includes its biodynamic principles, biomass energy production, and innovative composting system. 

Silo – London

Another example of effective green USPs is Silo, the UK’s first zero-waste restaurant, whose composting machine generates 60kg of compost from its food scraps every day. 

Wild Food Café – London

London’s Wild Food Café serves organic products and uses only eco-friendly and biodegradable materials. Uniquely, this example adds 99p to bills to help plant a fruit tree in the developing world.

Green SMEs in the Retail Sector

The retail sector has been criticised due to environmental concerns surrounding the ‘fast fashion’ industry. This provides opportunities for SMEs in the sector to differentiate themselves fundamentally through sustainability principles. A 2020 study from McKinsey and Co. found that 63% of consumers consider a brand’s promotion of sustainability an important purchasing factor. This asserts the utility of smaller brands engaging in green principle emphasis to compete for consumers’ attention against less environmentally conscious large multinational competitors.

This is reflected in the rise of responsible fashion brand Nobody’s Child, which has become a significant part of women’s fashion in the UK. This brand emphasises its sustainability goals and lays out a responsible brand commitment, which includes standards on sustainable materials and waste reduction. There is also a growing recognition of consumer concern for sustainability among established large retailers such as Asos. As a retailer, they have moved to 100% recyclable bags. 

A 2020 study from RSA found that 35% of women intend to buy fewer clothes in the future. This asserts the impact of the increasing expectation among consumers that quality rather than quantity will likely help characterise the future retail sector. Further, the research also found that during the COVID-19 pandemic, 28% of people were recycling or reusing more clothes than usual. This allows smaller clothing brands to engage consumers on sustainability and durability rather than price, helping level the field against larger, lower-priced competitors. 

Moreover, research conducted in 2020 by IBM found that 57% of consumers are willing to change their purchasing habits to help reduce negative environmental impact. This may allow SMEs to engage consumers who have previously ignored their business because of the negative connotations that large retailers hold regarding sustainability in the future.

Summary: Green USPs for SMEs

The creation of green USPs for SMEs is a process that can be systemic or relatively simple by implementing a few initial steps. It is more concerned with a business’s overall identity and operations than just its marketing efforts, as green marketing should act more as a compliment. There is clear evidence that consumer expectations and demands are changing, and with that comes a level of opportunity for SMEs across sectors. In a crowded digital marketing space, SMEs must look to provide clear and unique communications to stand out. Moreover, a green USP and clear communications around this can help engage consumers in such an environment.