ESG at HBS

Last week I had the pleasure to present, with 4 colleagues, to the amazing marketing faculty at the Harvard Business School. As we were each asked to showcase our best work, the camp unintentionally turned to Better Marketing for a Better World, and I can highlight the takeaways as ESG:

1) Environment: Karen Winterich on the circular economy;

2) Social: Andrew Stephen on inclusive ads, and Anna Tuchman on the pink tax;

3) Governance: Puneet Manchanda on platforms suggesting prices to sellers;

and of course our own work on how consumers and investors react to E, S and G.

Karen discussed the circular economy, focusing on the first line of defense: REPAIR.

 Consumers only repair when they see utility remaining in a broken product. Companies can signal such utility by offering paid repair services. Such brand certified services are more costly to the brand manufacturer, and therefore send a stronger signal than third party repairs. Indeed, the repair conversion rate is much higher for such certified landing page:

However, the repair effect goes away when the company substantially upgrades the product, as is the recent case for the Nintendo Switch:

How about when the product has sentimental value?

As expected, third party repairs score as well as brand certified ones:

Next, Andrew Stephen works with UN Women towards more inclusive advertising:

Does inclusive advertising improve effectiveness? Or do brands go broke when they go woke?

Data was provided by 392 brands in 58 countries over 4 years:

The researchers separate the effect on brand building and sales volume:

And find substantial brand sales lifts in the short term, and especially the long term:

How about brand attitudes? A third uptick in Consideration and two thirds in First Choice. Pricing Power, Trial, and Loyalty incrase while brand abandonment decreases:

And brand equity drivers increase, especially differentiation:

The bottom line: persistence in inclusive advertising pays off:

As my final feature of this Newsletter, Anna Tuchman analyzed the effect of the pink tax law in New York:

But DO women pay more for personal care products?

Yes in general: about 20% more. However, this is across all brands and formulations! Many women-targeted products have more expensive ingredients, which is why the pink tax law only requires SIMILAR products to have the same price.

Controlling for such differences, there is no consistent evidence for a pink tax. As a result, the pink tax law had little if any effect on the prices of personal care products in New York.

And of course, you can find out how consumers vs investors react to ESG performance with our own research on the topic.

All in all, a VERY insightful and delighful marketing camp. Thanks so much, Harvard Business School and all the participating scholars!