Belz, F. ( 2006 ). Marketing in the 21st Century.

Business
Strategy and the Environment, 15 (3) pp. 139-144. (AR87549)

Business Strategy and the Environment

Bus. Strat. Env. 15, 139–144 (2006)
Published online in Wiley InterScience
(www.interscience.wiley.com) DOI: 10.1002/bse.529

Editorial
Marketing in the 21st Century
Frank-Martin Belz*
Technical University of Munich (TUM Business School), Germany
Received 3 January 2006; revised 8 February 2006; accepted 8 February 2006

MAGINE THE YEAR 2099: A BOOK IS PUBLISHED BY A FAMOUS MARKETING HISTORIAN. THE FIRST PART

I of the book is about the rise and the development of consumer goods marketing in the industrial-
ized world during the 20th century. The second part of the book deals with the ambivalent role of
marketing in the light of sustainable development and the redefinition of marketing during the 21st
century: Sustainability marketing is born! It is taught in business schools all over the world and put into
practice. Sustainability marketing fosters sustainable products and services. It helps developing and dif-
fusing major sustainability innovations such as passive houses, renewable energies, fuel cell cars, com-
bined mobility, organic food and fair trade products. It promotes new lifestyles, which are modern and
less materialistic. . . .
However, at the beginning of the 21st century, sustainability marketing is far from being realized in
practice and explored in theory. The special issue ‘Sustainability Marketing’ gives some new insights
into this rising and fascinating field of research. It aims at clarifying the concept of sustainability mar-
keting and inspiring further research in this area.
Marketing is generally defined as building lasting and profitable customer relationships (Kotler and
Armstrong, 2004, p. 5). Marketing analyses customer needs and wants, develops products that provide
superior value and prices and distributes and promotes them effectively to selected target groups. If
marketing is about satisfying customer needs and building profitable relationships with customers,
sustainability marketing may be defined as building and maintaining sustainable relationships with
customers, the social environment and the natural environment. By creating social and ecological value,
sustainability marketing tries to deliver and increase customer value. Sustainability marketing aims
at creating customer value, social value and ecological value. Similar to the marketing concept,
sustainability marketing analyses customer needs and wants, develops sustainable products that
provide superior value and prices and distributes and promotes them effectively to selected target groups.
Unlike conventional marketing, sustainability marketing integrates social and ecological aspects
throughout the whole process. The managerial approach of sustainability marketing differentiates six
steps (Figure 1): analysis of socio-ecological problems; analysis of consumer behaviour with special
respect to socio-ecological aspects; normative sustainability marketing; strategic sustainability market-
ing; instrumental sustainability marketing and transformational sustainability marketing (Belz, 2005).

* Correspondence to: Prof. Dr. Frank-Martin Belz, Technical University of Munich (TUM Business School), Professorship of Brewery and Food
Industry Management, Alte Akademie 14, 85354 Freising, Germany. E-mail: Frank.Belz@wi.tum.de

Copyright © 2006 John Wiley & Sons, Ltd and ERP Environment
140 F.-M. Belz

1. Step: Analysis of 2. Step: Analysis of

Socio-ecological Problems Consumer Behavior

3. Step: Normative
Sustainability Marketing

4. Step: Strategic
Sustainability Marketing

5. Step: Instrumental
Sustainability Marketing

6. Step: Transformational
Sustainability Marketing

Figure 1. Conception of sustainability marketing (Belz, 2005, p. 3)

The point of departure in sustainability marketing is the thorough analysis of social and ecological
problems, generally and specifically regarding products that satisfy customer needs and wants. Here the
whole product life ‘from cradle to grave’ respectively ‘from cradle to cradle’ has to be taken into account.
Life cycle assessment (LCA) is an appropriate instrument to analyse the environmental impact of
products. The relevance and importance of social and ecological issues vary from one product category
to the other. Take, for example, beverages: fair trade with third world countries is a key issue in the
coffee market; obesity is becoming increasingly important for sugared soft drinks and in the case of
milk products the main issues are organic farming, genetically modified organisms (GMOs) and pack-
aging. The relevance and importance of socio-ecological issues is socially constructed and not purely
scientific. Mass media plays a significant role in determining which issues receive high or low attention
by the general public. Based on the ‘issue-attention cycle’ of environmental concerns in Western Europe
and North America, John Thøgersen shows in his contribution to the special issue that positive stories
about ‘green’ businesses (eventually) lose newsworthiness. Due to the boredom with the traditional,
predominantly positive way of framing green businesses, new and competing framings become
newsworthy: denying or downplaying ecological problems, reporting on ‘black sheep’ and presenting
‘green’ business in a negative light have gained more attention in mass media since the turn of the
millennium.
The second step of sustainability marketing is the analysis of consumer behaviour, which includes
the purchase, use and post-use of products. The main body of marketing literature focuses on the process
and act of buying (Kotler and Armstrong, 2004, pp. 178–205). In the context of sustainability, all three
stages of consumer behaviour are important: many significant contributions that consumers can make
towards environmental and social quality come in product use, maintenance and disposal, or in delay-
ing a purchase or avoiding it altogether (Peattie, 1999, p. 66). Sustainable consumption considers eco-
logical and social criteria in the purchase, use and post-use of products. Balancing ecological, social and
economic criteria is not an easy task for consumers. Seonaidh McDonald and Caroline J. Oates asked
British consumers to place 40 sustainability activities (e.g. insulation, turn down the heating, use public
transport, car sharing, ethical banking) on a matrix according to ‘perceived effort’ and ‘perceived dif-
ference to the environment’. One interesting and important empirical result is how few activities were

Copyright © 2006 John Wiley & Sons, Ltd and ERP Environment Bus. Strat. Env. 15, 139–144 (2006)
DOI: 10.1002/bse
Editorial 141

perceived in a similar way by the interviewees. For example, ethical banking was regarded as making a
lot of difference and being little effort by one-quarter of the respondents, making a lot of difference but
being a lot of effort by another quarter, making little difference and being little effort by the third quarter,
and making little difference but being a lot of effort by the remaining quarter. Based on the perceptions
of the sustainability activities, seven consumer types can be differentiated (optimists, pessimists, no
trouble, too much trouble, cherry picker, chicken or egg, and balanced), which offer the basis for a new
kind of market segmentation.
Normative foundations of sustainability marketing are corporate sustainability statements, guidelines
and principles, which are to inform and build trust, both internally and externally. Well intended cor-
porate sustainability statements and codices are of little use, if they are not integrated in the goal-setting
process. The socio-ecological objectives in sustainability marketing can be qualitative (e.g. the enhance-
ment of hybrid cars) or quantitative (e.g. the introduction of fuel cell cars in year 2010, and 20% of total
revenues with fuel cell cars in year 2020). Sometimes ecological, social and economic objectives are
complementary. However, in many cases there are trade-offs between ecological, social and economic
objectives – in the short term and in the long term – which have to be solved by marketing managers
in a responsible way. Finding the right balance between ecological, social and economic goals is a
demanding challenge and a continuous process.
On the strategic level of sustainability marketing there are two main issues to consider for marketing
managers: targeting and positioning. By definition, sustainable products make a contribution to the solu-
tion of socio-ecological problems. They have a (competitive) advantage over conventional products with
respect to socio-ecological criteria. Generally, there are three possibilities to use a unique sustainability
selling proposition (USSP). First, the socio-ecological dimension plays quite an important role in the
positioning of sustainable products. The socio-ecological advantage is communicated as the primary
benefit; performance and price are secondary benefits. Second, the socio-ecological dimension plays a
significant role, but it is not dominant. It is treated equally to performance and price. Third, the socio-
ecological dimension is an integral part of quality and performance. The USSP depends on a number
of influencing factors such as consumer preferences, competitive offers and brand assortment. The first
positioning may be suitable for small pioneers following a niche strategy and aiming at the core cus-
tomer group, which is socio-ecologically active. The second positioning aims at customer groups that
can be socio-ecologically activated. If companies manage to combine the socio-ecological dimension with
classical (buying) criteria such as performance, functionality, design, durability, taste, freshness and so
on to ‘motive alliances’, these customer groups are open for sustainability innovations. In many markets
they represent important, growing segments. The third positioning might be suitable for companies that
aim at the mass market. The social and ecological performance of a product is value added ‘for free’ to
the customer.
Sustainability marketing is usually targeted at the ‘global consumer class’, which has incomes over
$7000 of purchasing power parity and whose members are typically users of televisions, telephones and
the Internet, along with the culture and ideas that these products transmit (Gardner et al., 2004, p. 6).
In their contribution to the special issue Manfred Kirchgeorg and Monika I. Winn develop a concept of
sustainability marketing for the poorest of the poor. Based on the ‘bottom of the pyramid’ approach by
Prahalad (2005), the authors reconceptualize global poverty as an attractive growth opportunity for mar-
keting, which can simultaneously alleviate the problem of poverty.
To implement sustainability marketing strategies, a consistent marketing mix has to be developed
aiming at particular target group(s). At the heart of sustainability marketing are sustainable products,
which reduce the impact on the natural environment, consider social aspects and satisfy customer needs
better than competing offers do. Sustainable products are defined as products that have a higher socio-
ecological efficiency than other products in the same category. By definition, sustainable products are

Copyright © 2006 John Wiley & Sons, Ltd and ERP Environment Bus. Strat. Env. 15, 139–144 (2006)
DOI: 10.1002/bse
142 F.-M. Belz

not absolute, but relative measures in dependence on the status of knowledge, latest technologies and
societal aspirations, which change over time. Credibility and trust are of special importance in the market
for sustainable products. According to information economics, there are three different kinds of product
quality: search, experience and credence qualities (Darby and Karni, 1973). Search qualities can be
inspected by the customer prior to the purchase of a product (e.g. price). Experience qualities can be
experienced by the customer after the purchase of the product (e.g. taste). Credence qualities cannot be
inspected or experienced by the customer – either before or after the purchase of the product (e.g. organic
farming or labour conditions of workers in third world countries). The customer has to believe the infor-
mation given by producers or third parties with respect to the socio-ecological qualities of products.
These kinds of information asymmetry open the door for opportunistic behaviour on the supply side,
which may lead to scepticism on the demand side and, finally, to non-purchases and market failure.
This is why credibility, reputation and trust play quite an important role in the communication of sus-
tainable products. Possible ways to inform the consumer and overcome scepticism are: the use of third-
party labels, personal commitment of the founder, voluntary self-bindings and partnership with
governmental and non-governmental organizations (e.g. UNICEF and WWF). Katharina Sammer and
Rolf Wüstenhagen show in their survey of Swiss consumers and by means of a discrete choice analysis
that eco-labelling influences consumer behaviour and increases the willingness to pay. Another way of
providing information and overcoming scepticism is personal communication, which plays a significant
role in the case of ethical investment. Ulf Schrader presents the empirical results of a mystery shopping
study in Germany, which reveals that large retail banks are not yet ready to act as diffusion agents for
ethical investment. They only provide ‘ignorant advice’ for ethically oriented investors. By positioning
ethical funds as a key element in their existing product portfolio, informing their personnel about
their ethical funds and setting sales targets accordingly, German retail banks can overcome these
shortcomings.
Transformational sustainability marketing (Belz, 2001, pp. 91–99) is about the active participation of
companies in public and political processes to change the existing framework in favour of sustainabil-
ity. The rationale for such efforts is as follows. Within the present institutional framework the success-
ful marketing of sustainable products is possible, but limited. The institutional design fails to set positive
incentives for sustainable behaviour, both for producers and consumers. On the contrary, it allows –
and often even enhances – unsustainable behaviour. This is why changes in institutions are necessary
to expand the intersection between socio-ecological problems and consumption, and to set up the con-
ditions for the successful marketing of sustainable products beyond niches. Sustainability pioneers and
leaders can participate in enlightened self-interest, changing the public and political institutions and
thus enhancing sustainable development (Bendell and Kearins, 2005, pp. 376–378). They can help
develop the free market system towards a socio-ecological market system on the global level. The more
social and political institutions favour sustainable consumption, the easier it is for companies to market
sustainable products beyond niches. Transformational sustainability marketing is a form of ‘megamar-
keting’ (Kotler, 1986), which consists of ‘six Ps’: besides product, price, promotion, and place, there are
public and politics.
Figure 2 shows the two levels of integrative sustainability marketing: strategic and instrumental sus-
tainability marketing takes place within the present institutional framework, whereas transformational
sustainability marketing is to change the institutional framework itself (Belz, 2001). The idea of inte-
grative sustainability marketing is based on the concept of ‘integrative business ethics’ (Ulrich, 1998).
The objectives of transformational sustainability marketing are to initiate institutional changes that
either set positive incentives for the purchase and use of sustainable products, or set negative incentives
for the purchase and use of conventional products. Examples of transformational sustainability mar-
keting are public support of companies for an ecological tax reform, voluntary agreements of socio-

Copyright © 2006 John Wiley & Sons, Ltd and ERP Environment Bus. Strat. Env. 15, 139–144 (2006)
DOI: 10.1002/bse
Editorial 143

Transformational
Sustainability
Marketing

Socio- Customers
Ecological Needs and
Problems Wants Strategic/
Instrumental
Sustainability
Marketing

Figure 2. Integrative sustainability marketing. Source: Belz, 2001, p. 92

ecological industry standards, development of sustainability labels in co-operation with non govern-
mental organizations (NGOs) etc.
In the end, there is the question what is special about sustainability marketing. To which extent does
it differ from other marketing approaches? There are at least six distinctive characteristics of sustain-
ability marketing as compared with conventional marketing (Belz, 2005, pp. 21–22).
• Socio-ecological problems. The analysis and identification of ecological and social problems are points
of departure in sustainability marketing. Social and ecological aspects are integrated throughout the
whole process of sustainability marketing.
• Intersection. Sustainability marketing tries to find solutions to the socio-ecological problems and at the
same time meet customers’ demands.
• Normative aspects. Sustainability marketing aims at sustainable and profitable relationships with cus-
tomers, the natural environment and the social environment. Besides common marketing goals such
as sales, market shares and profits, ecological and social objectives are taken into consideration and
balanced in a responsible way.
• Information asymmetries. Social and ecological qualities of products are often credence qualities. This
is why signalling, credibility and trust are essential in sustainability marketing.
• Transformational aspects. Within the existing framework, there are few economic incentives to behave
in a sustainable way, either for producers or consumers. By engaging in public and political discourses
and changing the institutional design in favour of sustainability, companies set the conditions for the
successful marketing of sustainable products beyond niches.
• Time. Sustainability marketing aims at building lasting relationships with customers, the social envi-
ronment and the natural environment. Thus, long-term thinking and futurity are fundamental com-
ponents of sustainability marketing (Peattie, 1999, p. 58).
The papers of this special issue highlight the distinctive characteristics of sustainability marketing. Each
paper may well be read in isolation as they stand in their own right. Taken together, they provide inter-
esting insights into the biased and complex relationship between sustainability and marketing. We will
see during the 21st century whether the redefinition of marketing in the light of sustainable develop-
ment will come true. Thanks goes to the authors for their original contributions and co-operation.
Thanks goes also to the following scholars, who readily agreed and thoroughly reviewed the papers in
a double blinded process: Pratima Bansal, Christopher J. Cowton, Thomas Dyllick, Ulrich Enneking,
Georg Karg, Andrew King, Dirk Matten, Ken Peattie, Hanna-Leena Pesonen, Ivan Montiel, Rainer
Souren, Michael J. Polonsky and Richard Welford.

Copyright © 2006 John Wiley & Sons, Ltd and ERP Environment Bus. Strat. Env. 15, 139–144 (2006)
DOI: 10.1002/bse
144 F.-M. Belz

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Copyright © 2006 John Wiley & Sons, Ltd and ERP Environment Bus. Strat. Env. 15, 139–144 (2006)
DOI: 10.1002/bse