Fergus Hay is an expert in commercial transformation and product innovation, market positioning and growth, and founder of marketing and fundraising advisory firm Elysian Fields. Here, he shares his advice for green companies for the year ahead.
Investments and subsidies for cleantech startups have fallen by more than 40% in the past 12 months. At the same time, COP28 demonstrated that the financial industry needs to adopt transition technologies faster. This means that emerging sustainability companies will face a difficult funding environment in the new year and a renewed focus on the sector as a whole, with both less funding and more competition.
Over the past two years, we have worked with several ESG-focused companies, including Europe's largest foodtech VC, a pioneering sustainability traceability startup, and one of the world's best-known sustainability-focused brands. What we have learned from these companies and their competitors is that the most common barrier to effectively scaling, selling, and financing companies operating in this “hot market” is marketing. It means that it is of a certain nature. 1) They aren't listening to their buyers 2) They don't know how to differentiate their product from the competition.
- Emerging sustainability businesses tend to have a narrow view of the market and don't listen outward. They focus on the technology they create and how innovative it is. They are less focused on how to solve existing problems for individuals, groups of buyers, or the world at large. But technology can only go so far, and soon more “exciting” competitors become frustrated with lower-tier products that steal the show.
- Because of this, they also struggle to differentiate themselves from the new wave of innovations that hit the market every day.
So here's my advice for dealing with these challenges next year.
- Dig deep into the macro and micro insights that drive buyer behavior. It’s not enough to know how technology can help your buyer group. You also need to know how it ties into the big picture (macro) and what is keeping the individuals in the group up at night (micro).
- By listening further, you can use those insights to create competitive “unfair advantages” that can fuel your marketing growth machine and create clear market differentiators. , can steer investors and customers away from common value propositions that turn them off.
- Then, build on those insights to create provocative perspectives and bring the challenges your technology solves to life in ways that grab people's attention.
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