The world is experiencing a significant shift in how we generate, consume and think about energy, otherwise known as the energy transition. Increasing concerns worldwide about the environmental impact of traditional energy sources, such as fossil fuels, and the need to develop and adopt more sustainable alternatives drive this transition. While the energy transition presents numerous opportunities, it also poses significant branding challenges for energy companies and companies serving the energy industry.
The current energy transition from fossil-based to zero-carbon is an opportunity for all types of companies in the energy industry to be ahead of the curve, despite the highly-competitive landscape. From oil and gas operators to suppliers to the oil and gas industry to renewables providers, all have the opportunity today to improve their bottom line. Repositioning the company to meet audience needs is the answer.
Energy Transition Branding Without Greenwashing
An oil and gas company can do this without employing the dreaded “greenwashing” label. As a reminder, or to those newer to the oil and gas industry, this label is when a company communicates deceptive or false environmental claims in its marketing or branding. An oil and gas company can emerge unscathed from the energy transition whole with proper branding. The key is tactfully communicating what precisely the company’s products and services provide and how the company is forward-thinking.
The Federal Trade Commission (FTC) is working on revising its Green Guides. The guide outlines unfair or deceptive claims. Employ a branding strategy by a team abreast of FTC and international compliance. Partnering with a team abreast of FTC Green Guides updates in the United States and having tools to remain compliant worldwide is the best route for an oil and gas company.
Energy Transition Brand Identity Engagements
Oil and gas companies primarily target energy transition branding needs by asking the right questions.
Some of the oil and gas industry’s most pressing questions involve the following:
- How oil and gas clients enter new energy and renewable energy markets
- Building successful internal environmental, social, and corporate governance (ESG) planning, including ESG planning for recruiting
- Achieving clients’ sustainability goals
As reported by McKinsey & Company, It is possible to balance reaching a net-zero target while maintaining more carbon-heavy assets. Oil and gas companies need to keep their primary source of cash flow, which remains carbon-intensive assets. Balance and flexibility are critical to a successful transition.
Brand Perception Is Key
One of the critical branding challenges that energy companies face is the perception of their brand. Traditionally, people perceive energy companies as polluters and harmful to the environment. This perception presents a significant challenge for companies trying to reposition themselves as environmentally-responsible entities.
To overcome this branding challenge, energy companies must develop and communicate a clear and compelling environmental responsibility narrative. This narrative should outline the company's commitment to reducing its environmental impact and investing in sustainable energy sources. The narrative should also include the company's concrete steps to reduce its environmental impact and carbon footprint.
A Profitable Energy Transition From the Boots to the Suits
Conducting research that includes all company levels, from the boots to the suits, is integral to successful brand positioning for the energy transition. The messaging framework must include everyone within the organization, from people feeling threatened by the energy transition (those selling traditional products) to or embracing it and seeing it as an opportunity. Half the population of energy company personnel who deal with conventional oil and gas clients feel threatened and will react differently than others.
All levels of the company need to understand and be comfortable communicating how the energy transition applies to a company’s products and services. Answering the most pressing questions about the energy transition is successfully done by making an effort to plan targeted workshops and internal surveys, not just by speaking with communications managers as a point of contact. From there, an oil and gas company can apply a realistic energy transition-centric products and services branding.
Selecting the Proper Terminology Is Paramount
Another branding challenge is that energy companies must differentiate themselves in an increasingly crowded and competitive marketplace. The plethora of terms used in the industry regarding energy transition makes brand positioning and messaging challenging.
Calculated Leaps from Traditional Oil and Gas Towards Sustainability
Equinor was founded about half a century ago as the Norwegian State Oil Company, which became known as the supermajor oil company Statoil. With the energy transition in mind, the company implemented a sustainability branding strategy, with updates such as an Earth-inspired color palette (as posted on their YouTube channel) and removing "oil" from its name. Their rebranding grew them into a broader energy company, as opposed to a company focusing only on oil. As reported by Forbes, rebranding helped Equinor remain a supermajor oil company and grow its renewable earnings.
SLB was founded almost a century ago as Schlumberger, the name of its founding family. The company grew into a top oilfield service and equipment provider and is now branded as a digital services provider and heavy supporter of clean energy. SLB remains a leading fossil fuels service and equipment provider, all the while providing an array of renewable energy-related solutions while continuing to drive innovation, decarbonization and performance for the oil and gas industry, according to SLB's press release. The company rebranded into a new name, lighter-blue color scheme and logo to illustrate SLB's commitment to balancing clean energy, innovating and decarbonization. SLB's Chief Executive Officer Olivier Le Peuch said in an interview reported on Reuters that SLB's updated logo signifies the carbon dioxide emissions abatement curve.
BP became infamous for its rebranding campaign from the British Petroleum Group into Beyond Petroleum, quickly followed by disaster. BP rose again through fresh communications strategies, including brand repositioning. By acknowledging their legacy and communicating their progress, they regained a large portion of any lost trust, maintaining a strong portfolio through their renewed "aggressive" energy transition plan, reports NASDAQ.
Companies Must Position Themselves as Energy Transition Leaders
This transition presents a unique challenge as companies serving the energy industry must balance the need to diversify toward new energy while still serving their traditional client base. To succeed in this new era, they must position themselves as leaders in the decarbonization effort while continuing to provide reliable and efficient energy services to their existing customers. By setting themselves as innovative and committed to a sustainable future while still meeting the needs of their current customers, these companies can remain competitive and thrive in the energy transition era.
Energy companies face the challenge of communicating their message to a diverse audience. Sustainable energy is a global issue, and energy companies must find ways to communicate their message effectively to audiences, including:
External audiences that influence traditional marketing and sales collateral may consist of:
- Governmental entities
- Prospective customers
- Market competitors
Internal audiences comprising members of a company may include:
- Onboarding employees
- Employees throughout a company, targeted at any level or department
- Contract employees
The Critical Elements of Energy Transition Branding
Energy transition branding involves establishing a brand identity and messaging that communicates a company's commitment to sustainability, innovation, and the transition to renewable energy sources. The critical elements of energy transition branding include environmental responsibility, differentiation, innovation and simplification.
The company's commitment to reducing its environmental impact is a crucial element of energy transition branding. Companies must develop and communicate a clear and compelling narrative outlining their environmental responsibility and sustainability goals.
In a crowded and competitive marketplace, differentiation is crucial. Energy companies must establish a distinct brand identity built around their unique selling proposition and target audience.
Energy transition branding requires a strong focus on innovation. Companies must develop and invest in new technologies and business models that enable the transition to renewable energy sources.
Communicating complex technical information in a way that is easily understood by a broader audience is critical. Energy companies need to simplify their messaging and focus on the benefits of renewable energy, such as cost savings, energy security, and reduced environmental impact.
Energy transition branding requires a collaborative approach. Companies must work with policymakers, other companies, and communities to advance the transition to renewable energy sources.
In conclusion, the energy transition presents numerous opportunities for companies and companies serving the energy industry. However, it also poses significant branding challenges that companies must overcome to succeed in this new era. Energy companies need to develop and communicate a clear and compelling environmental responsibility narrative, differentiate themselves in an increasingly crowded marketplace, communicate complex technical information in an easily understandable way and communicate their message effectively to a diverse audience. By addressing these branding challenges, energy companies can position themselves for success in the energy transition era.
Expert Energy Transition Branding & Support
HexaGroup can provide expert branding and support in oil and gas energy transition challenges.
Our industry-focused, tried-and-true approach supports titans of the energy industry pivoting to renewables and startups. Our process reduces costs while increasing performance and can generate 500% more leads with 35% less budget.
Contact HexaGroup today for a profitable transformation.