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Sustainable Or Scam? Navigating Transparency in Climate Tech
26 Plays7 days ago
Greenwashing is a growing issue, leaving consumers unsure of which sustainability claims to trust. Enter Novi, a platform that verifies claims through data and partnerships with certification bodies. In this chat with founder Kimberly Shenk, we discuss transparency challenges, the role of data, and how brands can avoid greenwashing while earning consumer trust.
Guest: Kimberly Shank, CEO of Novi Connect
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Transcript
Introduction: The Green New Perspective Podcast
00:00:00
Speaker
Hello friends, you are watching or listening, depending on the platform of your choice, the Green New Perspective Podcast, a place where we talk about innovative technologies and discussing marketing strategies that are accelerating growth.
00:00:12
Speaker
If you like what we do here, please consider subscribing to our channel on your favorite streaming platform. Hit that subscribe button and support us in bringing you more high quality content. This episode is of is proudly sponsored by New Perspective, a Boston-based marketing agency working with climate tech companies for over 20 years now. And if you want to explore how New Perspective is helping climate tech companies to grow, you can check the links in the description of This episode, there's a lot of information there for you to dig through.
Transparent Communication and Greenwashing
00:00:42
Speaker
In today's episode, we are going to talk about the importance of transparent communications. Why? Because there's a lot of greenwashing there where companies are misleading their customers or partners about sustainability. My guest today is Kimberly Sheng, the CEO of Novi Connect, a company that he uses data and is partnering with certification bodies to verify claims. So if you want to know how you can be a better informed consumer,
00:01:08
Speaker
while you're shopping for sustainability related products or a company that wants to boost their transparency and communications efforts. Stay tuned and enjoy the conversation. And of course, leave your feedback after watching. We would really appreciate it.
00:01:34
Speaker
Hello, Kimberly. Welcome to the Green New Perspective podcast. Thank you for having me.
Kimberly Sheng's Background and Novi Connect's Mission
00:01:40
Speaker
So for starters, can you tell our audience a bit more about yourself and what inspired you to start and reconnect to the company we're talking about in this podcast? My background, I'm a data scientist at heart. I studied at MIT. I was a data scientist in the Air Force.
00:01:57
Speaker
led the data organization for Eventbrite and a couple of other tech startups. I've always viewed the world through data and how it can be leveraged for good. Ever since I was young though, I've always had a strong passion for health and wellness. and back in 2017, co-founded a company named Naked Poppy and the whole mission was to help women discover and purchase trusted products good for their health and for the environment. And it was a really confusing landscape. We were um aspiring to cut through the noise and that ah got complicated really quickly as we built that company. And it gave us a really interesting insight into how the industry operates and
00:02:40
Speaker
That was the core problem that I became obsessed with. I realized it was a data problem at its core, really understanding how a product is made, what ingredients are in it, and whether they're sustainable and clean. And that's where I got inspired to start building the technology that is now Novi and what we do today. So can you tell us more
How Novi Connect Uses Data for Transparency
00:03:00
Speaker
about Novi? and How does it fit fits into the climate tech ecosystem for those who are familiar with what you do?
00:03:07
Speaker
So we're essentially a platform that's scaling and and streamlining the certification and product claims landscape um for the consumer industry. And so um we have done the really hard work of decoding all the complex requirements around um clean sustainability. We have partnerships with certifying bodies, partnerships with retailers, partnerships with um a lot of industry leaders to understand all of the regulatory requirements and certification requirements what it means for a product to meet a certain claim and then ah through that we've built a proprietary vetting engine that automatically vets.
00:03:48
Speaker
products against these claims no matter how complex they are. And so all of this is rooted in data and we can talk about that. But the core of this is to build a very simple interactive workflow that's personalized to a brand and their products, only showing them that's relevant to them so that they can get to those certifications and claims that are verified as fast as possible. So that's the core platform that we partner with lots of large retailers to power their product claims programs. And so then when you're a consumer interacting with a product and you see a claim on it, you can trust that that product has been verified by a third party and that it actually meets the claim that you're hoping for as you're going to purchase the product. This is definitely not an easy job to do. So how do you ensure transparency and accountability in the claims?
00:04:38
Speaker
Absolutely. Yeah. So we, um, this is where we require the detailed supply chain data. Data is the core of the product, the core of what we help brands uncover document attached to different claims. Um, but we do require that raw information. And a lot of what we're doing is then helping to understand like, is that the right document? Is that from the right supplier? Did you get the right piece of information?
00:05:05
Speaker
Is it saying the right thing? Do you have the right substantiation to go forth and meet this claim? So that's why the workflows, the personalization of the tool is really important so that we help that brand focus only in on the data that they need to gather and provide in order to make a claim. But yeah, at the end of the day, we are always in the nitty gritty, tiny minutia of the data that then gets aggregated up to at the end of the day, just the claim that the consumer sees.
Challenges in the Consumer Product Industry
00:05:32
Speaker
and What are some of the challenges you've encountered while verifying the the impact of products, environmental impact? you know A lot of the consumer product industry is built on secrecy and that's largely just because um you know Every brand is creating something innovative and it is, at the end of the day, based on some sort of proprietary formula or way that they've crafted their product. and so Transparency of that information starts to lead to IP issues, and people not wanting to disclose. and so
00:06:12
Speaker
One of the challenges is largely transparency without full disclosure. um The other, I would say, is actually getting access um to that data from your supply chain. And it's largely just because that transparency issue travels all the way down the supply chain. So you might be working with a really interesting supplier of a ingredient.
00:06:34
Speaker
and you want to get transparency on how that ingredient was manufactured or the feedstock it was made from and that supplier has also spent a lot of time in IP developing that ingredient and doesn't want to share that up. And so transparency without disclosure happens all through the supply chain. And so really getting that information so that you can then go to the consumer as a brand and make a claim is really, really challenging.
00:06:58
Speaker
I think I would just say, like up until recently recently, the incentives for a company or a brand to spend the time and money to look for this data have not largely been there. But what's interesting is now the consumer demand has shifted so aggressively that it's no longer a ah cost or an activity that's so challenging. It's now, I need to do this to remain relevant and to drive the revenue opportunity that my competitors are seeing because they're out there making these claims. And so the flip has been now I have the leverage, the revenue opportunity, the internal buy-in from the organization to go forth and do the activities to get this information. So we're starting to see that that shift in the industry. Do you feel like policies could help to move the shift forward?
EU vs US Transparency Policies
00:07:47
Speaker
Yeah, I mean, we're seeing it in the EU, right? um The policies and the regulation there are so far ahead of the US and that has caused that industry, you know that landscape, that market ah to be much more transparent and to disclose information. I think what's fascinating and what's happening in the US is in the absence of regulation, that vacuum is being filled by retailers.
00:08:16
Speaker
um And so retailers are starting to say well we see this opportunity consumers are demanding and switching to products that have solid claims around.
00:08:26
Speaker
clean, transparency, sustainability, whatnot. And so we're going to put forth badging programs. And this is where you've seen Sephora with Clean It Sephora or Target with Target Clean or Target Zero or Ulta with Ulta Conscious Beauty. Obviously we have Whole Foods and Thrive Market. We have all of these companies that are now filling that void by putting together programs and helping consumers navigate when our regulatory and government bodies are not. And have you encountered green washing in the space?
00:08:57
Speaker
Yes, so that's I think that's the interesting dynamic that's more and more prevalent today, largely because I i do believe 10, 5, maybe even 5 years ago, the concept of doing or creating, developing, putting in market a more clean, sustainable product was less common, and it was the really mission-driven companies, the the early adopt like innovators of the space that were cared about doing this. And now we're in a landscape where consumers have any work.
00:09:31
Speaker
ah There's so many statistics out there, like 50% of the growth in the CPG industry is coming from products that are being marketed as a sustain sustainable data. is all like The consumer landscape has changed to Gen Z and Gen Alpha. They're expecting products to be have this intrinsic property of you know clean health, sustainability, planet friendly, all these kinds of yeah claims. and And because of that,
00:09:59
Speaker
Brands are now running after, how can I market myself in that way? How can I tell that story? How can I capture that demand and that revenue that's now being shifted to those types of products? And that has really brought a lot of the greenwashing up, increased and on the scene, I would say much more drastically than it has in the past.
00:10:20
Speaker
And so that's, I think, why we're starting to see more and more need for transparency, need for actual information. Consumers are doing a ton more research, like, huh, is this product really what it says it is, or is it just claiming that so I can i purchase it and it it makes money. So, yeah, it's an interesting shift. And how do you see your tech influencing the broader movement towards sustainability?
Novi's Technology and Its Role
00:10:43
Speaker
We are sitting right at the core of that data capture. I think a lot of what we do, so we're not we're not defining what's good and bad at all. And so our technology is very agnostic to that. We are empowering the third party certifications like you know obviously the certifying bodies, regulatory bodies, retailer programs to capture that data to help them build the trust and to have the substantiation. But at the end of the day, yeah we're we're mostly building the data network to empower that that ecosystem and help do that in a very easy, seamless way. So as a brand is capturing that information, they can leverage it across everywhere they sell. you know Just because you capture it to approve as a claim at Target doesn't mean you can you should be able to leverage that same data and use that to prove a claim at
00:11:30
Speaker
Macy's or wherever wherever your product is in market. and You mentioned that um this transparency sustainability movement in the US is pushed by companies. so Can we talk about how well companies all over the US s can leverage transparency to build trust and engage state stakeholders, whoever they may be, customers or ah partners, whatever.
Building Trust Through Transparency and Certification
00:11:56
Speaker
so there I mean, there's a couple of ways. there's obviously as i'm We're seeing a huge shift actually in as products are being brought to market, really careful conscious decisions on who to partner with in your supply chain, where to source materials, manufacturing partners, starting with a lens of tell us upfront before we even start working with you versus In the past, it's been, oh my goodness, we have a product in market. Let's furiously go down the supply chain and figure out what's going on to start to diagnose. I think now it's more intentional. And so flipping the script to say, we're not going to sign a PO to put this $100,000 or 100,000 unit face wash in market until we have full disclosure on these five things or else we're going to take our business elsewhere. I think that shift has been really powerful is choosing stakeholders up front.
00:12:45
Speaker
The other side, though, is now product is developed going into market. Honestly, that it's just going to be we're seeing a proliferation of different certifications, but going after these SEAL certification badges as a way to drive consumer trust. So this is basically the consumer saying, we can't take the brand's word for it anymore. And so I do think this is where we're going to see a lot more new were I mean, we're seeing it already, new certifications popping up. But this is this trend is also really interesting because there's a dynamic where, as we you know kind of talked about before, the CPG industry is built off of differentiation. And so not every product, not every brand wants to say the same things. And so not everyone wants the same certification because that says the same thing. And so we're seeing diversity in the types of claims
00:13:36
Speaker
a brand or a product wants to make so that they can show how diverse they are. I might focus on um fair, responsible practices in my supply chain while somebody else might we really focus on clean ingredients. like It all can be different. And so that is partnering with different certifying bodies or different badges or seals or or ah organizations out there that can help you differentiate as a product and brand and as you go to market. So yeah, I think it's ah it's across the supply chain.
00:14:06
Speaker
um You mentioned greenwashing. So aside from certifications, what other tactics or strategies can companies use to avoid pitfalls of greenwashing in their messaging?
00:14:19
Speaker
yeah This is actually what we found is interesting. I think for me personally, I've always lived under this mantra of, you know, data is um only as good as it garbage in, garage but garbage out, basically. It's only as good as you you're able to clean it and structure it. and capture it properly. um And so a lot of the greenwashing we've uncovered, especially as we work with brands in partnership, is an unintentional, to be quite honest. It's thinking it was one thing. They're not having the actual piece of information that was needed to substantiate their claim. And so I think as consumers, we're actually experiencing this firsthand as we're using AI products like chat GPT, and they can go off the rails because of inaccurate information. And so
00:15:06
Speaker
When we put models or things on top of inaccurate data, I do think that's where it leads to problems. And so the the onus is now on, brands are getting more curious and asking the right questions instead of taking for grant or taking the word of their supply chain and saying, oh, yeah, we trust you. You did the right thing. And saying, no, show us how you did the right thing.
00:15:27
Speaker
you know I have a manufacturing partner for this product, show me that you source the materials in this way, or show me that you did this on the you know assembly line or whatnot. So I do think greenwashing is going to be combated just by getting to the core, which is accurate, reliable information and data.
00:15:44
Speaker
And that'll help to drive decision making and uncover a lot of stuff that we, I think, as in many brands didn't even realize was happening in the first place. Consumers are more um informed about greenwashing and they know how to spot it. And that's basically what's driving the company. Not the only thing that's driving the companies, but it helps to drive. Absolutely. I mean, today, if you Say something incorrectly. I mean, you can lose trust and loyalty on TikTok overnight. Something can go viral and destroy your brand in hours. I mean, it is it is now no longer, a oh, you know this wasn't covered over months and years, and we have a J and&J situation where we're like, yes, there's talc in the baby powder, and here we are this many years later. This can happen like this. and so
00:16:32
Speaker
um I do think it's something where we're so socially connected. We have access to so much information. Consumers are so um intelligent and and research oriented, especially the younger generations that are up and coming. But yeah, I think it's now It's just an imperative. We are a marketing agency. Would you share advice from your experience on how marketers can contribute to the sustainability messaging moving movement and avoiding greenwashing in communications?
Authentic Stories in Sustainability Marketing
00:17:04
Speaker
One of the ways that we think about this all the time is, of course, telling the story authentically, leveraging data, bringing to the forefront how you as a company are putting
00:17:15
Speaker
the practices in place to actually capture this information, ensure it's trustworthy, going to the source, who you actually talk to. But then there's also the ah signals that consumers are really looking for, which would be those third-party certifications and and things that they look to as trust. And so that's going to be different for every brand. Every consumer is going to look to something different. But we are just seeing that it's It's got to be twofold, authentically telling the story, but then recognizing that you know a lot of consumers feel a little burned and aren't necessarily taking the brand's word for it and are looking for third-party validation from other partners who um don't have skin in the game and are checking and ensuring that the data is correct. And so companies I think that are investing in both are are doing really well. And how do you build trust for Novi?
00:18:04
Speaker
Ah, for Novy, a lot of the, yeah, for us the trust mechanism is we are constantly hounding accurate, reliable data and we don't make a determination of what's good and bad. So for us, we are not saying yes.
00:18:19
Speaker
this is a great product or no, this is a bad product. And so for us, the trust is actually with the brands that we work with because we want to be a partner in helping them get there. And so the minute we start to to um gang up or tell a brand that they're doing bad or promote a brand when potentially you know we start to to not look like we're completely unbiased in the conversation. So yeah, that's how we build trust is be very data driven and factual driven and just there to support.
00:18:47
Speaker
We hear our new perspective are in marketing agency and we're working with climate tech clients and a lot of them are shaping their businesses according to the ESG standards. um In your opinion, how can we shape our marketing efforts according to the same
Consumer Demand for Transparency
00:19:02
Speaker
standards? I think the marketing angle on setting standards is starting to become the most important.
00:19:07
Speaker
because there's a ah large disparity between the hard work that sustainability teams do within an organization and how it's talked about externally. And more and more, which I think is exciting, is that's what the you know consumer is looking for, is those companies that not only do the work but can talk about it. And I've talked to so many different, even retailers who There's brands that do amazing work and aren't getting credit for it because they're not talking about it and it's not forefront to their message. and they that um I think we're now just starting to see that the revenue side of the organization is being attuned to the fact that the consumer is demanding it and putting their dollars into those companies. and I think that's what's going to shift marketing team focus on, okay, well, of course, we're going to market and do the things that are going to drive in
00:19:57
Speaker
demand and bring us revenue and so starting to bring the sustainability team into the revenue conversation is extremely important. um It's no longer a cost center, it's no longer a because we want to do good, which obviously we do, but it's now because it's going to drive meaningful impact and and top line dollar for the business and how to shape that conversation and bring those partners into the equation I think is actually really, really important.
00:20:23
Speaker
And what other trends would you say that you're going to see, we're all going to see in the next year when we talk about sustainability, which is not an easy answer to give.
Mainstreaming Transparency in Consumer Choices
00:20:34
Speaker
Yes, well, I will maybe stick to the novi point of view or what we're seeing from our vantage point. When we started um Back in 2020, it was the early, early days where really it was only in niche categories, um where we saw beauty and personal care really starting to to come online um really for the only um more, I would say, like upmarket products.
00:21:01
Speaker
um And now what we're seeing is, I mean, obviously food is really strong, but this is really getting into, it's in clothing, it's in supplements, it's in baby, um ah food ah pet food is the one that I'm talking about. and so As we start to have consumers um really thinking about consciously what's in their products, wanting to shop their values, the future will be in building materials and we'll we'll start to see you know electronic purchasing decisions and furniture puring purchasing decisions and and things that I think are a little bit more on the peripheral right now from a consumer lens on how we're purchasing, but are very much the same equation, like how is it made,
00:21:44
Speaker
What's in it? how you know how is this How is the supply chain? And I think the other piece of this is you know everything has been very upmarket, but really getting into dollar general, dollar treat, like the equity conversation around Americans across the country, no matter where you live, should have equal access to transparent sustainable products. And I think that's the shift that I'm getting excited about too, is this isn't just like a luxury good or a luxury opportunity.
00:22:13
Speaker
but really getting into those down downstream or middle middle America enterprises. Because when we start to shift the conversation, things start to become, it's less of a premium dollar to make products in this way and to provide this the some level of transparency. and So it should become mainstream, let's say. like Exactly. yeah yeah exactly yeah and um Can you tell me since we're um coming to the end of our conversation.
Future Plans for Novi Connect
00:22:42
Speaker
What's next for Novi? What are you expecting to build in 2025? We have very, ah I guess over the past year, been heavily pulled into adjacent categories. Like I mentioned, we started in beauty and personal care and are very rapidly now in
00:22:59
Speaker
food and you know pet food, baby clothing, all of that. And so for us, it is expansion as quickly as possible into helping brands across different categories. And it brings through transparency and sustainability to more of the CPG categories.
00:23:15
Speaker
um And so that's a huge huge push for us in this and this year is how you know we democratize that. We start to work with more and more mainstream um retailers where, like I mentioned, the the mainstream consumer is to start bringing more equity equitable offerings to to every consumer out there and not just more of the ah more niche or upscale places that consumers shop. Perfect. And if people who are listening to the podcast or watching it on YouTube will want to know more about Novi or get in touch with you, where can they do that? ah Definitely. You should go to nobiconnect.com. um And there's a lot of resources there. There's ways to sign up to get a schedule, a one-on-one with us and learn more.
00:24:03
Speaker
But yeah, you can always just reach out um even to me personally. So Kimberly at neverconnect.com. Well, thank you, Kimberly. Thank you for being a guest here on 20 perspective podcast. ah Thank you so much for having me. It was a pleasure.
00:24:26
Speaker
Thank you for tuning in to Green New Perspective. This podcast is proudly sponsored by New Perspective. We are a Boston-based marketing agency working with clean tech clients only for over 20 years now. And if you want to check out how we help our clean tech clients to grow, you can click on the link in the description of this episode.
00:24:47
Speaker
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00:25:06
Speaker
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