As FTC Revisits ‘Green’ Definitions, Some Predict A Crackdown

Marketing_daily_jpegThe Federal Trade Commission is still in the midst of creating a new set of green marketing regulations and part of that is examining green packaging claims which haven’t been revised since 1998.  It is hoped that new guidelines will lead to clearer claims while at the same time reminding advertisers that their packaging needs to be clear and not misleading.  Some are concerned that the Federal Trade Commission will be creating guidelines for environmental terminology that is constantly changing.

Posted April 28, 2008
By Sarah Mahoney, Marketing Daily

Green_works_jpegThe Federal Trade Commission, which last revisited its "Green Guides" back in 1998 before anyone ever heard
of a carbon footprint, is holding workshops as part of its regulatory
review, and some experts are predicting that could make life more
difficult for marketers.

 

The FTC’s next workshop is
Wednesday and is intended to "examine developments in green packaging
claims and the consumer perception of such claims." Back in January,
another workshop addressed the marketing of carbon offsets and
renewable energy certificates.

If these workshops lead to revised guidelines, which would make plenty
of consumer groups happy, "it could have a chilling effect on an
advertiser’s ability to communicate important and valuable information
to consumers," writes Ronald R. Urbach, a partner at Davis &
Gilbert, and a leading legal expert on advertising and marketing, in a
recent filing on behalf of the nation’s largest and most influential
advertising trade organizations (AAAA, AAF, and ANA).

The FTC
says consumers are grappling with a sharp increase in new terminology.
"Since the Green Guides were last revised in 1998, there has been a
significant increase in the use of environmental claims in product
marketing, including "green" claims concerning product packaging.
Sellers and marketers frequently use terms addressed in the Green
Guides, such as "recyclable," "recycled content," "biodegradable,"
"degradable," "compostable," or "refillable," to claim that their
packaging is green," the FTC says. "Sellers and marketers also are now
using green claims that are not currently addressed in the Green
Guides, including terms such as "sustainable" and "renewable." The FTC
says that the sharp increase in environmental seals issued by third
parties also raise issues of "perception and substantiation."

And clearly, consumers are confused. A recent study from Cone LLC and
the Boston College Center for Corporate Citizenship found that almost
half (48%) think that "green" products are actually beneficial for the
earth, while a distinctly smaller group–22%–understands that such
purchases are simply less harmful than competing products. Some 76% in
that survey think environmental claims should be regulated by the
government. And in a study from Burt’s Bees, 78% of people think that
natural personal care products are regulated, and 97% of people think
they should be.

Urbach says he expects that over the next four months the FTC will find
a number of cases of false or misleading packaging. "It’s one way to
remind companies that they are on guard," he says.

But he’s hoping there won’t be new guidelines. Environmental
terminology and claims are changing so rapidly that the FTC "might be
shooting at a target that doesn’t exist," he says. If they do issue new
guidelines, "my concern is that they be very measured, so they don’t
squelch development among marketers," and instead rely on existing laws
to police deceptive or misleading claims. One concern, he says, is that
the perception of what’s good or bad for the environment is becoming
increasingly complex. And as consumers’ interest in such claims grows,
that won’t change any time soon–a big difference in the green movement
of the early 1990s, which faded fast. "There really has been a shift in
consumer attitude and sensitivity," he says. "People understand that
there is a significant problem with climate change, especially younger
people." And unlike the green of the early 1990s, "in this round,
environmental issues and economic issues are much more closely
aligned," he says. The question has become less about whether people
will pay more for a green product, and more about the green products
that can save them money, such as CFL light bulbs or hybrid cars.

Sarah Mahoney can be reached at [email protected]

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