Green Marketing: How It Works and When to Use It

EnvironmentalLeader In this article posted today on Environmental leader,
Emily McClendon discusses the ubiquitousness of green marketing and how the the term yields confusion and the practice lacks regulation. She mentions how "green marketing" began in the 80's with CSR and has shifted from the assumption of products being environmentally safe to to companies uses green washing tactics to sell. She notes that a truly green product means an overall reduction in carbon emissions, and that consumers should be conscious of elements such as production, packaging and transportation of a product. She sights successful green campaigns and truly green products in Brita and CFL bulbs.

Posted July 28, 2010

By
Emily McClendon, Environmental Leader

Marketing specialists are in agreement: green marketing campaigns
exist and their clients should have one.  The debate begins when the
question turns to actually knowing what green marketing is and the best
way to employ it. Although the rampant confusion is understandable due
to the current amorphous nature of green marketing, the original concept
was quite simple. Green marketing emerged as “marketing of products
that are assumed to be environmentally safe,” a simple enough definition
by anyone’s standards. Unfortunately, the very simplicity of the
initial definition provided excessive leeway for companies seeking to
take advantage of green marketing, and the marketers creating their
campaigns.

Although green marketing has experienced a recent resurgence as
environmental issues are becoming incorporated into the public psyche,
green marketing has been around for several decades. Green marketing
began in the 1980’s, with the implementation of Corporate Social
Responsibility (CSR) Reports which provided an overview of companies’
environmental, social, and financial impacts. When consumers were able
to monitor a company’s operational practices, they were better able to
understand which companies were wasteful and which were implementing
sustainable measures. With the establishment of CSRs and the publication
of several books highlighting green marketing, the movement gained
traction as well as evolved to become more profitable.

Over the relatively short history of green marketing, a movement that
began as a way to incentivize the production of environmentally
friendly products has degenerated into a mishmash of ideas, ethics, and
confusion about what green products really are.

Take one product, attempt to make it environmentally friendly, and
then tell everybody about it. That is current green marketing in a
nutshell. With few standards, and very little labeling of any
significance, the right to call a product environmentally friendly is
practically limitless. Authenticity of labeling has further lost
creditability as the pseudo-accepted authority, EnergyStar, has recently
undergone an embarrassment in which some of the more egregious products
deemed efficient were exposed – for example, the approval of a
gas-powered alarm clock.

One of the few true determinants of a sustainable product is a
demonstrably lower carbon footprint compared to competitors. Carbon
dioxide, despite controversy, is widely considered to be one of the most
common and detrimental greenhouse gases (GHGs) contributing to global
warming. To truly reduce a product’s carbon footprint, the entire
production process must be considered from manufacture to packaging to
transport. For example, one of the masters of efficiency, IKEA, uses
Optiledge for shipping. Optiledge utilizes recyclable plastic pallets rather than the
traditional wood pallets. The reduction in weight requires less fuel for
transportation, and the recyclable nature of the pallets allows them to
be reused several times, therefore removing the need for continual
manufacturing (a big carbon producer).

Although consumers often believe the claims companies make about
products being environmentally friendly, the true test is the amount of
carbon each product creates.

Companies have more than one reason to produce “environmentally
friendly” products. Sustainability usually encourages efficiency.
Creating a sustainable process for manufacture and distribution often
results in lower overall costs in the long run. Once companies get over
the sticker shock of the capital investments required to renovate and
reduce environmental damage, they often realize that net revenues will
increase. Profits remain a primary concern in a capitalist economy, as
they should, and cost effectiveness is an additional, persuasive, reason
to become environmentally friendly.

Although there is spirited debate about the reasoning behind social
accountability, the fact remains that corporations are stepping up to
become socially accountable. Part of accountability involves the effect a
company’s actions will have on the environment of their consumers. The
movement towards social corporate responsibility encompasses
accountability for the environmental impacts of their products, a
movement that results in both a reduced impact and recognition for
sustainable efforts. Although today’s consumers are balancing complex
lifestyle choices, environmental awareness is a growing factor in
product selection.

Just as the definition of environmentally friendly is surrounded in
confusion, so is the effectiveness of “green marketing.” While more
traditional marketing campaigns can point to metrics to illustrate the
effectiveness of an individual campaign, determining if consumers are
making choices primarily dependent upon environmental concerns is nearly
impossible. Surveys indicate that 78% of consumers consciously attempt
to buy products
that are environmentally friendly, but the problem
remains pinpointing how to utilize a sustainable preference.

With consumers making their own decisions about what “environmentally
friendly” means, producers are scrambling to capture the market and
convey the sustainability of their products. Although modern consumers
are making an active effort to buy more responsibly, many still have
little knowledge about what phrases like “all-natural”, “non-toxic”, and
“100% post-consumer recycled” truly mean. Further confusing the issue
are the varying degrees of consumer interest in “green” products.
According to Mintel,
currently 12% of consumers are classified as those that attempt to buy a
green product every time they make a purchase, while 68% of consumers
will only occasionally pursue a green option. Marketers must include
this discrepancy along with a consumer’s preference for price, quality,
and luxury.

Many marketers take advantage of this confusion to exaggerate their
claims or make their products appear to possess attributes that have no
relevance on the determination of sustainability. There is a market for
green products, a market that will yield considerable profit, but the
crux of green marketing is understanding how to exploit demand in the
green market.

Some companies have been able to create products with an emphasis on
green initiatives that appeal to consumers. Perhaps one of the best
examples is the compact fluorescent light bulb (CFL).  With a cost of
2-3 times that of their incandescent counterparts, CFL sales struggled
when they were first introduced. Not until marketing campaigns
underscored the sustainability of CFLs while promoting the energy
savings (about $26/yr per bulb replaced) did sales outpace those of
incandescent bulbs.

Another excellent example is Brita’s marketing campaign focused on
the environmentally aware. By promising that the use of their product
reduces plastic bottle waste and is less damaging to already depleted
watersheds, Brita has increased sales of their water filters. In this
case, green marketing was not supplemented by an appeal to
sustainability but was used as a standalone policy.

When you think of a green consumer you might envision someone who
cruises in a Prius while listening to NPR on the radio, but today’s
green consumer may just as well be the soccer mom down the street. Green
consumers aren’t conforming to the traditional idea of
environmentalists.  They are spread across age, geographic, racial, and
income groups.

Additionally, different groups consider different aspects of green
products priorities, and these draws range from altruistic environmental
protection to a purely financial concern due to the efficiency of most
green products. Grasping an understanding of the “green” market, and
doing it quickly, can be one of the best investments a company can make.
However, churning out products that are supposedly green will no longer
be an effective strategy as green consumers grow in both knowledge and
number.

Green marketing campaigns can be successful, but assuming that
reaping the benefits won’t require any more thought than a hastily
created green campaign could be an unsustainable mistake. Products must
actually have a reduced carbon footprint to be environmentally friendly,
and marketing firms need to tout the sustainable aspects their target
market consider the most important.

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