Monday, September 17, 2012

Profiting From the New Rules of Green Marketing

On September 13th, 2012, Jacquie Ottman conducted a webinar on the new rules of green marketing. Jacquie Ottman is a New York city-based expert on green marketing and an advisor to Fortune 500 and entrepreneurial companies and several US government eco-labels. She is also a sought-after speaker who has written four books on green marketing. She has worked with large and small companies and government agencies including Energy Star and USDA certified biobased label.

In this webinar Jacquie focused on stories and strategies from her award-winning book, The New Rules of Green Marketing: Strategies, Tools and Inspiration for Sustainable Branding (see below for more details). The webinar addressed how to take a lifecycle approach to developing and marketing greener products and packages in order to:

1. Address consumer needs
2. Manage for sustainability
3. Reduce the risks of greenwash

The Green Market is now Mainstream

Her first point was that the green market is now very much mainstream, however in the question and answer period she made it clear that we are still in the early stages. Citing Natural Marketing institute statistics she pointed out that the green market is already very large. According to 2010 research, the green market is currently worth 290 billion dollars. A total of 83 percent of US adults are associated with green purchasing in one way or another.

Consumer Breakdown

Deep Green Consumers
Natural Life Consumers
Drifters (status conscious)
Conventional (practical conscious consumers who like to save)
Unconcerned (Only 17 %)

Except for the "unconcerned" group, everyone is buying at least some green products. Proof that green is now mainstream comes from the fact that large multinationals are buying green niche labels. They are acquiring these companies as opposed to growing their own green brands. The fact that Walmart is into green demonstrates that there is value there.

Another reason why the green market is growing is because you have much better quality products offering genuine benefits just as good or better than the browner offerings.

Factors Holding the Green Market Back

The key element is perceived value. According to consumer statistics 63 percent think green products are too expensive. Another 36 percent have credibility concerns (they do not believe claims that state that a product or service is actually better for the environment). Rampant levels of Greenwash are making consumers uncertain about the veracity of green products and services.

How to Overcome Greenwash

Adopting a life cycle approach is the best way to overcome concerns about greenwash. This means that companies need to pay attention to all the attributes from cradle to grave or cradle to cradle. One attribute does not make a product green, you need to look at all of the product's attributes.

Examples of products that are not actually green are compact fluorescent lighting (CFLs). As Jacquie points out CFLs are not green, they are energy efficient. (They are not green because they contain mercury). Another example of products that seem green but are not are USDA organic produce that has been shipped across the country. The additional transportation issues preclude them from being truly green.

To be green requires that businesses look at the entire five step product life cycle, which includes:

1. Raw materials
2. Manufacturing
3. In use impacts
4. After use recycling
5. Disposal

To be green companies need to be thorough in their design so that they address all five elements of the product life cycle. Some forward looking companies are instituting takeback or reverse logistics. This implies bringing products or packaging back to the stores where they were purchased. A good example of this is Home Depot's takeback program for compact florescent lighting.

Communications

The key to green communications is to focus on primary benefits that your product represents. Stay away from the "save the planet message," or even referring to your product as green. Focus on consumer benefits (eg: maximizing their budget, saving money, longer life etc).

Marketing Focus Should Reflect Consumer Priorities

1. Health
2. Money
3. Convenience

Health is the top environmental issue, consumers are less focused on resource issues. In terms of consumer priorities focus first on water conservation, then on deforestation. Focusing on climate change does not offer a strong marketing position.

The goal when communicating information about a green product is to first distinguish your product from the browner products and then other green products. A good illustration is Proctor and Gamble's Tide Cold Water. The marketing of this product is focused on money savings.

An effective communication is focused on a few points that resonate with your consumers. You can talk about green issues when there is more space (ie on your company website), but the primary focus must always be on issues relevant to your client.

Establishing Credibility to Combat the Perception of Greenwash

Transparency is perhaps the single most important issue in the effort to address consumer mistrust. Patagonia  is a great example of a company that uses transparency well (they document important environmental details on their website).

Ultimately establishing credibility is about authenticity (walking your talk). You must do what you are asking your clients to do. Offering tips for consumers is a great idea but only if your company is doing it as well (ie HSBC encourages their clients to reduce their paper usage and they practice what they preach).

Shared Responsibility

Encourage your clients to use your products responsibly. That means promote responsible consumption (and disposal) of your product, not just selling your product. This point may seem counter intuitive to some marketers, but to be a responsible marketer you need to encourage your clients to buy when they need your product, not when they do not.

A good illustration of encouraging positive consumer behavior is the dashboard meter in cars that shows fuel efficiency ratings in real time.

Conclusion

The truth is there are no truly green products, some products are just greener than others. Find attributes that are most important to your customers and emphasize these. Do not make green references or make generalized environmental claims. Make specific claims about product benefits. Make environmental impact statements that show what is being saved or conserved. Essentially make the intangible tangible

To buy Jacquie's book The New Rules of Green Marketing click here.  Her site can be found here and to go to her new site called "We Hate to Waste" click here.

This webinar was sponsored by the Green Business Network, they work with over 3000 businesses, they are also behind "green festivals," and they are about to release their 20th edition of the national green pages. For more information on the Green Business Network click here

© 2012, Richard Matthews. All rights reserved.

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1 comment:

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