Understanding the five key rules of green marketing

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By: Wise Marketer Staff |

Posted on October 22, 2007

When it comes environmental and ecological sustainability, consumer groups are increasingly targeting even the most respected and trusted brands in the world, according to green marketing firm J. Ottman Consulting, which has identified five key rules to help marketers avoid green boycotts and ecology-related brand damage.

According to company president Jacquelyn Ottman, businesses that aren't managed with environmental and social sustainability in mind are now less likely to be sustainable in their own right, as consumer pressure continues to highlight the need for eco-friendly business practices.

Competitive advantage
In fact, Ottman suggests that the equation extends the other way, too: A strong corporate commitment to environmental sustainability in product design and manufacturing can actually yield new and significant opportunities to grow the business, to innovate, and to build additional brand equity.

But making sure that consumers understand the company's green positioning is not easy. Many responsible companies have found themselves being targeted by eco-enthusiasts simply because they had a badly planned and crafted green marketing message. In other words, if a company's green efforts aren't clearly understood, they're of absolutely no benefit to brand equity.

Five rules for green marketers
Ottman Consulting's rule book for marketers who are trying to put across a genuine green message can be briefly summarised as follows:

  1. Know your customer
    If you want to sell a greener product to consumers, you first need to make sure that the consumer is aware of and concerned about the issues that your product attempts to address. For example, one electrical appliance manufacturer quickly found out that customers weren't willing to pay a premium for "CFC-free" refrigerators simply because they didn't know what a "CFC" was.
  2. Empower your customers
    Make sure that customers feel - not only by themselves but also in concert with other users of your products - that they can actually make a difference. This kind of empowerment is often the main reason why consumers buy greener products.
  3. Be as transparent as possible
    Consumers must believe in the legitimacy of your product and the specific claims you are making. But beware: there's a lot of scepticism among consumers, fuelled by the hundreds of spurious claims made in the early days of so-called green marketing in the late 1980s and early 1990s. It's important to make sure that the green benefits of every product are clear, well explained, and completely true in any normal usage situation.
  4. Reassure the buyer
    Consumers need to believe that a product performs the job it's supposed to do. Consumers are seldom true 'green idealists', and won't usually forego product quality in the name of helping to save the environment.
  5. Consider your pricing
    If you choose to charge a premium for a green product - and many environmentally preferable products cost more due to genuine economies of scale and the use of higher quality ingredients - you also need to make sure that consumers can afford the premium, and feel it's worth the extra money. Many consumers simply can't afford premium prices, even for green products, so it's worth setting the pricing strategy according to the target audience and product specifications.

A fine example
There are some products that have already gained a competitive advantage through eco-friendly design and innovation. For example, family business Tom's of Maine created a line of eco-friendly personal care products some 25 years ago and, ten years later, the products were taken up by CVS, Duane Reade, and other mainstream drugstores. That company is now owned by Colgate-Palmolive, and is one of the many "deep green" brands that are increasingly being purchased by mainstream marketers.

The reason for the company's success was that the messages on the side of the company's product cartons reinforced the company's green position. On another panel is a list of all the ingredients (in the toothpaste, for example, "all natural spearmint oil") and next to each ingredient is the role it plays in the product. The company even went as far as to list where each ingredient was sourced. That showed an unprecedented commitment to transparency and consumer empowerment, and it won green consumers' hearts and minds. It helped get consumers over any price barriers at the point of sale because they knew they were choosing a brand with natural ingredients, and recognised that it had to come with a premium price tag.

Practicalities to address first
To begin putting these five rules to work, and to capitalise on the market opportunities represented by sound sustainability practices and green marketing, there are best practices that will need to be followed:

  1. Think and act holistically
    It is no longer enough to focus on functional benefits alone. Ask yourself: "What are we making (products or services), how are we making it (green or not), and who are we working with (what's their green status)?"
  2. Take advantage of green opportunities
    Green marketing offers a differentiated way to engage consumers on an emotional level and build brand equity. Ask yourself how you make your corporate "passion and vision" both relevant and engaging, and how you can turn your consumers into advocates. Examine how you can empower consumers to make a difference by providing them with the necessary information, education, infrastructure, events, and experiences.
  3. Don't even think about 'green-washing'
    The way you communicate your message will be critical to its success. Ask yourself how you can ensure that your approach is viewed by consumers as being authentic and transparent. Are all the stakeholders aware of your intentions and progress, and is the green vision firmly embedded in the fabric of the whole company?
  4. Greener innovation
    Eco-innovation represents a breadth of new ways to grow top line sales. Ask yourself how you can inspire consumers, and what technologies and partners you'll need to gain access to.
  5. Go for 'zero environmental impact'
    Strive for an ideal goal of zero environmental impact, and aim to eco-innovate rather than simply redesigning existing products to look greener. Ask what it would take to achieve that goal while still meeting your customers' needs. Can you make consumers more responsible, perhaps through education and awareness? A zero impact will only happen if changes in consumer behaviour can also be made.

J. Ottman Consulting is based in New York, and advises businesses on strategies for eco-design, eco-innovation, and green marketing. The company's clients already include Nike, GE, IBM, and the US EPA's Energy Star division.

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