Harvard Business Review

Make hay while the sun shines.

That’s an old adage I picked up from my Dad who grew up as an Iowa farm boy. The summertime - when the days are long and the sun is hot – is the best time to grow animal feed for the coming winter. For green marketers, the summer is now. But as Steve Bishop points out, executives may not see a bumper crop.

Curiously, branding is also a farm tradition. Searing an insignia into a steer’s side was often the only way to tell the difference between your livestock and mine. Today a sewed on “Swoosh” is often the best way to differentiate pairs of sneakers.

There are plenty of green branding efforts. GE’s “Ecoimagination.” GM’s “Live Green. Go Yellow.” BP’s “Beyond Petroleum.” All are attempts to define “sustainability” within their industry. But despite any ecological advances they have made, all can be disparaged as “greenwashing” by so-inclined environmentalists.

The real problem for green marketers hoping to sell green products is that sustainability isn’t a characteristic of any single product. It is a system condition. Nature shows us this. No ecologist would talk about a “sustainable tiger” or a “sustainable walrus.” It wouldn’t make sense. What makes a tiger or walrus “sustainable” is its membership in a larger community of organisms we call an ecosystem.

The same is true for “green products” and “sustainable companies.” They need a sustainable ecosystem to support them. Green products need green production systems. Green production needs green suppliers. Green suppliers need green energy. And so the chain of green relationships goes…

What green marketers - and green executives - need to communicate is not the greenness of their product line, per se. Instead they are better off engaging their customers in a conversation about how the company is fulfilling its ecosystem role. How they are driving their companies and their community of business partners toward sustainability.

Steve Bishop referenced the work of marketing great Ted Levitt. Levitt also spoke of marketing myopia arguing that managers focus, to their detriment, on products instead of customer’s needs. Maybe this is why one of the companies having the biggest impact on its commercial ecosystem doesn’t produce any products at all. The “Green Wal-Mart Effect” is being felt by consumer product companies around the world. The Green Wal-Mart Effect is a recognition that greatest contribution Wal-Mart can make is not in their stores - but in the operations of the innumerable suppliers that stock their shelves.

Wal-Mart appears to recognize that a sustainable product depends on a sustainable value chain behind it. It may be that companies like Wal-Mart, not the green consumer, make the sun shine. The members of Wal-Mart's greening ecosystem better get to hay makin’.

Environmental friendly production is vital in running future economies. By nature plants take carbondioxide from the air and gives oxygen in respiration process. By doing this,they make ecology sensible and sustainable. Companies should stop polluting the environment and make their existence sensible and sustainable. They should go green.

A critical challenge in marketing is to leverage consumer insights to translate product attributes into benefits that resonate with their customers. For example, instead of photographic filmmakers screaming that their picture was the brightest, consumer insight that tapped into underlying motivation for taking photographs ("storing memories") led to emphasizing attributes that were relevant and resonated with their customers.

In a similar manner, the motivation for purchasing green attributes or products will vary across customers. For some, the environmental benefit will need to be translated into a personal one - whether that relates to "biking with friends and family is fun" or "buying this washer/dryer will save me a few hundred dollars over the lifetime of the machine." For others, the societal benefit of helping the environment is compelling enough. Again, customer insights are critical in translating the attributes into the relevant benefits. In that sense, Levitt's axiom is incomplete: "different consumers define what is a "hole" differently."

A similar parallel can be drawn in other societal programs such as recycling and donating blood. For some, the personal satisfaction of saving a life is enough, for others, it may be the hobnobbing with celebrities, getting ahead in the line when they need blood, etc. that is the real motivator.

In my next post, I want to discuss the role of corporations in "shaping the benefit" derived from green products rather than being passively driven by the consumers. After all, most consumers don't spend every waking moment of their lives thinking about either the environment or green products. It is the job of the company to make the relevant links between the benefits and products or services provided. If you think of it as a niche, believe me, you will remain a niche.

Steve’s comments suggest that there are two distinct groups of consumers — his “hemp-wearing” “green” consumers who will sacrifice quality in the quest of a better environment, and everyone else, or “mainstream” consumers. The truth may actually lie somewhere in the middle. According to polls —and borne out by years of double digit sales of such products as organic foods, natural personal care products and hybrid cars, about 2/3rds of all U.S. consumers now have strong green leanings.

What my 20 years of experience tracking green marketing campaigns suggests, is that the most successful green marketing appeals underscore the primary benefits of greener products and incorporate environmental benefits as an “added plus”. (How many of us buy Energy Star-qualified appliances and CFLs because they first save money? Or organic foods because they are presumed safer or taste better?) Indeed, Steve’s example bears this out. Their bicycle —a green product—appealed to the greenness in the broad swath of the population.

What would-be green marketers need to avoid is something suggested by Steve’s remarks—and what my colleagues, Ed Stafford and Cathy Hartman of the Huntsman School of Business at Utah State University, and I call, “green marketing myopia” — leading with green benefits at the expense of the reasons why consumers buy certain products in the first place. This approach is destined to fail with even the greenest of consumers; they, like all of us go to the supermarket in search of laundry detergent to get their clothes clean, not to save the planet! See the article in Resources Section on this page for more details about this topic.

It is not just what one says, but how one says it. Complete, authentic messaging. If there is one thing that marketing to "Green" consumers has taught us, it is that they seek and respond to "authenticity". This is where I believe there is common ground with mainstream consumers, particularly younger Generation Y consumers. Pure benefit selling with factual reasons why is not enough for both groups; they are tired of endless advertisements, claims, "Green Washing", and the like. They seek authenticity and consistency in messaging, product/service design, manufacturing, employee and community support, and so on. Prius has done this rather well, providing both emotional and functional benefits that appeal to both Green and mainstream consumers, trying to build enduring brand relationships that will keep devotees brand loyal throughout their purchasing lifetimes.

I think that many persons do not start out buying green - what they are looking for is a hole, and if perchance the drill is low impact on the environment and low impact on the pocket, they buy the drill.

It therefore makes sense to expend more resources on greening the product than marketing to the green consumer (these are in the minority anyhow).

So I support Mr. Bishop's position of not marketing to the green consumer.

Gregory brings up a great point about the importance of a supportive ecosystem. By definition, for any green offering to be successful, it must find its place in the systems it’s connected with – the value chain, ecology, existing markets, and equally important yet often overlooked, people.

If people are considered, it is usually in how they use or consume supply. But what’s happening on the demand side of the equation? What do people desire? How might green offerings improve people’s lives? What green behaviors do they aspire to? Failing to address questions like these is why many green offerings fail in the marketplace and ultimately break the ecosystem they live in.

To follow Gregory’s analogy, if the tiger lives in a perfect jungle with an infinite supply of nutritional food that it doesn’t like, then the tiger won’t eat. The consequences will be felt by the tiger and the ecosystem. Similarly, companies that go through the admirable efforts of cleaning up their supply-chain, yet fail to create offerings that are desirable to their customers, risk similar results.

To create successful green offerings means creating something real and desirable that allows people to engage in new positive behaviors. A conversation about a company’s role in the ecosystem is important for a company’s CSR initiatives and in business-to-business conversations, but it’s not the way to connect with consumers. What they need are solutions that fit their everyday lives and a way to easily understand how they make sense for the environment.

As Gregory points out, retailers like Wal-Mart are making the sun shine on sustainability with advances they made in their value chains. The challenge for companies now is to "make hay." It’s up to marketing execs and designers alike to be sure we’re making hay that is desirable.

It has been my experience in helping consumers Green their home that there is no one "Green Consumer". For some, "Being Green" means saving energy and money. Other homeowners I deal with think almost exclusively in terms of "Indoor Air Quality and chemical free living" when they say "Green" and others mean "Food Quality, Food Miles, Organics". You can take this observation and perhaps conclude that you don't want to target the Green Consumer because there are really many different "Green Consumers" and what you thought was a large minority is really in fact just a collection of target consumers too small to bother with.

I really like Greg Unruh's post because I think a Green Eco System will in fact evolve, just as an "ecosystem" evolved around the concept of Quality and Waste Reduction when I got out of HBS in 1991. Your suppliers will have to supply inputs that are green in measurable ways and you will operate your business as if the environment really was a concern beyond just government compliance.

Just as the automakers developed quality certifications (Ford Q1, for example) and ISO 9000 came into its own, we see LEED really becoming defacto in new construction (LEED-NC) but there is also LEED-EB which helps measure progress by "Existing Businesses" in measures of sustainability.

Down the line, most products will have important green attributes and most successful companies will "walk the talk" when it comes to green (at least if they plan to recruit anyone under age 25). If for no other reason than we can't continue along the path of building products without regard to their impact on the environment during the entire life of the product.

So should you ignore the "Green Consumer" ? I think you ignore the Green motivated consumer at your peril. I deal with them every day and while Green is not mainstream yet, the skills to design and manufacturer green products and run a company in a more sustainable way are skills that will take years to perfect, just as changing a company culture to build "quality" with few defects and little waste was a multi year process.

We need our Green Dr Deming : -)

Travelling small distances on bicycle and printing on both sides of paper could be encouraged. Could we create a small list of "Green Behaviours"?

Part of the issue for some companies is that they seem to talk about being green far more than they actually do for the environment. For instance, several car companies have radio commercials in which they tout their alternative fuel development efforts, such as hydrogen fuel cells or a plug-in power system. These development efforts have yet to yield anything substantial, other than commercials and false bragging rights. Additionally, this is overshadowed by television commercials in which they are advertising their vehicles which average less than 20 MPG and their lobbying efforts to resist having to increase the fuel economy of their current line of vehicles. I would wager that the money spent on the latter marketing and lobbying efforts far surpasses that spent on the marketing of the development efforts.

While I heartily agree that companies need to determine consumer needs with their products, rather than develop a product and THEN look for a consumer, they need to be honest and earnest about fulfilling the consumer's needs. People have limited patience with empty promises of "some day." Even the most loyal customers will eventually tire of the promises and take their money elsewhere.

Take the example of Toyota, with its push for hybrid vehicles. Obviously, these vehicles appeal to consumers who desire better gas mileage and lower emissions. However, certain areas of the US allow single drivers to use high-occupancy vehicle (HOV) lanes if they are driving hybrids. Several individuals who are somewhat less than concerned with the environment have admitted to purchasing a Prius simply so they can use the HOV lane and reduce their commute time. The car companies who are still talking about their green development efforts, several years after beginning them, are losing part of their consumer base because someone else is fulfilling their consumers' needs -- a shorter commute.

At TheDailyGreen.com, we intentionally target what we call the "heart of green" market. On an imaginary bell curve of consumer "green-ness", it would comprise the middle 60% of the landscape.

That being said, we find it also important to "remember who brought you to the party," meaning we also program news and service journalism to excite the people who have been living the green life before it moved from fringe to mainstream. Not only is it the right thing to do, but these people remain thought leaders in the movement, and they wield broad first-mover influence in their social and business networks. In addition, the very robust eco-blogosphere tends to be made up of "movement" greens, and as we know, online green cred is conferred in some quarters among this constituency.

Consumer product marketers need to target the "heart of green" consumer to meet their numbers...but they also need to engage the deep green consumer for their product's cred.

We have a funny "how green do you want to be?" quiz on the site that lets readers self select where on the "green-o-meter" they want to be at: http://www.thedailygreen.com/environmental-news/how-green-are-you

Green consumer is a well educate people, so that he use to have a good level of income. Otherwise, His behavior is tauch to relatives, friends and coleagues. I think that all this are good reasons to expect this segment will grow in the future.
The firms that engage in green marketing will built knowledge and trademark for now and the future
Like any investment, it has risks but there is an opportunity too

Is there evidence that, all things being equal (price, performance, convenience, etc.), the world's consumers prefer green products? My sense is that "greenness" is far, far down the list of qualities the vast majority of people seek in the products they buy. They want the product that satisfies their material needs best -- does it make a hole the size I want? Is it cheaper than alternatives? Does it perform better? Will it cost less to own? Is it easy to buy? And so on. Whether a product is green or not, I suspect, has relatively little impact on most purchase decisions --particularly when you look beyond the rarified group of affluent, socially conscious shoppers at Whole Foods.

I have a hunch that unless a green product delivers material benefits that consumers can't get with a dirty alternative, it will remain marginal. The Prius does offer such benefits (high fuel efficiency, HOV lane access) and consumers can't get enough. But what consumer is going to toss his or her reliable, cheaper dirty paper towels and dish soap for the pricier, poorer-performing green versions? When companies make green products that outperform dirty alternatives, consumers will buy them. Appealing to consumers' presumed better selves -- the green behaviors they aspire to, as Steve Bishop puts it -- strikes me as, at best, an inefficient way for companies to try to influence consumer behavior.

What’s a green consumer? I don’t think we can adequately discuss whether companies should “bother” with this category until we define it better. If we assume it’s a niche (insert stereotype: granola eaters, Birkenstock wearers...) then sure, it’s easy to say that mainstream companies should not narrow their marketing efforts to just that group.

But the green consumer category is evolving rapidly and increasingly hard to pigeonhole. Does it include a suburban mother who buys organic produce for her family? A senior citizen who installs new home insulation to reduce energy use?

Research firm Gfk Roper’s 2007 Green Gauge study reports that 87% of American consumers say they are very concerned about the environment. Yet consumers often don’t think of their purchases as explicitly green. Ask that suburban mom why she buys organic and she’ll probably say, it’s healthier. The homeowner may well explain that he insulates to save money. Both consumers have made environmentally beneficial decisions, whether or not that’s their top priority.

To some degree, most of us are green consumers now, yet we’re a different shade of green: both pragmatic and uncompromising. In our research at GreenOrder, we’re increasingly encountering this “no sacrifices” consumer who expects products that are more efficient, less polluting, healthier, and more responsible, but who doesn’t want to skimp on quality, value, style, or convenience. (B2B consumers are even more demanding, but that’s another issue.)

Satisfying these consumers requires much more than savvy marketing. It demands a new approach to product development — and to business strategy generally — that sees green not as a marginal niche, but a source of value that all customers can appreciate and will eventually expect.

The corollary is that greener products need to be, quite simply, better products. And companies who succeed in bringing them to market should be rewarded accordingly.

So perhaps Steve Bishop is right that most companies should not bother with green consumers, but they certainly should worry about creating greener products.

I agree with Steve Bishop's basic sentiments. I don't buy "green" paper products because they don't meet my expectations. In addition green advertizing by companies like BP or GE triggers my cynicism and turns me off on the company.

However, I think Bishop misses an important aspect of the discussion. It is true that consumers speak when they buy products but they also speak when they vote. I would support a candidate who wanted standards for recycling even though I might not pay extra money for a recycled product unless I was clear that it was a quality product.

Thus I think that the organizations that do well in the future will be the ones that find themselves on the green side of practice as new legislation is put into place. I am convinced there will be new regulations in some form, whether we like it or not. The stakes are simply too high for us to wait for market based solutions to solve this overall problem.

I agree with Mr. Bishop. Green unto itself does not translate into results. Based on what I see, as the environmental issues take front and center in our collective consciousness, we will expect an environmetal concern built in to products and the companies we do business with. In other words green is and will continue to be Context. Violate it at your peril, as the US automakers did during the SUV bubble in the pre- $3/gallon gasoline era, but don't expect to derive differentiation or competitive advantage from green either. Customers still are looking at what's in it for them, and that was, is and will continue to be Core, as the Shimano case Mr. Bishop poses so clearly demonstrates.

Steve's column was "spot on" as the political pundents would say. We (CHEMARK Consulting) found out the old fashioned way ... we went out and interviewed a lot of people to find out that performance to cost ratio (value) is where descisions come down and, "Oh, by the way, it's green".

Our client had invented a new additive to latex paint that was green and was 10-20 times more effective that current biocides in preventing mold and mildew growth on our houses.

To gain EPA approval for a new biocide it requires $2 million and 2.5 years timie. We thought, because our new biocide was not only green but it was alos an ingredient currently used in foods, we would not need to go through the expense and time for approval. WRONG!!!!

Green didn't help nor did its' current use in foods with FDA approval help.

MOST importantly, the market we wanted to sell directly to said they would not promote green as the primary "pull-through" marketing mechanism. The new green biocide would have to be EPA approved ($2MM and 2.5 Years) as well as outperform the current approved non-green biocides and be within 3X the cost of those existing systems, to be interesting.

You're correct ... there is not enough mass demand pull-through for green to at this point in time.

Regards, Phil Phillips

There is one very good reason for companies to "green" their products...profits.

Using less fuel in Wal-Mart trucks will deliver meaningful bottom-line results for the company. Consumers likewise can benefit from purchasing products that consume less energy; their family budget will have more discretionary purchasing dollars left at the end of the month.

Not to diminish the marketing spin on "going green", but that value is a rounding error compared to the longer term competitive and profit advantages derived from smart investments in green technology and practices.

The point about consumer behavior (driving 55, what a concept!) is interesting. I have a 20 mpg SUV that I drive 12,000 miles a year...most of the time with several other people in the car. My neighbor has a Prius that she drives 22,000 miles a year...usually alone. If you compare gallons of fuel consumed per person, we're probably not much different. You wouldn't know that by her sanctimonious attitude, however!

"Don't bother with the Green consumer"... the tag line stood out for me personally as I am a shareholder and one of three chiefs at an energy retailer/utility. We attempted to position an environmentally-friendly product in the market about 6 months ago as we had been under the impression that there was a demand for the same, and secondly, we actually and sincerely would like to see more optionality when it comes to electricity generation. While a "green" product may not be a solid answer towards addressing the real issues around the core need for green products in general, seeing a positive response from the consumer definitely helps on a number of fronts including but not limited to creating a better regulatory landscape and warranting investment for more innovation.

In any event, the traction has been dismal at best. I was just yesterday having conversations on whether or not get a "bigger megaphone" etc... So the topic jumped out at me. At this point, the only conclusion that I can draw is that "green" is still very much a trend in the vast majority of the consuming public’s mind; because if you come right down to it, it appears that people would rather buy good-o-cheap and dirty coal power. Open to suggestions and thanks in advance.

A company who takes Mr. Bishop at his word - Don't Bother With the "Green" Consumer, will be lulled into believing that they can safely ignore the green consumer. Such a company will gradually see their market share deteriorate until they no longer have much presence.

Mr. Unruh's commentary comes closer to hitting the mark. Marketing green products is not an "either/or" proposition. You don't have to avoid marketing to green consumers for fear of alienating existing customers, or to customers with a more "mainstream" purchasing rationale.

I dare say that a clever pitch could engage all consumers, green or not, and have every one of them believing that they are getting a great product and also helping the environment. Those consumers who are not particularly green-focused, will, nevertheless, pat themselves on the back because the product they bought made it easy to be green (contrary to Kermit's lament) without having to think too much about it. Their carbon-consciousness will be slightly elevated each time this occurs, until they one day realize that it has woven itself into their everyday protocols and behaviors.

Mr. Bishop's philosophy totally ignores this possibility. Having a dearth of ideas is no excuse for settling for the easy solution and producing a vapid and cynical campaign. Green-ness is here to stay and more and more consumers will "come to the party" - some willingly, some reluctantly.

But until companies quit trying to "play the green card" as a side bet, just in case green is for real and not just a fad, and embrace green-ness as simply the proper course for the ultimate sustainability -- that of our planet -- then they will continue to do a disservice to their customers, to the ecosystem, and to their own viability.

Until companies quit trying to "play the green card" as a cynical mask of their true color (e.g. British Petroleum, who is trying to rebrand itself because it has the most egregiously poor environmental record of any major oil-driller, not because it permeates their business philosophy), consumers will not believe what the marketers are trying to tell them about their products.

Thank goodness for Wal-Mart! (I never thought I would hear myself say that!) Wal-Mart has seemingly taken all of the criticism of their business model to heart, and they are genuinely trying to "do the right thing." They are successfully overcoming a lot of bad press, and bad consumer-relations by stepping up to the "green" plate in many of their initiatives. They are not afraid to claim "green" as Mr. Bishop would have advised them, and they are going to reap benefits in every aspect of their operations because of it.

We have fostered a few successful 'green companies' at The Hive [a business incubator in Huntington Beach, CA]. Even though we are located in a wealthy area that favors ecological solutions, we find that few people will pay up for a product merely because it is 'green'. The product has to have a practical, and even money-saving, hook before it will be adopted by a meaningful market.

Imparting this knowledge to the entrepreneurs can be difficult. We have seen companies fail quickly in this space because they have an unrealistic view of their target market.

One mistake is to assume people will pay more for a green product. While it is true that people will pay a LITTLE more for a truly outstanding product, there must be an additional benefit. For example: The Prius is a bit more costly than other cars in that size class, but the attraction of being able to drive a hybrid car in the carpool lane in Los Angeles gave the Prius a major boost. Also, as gasoline prices rose the Prius became more attractive. It had been available for some years prior to the gas crisis, and had not enjoyed outstanding sales until the additional values of lower costs and the carpool lane promped people to buy.

Another mistake is to talk to the target market as if they share your passions about green products. While they may, it should be remembered that philosophy and reality are two different things. Your pitch should be aimed at the average consumer and, if it emphasizes the green qualities of your product, it should be communicated as a side benefit to the product. Everyone wants to feel good about purchases.

Here at Equal Exchange (a small organic, Fair Trade food company) our experience has given us a different perspective, but it seems consistent with that of many other small companies who helped pioneer one green category or another.

Basically we need to remember that the marketplace is not static, with a fixed number of deep/middle/or lite-green consumers amongst whom we have to choose who we pursue (tho' that is undoubtedly true in the short-term).

Rather - as we know well from the conventional marketplace - green pioneer companies very often create the demand for their goods and services, usually slowly and patiently over years, and often because they themselves felt so strongly about the issues involved. They’re sometimes ahead of the curve and creating and marketing such products before there is any “green consumer” segment – large or small.

So instead they have to doggedly educate some tiny receptive, but not yet converted, slice of the public, sometimes one shopper, one small store keeper, at a time. And they keep at it, gradually growing the market, and their own businesses along the way. This is not typically the way Fortune 500 companies roll out products or marketing campaigns but it is how the organic, Fair Trade, cruelty-free, allergen-free, etc. categories where slowly created over the last 20-30 years. They all started as “niches”, ignored by the big players, and in some cases a small player was able to ride the boom and stay atop of their categories (Organic Valley, Earthbound Farms), even after the much larger corporations and brands belatedly entered the fray.

And, of course, for those late-comers they do need to pick from amongst the existing segments UNLESS they, too, decide to become a champion & educator in the field and work to convert the some of the millions of average consumers to green consumers.

So if you can think REALLY long term you might have more options than you think.

It seems like most of the arguments against designing and marketing green products are strawmen at best.

Who said a green product has to be more expensive or not as effective? Clorox just introduced a line of green cleaning products that don't cost any more than the competition and work just as well. Green = more expensive is a myth.

Who said green messages don't resonate with a consumer? I guarantee you if you sell a dishwasher that costs $500 a year to run and I sell an energy-efficient one that costs $10 a year to run, I'll sell plenty due to the reduced cost of use. "Green" messaging doesn't mean we're selling flowers and puppies and blue sky.

Who said the greenness of a product has to appeal to the comsumer at all to be profitable? If a company reduces the amount of packaging they use by 20%, will the consumer care? Probably not. But they just made their product more profitable by spending less on packaging.

The big problem is that companies (and marketers) see "green" as something that can be bolted on. That's a recipe for failure. "Green" has to be woven into the fabric of a company. Then everything everyone at the company does will be viewed through a lens of sustainability. Suddenly, it's not something you do, but something you are.

As the editor of HBR Green, I am struck by the quality and quantity of the posts and the speed at which the discussion is growing. We started HBR Green because we realized that the scope of the business transformation that will be required to change traditional businesses to green businesses is overwhelming. Despite our decades long tradition of bringing the best of management to our readers piece-by-piece and page-by-page, we understood that only by hosting a collective conversation would we be able to encompass all the necessary vectors of this complicated topic. So whether you are from a Fortune 500 Company or a small green company, welcome, and let’s keep talking.

Now who has any advice for AROD whose post is above? He’s a well-meaning executive with a green energy product. He fears that maybe people really prefer coal. It is possible that some people, maybe the majority, will only think about their wallets, yes?

But we know that overwhelmingly polls show that people care about the environment. So where is the disconnect? What is the role of marketing in informing consumers about the choices they are making? When can a company get out in front and lead the consumer? When must they follow? And what should AROD do? What happens if he grabs that big green megaphone? Can he really convert his customers one at a time the way Rodney of Equal Exchange suggests? And, the real question of course that looms over this discussion: What happens if he can't? Do our environmental problems simply spin out of control?

Nancy Nichols
Editor, HBR Green

Let's face it, if consumers want to be green they're washing their windows with vinegar, not with a product that comes in a recycled plastic spray bottle "with vinegar added". I agree that it is a waste of time to market to this group, but the reason isn't that there's no market, it's that these consumers are, in fact, suspicious of the motives of companies that repackage old formulas to make so-called green products. This cynicism is reminiscent of the way some oil companies used to sponsor television shows about the wonder of nature to mask issues in the industry, or how tobacco companies sponsor art exhibitions.

To my mind, the real problem isn't how consumer goods companies can market to the "green consumer", it's whether or not that particular consumer is going to be receptive to any message at all. If we look at what does work, it's in the service sector -- green drycleaners, for example.

Traditional consumer goods companies won't truly change their products unless their profits are declining, and unfortunately they may turn to these consumers only as a last ditch effort. On the other hand, service companies can offer green services without affecting their value propositions substantially.

"Don’t Bother with the Green Consumer" is a catchy and provocative headline but it obscures the real issue. I believe there is a "green consumer" market – i.e. consumers who prioritize sustainability above other product features. But, this is a niche market. Some companies can target this market and be financially successful (e.g. Burt’s Bees).

The real issue is that most consumers – and business customers – are looking for other (non-green) benefits first. As Steve puts it, “they want solutions to their day-to-day problems that also make sense for our environment.” That does not mean that product marketers can ignore sustainability issues when they are developing market requirements for new products. It means that marketers and product developers face the very interesting challenge of devising products that incorporate sustainability while still meeting the customers’ other (in most cases, higher priority) needs. It’s an exciting challenge, full of real opportunity for those who like to innovate and want to beat their competition in the marketplace!

It also means that marketers need to tailor their green messaging to their markets so that these messages resonate with their consumers. Lexus hybrid marketing is a case in point. See my post "Tailoring Cleantech Messages to Your Target Market."

It’s easy to get carried away by the current media avalanche of green stories and consumer surveys. Smart marketers need to remember that consumer buying intentions are usually not completely borne out by actual purchases (as in “the road to hell is paved with good intentions”).

It's also important to critically assess who is deciding what is green. There is alot of noise out there as to what is green (or in relaity - greener than something else). Let's not forget that many standards and certification systems have been developed to exactly draw that line in the sand. We are launching www.ecolabelling.org to be a reference point on all those labels.

Anastasia O'Rourke
Co-Founder Big Room &
PhD Candidate, Yale School of Forestry and Environmental Studies.

For AROD I'd first acknowledge that there are all kinds of issues, like matters of scale, or the price premium or price point, etc. that influence one's options in marketing a green product. No doubt selling green power is very different than selling Fair Trade coffee as we do. For example back in the 80's we could sell less than a $1 million of coffee per year - to customers scattered over 20 states - and still operate and keep slowly growing. Maybe AROD has to sell $50M/yr in one state for it to work.

With that said instead of a bigger megaphone AROD might try starting some quiet, one-on-one conversations with his customers, of course, starting with the likely ones (members of the Sierra Club & other environmental orgs). Ask for the opportunity to speak to their local chapters (so we're talking 10, 20, 30 people at a time). Try to secure some endorsements and public support from such groups, or really any group that is highly reputable. For example, many faith-based groups across the political spectrum are now advocating for greener causes, especially the fight against global warming. They might lend you a hand. Local city governments, schools, universities, hi-profile like-minded businesses could all play this role, too.

Also, be patient. I know you may not have that luxury but in terms of converting consumers, or educating them, or establishing your legitimacy or even getting people's attention six months is nothing. But if you can hang in there, show you're serious, and slowly build a foundation of public awareness and a network of both individual and institutional support over a few years you might get there.

We had success with all those approaches, as well as others.

And as others have pointed out here, regulations might well demand these changes of you anyway before long, so you might as consider this a way of hedging your risk even if its a money-loser for now.

I can agree with most of the comments stated in these notes. As a marketer I believe the true problem is consumer knowledge along with a lack of educated business leaders within the environmentally friendly fields. For years I tried to sell to consumers and always found them more knowledgeable than my sales people and dealers. in some cases even myself. Be aware of your marketplace and why they are shopping for green products. Knowledge is a powerful tool.

The ideas behind the article make one think about the real ways in which we can save the environment, but certain aspects are to noticed.

You can tell people to drive more efficiently or turn off their laptops when they're not using them etc.But consumers won't change their behavior overnight, it takes time.

Another issue is the real reason why consumers buy green products. Many truly care about making a difference but some use it as a status symbol in the society to show their green credentials or just jump on the green bandwagon without fully understanding what they're actually buying.

Green products create awareness, which is an important signal to consumers, which see that the companies are "trying to do something about it". Yes, it is not enough to buy a green product (or one labeled as such), but we also need to change the way we use these products. If companies truly want to achieve CO2 emission cuts for example, they have to provide the consumer with addition information on efficiency.

Producing good value products that last is a "green" thing. For many of us who make personal decisions to purchase based on longevity as well as value, the greenness is in not having to buy something again in a year or two. As a toxicologist, I would suggest that marketing to green consumers is less important than marketing to value-based consumers.

Also, I judge a product's worth not only by whether it is green now, but what expenditures were required to produce it and what are the environmental consequences of disposing of it when it finally wears out? Is it in fact recyclable or re-usable and is there a current outlet for the product to be re-used in some way. Claims that ethanol is an environmentally friendly fuel do not take into account the fuel costs of producing ethanol from corn.

Having spent many years working for an environmental agency and helping with environmental education, I would say that the average consumer is very unaware of what sustainability really means and is easily misled. While it is not the manufacturer's job to educate the consumer, sometimes explaining why a product is actually better for the environment as part of the literature included with a product might make people recognize the value-added by buying that green product the next time. But if it is inferior or does not last, few rational consumers will buy the product again.

Since many of the people on this chat are marketers they might not like the idea of "Use Less Stuff" but consumers can pick up on the idea that we consume and throw away a lot of junk! Again, buying wisely for value and durability is an environmentally sensible thing to do.

We are marketing an easy means of disposing of domestic organic waste and adding value to land - it's a composter.
We market the product with the message 'GOOD FOR THE PLANET - GREAT FOR THE GARDEN'. This has expanded our market beyond those seeking an easy to use composter to include those wanting to 'do the right thing' as long as it is not a hassle.

We agree with the thrust of Bishop's argument that only reaching minority niche markets is not good business. We would also suggest that unless products that are more eco-friendly reach mass markets they won't help divert the danger we face.

New tools change behavior (think computers and mobile phones) so providing products that meet needs/wants easily AND are better for the environment is likely to be more productive than worthy education programs.

Michael Smythe
Design Director
Earthmaker Enterprises

Consumers do need more and better information on why the 'green' feature is important, and what specifically the company or its product does to help, in terms of this importance. Research suggests consumers increasingly care about environmental and social aspects of products and firms' operations, but research also suggests that firms do a poor job of communicating to these consumers (e.g. the very high proportion of cause-related marketing claims that are vague or abstract, rather than concrete and therefore useful to the consumer who needs clear information to assist their evaluation. Greenwashing has made consumers skeptical, so firms need to tell their 'story' better, and more convincingly. Should firms market to 'green' consumers? Given the increasing sustainability imperative they'd better; if they don't their competition just might. But 'green' is only one issue that firms could/should be considering. As large corporations have recently discovered (e.g. Nike, Starbucks, WalMart), there are other 'social' ('blue') issues that need to be attended to, and not attending to these, and telling consumers you are doing so (through your communications) is a further rising imperative. Steve's bike example is a good one, but the bikes could also be made from recycled metals, etc. The story behind the 'green' (or 'blue') marketing message has got to be real, not just a fairy story that marketers think consumers want to hear, otherwise cynicism and skepticism will only increase.

I'd suggest a third alternative: focusing on green behaviours that reflect the social value of our society as a whole. With respect to our concern about global warming, this might be done by imposing some sort of carbon tax--either directly or via a cap and trade system--on products according to our societal concern about this issue. This application of the "polluter pays" principle would automatically enable a consumer's economic decision on choosing between products to buy to be much more consistent automatically with society's view of the long-term environmental cost of buying products in general.

Basically, the market for green consumer is quite limited. As we can see, not all consumers are looking for something 'green'. The basic for a product is because the consumer need this product and when the consumer obtain such product, it is easy to be used and give more convenience to them.

As we can see, green business is a new emerging business trend worldwide. I do not think it should only stay as a trend, but it should be incorporated into the business and being look as a responsibility towards the environment rather than fulfilling the trend. I have learned about environment and I can see more and more corporations are taking the advantage of the trend to boost their image, I do not know how many of these corporations really care about the environment. Carbon trading, PPP, EPR, glabal warming, just name it, you have a lot in the list.

Instead of targeting the consumer, I believe the corporation should starts internally to bear in mind that they do it for the world they live in and not merely for a business opportunity.

There is usually a mismatch between what consumers say and their consumption pattern. A significant number of people will claim they are for green products and the environment. However, their purchasing behavior doesn't usually support their stated intentions. As pointed out already, the definition of the green consumer needs to be qualified. Furthermore, once defined, the size of this segment needs to be quantified.

I believe a company can create a green image in its branding in a more low risk and less costly manner by segmenting the customer base and designing a true green product for the real green customer. Developing a green product for the "mass" market will most likely fail because the basic needs across a large base will not be addressed through the product attributes. Segmentation and product portfolio are just as important for this space as any other. I believe that by identifying the expectations of the green consumer segment and developing a specific product a company can: (1) continue to sell "traditional" products to the mass market and maintain its market share, (2) keep production costs low across the product portfolio, (3) market a unique green product to the true green customer segment, and (4) use the "niche" product to project a green image in its branding.

I totally agree with the author. Selling green items will always be limited as society is moving towards more consumption. Take as an example, the ZARA phenomenon. ZARA changed the landscape of the retail industry by introducing 17 seasons instead of the normal 4 (fashion industry has 4 seasons for introducing new fashion).

By doing this, consumers are buying more fashion and are concerned less about the environment.

Therefore, a company can introduce products to encourage consumers to do green activities (outdoors, biking, walking, etc) also by using recycled material for packaging.

Responding to both Nancy’s and AROD’s comments about the disconnect in what customers say in surveys about concern and willingness to pay for a greener product and what actually happens when customer finds themselves alone in the privacy of Target’s shopping aisles, there has been a lot of debate. My personal view is that consumers expect the company to pony up for green. It’s similar in some ways to the quality revolution of the 1980s. Can you imagine Ford Motor (remember “Quality is Job #1”?) asking customers to pay a premium so that their door handles wouldn’t fall off after the 30 –day warranty expired? Quality is a market expectation, not an option. Green is quickly becoming the same thing.

It seems evident that over time, a few activist designers and industrious individuals have been successful at pushing the market into new niches that ultimately get picked up by larger a more popular market. Initial marketing in new and risky ventures to a small group is still a necessary element.

I see parallels in this in other non-product environmental initiatives. For example, in Northern California, with Salmonids in the streams surrounding woodlots. The lumber industry was feeling attacked by activists who were trying to save the streams. Eventually, the lumber companies were advertising their good stream stewardship as not only their idea but also as a good and popular thing to do to sell more wood.

Dan Trockman, Linden Hills Power and Light

Responding to John Jaddou's suggestion to offer a portfolio of products including green products/services for the true green consumer:

I think this can work sometimes and backfire other times.

For ex, Toyota manages quite well to sell the über-green-product - the Prius - even while also selling 8 cyl. gaz-guzzling Tundra pick-ups and everything in between.

But in my own fields - coffee, chocolate, etc - I've seen very large, otherwise successful and very brand savy companies try this approach only to fail. For example, they might offer one or two Fair Trade or organic products amongst dozens of conventional products, run big ads and expensive PR campaigns touting the green products and then wonder why the green consumers remain unimpressed, even cynical about these offerings.

Maybe its something about food, but these green consumers don't see "segmentation" or a "diverse product portfolio". They see tokenism. If you talk to a few hundred of these green consumers, or track the blogosphere, you'll hear them say that if the corporation really cared about these environmental or social issues why are 95+% of their products produced in the same old way?

Maybe a key difference between food and cars is the difference between small and huge purchases and between higly fragmented, competitive markets and oligopolistic markets. Consumers can choose from dozens of coffee companies, including tiny local ones and some that are 100% organic, etc (& therefore are trusted as authentic/sincere). So the large corporate brand has to compete with smaller "niche" companies that set a very high bar for green authenticity. The large company is hard pressed to achieve that same level of green cred, especially with a product portfolio that is overwhelming non-green.

By contrast Toyota, or the local electricity provider, doesn't have small, super-green competitors nipping at their heels. If you didn't like the Prius, or maybe one of Honda's early hybrids, there wasn't much else to choose from.

Consequently Toyota had a chance to get the enthusiastic backing of environmentalists and wasn't penalized for still selling millions of conventional cars and SUV's.

Steve, great article. From the media perspective we have seen an overwhelming growth in greenwashing and the result, as you point out, is a horde of companies that are, "neither fish nor foul." They've spent years, or perhaps even decades, creating a brand and they now are suddenly trying to change that established image to a "green" one... frankly it doesn't work.

Solving consumer problems in a green (both ecologically and ECONOMICALLY efficient) way is the only true path forward. Everything else is just window dressing. If companies do that, then consumers will not need to be told how "green" they are, the consumers will recognize it themselves.

It won't be easy for a consumer to directly influence a corporation to go green. The pressure must come from government legislature down to corporates. So it's probably a better idea for a consumer to use his/her vote to elect politicians who will push for 'green' legislation.

This is an extremely timely discussion for us. I work for an advertising agency and we are currently debating the green question for one or our clients, an air conditioning and heating service and repair company.

We had this very discussion last week. One of our partners, who doubts we can monetize a green marketing strategy, believes that we should focus the green message on a niche of green customers. I on the other hand strongly believe that the all customers should be the target.

We are dealing with a grudge purchase. No one wants to buy a new air conditioner or furnace. Nor are they particularly interested in paying to have their systems maintained regularly. The “hole” they are all buying is home comfort. And since they have decided to or are considering making these purchases, the simple fact is that if you maintain your system regularly, you save energy (and money), if you buy a new, more efficient system, you save energy, if you buy a programmable thermostat, you save energy. This message is relevant or should be relevant to every single customer. So, I agree, forget about the green customer. As Steve said, focus on green behaviors that everyone can aspire to.

Is Green the new Black? Well, not quite. Several posts have pointed to a lack of compelling interest in "Green Products/Services" because people are unwilling to pay a price premium or accept a quality discount. In my opinion, part of the marketing challenge is frame price and quality as may be done in traditional ways. Some examples:

What should go into a price of the product -- if you are a purchase manager in a silo, it is only the price paid and processing cost in acquiring a product or service. If you are a CFO, it is the total cost of ownership. Marketing to businesses, many firms such as Philips and Dell have reframed costs by persuading companies to think of TCO as opposed to unit prices for the widgets. Since consumers seem to have high discount rates, the challenge is to persuade them to consider not just the price of a washer/dryer/car but the operating costs as well.

Why stop at cost of ownership, what about "reframing" costs to include other costs. Second hand smoke was the real cost that accelerated regualations to limit smoking. Prior to that, people often said "well if s/he wants to smoke to death, it's their choice." Naturally, theses costs should be seen as relevant to the buyer but these beliefs can be shaped over time.

Similarly, the benefits are broader than performance of the product purchased. Why do people put stickers on their car proudly mentioning the university they or their kids attend or support for the troops or even placards for their favorite politicians. Obviously, people live in a community and highlighting membership of a community (whether it is Harley or eBay) makes people feel better. Giving that ribbon or any other visible token for donating to a charity allows people to signal to others they are the kind of person who cares for the community or certain causes. This in turn puts pressure on others.

An interesting study showed that more people recycled their towels when a little notice in the hotel bathrooms mentioned not how important the environment was (that helped some) but when it stated how many guests who stayed in that hotel also recycled. Thus, while no one can see what power you consume at home, taking something invisible and making it visible (by putting a big star in front of their homes!) communiciates to the neighbors what the values are and might influence other neighbors.

So yes, costs and benefits matter, but it is important not to buy into a common definition of "costs" and "benefits."

I agree with much of the commentary on this topic to date, especially the reference to the similarities between the current 'green movement' and the quality movement in the 1980s.

Consumers expect the products they purchase to be safe to their health (and increasingly so, the environment) and they rely on government entities and corporations to ensure that is the case. While some consumers are highly educated about the environmental impacts about the products they purchase, others are not. Does that mean that the less educated consumer does not want the products they buy to be safe for the environment?

The auto industry had invented airbag technology in the first half of the 20th century, but the technology was not broadly implemented in cars until the 1980s. Who is responsible for the lives that were lost for decades which could have been prevented using airbags? Was the consumer to blame for not demanding a safety feature they did not know about? Was the auto industry to blame for not incurring the cost of implementing the technology sooner? Was the government to blame for not ammending safety standards in automobiles sooner?

Who is ultimately responsible for public health and the health of the ecosystems we inhabit? The answer, of course, is that this is a shared responsibility and business plays an important role. As we become more enlightened about the degree to which behaviors, processes and materials are 'sustainable' or detrimental to our health and our ecosystems, whether or not we choose to 'do the right thing' is a moral question.

Having read the many comments, my reaction is "I can only agree."
Every comment so far brings increased focus and clarity to this complex issue:

Consumers said for years they would pay more for "green" products but they voted with their wallets, by and large.

Regulators and NGOs said being "green" was good for business frequently without much to go on, because they wanted it to be so.

Companies struggled with how to tell their stories and how to be "greener" than the competition.

Some companies said "can't be done" while their competitors put "greener" and more sustainable product lines in the marketplace that had immediate and astounding impact -- think Prius.

So has anything changed and how should we think about the issue?

I think there is a change and those companies that can demonstrate that their products provide positive environmental benefits and -- to Steve Bishop's essential point -- address consumer's needs are and will continue to enjoy a competitive advantage and a positive reputation for innovation and social responsibility. Increasingly those consumers are not just individuals looking for more efficient appliances, lighting and automobiles but include the power generation, transportation, agriculture and manufacturing sectors.

The market for lower emitting and cleaner products exists and is growing. The number of companies touting green products has increased exponentially. The reality of climate change has been a critical driver, particularly in the industrial sectors. But so has the explosion of infrastructure projects in the developing world.

The development of cleaner technologies has been long awaited and finds common support in the industrial, NGO and governmental sectors. When we started thinking about Ecomagination at GE, we talked privately to various stakeholders, including some folks who might be expected to cry "GREENWASH." The response was both interesting and unanimous. The folks we talked to said, "We've been waiting for years for a company to say it can provide products that help with important environmental issues and make money doing it."

This common ground is essential because -- whatever some may wish -- people are going to continue to drive, fly, use electricity and expect their lives not to change very much. In the developing world, the expectation is that improvement in quality of life should not be impacted by the drive for cleaner, greener, and more sustainable products and lower CO2 levels.

Commenters have pointed out that we need better educated consumers; increased number of sustainable products; by implication, product development processes that have sustainability as a design /development criteria; and -- although no one has said so -- to find ways to generate the electricity we need in a manner that meets consumer and societal expectations about lower emissions and sustained life style.

So, how are we going to accomplish these things? What about nuclear power; incentives for cleaner coal and alternative energy technologies? DO we need a carbon tax or a cap and trade program? Should business focus on greening production in the developing world (more cleanup for the cost?)

How do we or should we try to translate these big picture issues to individual consumer decisions? How does the consumer separate puffery from true? What is the role of the government vis a vis the market place to sort this out?

I am fascinated by this string. I teach Marketing Research to undergraduates and this term we are working on an applied business project for a small business owner (children's apparel industry) who wants to go “green” without lowering customer expectations or negatively impacting profits. The students will be developing a survey to determine what modifications to the existing products mix would work and what business practices can be changed that would allow the goals to be met.

Gardiner's Morse's post asking:"Is there evidence that, all things being equal (price, performance, convenience, etc.), the world's consumers prefer green products?" is salient and will be part of the research. I would be very interested to hear opinions on other must-ask questions. Should the survey focus on purchase intent or pricing? Product mix or communication strategies? How can they (and therefore, we as dispensers of advice) get a handle on defining the issues so that business owners come away with actionable data?

Any and all feedback would be appreciated.
jkaplan@marymount.edu

Snappy headline aside, to segment the market into "green" and "mainstream" consumers does not reflect the marketplace reality that consumer lifestyle behaviors and choices reflect a spectrum of greenness. I might buy organic food, but drive a low mileage truck because I need the towing capacity.

In my experience as VPs of Marketing for two leading green brands, the core issue was identifying where "green" was relevant to creating value for our customers. Of course the yogurt had to taste good and the laundry detergent had to work. But the yogurt tastes better because of the natural ingredients, and the laundry detergent doesn't irritate your skin because it doesn't include petroleum based chemicals.

Consumers who choose green products do so because the products meet their needs. Period. But companies who authentically market green products attract customers who are more loyal, less price sensitive, and more likely to recommend their products to their friends and families. Not a bad customer base to have, particularly in a downturning economy...

Now as a professor of sustainable business, it is my strong opinion that companies who choose not to go green do so at their peril. It is not a question of if a company should go green, but how and when. Climate change is the environmental issue du jour, but there are many other environmental challenges looming on the horizon that will have a significant impact on how business is done. Companies who move now can create and enjoy the differentation advantages of incorporating green into their marketing.

I listened to the first 2 minutes of your interview on the HBR podcast and I could not disagree with you more. My research indicates that the consumer does have an increasing awareness of how their own well-being is fundamentally tied to the environment. (I assumed you are referring to US consumers). This may not be pervasive but I think 2008 could prove to be a watershed year. The willingness to change attitudes does not appear to be optional at this point in time.

An interesting anecdote I heard today from a California utility executive. While over 70% of their customers self-declare as “environmentalists," when offered the opportunity to purchase climate neutral energy for a few bucks a month, less than 1% signed up. It wasn’t an entire loss, however. The company found that the real green consumers were other companies rushing to demonstrate how environmentally responsible they are. Actually it makes sense that B2B is where the green El Dorado lies. Corporations have reputations and brand equity that live or die on market and consumer perceptions. Purchasing green is a quick and easy step to burnish a company’s eco-cred. Individual customers only have to live with their conscience. That and their shrinking wallet.

Karen hit the nail on the head. You don't market the greenness of a product. You market what the benefit of the greenness is to the consumer.

And since when is marketing a benefit NOT a mass market strategy?

The green revoloution and the so called geen products are still to make a headway in devoloping countries like India,China etc. It would be intresting to see when these products do enter the devoloping countries but whenever they do, they'll definitely have to keep the price in mind. Not many consumers in devoloping countries would shell out anything extra for green products.

To Steve Bishop's phrase "The majority of consumers seek to satisfy their personal needs before considering those of the planet" I want to comment that while this is a fact, it is the result of a profound environmental iliteracy. We can change that, since it is a matter of educating, informing and sharing data. We all have some opportunities, daily, to expand the awareness of others when it comes to the impact of our behaviors on the environment, both natural and social. Corporations and media have a huge opportunity/responsibility to educate consumers and communities. And since everything is connected, it ends up being better business too. We need to be aware of the System's Myopia.

I do believe that the biggest market opportunity for green companies is somewhere within the general population--consumers looking for quality products at a competitive price whatever their level of concern for the environment.

Being biodegradable or sustainably produced are product attributes that may contribute to the perception of quality by both "deep green" consumers and those who have not yet made it a priority to buy organic-, sustainably produced-, or recycled-products.

From the research I have read, the potential size of a green market for a company depends upon the product category, so you really can't clearly delineate between the green and non-green market in some absolute sense. Food, cosmetics, children's clothing, bedding, and household cleaning products may have a larger green consumer base because people are concerned most about what goes in and on their own and their children's bodies.

In general I agree that it isn't useful to focus on a green or non-green market for any product. The key is to focus on the largest group of potential buyers and what product attributes and features matter most to them. If the fact that a product is green is only of peripheral interest to those consumers, so be it.

In whatever way we can increase the market share for sustainably produced, energy conserving, or recycled goods, it's all good!

Steve Bishop has an excellent point and I’ve found the postings, regardless of position, worth the time. I like the green goals, religiously recycle, yet am not a “hemp clothing” kind of green fanatic, and believe the issue is important.

I’d comment on a key comment in the Ideacast, the importance of behavior. The ability to impact our environment depends in part on a shift, and I’d argue a rather significant shift, in the habits and decisions consumers make. It also highlights a weakness of the product cycle in many cases.

Let’s look at the Super Bowl in a couple of weeks – That day there will be millions of beverages consumed in bottles and cans – and the marketing will be fierce, and at $2.7M per advertising minute, I mean fierce. Arguably the most recyclable mainstream products, bottles & cans, will be lost in the shuffle. On Monday the percentage of these containers recycled will probably be well below 50% (I’m confident that someone will know the actual number). Why? Because the consumer probably bought the goods because of price and/or taste, not because they were easily recyclable – they are green products in a sense, but take a behavior to make them “work.” If there isn’t a supporting behavior (the habit of recycling built up over time and the infrastructure to support it) then it won’t happen – even when the plan is to be green. How many trash cans have recycling bins built into them? Would people use them if they were? So green products are nice, but if the broad base (not niche) understanding of the importance of the environment isn’t understood – then what’s the point? So behavior is critical, and international behavior – China and India stand out because of there sheer number – isn’t in sync, industry will go to the point of profit in most cases.

Focus on behavior. The Prius example is a great “counter green” example to me. The price is so high that I have no incentive to buy one – it is a status symbol, not a mass market green product. Be real - HBR readers aren’t the mass market kind of folks. The Prius with a Scion price tag would be real green product.

Isabel Rimanoczy’s post is about right – although I’d add that everyone is responsible for moving the importance of this issue forward – not just corporations and the media.

We believed our products would save time, money, energy and remove hazardous materials from the environment. Who could want more? Since this product carries our clients’ label, it was offered at a 10 percent premium over old school devices that have been in the market since 1958. When sales stalled, we realized we wouldn’t have a chance beyond attracting early adopters.

Competitors questioned the reliability of new technology, despite its benefits, placing doubt in the consumers mind “What will you save if this new fangled gadget does not last”. We had to reinvent our position quickly otherwise performance in favor profits or the environment would fade to red.

Green was accepted after a price reduction to a point below existing products coupled with an unconditional warranty. We refer this success as Green Shift - the acceptance of products by consumers where a suitable business model has been developed so that relationship can continue. We now propose that Green Shift can be created or accelerated by removing the consumer’s perceived economic risk.

The consumer knows the positive impact of energy efficiency or environmentally friendly products; however, they are unwilling to accept the entire risk for creating a new economic foundation. Sharing this responsibly via pricing and a quality statement made by an extraordinary warranty acknowledges market demands and has benefited the business through market share and scale of economies.

"Don't bother with the green consumer" is much too strong a comment, at least in the world of apparel retail. While I agree that just being green is not enough to entice a customer to buy a product, I believe that affordable green products (Priced approx 5 dollars more than the similar non green product in store), are the way to go. Additionally instead of replacing all the products in a store with green products, a company could run a line that they could do this with. Many apparel retailers have had success with this.

H&M had a great line in their stores a few seasons ago, that not only was affordable, but extremely trendy and flattering as well. The final bonus benefit was that the styles were all made with organic cotton.

In addition Forever 21 made a "green" line by making trendy patchwork waistcoats and tees from recycled clothing. In addition to being green, this line was a great way to use up fabric from styles that did not sell.

I firmly believe that apparel companies can have a lot of success if they consistently run an organic cotton line that is only made in green factories. But only if they price it at almost the same price as their current products.

In addition to the sales benefit, a company will be perceived as being green without too much risk on their part by going this route. However the message of the line must be clearly advertised, whether it is through hangtags, or store signage around the line in order for it to be truly successful.

I just wrote a post elaborating on Steven Bishop's article, at:

http://lamarguerite.wordpress.com/2008/01/27/green-marketing-remember-its-about-solving-peoples-real-problems/

I would say the biggest sin of marketers in general, is marketing amnesia, i.e., the unfortunate tendency to forget over and over, marketing's basic premise: if it does not solve real user pain, forget about it.

Steve...how right you are. If I may, I think its worthwhile to add a few thoughts though because I believe that green attributes can and should actually enhance the ability of a product to meet consumer's aspirations...

So, here is the shameless check out my blog for more part:

http://www.checkoutblog.com/entries/categories/144/default.aspx

Rand Waddoups
Senior Director, Wal-Mart

A week into this terrific conversation, it seems to me that there are two strands to this thread, and that perhaps there is value in unwinding them, then plaiting them back together.

Strand #1: Green marketing. The consensus of what people are saying seems to be that there is a niche group of consumers who are eager for explicitly green products and responsive to companies and campaigns that serve them. One might draw an analogy to organic food. A small but significant number of people are willing to pay a premium, sometimes even a large premium, for what might be called "specialty green" products. For these customers, the fact that a product is green is a primary--perhaps the primary--benefit the product can bring. It's noteworthy that a lot of the people posting here on behalf of those products and customers come from smaller companies--but it's also historically true that some pretty big outfits (e.g., Body Shop) can serve this group of customers. It's also noteworthy that the size of this segment varies by geography; it's lots larger in Europe, for example. Also larger in Europe is what one might call the anti-non-green segment. For example, genetically modified foods (Frankenfoods, they are often dubbed) are much less acceptable to mainstream European consumers than they are to North Americans.

Strand #2: Products that are made in a green way. For most consumers, green isn't the primary benefit--but it's nice to have. For me, it's more important for a duvet to be warm than for it to be green; all else being equal, I'd pick the green one, but I'd have to be sure they were equal. Regardless of the consumer preference, however, there's much to say for green product development and production, not for the sake of greenness, but for the sake of superior product development and production. I'm reminded of the great counterintuitive epiphany that drove Total Quality Management: the realization that quality saved money rather than costing it. ("Why is there never time to do it right, but always time to do it over?" read a sign over the desk of a production executive I knew.) We've been talking (in strand #1) as if green is a cost; but might it not actually be true that it's a source of saving? That parsimonious design, development, and production would yield benefits in elegance and in cost? That materials chosen and handled according to Bill McDonough's "cradle to cradle" principles (ably described in Greg Unruh's "Biosphere Rules" in February's HBR) would result in better products with lower costs of production and ownership? That products that are green from the ground up could have fundamentally different economics and markets from products that start dirty and are cleaned up by re-engineered processes? Might there be, for climate in particular and green in general, an equivalent of W. Edwards Deming's 13 points? And where would we find it--or should we start drafting it here?

A big “Thank You” to Tom Stewart for seeing the forest for the trees in our discussion. I am taken by point #2 and the idea of cost savings. Perhaps what we are looking for from the Quality Movement is the equivalent of Joseph Juran’s assertion that “Quality is Free.” Actually, quality wasn’t free. It required up-front investments up-stream to design out wastes, but it paid for itself in the long run. Cleaning up and re-engineering existing processes for environmental reasons is an expensive proposition. This is why companies prefer to leave the factory untouched and bolt on a filter or smoke stack scrubber. This type of “end-of-pipe technology” still accounts for over 2/3 of environmental capital expenditures. But it has long been said that 80% of manufacturing and life-cycle costs are locked in once the designer passes off the blueprints to the production team. It also makes sense that 80% or more of environmental impacts are also baked in at the design step. The numbers point to an opportunity. Design out waste - both economic and environmental - at the beginning and you get a double pay off in greener products and greener bank account.

In the energy arena, these “win-win” opportunities are legendary and never seem to fail to surprise managers when they are discovered. BP thought it would be a serious stretch goal to reduce carbon dioxide emissions 10% by 2010. They did it by 2001 (nine years ahead of schedule) while generating over $600 million in savings. Green is Free?

Tom’s comments get to the heart of this discussion: designing green products (the supply side), and marketing them (the demand side). As he points out, both are inextricably linked. Dealing with each separately leads to what we have today – green products for a niche market, or a green message that rings hollow with the mainstream. Together, they create offers that deliver true, desired value and tell the green story themselves.

The best marketing execs realize this. They are not copyeditors or myth-makers, they are designers. The marketing message needs the offer to back it up. And the offer is the message, or it should be. Design and marketing inform each other.

When disconnected, you end up in AROD’s situation. What I read in AROD’s post is “I tried ‘green’ and my customers don’t want it.” They don’t get the message, they aren’t ready for it, or they need to be educated about the value of the green product.

Companies often fault marketing for not connecting to or educating the consumer. However, it’s important to note that neither marketing nor design will change people. The offer must be designed to fit their lives and communicated in a way that is meaningful to them for the marketing to work. In other words, there is no such thing as people failure, only design failure. If you need an educational campaign or a bigger megaphone to communicate the value of your green offer, that’s a sure sign of design failure.

For example, the solar (photovoltaic) industry has struggled a long time with design failure in the residential space. If the promise of residential solar has been “low cost, clean energy,” and it's still less than 0.1% of energy generated in the US, is this because people need to be educated about the virtues of residential solar?

Look at it from the homeowner’s point of view. To install a home solar system, I need to put holes in my roof to mount a system that looks like a science fair project and requires maintenance, and I probably won’t recoup my costs in the time I own the home. Even the most virtuous will have a hard time justifying solar. Yet solar is focused on designing cheaper, more efficient panels (supply side) and not addressing what the technology enables (demand side). It offers no improvements to homeowners’ day-to-day lives, it is unable to connect with mainstream consumers, and the result -- 0.1% market share.

What residential solar needs is to design a new value proposition, a real offering that creates value for people, and a marketing a message that engages people in a meaningful way -- in essence, design and marketing hand in hand.

One of the most important points to highlight is th integration and realignment of the corporate social responsibility (CSR) programs of corporates-as touched upon by Bishop while talking about Green Marketing Myopia.

First,the CSR programs should sensitize the internal customers, i.e., the employees, towards anything green that is being done. It might be seen as a small step but fact is that conviction comes only when the producer and seller is convinced and aware of the difference they are going to make to the customer and the planet, but this should not come at the cost of those employees closing their eyes to the needs of the consumers and being arrogant about it.

Second point which I didn't observe being mentioned was that CSR initiaitives and other Green marketing efforts should be carried out with the intent of market expansion. Because it's for sure that the need for Green products is actually universal.

Though for more people than less its a "latent/hidden" need.Quite unlike the way a need was created for soft drinks--which certainly could have been taken care of with plain water as well,everyone on this planet stands to benefit from Green marketing and green products.Through various programs and drives one should look at unleashing the latent/hidden need for Green products.For example,here in India in the financial services sector, players like Reliance Mutual Fund conduct a lot of investor awareness programs and roadshows to include more and more people as investors--while talking about pros and cons of investments.
This is a long term initiaitive and just like R&D initiatives,companies should have patience to let the above initiatives make a meaningful impact to the customer base.
However, one very important point that we as human beings cannot overlook and that has been a part of civilisations since inception is the regulatory framework. Some of the State electricity boards in India have made it mandatory that an X percentage of the electricity production has to come from alternate/renewable sources of energy.There has to be political and business buy in for green products. Once that is done the market automatically expands. However this aspect needs to be looked at more seriously by corporates and regulatory bodies.

Customers might not have the time to appreciate that thry are buying Green while they shop-as Ravi Dhar says. Especially so as the green concept is likely to be overlooked for the other benefits that ensue to the customer while shopping.
However even this view is not holistic. It discounts other points of exposure-workplace,activists,media,something as school curriculums of children. So there is a need and exposure to this need that is always there for much more numbers than is visible. It's just that all green marketing and non-green marketing has to integrate.

Gaurav Maleri
Reliance Capital, Mumbai, India

I chuckled to myself when I read about the illustrious "green consumer" here, because there isn't a green consumer, and a non-green, or un-green, consumer. Instead, we have found a segmented landscape that, in its entirety, might define "the green consumer", and yet no two green consumers look alike, even within one segment. (That's because no two people are the same, green or not.)

We use the idea of enlightened self-interest when looking at the green consumer. Two variables, enlightenment(or altruism), and self-interest, each weigh in to varying degrees on a consumer's decision-making in the market. The majority of consumers will look for one or more primary brand driver that satisfies self-interest(cost, efficacy, style, convenience, taste, health), and then secondarily, a brand driver that satisfies the enlightenment or altruism component which serves the greater good(and it can be easily argued, another level of self-interest). Mainstream green consumers are looking for the first, with the second providing a halo effect. The very small population of "core" green consumers weighs the second much more heavily, even outweighing self interest at times.

But the drivers of "green" end up being mostly self-interest related. For example, organic food is not driven by environmental effect at all, but rather health. (Non-Prius) hybrid cars are popular for mileage and petrol savings reasons, not environmental. In each case, a specific product or service needs to take into consideration its audience and what their needs are. Strategic brand planning helps unearth those needs and lead to consumer insights which help us craft effective communications strategies.

After several national surveys and meta analyses, we have found that people for whom altruism and consideration of the greater good factor into purchase behavior is marginal.

All of which begs the question of how does Steve defines the green consumer. Often, companies launching a product or service or brand that has a green component (meaning environmental attribute) will target this small core green consumer first, and then try and grow appeal outward, but must adjust messaging accordingly to shift appeal from the enlightenment aspect to the self interest aspect.

Going Green is a reality looming in front of the humanbeings - be it individuals,groups or corporates. How can any of these groups be so insensitive to such a vital issue? Is it that we are so selfish in nature to even nor recognise the warning signs that are already happening in and around us or is it the loss which is the concern for us ?

I guess still we are not ready to take the losses - seen great names of the corporates making huge donations towards the upliftment of the underpriviliged but yet to see some major iniative from any one towards the eco system.can we sum up that the answer lies in the same !

How ever i feel that going green in a must for all and without which we cannot survive for long.........

Prakash
India

I agree with Tom Stewart's assessment that there are two different threads here. I am almost hesitant to do it, but I think there is also a third.

It has to do with growing consumer demand for products that are green in the sense that they are safer to use and toxin-free. Items in this arena would be lead-free lipsticks, paraben-free cosmetics, organic foods, green dry cleaning, plastic bottles that don't leach toxins, toys and jewlery that don't contain lead, etc.

This is a different consumer driver than shopping for green to reduce one's impact on greenhouse gasses. People seem to be waking up to the possibility that long-term exposure to a toxic swill of these kind of components might be at bottom of some of the health issues we face as we age as a society. It is very personal and is connected to the broader movement towards healthier living.

We find on TheDailyGreen that stories related to this variation on green content are among the most popular on the site.

I'm learning that green doesn't go with everything, like those strange-shade-of-green pants abandoned in my closet. The last time I wore them, all it took was a raised eyebrow from my wife for me to head back upstairs, head-down defeated.

These days, it's me doing the eyebrow raising, as I'm bombarded with ads and press releases linking 'green' (as in "environmentally friendly") with all sorts of products and services. Is Bubble Wrap, for example, a 'green' product? The folks at Shoplet.com think so. The product is included in the "Shop Green" section of its website (tagline: "Save Money, Save the Planet"), along with telephones, cameras, pens, and other items that contain recycled or recyclable materials (apparently, recyclability is the only criteria Shoplet.com used in making its 'green' selections).

On the one hand, Bubble Wrap allows companies to protect their products with less packaging material compared to alternatives such as loose fill or paper. Sealed Air, the manufacturer of Bubble Wrap, also encourages customers to reuse the material as much as possible to "delay [it's] final disposal and reduce the amount of materials needed to manufacture new products." On the other hand, Bubble Wrap is a petroleum-based material, a co-extrusion of nylon and polyethylene that can't be processed at many municipal recycling locations. Sealed Air has seven sites where customers can ship used material for recycling, but customers have to pay for shipping and the wrap must be free of tape, labels or any foreign materials. (In this case, it's important to note that the product is being promoted as 'green' by the retailer, not the manufacturer).

This example illustrates an inconvenient truth of many 'green' products and initiatives: there are tradeoffs that companies and consumers must acknowledge and address. Negatives may still exist, even if the net results are positive. It’s like prescription drugs: you can take a little purple pill to treat your heartburn, but you may have to deal with headaches, diarrhea, and dry mouth in the process.

Tradeoffs exist because most products, manufacturing processes, and supply chains were not designed with sustainability in mind. Although sustainability is weaving its way into the industrial world, change will occur slowly, so companies and consumers will have to manage these tradeoffs for many years to come. But what are the tradeoffs? Unfortunately, you won't find the answer in most articles about 'green' and sustainability.

For example, I've read countless articles highlighting the energy-saving benefits of compact fluorescent lights (CFLs). According to ENERGY STAR, if every American home replaced just one incandescent bulb with an ENERGY STAR qualified CFL, we would "save enough energy to light more than 3 million homes for a year, more than $600 million in annual energy costs, and prevent greenhouse gases equivalent to the emissions of more than 800,000 cars." It's the feel good story of the moment, which is why I've replaced most of the incandescent bulbs in my house with CFLs.

But I can't recall a single article shedding light (no pun intended) on how these bulbs contain mercury, on how consumers shouldn't throw them away in the garbage, or what to do if you break one at home, as happened to me (see EPA site for what to do). Unlike some folks writing on this topic, I'm optimistic about Wal-Mart's commitment to sustainability, including its actions to promote broader use of CFLs. But if you go to Walmart.com to buy a CFL, you'll see plenty of information about the cost and energy benefits of the bulbs, but no mention of mercury or responsible handling and disposal information.

Granted, the amount of mercury in each CFL is miniscule compared to old thermometers. And earlier this year, lighting company members of the National Electrical Manufacturers Association (NEMA) voluntarily committed to cap the amount of mercury in each 25 watt or less CFL at 5 milligrams (see March 13, 2007 press release). Also, a coal-powered plant releases more mercury powering an incandescent lamp, over a five year period, than a comparably luminous CFL.

So, yes, the benefits of CFLs far outweigh the negatives. But if these negatives are not recognized and dealt with effectively, are we really making progress? Taking five steps forward and one step back keeps you moving in the right direction, but eliminating the backward step will get you to the final destination faster and with less negative impact on the environment.

If recyclability alone does not define a 'green' product, what does? Being made from natural materials? Helping to lower greenhouse gases? Asbestos is made by Mother Nature herself and its insulating properties help reduce energy use, leading to lower carbon dioxide emissions. Viewing asbestos from this perspective only, it's irresponsible for us to spend billions of dollars on lawsuits and asbestos-removal projects to eliminate a material that can significantly lower our carbon footprint. But as radio legend Paul Harvey reminds us each day in his broadcast, knowing "the rest of the story" helps us to reach more accurate and complete interpretations of history, people, problems, and opportunities.

Defining 'green' is not a trivial task, especially when tradeoffs exist. Several organizations have developed certification programs in this area, including MBDC and The International Oeko-Tex Association. The Federal Trade Commission (FTC) is also tackling this question, announcing in late November that it's beginning a regulatory review of its environmental marketing guidelines (last updated in 1998). The FTC was planning to review the guidelines in 2009, but "because of the current increase in green advertising claims, the Commission is reviewing the guides at this time to ensure they reflect today’s marketplace." I hope this means I'll be raising my eyebrows less next year.

As for my pants, the rest of the story is the same: they're still hanging in the dark corner of my closet. The holidays have come and gone, and although I received several nice shirts as presents, none of them match the pants. So I'm going to wait a few more months and see what happens on my birthday. If no luck, I'll give the pants to my kids, let them make dragon and frog puppets with the fabric--after I test the pants for lead, of course.

Suggestions for AROD - sustainable energy utility adoption

1) Enable community identification: let consumers form their own buying groups with volume discounts. Have their group affiliation and special rates show up in their monthly bills. Bigger groups enable bigger discounts.
2) Have iconic symbol - give customers artsy lawn statues or signage indicating their participation
3) Inform - print extra page in their monthly bills showing that months spot prices and suppliers for the utilities green energy. also show how that compared with that months spot prices and suppliers for dirty power supplied to the utility. show how the power got to their house.
4) Entertain - tell interesting stories about local businesses and people who adopted it.

Tom Stewart’s comment reminds me of something we at GreenOrder see with increasing frequency: Companies that want to market green before they probably should.

Executives will say, “We’re doing all these terrific green things but we’re not getting credit in the market. Can you help?” We will then review the company’s environmental record -- its principles and goals, operating practices, product features, and so on. And it often turns out that the company is doing a lot to improve environmental performance, but those actions may not be strategic – which is to say, they’re not creating value for customers and other stakeholders. The company then gets frustrated that they’re expending resources to tell their green story publicly, but without much in the way of results.

The issue here is one of priority: Unless they are real pioneers in sustainability, most companies need to focus more on embedding efficiency, environmental performance, and other green values into the DNA of the company. They need to align their green initiatives with other core business goals – whether that’s growth, entrance into new markets, cost cutting, etc. And they need to craft a sustainability strategy that is: relevant to customers and other key stakeholders; differentiated from the competition; credible to the broadest array of stakeholders; and effectively messaged, so that complex science is translated into compelling proof points.

How should companies pursue the green agenda?

Steve Bishop makes the valid point that there is not room for most large companies to exist exclusively in the 'green consumer' market. It is also said of environmentally concious consumption that the largest cost isn't the price on the ticket but the 'opportunity cost', or in my preferred words, in the connotations and implications of our choice. Thanks to effective marketing people believe that consumption embodies their values. It is also true that people will go out of there way to be internally consistent, buying products marketed primarily as green would open a Pandora's box of ethical judgements, the car, the holiday...this is not a small choice! I will address this weary but concerned majority momentarily, but it is worth noting that the 'green consumer' minority is growing and therefore large companies may wish to specifically address this group through new and distinctive brands.

For companies wishing to remain planted in the conservative mainstream I believe that addressing these issues subtly and pragmatically is the key. Understandably steve approaches this issue from a consumer and marketing perspective. Personally i see a Pandora's box that needs to be opened—the crux of this discussion is sustainability as a strategic issue. Broader perspectives based on government, business efficiency, consumer and inter-business relationships give a more substantial measure of where the widespread green conciousness is heading specifically for products not destined for people who accept the 'green consumer' label.

What is needed is a strategy of increased resource efficiency. I would not make this case on the recent groundswell of consumer interest alone. I do make the case based on several mutually supportive drivers coming together. Firstly, as businesses look more closely at manufacturing, packaging and transport they are realising that this is smart business. Resources have a cost, and increasingly so to does all sorts of waste including greenhouse gases. An example of reducing resource usage that i am familiar with is from Boots the pharmacy in the UK which is vertically integrated, making, transporting and retailing many of there own products. Boots studied the carbon footprint of there own shampoo and discovered that by using recycled PET in their bottles they could gain a green advantage and save money! This works for there profits, the environment, and the brand; in the UK it is striking that even people who aren't at all environmental are often passionate about recycling and consider those who don't to be lazy. Recycled bottles are a subtle way to use less resources, save money, and have a marginal advantage over competitors, certainly and advantage with eco-shopper but also with many average people.

But saving money, protecting the environment and appealing to customers may not be enough; the real danger is Walmart, and Boots, and British Telecom, and all the other organisations who are starting to add environmental performance to the criteria that they have for stocking or procuring goods. Environmental score cards are entering the arena and you don't want to come last (it will cost your margins or even the deal) and the likes of BT are taking on procurement standards that forbid them from purchasing technologies that aren't more efficient that the pieces they replace. Business is being pushed by cost reductions from resource savings and pulled by demand from customers and other businesses. These forces are acting now, but there are others which promise to become an even more prominent concern.

Asia is in the ascendency, the developed world is undergoing a massive expansion, our reserves of resources are not. Some are concerned about 'peak oil' and general resource depletion. In general i am not, but i do recognise that increased prices for raw materials of all kinds, from grains to ores will become a major pressure on a wide range of businesses. Add to this the inevitable coming of a price of carbon and business faces a rocky road. Resource inefficiency, which under close inspection in recent time, appears to be at often embarrassing levels, is going to become about the biggest crime in business. What i would like to stress particularly is the scale and rate of change that we are currently embarking on. If the international community can get its act together on climate change then in accordance with the conservative estimates of the IPCC the globe will have to reduce emissions 60% by 2050, whilst the economy quadruples! The question that i wish businesses where asking more is not, how can we get the win-win but, what strategy should we take to out moreover our competitors on our way to a low carbon economy. Can we make efficiency gains and carbon reductions of the scale required? If not, is there a business model that we could adapt to allow us to do so?

Reducing the amount of packaging on a product is an interesting example of the sort of virtuous cycle that we need to be looking at. Reducing the amount of individual packaging saves packaging, it also saves boxes that these packages go into, which corresponds to fuel usage. That is a small step, and Walmart is reporting these savings in the hundreds of millions. A larger change, the sort of thing that might give you a real advantage would be doing away with products and selling services. If your customer needs large volumes of solvent which are expensive, perhaps you could start collecting the solvent once it has been used once and purifying it before renting it out again, Du Pont decided to do just this. Or how about people who need good quality flooring? Sometimes it goes bare in small patches but the whole carpet is replaced. Now 'flooring services' are offered by Interface and an annual fee is paid, carpet tiles are used and replaced as required.

The key areas of work for greening a product (not necessarily the brand) are:

1.Minimizing resource usage. ( Can you remove packaging or manufacture the product more efficiently, or even provide service instead?)

2.Minimizing lifetime input. (Make 'made to last' a brand priority, offer repairs, reduce energy use and promote as energy saving)

3.Manufacture with intent for recycling. (Carefully choose materials, take care on choosing glues and resigns, decide on disassembly method)

Improving performance in these areas often leads to win-win-win results for cost-environment-brands. However businesses should also realise that there are very real risks of market loss and regulatory costs if innovations in these areas are not made.

Further reading:
Amory Lovins, 'Natural Capitalism'
Kenny Tang, 'Carbon Down: Profits Up'
William McDonough, 'Cradle to Cradle'

I received an email about the comment I made on January 26th (above) and thought I would answer the request to name a study that shows consumers have varying concerns about how green their purchases are, depending upon the product category, for everyone in this conversation.

One report I had in mind was presented by The Hartman Group at the Green Business Conference in San Francisco last November. See my post about the presentation: http://ecopreneurist.com/2007/11/09/the-green-business-conference-entrepreneurs-step-up/

Yankelovich has also made a number of presentations about their differentiation between green attitudes and green behaviors, claiming that behaviors, such as buying local fruits and vegetables, can happen well before the same consumers have a conscious concern for the environment.

In the UK there is some consumer interest in green products, but as Tom outlined the market divides into a relatively small though growing segment who are willing to trade price for sustainability, and the majority for whom price and performance rank well ahead of sustainability.
Green consumer issues are having a significant indirect effect in particular on supermarkets, inasmuch as there is growing consumer expectation that they should ensure their practices and products become more environmentally sound. Consequently supermarkets are addressing sustainability issues such as packaging, delivery process, reducing use of plastic carrier bags with their supply chains, as well as growing certain sustainable product lines such as energy efficient light bulbs. A year ago such action was still quite novel, but as the level of engagement on these issues has increased, most of the main supermarkets are now adopting similar programmes. Consumers may not elect to buy more expensive products that are badged green, but, given a choice, they may elect to do the weekly shop at the supermarket that they perceive to have the greener agenda.

This is a highly important discussion for us at LivingECHO. We're constantly researching the Green Market Segment and we're finding a lot of conflicting information out there. However, I would have to agree with a previous poster stating that fact that the average consumer does have an increasing awareness of sustainability and environmental awareness.


Recent reports find that 72% of US consumers believe their purchases have significant impact on society and on the environment. Shockingly, 71% of consumers also mention that they are "somewhat likely" or "very likely" to pay a 10% premium on green or sustainable products.

The fact is that the green industry is expanding and is highly disorganized. As our government is doing very little to address the issue of global warming, more americans are looking towards businesses to lead the way in sustainability. They are expected to do this by either offering green products and/or by minimizing their carbon footprint through sustainable practices in the workplace.


I do agree with Steve Bishop in the sense that marketing outside of the core green consumer is imperative for the purpose of expanding that segment base. Although, I disagree in the sense that I think that the environment should still be the focal point in the marketing campaigns. People need to get the point drilled into their heads that our environment is in crisis and more needs to be done.


We feel that corporate corporate social responsibility (CSR) is going to play the leading role on the green stage and then trickle down to the general public. It is corporations that got us here in the first place, so we think corporations should take on the responsibility of reversing the tide. LivingECHO's strategy for creating a more sustainable world includes: an eco-friendly comparison shopping site for the retail and wholesale consumers, a central networking space for business solutions, open source information, the ability to self-publish at no cost, and the ability post eco-friendly products of your own.

Closing the gap between the green consumer and the non-green consumer is based on price and image. If green products are just as cheep, accessible and look just as good or better, then the public will follow.

Reading through these discussions it seems that most people are in agreement that environmental and commercial benefits can go hand in hand. The issue is how do you achieve that?

Certainly Steve's point of focusing on providing people with benefits is absolutely right. Many green products have failed even in the 'green' niche because they fail to actually deliver the practical and emotional benefits expected from that type of product. It doesn't matter how green a product is, it's not at all green if it doesn't work or no one wants it. This really comes back to Gregory's point about systems, and making sure that we consider and design things in context.

Authenticity seems to be a key point that has come up. Certainly here in the UK, there has been huge cynicism developing lately about companies 'green' credentials because businesses have gone mad sticking eco and green on everything they possibly can. This is actually reflecting badly on companies in many cases. Those benefiting are those that treat their customers as intelligent people, and demonstrate their greenness with integrity and transparency. In many ways its those shouting about it that appear the least authentic.

Then I think cost is the other big issue, because no matter how environmentally friendly many people would like to be, few are prepared to pay a premium for it unless it comes with additional benefits such as improved quality or performance (but then its that that they are paying for). Many seem to feel that it is not they as an individual that should be paying to protect the wider society. Company's that are truly green should surely offer these benefits as standard, because if they charge the customer for them, then they can't really take the credit themselves. As has been noted though, the environmental issue does present many cost saving opportunities, and as a catalyst for innovation can create a wide range of commercial opportunities if company's are open to explore new ideas and business models.

In essence, to sell green into the mainstream then you need to sell genuine, authentic benefits (not necessarily green) at competitive prices.

Getting away from the trees in the forest and soaring high up, I have come to believe that we have only accidentally overlapping ideas of what we mean by 'green.' Recovering toxic materials from CPUs and recycling copy paper are quite a bit different, even if some claim them to be somewhat the same.
In a real sense, everything produced falls into categories of: inert, bidegradable, reusable or perhaps adaptively reusable, and recyclable; if none of these, then - TOXIC. These all require very different approaches.
I suggest a three-axis (3D) model to provide an organizing perspective: How serious the issue (product), Intensity of concern by a relevant audience, and How Many $ to rectify. It is only the barest of starts, but will obviate the tons of ink so ungreenly expended talking past one another using the same words and meaning different things.

I'd like to pick up on one of Andrew Shapiro's comments, and pose a question from it. Andrew wrote: "It often turns out that the company is doing a lot to improve environmental performance, but those actions may not be strategic – which is to say, they’re not creating value for customers and other stakeholders. The company then gets frustrated ... They need to align their green initiatives with other core business goals – whether that’s growth, entrance into new markets, cost cutting, etc." I like that. We've seen companies that have done that successfully (or successfully so far): GE's Ecomagination initiative (which Andrew helped design, right?) (1) gave GE a new way to drive cost-cutting, which is deep in the company's culture but can always use fresh impetus (2) created a market pull for the company's new GE Infrastructure business unit, which was an agglomeration of assets in energy, water, and other areas that wanted an organizing theory, a strategic vector, and (3) provided a rallying cry for the company's decision to build up its marketing function, which had been deliberately left to rust for some 20 years. Presumably it had other benefits as well, but that's a pretty fair description of how Ecomagination was strategic for GE.

On the other hand, British Petroleum (I mean, BP) also had and has strategic reasons for going green. It, too, has done a pretty good marketing job--giving itself a pretty green flower logo for its gas stations, producing classy "beyond petroleum" commercials. The company also spent, and spends, a lot of money in pursuit of renewable energy sources and in developing carbon sequestration technologies, etc. I was at a conference in London a couple of weeks ago with BP's chief scientist, who spoke not only eloquently but with solid, smart business sense about BP's strategic vision of the future of energy. The company's long-term future is clearly dependent on its being able to operate and profit in a carbon-constrained world (a topic we'll discuss later on HBRGreen.org).
Now, both companies also have their environmental back pages and they're not all pretty: PCBs in the Hudson, problems in Alaska, etc., etc. So the fact that BP isn't beyond petroleum (or beyond reproach) doesn't explain why it didn't get traction but GE did. What I wonder is this: What could BP have done differently--or what should BP do differently--so that it can actually develop and sell to a green consumer? Anything? Or is there something in the GE vs BP comparison (or some other comparison you think is better), that sheds light on this green-consumer topic, or on how to get a strategic approach to green products?

Going green certainly means different things to different people.

Consumers, by and large, want to make the right decisions, yet manufacturers and producers do not make it easy. If there is a cheaper cleaning product, which contains VOCs for example, and a slightly more expensive brand which contains no VOCs, the consumers on average will select the lower cost product.

The sellers of the product containing harmful VOCs are culpable in contributing to the problems left for society to deal with while they keep their shareholders happy with a higher profit.

Responsible producers, interested in providing viable solutions, should be selling products that do no harm.

I'm glad individuals are taking their "small steps" but we really need are "big leaps". Green washing should not be allowed. By default we are licensing companies to continously contribute to the cumulative problems for short-term economic benefits at the expense of long-term health benefits - which affects green and non-green consumers.

The consumer is at the end of the chain and relies on responsible suppliers to provide products which have everyone's interests at stake. Consumers will make informed choices - but the marketing "noise" often drowns out the better choices. As long as companies can legally make and market any product meeting their legal requirements, then voluntary standards will only appeal to the minority of green consumers.

Although this focus is on green - I think it should shift to the broader issue of reducing carbon emissions and conserving resources. The carbon emission reduction issues are industrial-based and make the green choice issues pail by comparison.

Following on Andrew and Tom’s point, this is where the real management challenge lies. For companies that have gotten past the debate over whether they have responsibilities that go beyond increasing shareholder wealth, creating jobs and useful products for the market and following existing laws (this debate still continues in many quarters) the challenge is twofold. The first is what does this responsibility require us to do? Second, and often the most difficult, how can we do so in ways that create value for our business? Managers trip up on both these questions. First by doing things that, while may be good for society, have no real ties to the business. Second, by doing the right thing from a social or sustainability perspective, but failing to structure it in a way that creates business value. Solving both of these problems simultaneous requires real leadership and insight.

GE and BP are both making real efforts in their pursuit of sustainability and marketing them aggressively. Tom’s question gets to why BP’s message isn’t sticking as well as GE’s. What’s different? The answer can be found in the offer.

Long term & Short term
Because of its business structure, GE can offer consumers ways to address sustainability now, in the short term, with things like compact fluorescent lights (CFLs), perhaps the most visceral embodiment of green today.

BP does not have that luxury. It realizes petroleum is going to stop being a viable business and is pursuing a slew of real, long term solutions in “low-carbon power," like carbon sequestration, solar, wind, and biofuels. But with immediate energy needs to meet, their most tangible offer to consumers in the short term is still gasoline, one of the most visible catalysts of climate change.

Marketing campaigns, regardless of how sophisticated they get, rarely speak louder than what it is the company offers to consumers, which demonstrates the thesis of this discussion: The offer is the marketing message.

Real, Relevant, and at the Right Time
What companies like BP are struggling with is making their real long-term accomplishments relevant in the short term. Let’s look at BP's gas station concept. It’s an admirable feat of green construction, but how does this make its investments in low-carbon power or carbon sequestration relevant to me today? After all, until biofuels are available, I’m still buying gasoline.

To make long-term efforts as relevant as CFLs, BP might engage people in new ways at their primary touch point – the pump. What if my receipt revealed how much of my gas purchase will go into low-carbon power development, or for repeat customers, gave me a low-carbon efficiency rating? What if carbon sequestration came with each gasoline purchase?

Perhaps the key for BP is to get beyond the traditional touch point and create new offers that are as relevant to consumers’ everyday lives as CFLs. What if every BP station offered plug-in fuel consumption meters like those found in hybrid vehicles, but worked for any car? What if they gave prizes to the least carbon-emitting drivers?

What kind of new positive behaviors would these concepts inspire, and how would they change their relationship with consumers? Initiatives like these start new conversations rather than having the same conversation in a louder voice.

Implicit vs. Explicit
Timing is also important and Andrew’s comment about timing is a good one. Most companies feel that if they invest time and energy in pursuing green, they need to leverage it immediately. But real green efforts can be marketed either in an implicit or an explicit way. Had BP been implicit about its efforts at the new station, then explicit when they had an offer to back up the green message, they’d be in a better, more credible place. The station concept is a good idea, but it does underscore the important decision market executives must make between implicit or explicit messaging (more details in the podcast).

Values
The final point is about values. Any business wanting to connect with people on the issue of sustainability must, as Andrew points out, “[embed] green values into the DNA of the company.” But values go beyond metrics or business goals. They are emotional. “Beyond Petroleum” has wonderful aspirational values. What BP can focus on now is expressing those values in their offer.

"GREEN" vs. NATURAL vs. ORGANIC vs. LOW CAL

What can we learn from the natural and organic movements. I believe one of these terms (organic?) had agreed upon definition, while the other doesn't.

It strikes me that most of these terms are marketing wash. Already the green movement has been discredited, in my view, by the flood of "green product".

If food is analogy, it strikes me there will be a robust market for ill defined "green" label just like "lo cal" cookies.

Isn't the consumer really asking: "Give me what I want, but put the politically correct, currently fadish label" on it.

Paul

Thank you everyone for a lively discussion on this very timely topic. In two weeks, we’ve had almost 80 insightful posts from a diverse group of responders: marketing execs of companies large and small, consultants, designers, VCs, heads of utilities, academics, not to mention Gardiner Morse and Tom Stewart of HBR.

The original thesis, "Don’t bother with the green consumer," seems to have held up fairly well throughout. As Ravi Dhar affirms “If you think of [green] as a niche, believe me, you will remain a niche.”

But what’s most gratifying is the number of other rich insights we’ve unearthed in the process:

The action gap
“While over 70% of their customers self-declare as ‘environmentalists,’ when offered the opportunity to purchase climate neutral energy for a few bucks a month, less than 1% signed up.” -- Gregory Unruh

Personal needs come first
“What my 20 years of experience tracking green marketing campaigns suggests, is that the most successful green marketing appeals underscore the primary benefits of greener products and incorporate environmental benefits as an ‘added plus’”. -- Jacquelyn Ottman

Make it core to the business strategy
“…companies need to focus more on embedding efficiency, environmental performance, and other green values into the DNA of the company. They need to align their green initiatives with other core business goals.” – Andrew Shapiro

It’s about behavior, not things
Yes, it is not enough to buy a green product (or one labeled as such), but we also need to change the way we use these products. – Adrian

“The ability to impact our environment depends in part on a shift, and I’d argue a rather significant shift, in the habits and decisions consumers make. It also highlights a weakness of the product cycle in many cases.” -- M J Fair

People won’t pay a premium for green alone
“One mistake is to assume people will pay more for a green product. While it is true that people will pay a LITTLE more for a truly outstanding product, there must be an additional benefit. -- Victoria Duff

Connect to consumers through value and values
“Green pioneer companies very often create the demand for their goods and services, usually slowly and patiently over years, and often because they themselves felt so strongly about the issues involved.” -- Rodney North

“Consumers, by and large, want to make the right decisions, yet manufacturers and producers do not make it easy.” -- Larry Berglund

In my experience as VPs of Marketing for two leading green brands, the core issue was identifying where "green" was relevant to creating value for our customers. -- Karen Martinsen Fleming

Educate the consumer
“[We have] a profound environmental illiteracy. We can change that, since it is a matter of educating, informing and sharing data.” -- Isabel Rimanoczy

Note: Although this came up a number of times, my position remains the same: If you need an educational campaign to communicate the value of your green offer, that’s a sure sign of design failure.

Seek competitive advantage
"...those companies that can demonstrate that their products provide positive environmental benefits and address consumer's needs are and will continue to enjoy a competitive advantage and a positive reputation for innovation and social responsibility." – Stephen Ramsey


We also had a number of great questions. I think it would be most appropriate to wrap up with this one from Tom Stewart:
“Might there be, for climate in particular and green in general, an equivalent of W. Edwards Deming's 13 points? And where would we find it--or should we start drafting it here?”

The points above are a great first draft. Thanks again and I look forward to seeing how the thinking on this topic evolves from here.

Wonderful conversation enjoyed going through the exchange.

We are currently experiencing change taking place at the speed of light, assisted by apparent dramatical changes in weather paterns and new highly connected communication channels where knowledge and word of mouth travel at the speed of light.

One of these changes is reflected in the different shades of green. There is no longer a quintessential green person - there now are shades of green and University of Tasmania has even done extensive research on how many shades of green there are, their associated attributes and their demographic. You can even see Bush is a shade of green, based on statements he makes today about climate change - regardless if you doubt his integrity. If you would have heard make these statements 3 years ago you would have wondered if he had joined the greens.

I think in the end it is about being sustainable, which causes balance and takes away risk. Today the words carbon and green are heavily used - because the words mean something to us and put things into some context. Over time, people and business will abuse these words and we will come up with other words to describe becoming more sustainable.

Todays customer is quite informed through their connnected world they share opinions and ratings of companies and it may well be that those companies that have never thought about being sustainable and csr are going to suffer over the next decades - if they are engineered in a way that does not allow them to change. The ones that started down the sustainability path years ago will have that advantage over the competitors.

So we are coming to terms with being unsustainable as a whole and are only considering sustainability now because we are forced to - and this applies to the consumer just as much as it does to the corporation. Chevron or John down the road both have to change. They are linked and now being forced. That would be different for BP and Jack down the road, who started thinking about these things some time ago.

So if a company can only be as green or rather sustainable as its supply chain, then the same can be said for the customer - as customers we can only be as green and sustainable as our suppliers.

Whatever you do as a business, you do need to deliver value to your customers - otherwise you are not 'financially' sustainable. Value is represented in different ways, the best known one being money but there is also information and enabling your customers to meet their aspirations and understand what they value. If you cannot do this and make a profit - you do not have a sustainable business.

Recent UN research echoed by many other research report indicates that because of climate change, the concept of the environment or green has moved away from being a cause to being a core value (Maslow). From here thinking about sharing these value's with your customers seems to be a logical next step. Globescan recently conducted research across 22 different countries where 81% of the people in Australia expect they will need to pay more for energy due to climate change. Do they want to pay more? No of course not.

Now all of this is nice research, here some numbers (for Arod):one of the largest energy retailers in Australia has seen a dramatic % increase in their 'renewable energy' customer base (hundreds of thousands). They have also increased the minimum % of their base renewable energy package from 10 to 20% and still saw sales increase.

The above company also owns another retail brand in another country. Management in that company is unclear about what to do with climate change and how it can-will affect their business or customer perception. They also struggle with getting their green offering of the ground. Owned by the same corporation - just different management.

There are also 'renewable only' energy retailers that have not seen their base grow as much. There are many factors that can help customers buying from you. Transaction buyers will always look at the cheapest price and think of green last - but there is an increasing customer base - that will buy a skirt or dinner less to become sustainable and that is another indication that we are changing and sustainability becoming a value.

As for Arod, I would go back to the drawing board and explore what went wrong or why it did not work.

The reality is though that if as a consumer, you are struggling to pay your home loan and make ends meet - you may not have the money to pay extra for renewable energy and hence are forced to buy the cheap stuff that is not good for you.

A start up energy company in the Netherlands took advantage of the deregulation of the market in 2002. Their objective was to supply to their customers what was better for the environment and more sustainable. They engineered their entire business so that they could call a prospective customer and say::"Would you like to spend less on your energy bill and would you like it to be 100% renewable?" The obvious answer was yes and the result was that the company was sold after 3 years for some 150 million Euros to a British conglomerate. No billboards,no tv - just call centre operators.

I think the title is a bit black and white - but sometimes that generates a lot of opinions and view and an interesting thread - like these 80 odd posts. I think it would have been more appropriate if the quotation marks were used for the word 'bother' rather then 'green';-)

As far as educating people and failure. There are campaigns that focus on alcohol abuse and smoking: the value of not consuming them. In Congo they have billboards that communicate that raping a woman is not good. Sometimes you cannot get away from educating the customer and I think we do not know the sustainable alpabet very well and hence there will be a lot of requirement for education. So the the component of failure can be people NOT 'redesigning' their behavioural patterns. And of course there is a lot to be said for the strength of simplicity.
Cheers

Hans
Sydney, Australia

We develop GIS software for businesses and governments. Green to us means building and delivering technology that helps them make better decisions. Many of the organizations we work with don't look at the whole picture when they make decisions. This costs them money and impacts the environment. Our technology allows them to take a geographic approach to problem solving. We don't market this as being "green" but being smarter. Being "green" is a side benefit.

I enjoyed the article, but I do need to point out a flaw in using hemp as an example of a green niche product that can't break out into the mainstream. Hemp is hamstrung, not by any deficiencies in the fabric itself, but by the ridiculous tariffs on imported hemp (it can't be produced here since we don't want the farm workers and factory workers catching a buzz. /snark). I would be happy about wearing more hemp - and not because of any green attributes, but because it is a wonderfully wearable and long lasting fabric - if I could afford it.

I'm currently engaged in a university project and it's on green roofs/walls (using plants, not painting them). My work is on targetting the average consumer, not the green ones for the reasons you have stated so clearly. To me that's obvious, if you want to market something don't look at the current market but at the future market and take the technology push route. The average consumer who doesn't see the point in making any effort towards curbing greenhouse gases, recycling, walking when they can drive, etc is not going to give a positive response to building a garden on their rooftop. However, if the point is raised that it will reduce their expenditure on electricity by increasing insulation, use rainwater harvesting for toilets etc so reducing water bills (where they pay) and other cost-cutting benefits, and even some aesthetic ones like birds, bees, fruit (whether blueberries or apples) and so on, then the market uptake will increase substantially, although it won't capture everyone.
So that's my view on it, and I'm keeping your article to refer to!

This, I believe, was more true a few years ago. The need to be green has become mainstream, and marketing strategies should adjust to that.

Shel Horowitz

I tend to agree with Steve Bishop.
Numerous investigations have shown that sustainability concerns incorporated in products is fine, but it is functionality that counts. And well, price, as it turns out.
Consumers may be willing a premium for products that have a positive environmental or social effect, but only a small one, and this will definitely not be the case if the product fails to deliver functionally.
This makes the challenge to come up with sustainable products from the start larger, but not impossible. One would however be well advised to ask which problem needs to be solved. It may very well be that sustainable products can be a new and competitive answer, but a solution without a problem is like a hammer with no nail in sight.

I think you've got the right idea here. While producing a window cleaner that claims to be environmentally friendly is good, we need something more to save the world. What’s needed today is a bigger more complete system of capitalism. We need to be more than sustainable or socially responsible; we need to be socially-strategic. We need to do more than doing no harm; we need to heal, to restore, to create a robust world that offers future generations the greatest chance for an enriching life. Please visit http://www.thoughtrocket.com for more.

i really appreciate the contribution of others.As regards the word green marketing and it contribution to the society at large.My question is 'what is the effect of green marketing in the satisfaction of the needs and wants of consumers'

consumers including all of us are the world and it's everyones responsibility to ensure the sustainability of the world. Green marketing plays an important role in educating the consumers and creates values that would lead to a green consumption pattern thus shaping "new" needs and wants for the betterment of the world.