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Global Warming & green marketing

Global Warming & green marketing

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Published by: Hardik Shah on Jun 14, 2010
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Global Warming:Global Warming is defined as the increase of the average temperature on Earth.

As the Earth is getting hotter, disasters like hurricanes, droughts and floods are getting more frequent. Over the last 100 years, the average temperature of the air near the Earth´s surface has risen a little less than 1° Celsius (0.74 ± 0.18°C, or 1.3 ± 0.32° Fahrenheit). Does not seem all that much? It is responsible for the conspicuous increase in storms, floods and raging forest fires we have seen in the last ten years, though, say scientists. Their data show that an increase of one degree Celsius makes the Earth warmer now than it has been for at least a thousand years. Out of the 20 warmest years on record, 19 have occurred since 1980. The three hottest years ever observed have all occurred in the last ten years, even. Earth should be in cool-down-period:But it is not only about how much the Earth is warming, it is also about how fast it is warming. There have always been natural climate changes – Ice Ages and the warm intermediate times between them – but those evolved over periods of 50,000 to 100,000 years.

A temperature rise as fast as the one we have seen over the last 30 years has never happened before, as far as scientists can ascertain. Moreover, normally the Earth should now be in a cool-down-period, according to natural effects like solar cycles and volcano activity, not in a heating-up phase. What is more, climate change won’t be a smooth transition to a warmer world, warns the Tipping Points Report by Allianz and WWF. Twelve regions around the world will be especially affected by abrupt changes, among them the North Pole, the Amazon rainforest, and California. All these facts lead scientists to infer that the global warming we now experience is not a natural occurrence and that it is not brought on by natural causes. Man is responsible, they say. What did we do? Read more about the man-made causes and impacts of global warming in the following articles.


The UN Global Warming Report Facts and Predictions :The latest report from the Intergovernmental Panel on Climate Change delivered a huge blow to global warming skeptics. Leading climate scientists are now 90 percent sure that human activity is heating up the planet. They present various scenarios that show where global warming could take us by the end of the century. The choice is ours. Global and Continental Temperature Change Global temperature changes during the 20th century. The blue line depictures only changes due to natural forcing triggered by solar activity and volcanoes. The red lines is made up of changes induced by natural and anthropogenic sources (Graphic: IPCC) First, the facts as outlined by the report. Global warming is a reality and “very likely” human-induced. Although the term “very likely” may seem vague, it is as close as 700 scientists, 2,500 reviewers and countless government officials can get to consensus about if humanity is to blame. Greenhouse gases in our atmosphere have increased since 1750 due to the consumption of fossil fuels, new forms of land use, and agriculture. While atmospheric pollution has had a cooling effect during the last centuries, the massive increase in greenhouse gases has lead to a rise of average temperatures by 0.74 degrees Celsius since 1901. Scientists are 90 percent sure that the last half of the 20th century has been the hottest period in the Northern Hemisphere since 500 years. "Numerous long-term changes in climate have been observed. These include changes in Arctic temperatures and ice, widespread changes in precipitation amounts, ocean salinity, wind patterns and aspects of extreme weather including droughts, heavy precipitation, heat waves and the intensity of tropical cyclones." Scientists have refined their simulations and now have a fairly good idea of the effects of carbon dioxide emissions. A doubling of carbon dioxide levels in the atmosphere, relates to a surface warming of some 3 degrees Celsius plus-minus one degree. Even if we manage to reduce carbon emissions to year 2000 levels such a doubling of carbon dioxide is unpreventable. Warming, the report reads, will not be equally distributed. Effects will be more pronounced in the northern latitudes. Critics often referred to changes in the sun’s radiation to account for global warming. Although scientists have found fluctuations in the sun's radiation, its effects are nearly 20 times weaker than human-induced warming.


Meanwhile glaciers all over the world are declining, an effect that is also perceivable at the fringes of the vast Antarctica ice shield. Scientists say that sea levels have already risen 17 centimeters during the 20th century, most of it due to the simple fact that warm water has a larger volume than cold water. With the melting of icecaps and glaciers, the annual rise has nearly doubled since 1993 to a rate of about 3.1 mm. Even if carbon dioxide emissions can be stabilized, sea levels will keep on rising for centuries until the temperature gain will have reached the deep oceans.

Findings also show that the atmosphere now holds more water vapor, one of the driving forces of tropical storms and floods. Since the 1960, Westerly winds have gained in strength all over the planet. The Atlantic was particularly effected by more frequent and severe tropical cyclones, a phenomenon in line with rising surface water temperatures. The report says that there is a chance of six out of ten that recent severe storms were boosted by global warming. Arctic temperatures have increased twice as fast as global average temperatures. Summer ice in the Arctic Ocean is decreasing by 7.4 percent per decade. By the end of the century, the Arctic might well be ice-free in summer. Meanwhile permafrost is on the retreat. Since 1900, the seasonally frozen ground in the Northern Hemisphere has shrunken by some 7 percent. This has freed large amounts of methane, another potent greenhouse gas. To which extent such side-effects amplify ongoing global warming is not yet properly understood. The IPCC’s scenarios, therefore, do not account for eventual runaway effects that would speed up global warming. Precipitation patterns, too, changed over the last century. There is significantly more rain in the eastern parts of North and South America, northern Europe and northern and central Asia. On the other hand, dry spells are more frequent in the Sahel, the Mediterranean, southern Africa and parts of southern Asia.

The IPCC Scenarios :The world’s leading scientists have put together data and expertise available and devised seven climate scenarios for the 21st century. It all depends – they say – on the level of demographic and economic development, and how serious we are about the fight against global warming.


Level 2000:- If we manage to stabilize our greenhouse gas emissions to the levels attained in the year 2000, we will still feel the heat, but the increase will be less than a degree over the next hundred years. Unfortunately, this option is not even considered a real scenario but rather a benchmark to compare with more realistic models. Global Service Economy:- Scenario B1 presents the most optimistic outlook: by mid-century, global population will hit a peak and decline thereafter. Rapid economic changes will bring about a service and information economy based on clean and efficient technologies. The international community will unite around policy solutions - such as the Kyoto Protocol - for the reduction of greenhouse gases. While all this sounds promising, global warming will still occur, albeit not beyond a range of 1.1 to 2.9 degrees Celsius. Sea level rise between 18 and 38 centimeters until the end of the century. Population Growth:- Scenario B2 is less rosy: global population will constantly grow while climate change mitigation efforts have a regional focus. This translates into a temperature rise of some 1.4 to 3.8 degree Celsius. Sea levels increase some 20 to 40 centimeters by 2100. Rapid Economic Growth:- The A1 scenario has been split up in three subdivisions. Each of them is based on rapidly growing economies and a growing number of people, albeit populations will decline towards the second half of the century. A1FI represents “business-as-usual” - a world that still runs on coal and gas. It is here that predictions are most shocking: temperature gains of some 2.4 to 6.4 degrees are within reach. The sea would rise some 26 to 50 centimeters until the end of the century flooding large coastal cities and numerous islands. A1B, the most probable scenario given current trends, is also alarming. While fossil fuels are still widely used, they are part of a more balanced energy mix. Still, by the end of the century, temperatures will have risen some 1.7 to 4.4 degrees Celsius, with the oceans gaining some 21 to 48 centimeters. Rainfall is likely to decrease by some 20 percent in the subtropics, while more rain will fall in the northern and southern latitudes. The Gulf Stream will not stop, but it will lose about a quarter of its force. Finally, A1T is a world that has lived through a third industrial revolution - a widespread conversion to “green” energy sources. It is similar to B1 in the sense that temperatures and oceans will rise, but to an extent that experts such as Hans Joachim Schellnhuber call “manageable".


The sun is the Earth’s primary energy source, a burning star so hot that we can feel its heat from over 150 million kilometers away. Its rays enter our atmosphere and shower upon on our planet. About one third of this solar energy is reflected back into the universe by shimmering glaciers, water and other bright surfaces. Two thirds, however, are absorbed by the Earth, thus warming land, oceans, and atmosphere. Much of this heat radiates back out into space, but some of it is stored in the atmosphere. This process is called the greenhouse effect. Without it, the Earth’s average temperature would be a chilling -18 degrees Celsius, even despite the sun’s constant energy supply. In a world like this, life on Earth would probably have never emerged from the sea. Thanks to the greenhouse effect, however, heat emitted from the Earth is trapped in the atmosphere, providing us with a comfortable average temperature of 14 degrees. So, how does it work? Sunrays enter the glass roof and walls of a greenhouse. But once they heat up the ground, which, in turn, heats up the air inside the greenhouse, the glass panels trap that warm air and temperatures increase. Our planet, however, has no glass walls; the only thing that comes close to acting as such is our atmosphere. But in here, processes are way more complicated than in a real greenhouse. Like a radiator in space :Only about half of all solar energy that reaches the Earth is infrared radiation and causes immediate warming when passing the atmosphere. The other half is of a higher frequency, and only translates into heat once it hits Earth and is later reflected back into space as waves of infrared radiation.

This transformation of solar radiation in to infrared radiation is crucial, because infrared radiation can be absorbed by the atmosphere. So, on a cold and clear night for example, parts of this infrared radiation that would normally dissipate into space get caught up in the Earth’s atmosphere. And like a radiator in the middle of a room, our atmosphere radiates this heat into all directions.


Parts of this heat are finally sent out in the frozen nothingness of space, parts of it are sent back to Earth where they step up global temperatures. Just how much warmer it gets down here depends on how much energy is absorbed up there– and this, in turn, depends on the atmosphere’s composition. The switch from carbon dioxide to oxygen:Nitrogen, oxygen, and argon make up 98 percent of the Earth’s atmosphere. But they do not absorb significant amounts of infrared radiation, and thus do not contribute to the greenhouse effect. It is the more exotic components like water vapour, carbon dioxide, ozone, methane, nitrous oxide, and chlorofluorocarbons that absorb heat and thus increase atmospheric temperatures. Studies indicate that until some 2.7 billion years ago, there was so much carbon dioxide (CO2) and methane in our atmosphere that average temperatures on Earth were as high as 70 degrees. But bacteria and plants slowly turned CO2 into oxygen and the concentration of CO2 in our current atmosphere dropped to just about 0.038 percent or 383 parts per million (ppm), a unit of measurement used for very low concentrations of gases that has become a kind of currency in climate change debates. Minuscule changes – global impact :But while we are still far from seeing major concentrations of CO2 in our atmosphere, slight changes already alter the way our celestial heating system works. Measurements of carbon dioxide amounts from Mauna Loa Observatory in Hawaii show that CO2 has increased from about 313 ppm in 1960 to about 375 ppm in 2005. That means for every million particles in our atmosphere, there are now 62 CO2particles more than in 1960. Even if this does not seem like much, scientists say this increase – most probably caused by human activities – is mainly responsible for rising global temperatures throughout the last decades. Even if the term “greenhouse effect” is somewhat of a misnomer, it still might be a useful handle from which the public can grasp an otherwise intricate natural process. Most people can relate to how hot and stuffy a greenhouse can get. Now that the Earth has started to heat up, we realize that our own global greenhouse has no window that we can open to catch some fresh air.


Green Marketing and Ethical Issues:INTRODUCTION:The marketer need to know about what is the relevance of Social Marketing in order to protect the environment and to improve the quality of life and are concerned with issues that include conservation of natural resources, reducing environmental pollution, protecting endangered species, and control of land use. Many companies are finding that consumers are willing to pay more for a green product. The last three decades have seen a progressive increase in worldwide environmental consciousness. This has been driven by a number of factors from increased media coverage to rising evidence of environmental problems such as the depletion of the ozone layer, acidification of rivers and forest degradation, global warming, the rise of pressure group activity, tougher legislation and major industrial disasters. Concern has moved from the local scale to a national and increasingly global scale. The rate of environmental degradation has intensified. The nineteenth century brought the first large scale pollution as companies geared themselves to produce goods as fast as possible, with virtual disregard for human or environmental well-being. Nations battled for industrial supremacy using raw materials and creating pollution at a staggering rate. As countries became economically stronger, competition also grew. More efficient production methods were employed, and few companies, if any, gave a thought to the impact they were having on their surroundings. With the increase in water pollution from the chemical works, and air pollution from the iron and steel industry, towns and cities began to pay the price for high industrial productivity. Ass the 1980s progressed; it became increasingly clear that, although the starkest predictions of resource depletion and population explosion had failed to materialize, all was far from well with the planet. A number of published analyses of the environment showed that according to a wide range of indicators, the environment was coming under increasing stress. Concern among consumers and the electorate began to mount, with the inevitable consequence being that environmental issues moved from the fringes to the center of the business and political agenda. The environment’s role in business is profoundly obvious, but easy to overlook. It provides every business with its inputs, and a destination for all its outputs. It also provides the business with the physical space within which its operations occur. For businesses dealing directly with environmental resources, such as agriculture, tourism or oil, the importance of the physical environment has always been apparent. Society in its present form and on its current trajectory of development, however, cannot be sustained indefinitely. The physical


environment has limited resources and limited capacity to absorb pollution and waste. The underlying cause of society’s current unsustainability relates to the way in which economics and technology have come to dominate our thinking about business and the environment. Conventional marketing within industry is very much a product of this techno-economic perspective. This has created a ‘grey’ culture which is not sustainable and is therefore terminal. To transform this into a ‘green’ sustainable culture, there is a need to balance consideration of the economic and technical impacts and aspects of businesses with understanding of their social and physical implications. It is now widely accepted that societies, economies, and the businesses within them need to find a more sustainable path to for future development. In the business world the vocabulary of management was suddenly expanded by the discussion of ‘green consumers’, ‘green markets’ and ‘green products’ and the practice of ‘environmental’ or ‘green marketing’. For majority of the companies improving environmental performance has, until recently, been a question of legislative compliance and occasional reactions to external events and pressures. It has only been companies in the front-line sectors such as oil, chemicals, power and cars that have gone beyond a reactive and tactical approach to green issues. However, by early 1990s a shift away from a technical-compliance oriented approach towards a more proactive green strategy orientation was noticed. Companies were increasingly pursuing competitive advantage and product differentiation by increasing investment in environmental marketing, green design and improving overall corporate eco-performance. In addition to these externally motivated changes, the realization is dawning within industry that sustainability will not be reached simply by demand-pull from the market and compliance-push from the regulators. The changes that are needed to safeguard the future of the environment and the economy must partly be driven from the business community, which means they must proactively integrate eco-performance into the strategies, systems and cultures of the organization. Eg: Toyota has become quite successful with their hybrid cars. The three R s of environmentalism are:Reduce Reuse and Recycle. Green marketing refers to the development and distribution of ecologically-safe products. It refers to products and packages that have one or more of the following characteristics:


(1) Are less toxic (2) Are more durable (3) Contain reusable materials (4) Are made of recyclable material. In short, these are products considered “environmentally responsible”. In the early to mid 1960s created concern about the social responsibility of businesses and their impact on the natural environment and the health and welfare of the planet. This concern was heightened during the early 1970s in response to Limits to Growth and resulted in the emergence of both the ‘societal marketing concept’ and the ‘ecological marketing concept’. In response to the new green challenge that emerged during the early 1980s, these early concepts have amalgamated to create an environmental marketing concept. Green marketing is thus a form of socio-ecological marketing whereby the goods and services sold, and the marketing practices involved in their sale take into account the environmental ramifications of society as a whole. The marketing process essentially involves matching the controllable internal variables of the marketing mix with the demands of the marketing environment. Environmental marketing is no different, in principle, although the internal variables and external demands that must be reconciled are a little different. Green marketing takes account of the wider relationship of the organization and its products to the surroundings. It is about a more aware, open, targeted and sensitive approach that integrates the strategic link between the company, the environment, and marketing, rather than being primarily concerned with tactical communications opportunities. The prime emphasis is on, developing relationships and satisfying separate Stakeholders needs in an environmentally and socially responsible manner. The key stakeholders are customers, investors, parent company, directors, employees, the community, legislators, pressure groups, suppliers, and the media Green marketing differs from its societal and an ecological predecessor in it’s intertwining of ecological and social concerns, in the breadth of the ecological agenda that it tackles, and in its potential application across all types and sectors of business. Green marketing goes beyond societal marketing in four key ways: It is an open-ended rather than a long-term perspective.:• •

It focuses more strongly on the natural environment. It treats the environment as something which has an intrinsic value over and above its usefulness to society.


It focuses on global concerns rather than those of particular societies.

The key elements of green marketing can be summarized as under:• • • • • • • •

A balanced approach to the social, technological, economic and physical aspects of businesses and societies. An emphasis on long term sustainable qualitative development rather than short-term unsustainable quantitative growth. A holistic approach aimed at reversing the educationalists and fragmented approach of previous business theory and practice. A consideration of consumers as real human beings rather than as hypothetical ‘rational economic’ entities. An emphasis on meeting the genuine needs of consumers, rather than on stimulating superficial desires. Recognition that consumers and society have multiple and sometimes conflicting wants and needs. A view of the company and all its activities as part of the ‘product’ that is consumed. A recognition that the large scale long distance nature of the current economy is not sustainable, and that in the future small and local will be beautiful. Embracing the concept of eco-performance which incorporates the nonmarket outputs of the company, with performance of the product during and after use and the environmental impact of companies which contribute to the creation and marketing of the product elsewhere in the supply chain. The pursuit of added socio-environmental value as well as added technoeconomic value.

Green Marketing :Meaning:Green marketing refers to the process of selling products and/or services based on their environmental benefits. Such a product or service may be environmentally friendly in it or produced and/or packaged in an environmentally friendly way. The obvious assumption of green marketing is that potential consumers will view a product or service's "greenness" as a benefit and base their buying decision accordingly. The not-so-obvious assumption of green marketing is that consumers will be willing to pay more for green products than they would for a less-green comparable alternative product - an assumption that, in my opinion, has not been proven conclusively. 10

While green marketing is growing greatly as increasing numbers of consumers are willing to back their environmental consciousnesses with their dollars, it can be dangerous. The public tends to be skeptical of green claims to begin with and companies can seriously damage their brands and their sales if a green claim is discovered to be false or contradicted by a company's other products or practices. Presenting a product or service as green when it's not is called green washing.

Definition:According to the American Marketing Association, green marketing is the marketing of products that are presumed to be environmentally safe. Thus green marketing incorporates a broad range of activities, including product modification, changes to the production process, packaging changes, as well as modifying advertising. Yet defining green marketing is not a simple task where several meanings intersect and contradict each other; an example of this will be the existence of varying social, environmental and retail definitions attached to this term. Other similar terms used are Environmental Marketing and Ecological Marketing. The legal implications of marketing claims call for caution. Misleading or overstated claims can lead to regulatory or civil challenges. In the USA, the Federal Trade Commission provides some guidance on environmental marketing claims.

Three keys to successful green marketing:Show potential customers that you follow green business practices and you could reap more green on your bottom line. Green Marketing isn't just a catchphrase; it's a marketing strategy that can help you get more customers and make more money. But only if you do it right. For green marketing to be effective, you have to do three things; be genuine, educate your customers, and give them the opportunity to participate. 1) Being genuine means that a) that you are actually doing what you claim to be doing in your green marketing campaign and b) that the rest of your business policies are consistent with whatever you are doing that's environmentally friendly. Both these conditions have to be met for your business to establish the kind of environmental credentials that will allow a green marketing campaign to succeed. 2) Educating your customers isn't just a matter of letting people know you're doing whatever you're doing to protect the environment, but also a matter of 11

letting them know why it matters. Otherwise, for a significant portion of your target market, it's a case of "So what?" and your green marketing campaign goes nowhere. 3) Giving your customers an opportunity to participate means personalizing the benefits of your environmentally friendly actions, normally through letting the customer take part in positive environmental action.

Evolution of Green Marketing:The green marketing has evolved over a period of time. According to Peattie (2001), the evolution of green marketing has three phases. First phase was termed as "Ecological" green marketing, and during this period all marketing activities were concerned to help environment problems and provide remedies for environmental problems. Second phase was "Environmental" green marketing and the focus shifted on clean technology that involved designing of innovative new products, which take care of pollution and waste issues. Third phase was "Sustainable" green marketing. It came into prominence in the late 1990s and early 2000.

Why Green Marketing:As resources are limited and human wants are unlimited, it is important for the marketers to utilize the resources efficiently without waste as well as to achieve the organization's objective. So green marketing is inevitable. There is growing interest among the consumers all over the world regarding protection of environment. Worldwide evidence indicates people are concerned about the environment and are changing their behavior. As a result of this, green marketing has emerged which speaks for growing market for sustainable and socially responsible products and services.

Green Marketing Important :Green marketing offers business bottom line incentives and top line growth possibilities. While modification of business or production processes may involve start-up costs, it will save money in the long term. For example the cost of installing solar energy is an investment in future energy cost savings. Companies that develop new and improved products and services with environmental impacts in mind give themselves access to new markets, substantially increase profits and enjoy competitive advantages over those marketing nonenvironmentally responsible alternatives.


The Four Ps of Green Marketing:Like conventional marketers, green marketers must address the ‘four Ps’ in innovative ways.

1.ProductEntrepreneurs wanting to exploit emerging green market either:  identify customers’ environmental needs and develop products to address these needs; or  Develop environmentally responsible products to have less impact than competitors. The increasingly wide varieties of products on the market that support sustainable development and are good for the triple bottom line include:  Products made from recycled goods, such as Quik’N Tuff housing materials made from recycled broccoli boxes.  Products that can be recycled or reused.  Efficient products, which save water, energy or gasoline, save money and reduce environmental impact. Queensland’s only waterless printer, Print point, reduces operating costs by using less water than conventional printers and is able to pass the savings on to customers.  Products with environmentally responsible packaging. McDonalds, for example, changed their packaging from polystyrene clamshells to paper.  Products with green labels, as long as they offer substantiation.  Organic products — many consumers are prepared to pay a premium for organic products, which offer promise of quality. Organic butchers, for example, promote the added qualities such as taste and tenderness.  A service that rents or loans products – such as toy libraries.  Certified products, which meet or exceed environmentally responsible criteria. Whatever the product or service, it is vital to ensure that products meet or exceed the quality expectations of customers and are thoroughly tested.


2.PricePricing is a critical element of the marketing mix. Most customers are prepared to pay a premium if there is a perception of additional product value. This value may be improved performance, function, design, visual appeal or taste. Environmental benefits are usually an added bonus but will often be the deciding factor between products of equal value and quality. Environmentally responsible products, however, are often less expensive when product life cycle costs are taken into consideration. For example fuelefficient vehicles, water-efficient printing and non-hazardous products.

3.PlaceThe choice of where and when to make a product available has a significant impact on the customers being attracted. Very few customers go out of their way to buy green products merely for the sake of it. Marketers looking to successfully introduce new green products should, in most cases, position them broadly in the market place so they are not just appealing to a small green niche market. The location must also be consistent with the image which a company wants to project. The location must differentiate a company from its competitors. This can be achieved by in-store promotions and visually appealing displays or using recycled materials to emphasize the environmental and other benefits.

4.PromotionPromoting products and services to target markets includes paid advertising, public relations, sales promotions, direct marketing and on-site promotions. Smart green marketers will be able to reinforce environmental credibility by using sustainable marketing and communications tools and practices. For example, many companies in the financial industry are providing electronic statements by email, e-marketing is rapidly replacing more traditional marketing methods, and printed materials can be produced using recycled materials and efficient processes, such as waterless printing. Retailers, for example, are recognizing the value of alliances with other companies, environmental groups and research organizations when promoting their environmental commitment. To reduce the use of plastic bags and promote 14

their green commitment, some retailers sell shopping bags, under the banner of the Go Green Environment Fund. The key to successful green marketing is credibility. Never overstate environmental claims or establish unrealistic expectations, and communicate simply and through sources that people trust. Promote your green credentials and achievements. Publicise stories of the company’s and employees’ green initiatives. Enter environmental awards programs to profile environmental credentials to customers and stakeholders.

Firms Using Green Marketing :When looking through the literature, there are several suggested reasons for firms increased use of Green Marketing. Five possible reasons cited are: 1. Organizations perceive environmental marketing to be an opportunity that can be used to achieve its objectives 2. Organizations believe they have a moral obligation to be more socially responsible 3. Governmental bodies are forcing firms to become more responsible 4. Competitors' environmental activities pressure firms to change their environmental marketing activities 5. Cost factors associated with waste disposal, or reductions in material usage forces firms to modify their behavior

(A) OpportunitiesIt appears that all types of consumers, both individual and industrial are becoming more concerned and aware about the natural environment. Nowadays, firms marketing goods with environmental characteristics have realized a competitive advantage over firms marketing non-environmentally responsible alternatives. There are numerous examples of firms who have strived to become more environmentally responsible, in an attempt to better satisfy their consumer needs.

• •

McDonald's replaced its clam shell packaging with waxed paper because of increased consumer concern relating to polystyrene production and Ozone depletion Tuna manufacturers modified their fishing techniques because of the increased concern over driftnet fishing, and the resulting death of dolphins Xerox introduced a "high quality" recycled photocopier paper in an attempt to satisfy the demands of firms for less environmentally harmful products.

This does not mean that all firms who have undertaken environmental marketing activities actually improve their behavior. In some cases, firms have misled 15

consumers in an attempt to gain market share. In many other cases firms have jumped on the green bandwagon without considering the accuracy of their behavior, their claims, or the effectiveness of their products. This lack of consideration of the true "greenness" of activities may result in firms making false or misleading green marketing claims.

(B) Social ResponsibilityMany firms are beginning to realize that they are members of the wider community and therefore must behave in an environmentally responsible fashion. This translates into firms that believe they must achieve environmental objectives as well as profit related objectives. This results in environmental issues being integrated into the firm's corporate culture. Firms in this situation can take two perspectives: 1) they can use the fact that they are environmentally responsible as a marketing tool; or 2) they can become responsible without promoting this fact. There are examples of firms adopting both strategies. Organizations like the Body Shop heavily promote the fact that they are environmentally responsible. While this behavior is a competitive advantage, the firm was established specifically to offer consumers environmentally responsible alternatives to conventional cosmetic products. This philosophy directly ties itself to the overall corporate culture, rather than simply being a competitive tool. An example of a firm that does not promote its environmental initiatives is Coca-Cola. They have invested large sums of money in various recycling activities, as well as having modified their packaging to minimize its environmental impact. While being concerned about the environment, Coke has not used this concern as a marketing tool. Thus many consumers may not realize that Coke is a very environmentally committed organization. Another firm who is very environmentally responsible but does not promote this fact, at least outside the organization, is Walt Disney World (WDW). WDW has an extensive waste management program and infrastructure in place, yet these facilities are not highlighted in their general tourist promotional activities.

(C) Governmental PressureGovernmental regulations relating to environmental marketing are designed to protect consumers in several ways: 1) reduce production of harmful goods or byproducts; 2) modify consumer and industry's use and/or consumption of harmful goods; or 3) ensure that all types of consumers have the ability to evaluate the environmental composition of goods. These governmental regulations are designed to control the amount of hazardous wastes produced by firms. Many by-products of production are controlled through the issuing of various environmental licenses, thus modifying organizational behavior. In some cases governments try to "induce" final 16

consumers to become more responsible. For example, some governments have introduced voluntary curb-side recycling programs, making it easier for consumers to act responsibly. In other cases governments tax individuals who act in an irresponsible fashion. For example in Australia there is a higher gas tax associated with leaded petrol. One of the recent publicized environmental regulations undertaken by governments has been the establishment of guidelines designed to "control" green marketing claims. These regulations include the Australian Trade Practices Commission's (TPC) "Environmental Claims in Marketing - A Guideline, the US Federal Trade Commission's (FTC) "Guides for the Use of Environmental Marketing Claims" and the regulations suggested by the National Association of Attorneys-General. All these regulations were designed to ensure appropriate information to consumers so that they could evaluate firm's environmental claims. Thus, governmental attempts to protect consumers from false or misleading claims theoretically provide consumers with the ability to make more informed decisions.

(D) Competitive PressureAnother major force in the environmental marketing area has been a firm’s desire to maintain its competitive position. In many cases, firms observe competitors promoting their environmental behaviors and attempt to emulate this behavior. It is only in some instances that this competitive pressure causes an entire industry to modify and thus reduce its detrimental environmental behavior. For example, it could be argued that Xerox's "Revive 100% Recycled paper" was introduced a few years ago in an attempt to address the introduction of recycled photocopier paper by other manufacturers. In another example when one tuna manufacture stopped using driftnets, the others followed suit.

(E) Cost / Profit IssuesCertain firms use green marketing to address cost/profit related issues. Disposing of environmentally harmful by-products, such as polychlorinated biphenyl (PCB) contaminated oil are becoming increasingly costly and in some cases difficult. Therefore, when attempting to minimize waste, firms are often forced to re-examine their production processes. In these cases, they often develop more effective production processes that not only reduce waste, but reduce the need for some raw materials. This serves as a double cost savings, since both waste and raw material are reduced. In many other cases, it has been found that firms find end-of-pipe solutions, instead of minimizing waste. In these situations firms try to find


markets or uses for their waste materials, where one firm's waste becomes another firm's input of production.

Differences between classical marketing approach and green approach:We have already pointed out that the rhythm of changes, global ecological problems, global business, growing dependence on networking and mutual exchange of various organizations, without obvious and fixed borders, sets new challenges before marketing both professionally and scientifically. For this reason, classical marketing, defined as "social and management process whereby, through creation, offer and exchange of products of value with others, Individuals and groups get what they need or what they want", can no longer meet growing market needs of "green" customers. Classical marketing is based on discovering, developing, and sale of products and services whose price, quality, and characteristics will best fulfill customer needs without taking into consideration a wider social sensitivity. As opposed to classical marketing, green marketing has much more complex objectives that cannot be realized using classical marketing strategies: 1. developing a product that will simultaneously satisfy needs and desires of customers in terms of quality, price, efficiency, with minimum impact on the environment. 2. Projecting high quality image with ecological sensitivity of the product and customer. The implementation of green marketing changes the relationship between the company and the customer. Customers increasingly decide on "green" lifestyle, with respect and in appreciation of the environment, they value not only material aspects of life, but also those spiritual, they are concerned about circumstances in which they live and similar. To satisfy new demands of customers, companies develop "green" products that offer both functional and psychological pleasure due to the fact that their use will not be harmful for the environment. In short, basic differences between classical and green approach have to be sought in the proactive opinion of "green" companies, one of the sources of its competitive advantage. The essence of proactive “green” approach lies in continuous learning, specialization, research, introduction of new technologies, use of new alternative materials, discovering and fulfilling still undiscovered desires and needs of customers at the same time complying with ecological Standards. This is where we have to look for basic differences between green and classical approach. In fact, "green" companies, as opposed to “classical” companies, carefully choose their partners, suppliers, and distributors with whom they will make business taking environmental friendliness as one of the criteria of their choice. Partnerships and collaborations of "green" companies also enable compliance and integration of ecological values into the whole chain of production. By all means, the results will be better if the whole system (design, transportation, reuse, or recycling) is suited to preservation of environment. "Green" companies give priority to long-term goals. Together with the realization of profit, they also want to contribute to society and protect the environment. 18

NEW "GREEN" MARKETING APPROACH Classical marketing Customers Products the Customers with their Lifestyle "From the cradle to the grave" One size fits all products Marketing concept Company Sales orientation Final values Reactive Independent Competitive By department Short-term orientation Profit maximizing I Green marketing Human beings with their lives "From the cradle to cradle" Flexible Services Educational Values Proactive Interdependent Cooperative Holistic Long-term Double final target


Strategies of green marketing:Ecological approach to business activities will produce long-term benefits for the company if green marketing within the company develops into a complex, integrated, comprehensive, strategic and tactical process of minimizing negative effects of the company and its exchange with the environment. Simultaneous fulfillment of social obligations and business objectives may be difficult or almost impossible for a company with no developed appropriate strategy. In developing a successful green strategy, the company must consider the following questions: 1. How to teach consumers to responsibly use, spend and dispose our products? 2. How to make the company green? 3. Who can collaborate and do business with us? 4. How to develop a new generation of products? 5. How can we contribute to regeneration of environment?


Authors Aganovic-Topalovic19 claim that there are five key factors for green marketing strategy: clarity of objectives, collaboration with third parties such as governmental organizations, ecological and similar associations and other “green” non-profit organizations, communication, motivation for the customer to buy “green products” convinced of their advantages and of the fact that the whole company is “green.” In Polonsky’s20 view, the following is needed successful green marketing: 1. Successful segmentation of the market and focus on selected market segment Today’s companies can use a much larger quantity of information about psychological, demographic and sociological characteristics of consumers, their needs, desires and preferences. Numerous "green" companies use the Internet for better and more efficient contacts with their target segment. For example, Ecomall advertise a wide range of "green" companies. 2. Developing a new generation of "green" products inadequate production process and bad design of products can be very harmful for the environment, and this is why companies have to consider possible harmful effects on the environment and minimize them at the very beginning of New Product Development (NPD). 3.”Green” positioning Companies that want to position themselves in the market as "green" have to comply with accepted ecological principles from the very beginning. This means that all their activities have to reflect their "green" image. "Green" positioning requires strategic, not only tactical approach.

4. Deciding about "green" prices Introduction of "green" products may sometimes be expensive due to expenses of introducing a new technology, new manner of production, use of alternative raw materials and similar. Precisely due to high costs of production, "green" products may be more expensive. In deciding whether products shall cost the same, more, or less than "brown" competitors, the company has to take into consideration sensitivity and readiness of customers to pay the premium for a "green" product. 5. Applying "green" logistics the application of ecological values in the process of distribution may result in reduction of business expenses and environmental impacts. The trend of reduction of packaging and wrapping has immediate effect on reduction of expenses of distribution. Unfavorable effects of distribution on the environment may be reduced by developing an integrated system of transportation, using the Internet and other innovations in the field of distribution.


The greatest progress has been realized in the application of the “Reverse Logistics" system, through which customers return empty packaging and used products to the company. 6. Changing the attitude to waste does not necessarily have to be a negative consequence of the process of production, it may be used as input in further production, but it requires implementation of changes within the company. A new understanding of waste results in the creation of a new market of recycled products where waste producers act as purchasers of their own processed and recycled waste. Some American wineries use services of companies specialized in collecting and processing postproduction waste that they buy after processing and use it as fertilizers. 7. Applying “green” promotion Success of “green” promotion depends on proper choice of information and means of communication. Communication has to comprise only complete, correct, and valuable information based on actually undertaken ecological activities of the company. Dissemination of superficial or incorrect information will result in creation of negative image. 8. Creating "green" partnerships sometimes the company may lack fundamental knowledge and experience in applying green marketing. Such lack may be resolved by creating "green" associations with companies that already apply green marketing. "Green" partnerships are the source of necessary knowledge and information for the development and implementation of appropriate strategies and tactics of green marketing. Disadvantages of "green" associations are contrasting interests and objectives of partners, which may reduce company benefits, harm its image and its ability to realize its long-term

BENEFITS OF GREEN MARKETING :Today's consumers are becoming more and more conscious about the environment and are also becoming socially responsible. Therefore, more companies are responsible to consumers' aspirations for environmentally less damaging or neutral products. Many companies want to have an early-mover advantage as they have to eventually move towards becoming green. Some of the advantages of green marketing are, *It ensures sustained long-term growth along with profitability. *It saves money in the long run, thought initially the cost is more. *It helps companies market their products and services keeping the environment aspects in mind. It helps in accessing the new markets and enjoying competitive advantage.


*Most of the employees also feel proud and responsible to be working for an environmentally responsible company.

Challenges Ahead:1. 2. 3. 4. 5. Green products require renewable and recyclable material, which is costly Requires a technology, which requires huge investment in R & D Water treatment technology, which is too costly Majority of the people are not aware of green products and their uses Majority of the consumers are not willing to pay a premium for green Products

Adoption of Green Marketing :There are basically five reasons for which a marketer should go for the adoption of green marketing. They are * Opportunities or competitive advantage * Corporate social responsibilities (CSR) * Government pressure * Competitive pressure * Cost or profit issues

Some Problems With Going Green:Although a large number of firms are using green marketing, there are a number of potential problems which need to be addressed. One of the main problem is that firms using green marketing must ensure that their activities are not misleading to the consumers or the industry, and do not breach any of the regulations or laws dealing with environmental marketing. In short, green marketing claims of a firm must:
• •

Clearly state environmental benefits; Explain environmental characteristics; 22

• • • •

Explain how benefits are achieved; Ensure comparative differences are justified; Ensure negative factors are taken into consideration; and Only use meaningful terms and pictures.

Furthermore, as many firms have tried to modify their products due to increased consumer concern, are misled with the fact that consumers' perceptions are always correct. Take for example the McDonald's case where it replaced its clam shells with plastic coated paper. There is ongoing scientific debate which is more environmentally friendly. Some scientific evidence suggests that when taking a cradle-to-grave approach, polystyrene is less environmentally harmful. If this is the case, McDonald's bow to consumer pressure, has chosen the more environmentally harmful option. When firms attempt to become socially responsible, they face the risk that the environmentally responsible action of today will be found to be harmful in the future. Take for example the aerosol industry which has switched from CFCs (chlorofluorocarbons) to HFCs (hydro-fluoro-carbons) only to be told HFCs are also a greenhouse gas. Some firms now use DME (dimethyl ether) as an aerosol propellant, which may also harm the ozone layer. Given the limited scientific knowledge at any point in time, it may be impossible for a firm to be certain they have made the correct environmental decision. This explains why some firms, like Coca-Cola and Walt Disney World, are becoming socially responsible without publicizing the point. They may be protecting themselves from potential future negative backlash; if it is determined they made the wrong decision in the past. Reacting to competitive pressures can cause all "followers" to make the same mistake as the "leader." A costly example of this was the Mobil Corporation who followed the competition and introduced "biodegradable" plastic garbage bags. While technically these bags were biodegradable, the conditions under which they were disposed did not allow biodegradation to occur. Mobil was sued by several US states for using misleading advertising claims. Thus, blindly following the competition can have costly ramifications.

The push to reduce costs or increase profits may not force firms to address the important issue of environmental degradation. End-of-pipe solutions may not actually reduce the waste but rather shift it around. While this may be beneficial, it does not necessarily address the larger environmental problem, though it may minimize its short term affects. Ultimately most waste produced will enter the waste stream, therefore to be environmentally responsible organizations should attempt to minimize their waste, rather than find "appropriate" uses for it.


Green marketing cases:Philips Light's "Marathon"

Philips Light's CFL:Philips Lighting's first shot at marketing a standalone compact fluorescent light (CFL) bulb was Earth Light, at $15 each versus 75 cents for incandescent bulbs. The product had difficulty climbing out of its deep green niche. The company relaunched the product as "Marathon," underscoring its new "super long life" positioning and promise of saving $26 in energy costs over its five-year lifetime. Finally, with the U.S. EPA's Energy Star label to add credibility as well as new sensitivity to rising utility costs and electricity shortages, sales climbed 12 percent in an otherwise flat market. Car sharing services:Car-sharing services address the longer-term solutions to consumer needs for better fuel savings and fewer traffic tie-ups and parking nightmares, to complement the environmental benefit of more open space and reduction of greenhouse gases. They may be thought of as a "time-sharing" system for cars. Consumers who drive less than 7,500 miles a year and do not need a car for work can save thousands of dollars annually by joining one of the many services springing up, including ZipCar (East Coast), Flex Car (Washington State), and Hour Car (Twin Cities).


Electronics sector:The consumer electronics sector provides room for using green marketing to attract new customers. One example of this is HP's promise to cut its global energy use 20 percent by the year 2010. To accomplish this reduction below 2005 levels, The Hewlett-Packard Company announced plans to deliver energyefficient products and services and institute energy-efficient operating practices in its facilities worldwide. Introduction of CNG in Delhi:New Delhi, capital of India, was being polluted at a very fast pace until Supreme Court of India forced a change to alternative fuels. In 2002, a directive was issued to completely adopt CNG in all public transport systems to curb pollution. ITC :* ITC has been 'Carbon Positive' three years in a row (sequestering/storing twice the amount of CO2 than the Company emits). 'Water Positive' six years in a row (creating three times more Rainwater Harvesting potential than ITC's net consumption).

* Close to 100% solid waste recycling. * All Environment, Health and Safety Management Systems in ITC conform to the best international standards. * ITC's businesses generate livelihoods for over 5 million people. * ITC's globally recognised e-Choupal initiative is the world's largest rural digital infrastructure benefiting over 4 million farming families. * ITC's Social and Farm Forestry initiative has greened over 80,000 hectares creating an estimated 35 million person days of employment among the disadvantaged. * ITC's Watershed Development Initiative brings precious water to nearly 35,000 hectares of drylands and moisture-stressed areas. * ITC's Sustainable Community Development initiatives include women empowerment, supplementary education, integrated animal husbandry programmes.


Maruthi:Greening of Supply Chain :The company has remained ahead of regulatory requirements in pursuit of environment protection and energy conservation at its manufacturing facilities, and in development of products that use fewer natural resources and are environment friendly. The company credited the 'Just-in-Time' philosophy adopted and internalized by the employees as the prime reason that helped to excel in this direction. The company has been promoting 3R since its inception. As a result the company has not only been able to recycle 100% of treated waste water but also reduced fresh water consumption. The company has implemented rain water harvesting to recharge the aquifers. Also, recyclable packing for bought out components is being actively promoted. The company has been facilitating implementation of Environment Management System (EMS) at its suppliers' end. Regular training programs are conducted for all the suppliers on EMS. Surveys are conducted to assess the vendors who need more guidance. The systems and the environmental performance of suppliers are audited. The green co-efficient of this system is much better than the conventional system HCL's Environment Management Policy under HCL ecoSafe :In building a system to identify, develop and sustain the maintenance of an environment management system at corporate level we have formulated a program that we proudly refer as HCL's ecosafe. The aim is to encapsulate knowledge, awareness, and key developments on all environmental issues faced by today's world and to incorporate these in HCL's operations assuring our commitment in delivering quality products, solutions and services The key objective under HCL ecoSafe is targeted at integrating environmental management procedures into its business processes thereby protecting the environment, health, and safety of all its stakeholders. HCL commits to 26

manufacture products that are environment friendly in all respects and are free from hazardous chemicals. HCL ecoSafe focuses on product lifecycle management to ensure that our products right from when they are manufactured, bought by customers, recovered at their end-of-life and recycled after useful life are done in an environmentally responsible manner Key initiatives undertaken through HCL ecoSafe program are: Some more Examples:* McDonald's restaurant's napkins, bags are made of recycled paper. * Coca-Cola pumped syrup directly from tank instead of plastic which saved 68 million pound/year. * Badarpur Thermal Power station of NTPC in Delhi is devising ways to utilize coal-ash that has been a major source of air and water pollution. * Barauni refinery of IOC is taken steps for restricting air and water pollutants. SOURCES:1. Keller, G. M. 1987. "Industry and the Environment: Toward a New Philosophy." Vital Speeches 54 (5): 154-157. 2. McIntosh, Andrew. 1990. "The Impact of Environmental Issues on Marketing and Politics in the 1990s." Journal of the Marketing Research Society 33 (3): 205-217. 3. Ottman, Jacquelyn. 1993. Green Marketing: Challenges and Opportunities for the New Marketing Age. Lincolnwood, Illinois: NTC Business Books. 4. Shearer, Jeffery W. 1990. "Business and the New Environmental Imperative." Business Quarterly 54 (3): 48-52. 5 Chopra, S. Lakshmi (2007), "Turning Over a New Leaf", Indian Management, Vol-64, April-2007 6 Ottman, J.A. et al, "Avoiding Green Marketing Myopia", Environment, Vol-48, June-2006


Green marketing should not neglect the economic aspect of marketing. Marketers need to understand the implications of green marketing. If we think customers are not concerned about environmental issues or will not pay a premium for products that are more eco-responsible, think again. We must find an opportunity to enhance our product's performance and strengthen yur customer's loyalty and command a higher price. Green marketing is still in its infancy and a lot of research is to be done on green marketing to fully explore its potential.Think of a refrigerator for example. While we may have had to be convinced in the 1950s to buy a refrigerator, we would have wanted the great white box to look cool in the 1970s, but in today's uncertain world, we might ask ourselves about the impact of the chlorofluorocarbons (CFCs) that our refrigerator is emitting and demand a more environmentally friendly refrigerator. So, if today's successful marketing is about appealing to personal values and delivering consumer empowerment, then surely the time is right to inject sustainable development into the marketing mix to help address some of the gritty issues currently facing our planet.Green marketing methods produce highly effective results. They apply all of the steps you need to cut costs, raise response rates and increase growth in the most important marketing metric we are all held accountable for—the bottom line.



www.greenmarketing.net/stratergic.html www.epa.qld.gov.au/sustainable_ industries http://www.coolavenues.com http://en.wikipedia.org/wiki/Green_marketing www.google.com/ green marketing WWW. Retailsystemsresearch.com. www.capitalmarket.com


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