Marketing Strategies for Green Business for sustainable future

Presented by, V. ARAVIND K. M. UDAY RAJ

Climate changes have brought attention to people all over the world to take action in slowing down the causes of the ongoing global warming crisis. companies have gradually been changing ways of doing business to decrease the negative impact on the environment. going green might mean higher costs. Corporations can learn from this research paper about the benefits of going green and what marketing strategies one can implement for sustainable future. This strategy. the majority have yet to respond to the global crisis. known as the green strategy. it was rare to hear of any business with dedicated green. a new trend of marketing strategy will take its place. you just haven’t thought of it yet -Sir Winston Churchill. In order for businesses to respond to climate change. In the short term.Consumer awareness of going green has also brought demand for green products. Companies must understand the importance of going green and construct enterprise-level green strategies that best fit their business (Olson. In recent times. other laws such as Assembly Bill No. This in turn will encourage and force companies and businesses to incorporate green alternatives to products and services. 2008). In addition. or sustainability initiatives (outside of those designed to protect them from regulatory fines and other liability for polluting activities). As environmental awareness grows. the long term benefits heavily outweighs the initial costs of going green. will ultimately dominate in the near future. Yet even ten years ago. more focus has been geared towards environmental issues such as global warming.MARKETING STRATEGIES FOR GREEN BUSINESS FOR SUSTAINABLE FUTURE There is always a better strategy than the one you have. Former British Prime Minister ABSTRACT For almost half a century. environmentalists have been advocating for big businesses to incorporate sustainability principles into their practices. While most corporations have already implemented some form of green strategies. environmental. . 32 have mandated companies to adopt greenhouse gas emission measures to minimize greenhouse gas emissions by year 2012. This paper focuses on green strategies and green marketing and their importance for corporations.

green marketing is the marketing of products that are presumed to be environmentally safe. Lozada define green marketing as "the application of marketing tools to facilitate exchanges that satisfy organizational and individual goals in such a way that the preservation. Mintu and Hector R." . Some general guidelines include that a green product    Does not present a health hazard to people or animals.   Does not contribute to excessive waste in its use or packaging. including product modification. communicating. protection and conservation of the physical environment is upheld.Introduction: Marketing is an organizational function and a set of processes for creating. Is relatively efficient in its use of resources during manufacture. To utilize the resources which are limited efficiently and achieve organization’s objective green marketing is the best – suited solution. According to the American Marketing Association. Thus green marketing incorporates a broad range of activities. and Does not rely on unnecessary use of or cruelty to animals. and delivering value to customers and for managing customer relationships in ways that benefit the organization and its stakeholders. Such a product or service may be environmentally friendly in itself or produced and/or packaged in an environmentally friendly way. as well as modifying advertising. and disposal. Alma T. Green marketing refers to the process of selling products and/or services based on their environmental benefits. packaging changes. use. There is no widespread agreement on what exactly makes a product green. Green marketing emphasizes environmental stewardship. changes to the production process. Does not incorporate materials derived from endangered species or threatened environments.

The first wave of Green Marketing occurred in the 1980s. In many cases. or better. it can be dangerous. the green product is the tiebreaker or the cherry on top. Review of Literature The term Green Marketing came into prominence in the late 1980s and early 1990s. has not been proven conclusively. Green marketing can be a very powerful marketing strategy though when it's done right. The American Marketing Association (AMA) held the first workshop on "Ecological Marketing" in 1975. Motti Essakow Sustainable lifestyle consultant. Example.an assumption that. 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 .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 proceedings of this workshop resulted in one of the first books on green marketing entitled "Ecological Marketing. on a conceptual lever . thus green consumers must see the product as the same. While green marketing is growing greatly as increasing numbers of consumers are willing to back their environmental consciousnesses with their dollars. Sustainability is usually understood in the sense of planning for the future. it is useful to think of sustainability as balance – the midpoint between destruction and restoration . Presenting a product or service as green when it's not is called green washing. 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. sustainable practice in a resource and the industry into the future. in my opinion. Corporate Social Responsibility (CSR) Reports started with the ice cream seller Ben & Jerry's where the . than the competition.

According to Jacquelyn Ottman. Environmental issues should be balanced with primary customer needs. and NGOs. In 1987 a document prepared by the World Commission on Environment and Development defined sustainable development as meeting ―the needs of the present without compromising the ability of future generations to meet their own need‖. consumers' efforts to do so in real life have remained sketchy at best One of green marketing's challenges is the lack of standards or public consensus about what constitutes "green. While public opinion polls taken since the late 1980s have shown consistently that a significant percentage of consumers in the U.S. marketers. and influential people—has slowed the growth of green products. The holistic nature of green also suggests that besides suppliers and retailers new stakeholders be enlisted. (author of Green Marketing: Opportunity for Innovation) from an organizational standpoint. because companies are often reluctant to promote their green attributes. . there is no definition of "how good is good enough" when it comes to a product or company making green marketing claims. Two tangible milestones for wave 1 of green marketing came in the form of published books. activists. environmental considerations should be integrated into all aspects of marketing — new product development and communications and all points in between. regulators. says Makower." according to Joel Makowr. this became known as the Brundtland Report and was another step towards widespread thinking on sustainability in everyday activity. The past decade has shown that harnessing consumer power to effect positive environmental change is far easier said than done. both of which were called Green Marketing. and consumers are often skeptical about claims. The so-called "green consumer" movements in the U. This lack of consensus—by consumers. members of the community. In essence. and elsewhere profess a strong willingness to favor environmentally conscious products and companies. regulators. including educators.S. a writer on green marketing.financial report was supplemented by a greater view on the company's environmental impact. They were by Ken Peattie (1992) in the United Kingdom and by Jacquelyn Ottman (1993) in the United States of America. and other countries have struggled to reach critical mass and to remain in the forefront of shoppers' minds.

Third phase was "Sustainable" green marketing. marketers can take care of environmental issues. 2. Environmental Issues: Need to be balanced with primary customer needs. This concern has led more companies to advertise their commitment to reduce their climate impacts. and the effect this is having on their products and services. Holistic Nature: All stake holders need to be part of this initiative – marketer. Jacquelyn A Ottman and others have described green marketing at three different levels: 1. supplier. New process and technology to develop environment – friendly products and services. 3. There are many ways wherein along with making profits. green marketing has continued to gain adherents.Despite these challenges. regulator. retailer. Second phase was "Environmental" green marketing and the focus shifted on clean technology that involved designing of innovative new products. new process and new product and communicating the same to the customer. Evolution of Green Marketing The green marketing has evolved over a period of time. NGO-in deed all of them. . community member. and during this period all marketing activities were concerned to help environment problems and provide remedies for environmental problems. Marketing: Development of new technology. According to Peattie (2001). particularly in light of growing global concern about climate change. It came into prominence in the late 1990s and early 2000. Innovation is an integral part of it. educator. the evolution of green marketing has three phases. First phase was termed as "Ecological" green marketing. which take care of pollution and waste issues.

Those that promote a green lifestyle by highlighting a product or service. Some have 4 P's and some have 7 P's of marketing mix. or taste. Ads that present a corporate image of environmental responsibility. visual appeal. This value may be improved performance. Product The ecological objectives in planning products are to reduce resource consumption and pollution and to increase conservation of scarce resources (Keller man. Promotion There are three types of green advertising: 1. Most consumers will only be prepared to pay additional value if there is a perception of extra product value. Place The choice of where and when to make a product available will have significant impact on the customers. Price Price is a critical and important factor of green marketing mix. Green marketing should take all these facts into consideration while charging a premium price. function. 2. Ads that address a relationship between a product/service and the biophysical environment. . The 4 P's of green marketing are that of a conventional marketing but the challenge before marketers is to use 4 P's in an innovative manner. design. Very few customers will go out of their way to buy green products. 3.Green Marketing Mix Every company has its own favorite marketing mix. 1978).

) There are the four main factors that influence Americans‘ (not so) green behaviors: 1) Lack of actionable information.  do not have the information to be personally involved in increasing their green behavior aren‘t sure which products and packaging materials are recyclable would do more for the environment if they only knew how they have questions about the true impact of green products    2) Lack of convenient solutions to accommodate people‘s increasingly busy lifestyles. as reason why they seek environmental information.Keys to Successful Green Marketing (Interpreted from the Green Gauge Report. . be genuine. educate your customers. You know that the traditional plastic bag takes about one thousand years to decompose and want to do your part to stop the proliferation of plastic bags in landfills. and give them the opportunity to participate. with half of consumers who claim they. Hence for green marketing to be effective. Let us take an example: Suppose that you have decided that your business will no longer use plastic bags to wrap customer purchases. you have to do three things. You feel that this is the kind of environmental action that will be popular with potential customers and a good opportunity to do some green marketing. with half admitting they know they should make the green lifestyle changes but are too busy 3) Cost of green products compared to traditional alternatives 4) Need to protect personal/family health is cited by an equal number of consumers (52%) as looking to personally protect the environment.

Do your customers care about the benefits your product or service offers? If customers are just learning about what it means to be green. he or she will decide that you don't care as much about recycling as you say you do in your green marketing. And the third element? By shopping at your store. you have to ensure that none of your business practices contradict your decision not to use plastic bags. cardboard and plastic bottles? Obviously. Through education. the customer is taking action to protect the environment by preventing at least one single use plastic bag from going into a landfill. This one little factoid about plastic bags could be used as part of your green marketing campaign . Not using plastic bags appears to be environmental no-brainer. 2. Therefore for successful Green Marketing the following steps need to be considered: 1. such as buying cloth bags to use for future purchases. but he or she gets the satisfaction of physically doing something that fulfills their beliefs. but you will still need to educate your target market. take baby steps in your introduction of why your product or service is important to the environment. Did you know that a single use plastic bag takes about one thousand years to decompose? I didn‘t until I researched this article and probably a fair number of otherwise environmentally conscious people don't either. Educate Customers to Empower Them.all by itself it lets the public know why single use plastic bags are environmentally disastrous and that you and your business care about the environment. your customers can learn to see that the choices they make when selecting your company's goods and services do make a difference for the planet -. You can also reinforce your customers‘ green decisions and increase their participation by offering them additional related actions.To be genuine. It doesn't sound like much. . What if customers who happen to walk behind your store see an overflowing trash bin filled with paper. Customers Want What They Want.even on a small or local scale.

sales climbed 12 percent in an otherwise flat market. to complement the environmental benefit of more open space and reduction of greenhouse gase.S. I-GO Car (Chicago). with the U. Truth in Advertising is Critical. For the customer who can afford a highend green product without questioning its price. Just be prepared to offer proof (see No.or add more value so the price is more acceptable. if you want to entice non-premium buyers to the table. above): test results and credible testimonials can make the case for you. you may have to change the price . that's great. The company re-launched the product as "Marathon. 5. Skip the hype and promote the truth about what's good about your product.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. Green marketing cases Philips Light's "Marathon" Philips Lighting's first shot at marketing a standalone compact fluorescent light (CFL) bulb was Earth Light. Flex Car (Washington State). Finally. Keep Pricing in Line With Expectations. and Hour Car (Twin Cities) . all you need to do is to keep your price where it is. EPA's Energy Star label to add credibility as well as new sensitivity to rising utility costs and electricity shortages. They may be thought of as a "time-sharing" system for cars." underscoring its new "super long life" positioning and promise of saving $26 in energy costs over its five-year lifetime. at $15 each versus 75 cents for incandescent bulbs. 3. Offer Proof. However.3. If your product or service does something wonderful. Consumers who drive less than 7. Buyers are skeptical. including ZipCar (East Coast). 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. The product had difficulty climbing out of its deep green niche. 4. so it's up to you to give them proof.

Electronics sector The consumer electronics sector provides room for using green marketing to attract new customers. Toyota has taken the lead with its environment –friendly fuel –cell technology and entered the Chinese market with its fuel cell hybrid vehicle-prius. but in recent years automobile emissions have been increasing very rapidly. Toyota is known as pro-environment company in china. One example of this is HP's promise to cut its global energy use 20 percent by the year 2010. capital of India. Introduction of CNG in Delhi New Delhi. . a directive was issued to completely adopt CNG in all public transport systems to curb pollution. Case Study – Toyota’s Fuel Cell Hybrid Vehicle The Chinese automobile is the second largest mobile in the world after that of us and is soon slated to become number one. given the pace at which it is growing. In 2002. was being polluted at a very fast pace until Supreme Court of India forced a change to alternative fuels.air pollution is quite high in china mainly because of smoke from factories and houses. Major automakers across the world are jostling to strengthen their position in such a lucrative and growing market . by the end of 2005wih china‘s FAW group. Chinese authorities have recently put in place a number of conditions on automakers entering the Chinese market. To accomplish this reduction below 2005 levels. To control this pollution levels. Today. The Hewlett-Packard Company announced plans to deliver energy-efficient products and services and institute energy-efficient operating practices in its facilities worldwide.

org‘. more companies are responding to consumer‘s aspirations for environmentally less damaging or neutral products. Dell has launched the ‗plant a tree for me‘ program in partnership with ‗the conservation fund‘ and ‗carbonfund. It helps in accessing the new markets and enjoying competitive advantage. Some of the advantages of green marketing are: A) It ensures sustained long-term growth along with profitability. D) Most of the employees also feel proud and responsible to be working for an environmentally responsible company. They are     Opportunities or competitive advantage Corporate social responsibilities (CSR) Government pressure Competitive pressure . C) It helps companies market their products and services keeping the environmental aspects in mind. Benefits of Green Marketing Today‘s consumers are becoming more and more conscious about the environment and are also becoming socially responsible.Xerox Corporation and Canon It has introduced high quality recycled photocopier paper to meet the demand for less environmentally harmful products Dell Computers Recently. Therefore. It has been a very good initiative to offset carbon emission and individuals and corporations can easily participate in that. B) It saves money in the long run. Many companies want to have an early advantage as they have to eventually move towards becoming green. Adoption of Green Marketing There are basically five reasons for which a marketer should go for the adoption of green marketing. through initially the cost is more.

Information support structures to help people navigate the green landscape. including creative financing solutions for higher ticket items. Trusted sustainability standards for all products 5. Lower costs so that cost does not become a barrier to adoption. and green marketers ought to show some more empathy towards themselves and others.g. influencers. e. Provide green solutions that are at least as easy and convenient as traditional products and services 6. truly designed to make their lives easier. and its stakeholders are all the people on the planet. Green Marketing Strategies for sustainable future: For the company which has a strong commitment to environmental sustainability in either its design or manufacturing of a product or a service that's keen on green. healthier. Cost or profit issues Maybe policy makers. not burden them with more 3. Asking people to do one thing at a time 2. and make sure they deliver on the following. greener world. The value to be created is a sustainable. The larger organization at stake is the world. Whenever possible tie in personal/family health into the environmental equation. community purchase plans 7. follow these steps for having effective green marketing and to put you ahead of the competition:     Marketing Audit (including internal and external situation analysis) Develop a marketing plan outlining strategies with regard to 4 P's Implement marketing strategies Plan results evaluation . seven green marketing promises: 1. More visible and clear recycling directions on product packaging 4.

There are lots of blogging. 7.com that encourages consumers to share ideas to save the planet. 4. Better Midler. 5. 2. Design for Environment. Lead from desirable primary product benefits . I suspect this is a natural next step for Sun Chips. Partner to extend credibility.to go to stores with their shopper hats on not citizen). healthfulness (rather than environmental product attributes). 9. Lay‘s is now making it easy for smackers to find out which farmers supply the potatoes from Lays. Gwyneth Paltrow all provided free exposure and excitement for the introduction of Toyota‘s Prius. Health is the number one reason why consumers are motivated to act on green. Cultivate relationships with new heroes. Educate and empower consumers.Hence. GreenEffect. used by Clorox Green works. Communicate processes as well as green product benefits. reach and resources. 6. naturalness. It's not enough to have a green product. 10. the package. Leverage social networks. Underscore authenticity with packages that use renewable materials and are compostable. Representing a new development. I did get the distinct impression though that Face book pages are not always so . indeed every aspect of your product throughout its lifecycle must be green too. twittering and Face book pages going on. 8. Humanize your effort. 3.efficacy. described their intriguing website entitled. EPA‘s Energy Star. Celebrities are proven green spokespeople— Leonardo DiCaprio. Provide transparency: 83% of consumers now want to know where their food comes from. It‘s clear by now that consumers won‘t trade off efficacy for the planet (and why should they . Thomas Oh. Reinforce credibility through labeling and third party seals. the marketing strategies for sustainable future one can follow are: 1. Frito-Lay‘s Sun Chips brand manager. Adopt a cause.

it becomes the responsibility of the companies to adopt creativity and insight. Firms practicing green marketing must ensure that their activities are not misleading the customers and are not violating any rules and regulations pertaining to environmental protection . Standardization and identification of product parts and packaging materials benefits the environment by reducing complexity and improving efficiency. Use more environment-friendly raw materials at the production stage itself. Adopt new technology/process or modify existing technology/process so as to reduce environmental impact. 4. This will help the society in the long run.successful. Suggestions to the companies which embark on green marketing Green marketing involves focusing on promoting the consumption of green products. Green marketing strategies are also reducing inventory and production costs. and be committed to the development of environment –friendly products. Some of them are as follows: 1. Substituting electronic or computer controls for analog devices improve quality and reduces waste. Challenges Associated With Green Marketing There are a number of challenges and problems associated with the understanding and application of green marketing. Therefore. Establish a management and control system that will lead to the adherence of stringent environmental safety norms 3. 2. 1. Explore possibilities of recycling of the used product so that it can be used to offer similar or other benefits with less wastage. Companies which embark on green marketing should adopt the following principles in their path towards ―greenness‖. We still understand how to use this powerful medium.

Innovation is. only if the additional can be recovered. Marketers need to understand the implications of green marketing. This lead to a debate as to which is more environmental –friendly 4. 5. Firms should be socially responsible and look for sustainable development. though there may be dire shortage of water. the first step in the successful development of a green product. Practising green is costly. Green . This makes the use of recycled water beyond the reach of most users. 8.2. Sometimes. 6. Firms must do their best to clearly state the benefits of green marketing. 3. If you think customers are not concerned about environmental issues or will not pay a premium for products that are more ecoresponsible. then it is certain that they will appreciate the same. McDonald‘s replaced its clam shells with plastic –scooted paper. As a result. steep competition can force a company to adopt unfair practices to cut costs. Many people may not be prepared to pay higher prices for green products. Green products require renewable and recyclable products that are more expensive. Substantial investments in research and development and innovative organizational culture are a must for developing and marketing of green products. The companies should actively put the efforts to reduce the carbon foot print CONCLUSION Green marketing should not neglect the economic aspect of marketing. You must find an opportunity to enhance you product's performance and strengthen your customer's loyalty and command a higher price. Water treatment technology is very expensive. in such situations. Unless there is widespread awareness about the long term implications of continuing to use non green products. 7. Majority of the people are not aware of this concept in the developing and underdeveloped countries. Lack of scientific knowledge on the part of firms sometimes creates unnecessary problems. Green marketing can succeed in the long-run. think again. it becomes difficult for the companies to practice green marketing. If customers are explained the benefits of green marketing. 10. one faces the additional challenges of creating awareness and willingness to spend on green products. 9. in fact.

Environmental Marketing. Ottoman. Fuller. 1995. The Myth of Green Marketing: Tending Our Goats at the Edge of Apocalypse. Sustainable Marketing: Mancigerial-Ecological Issues. NY: Haworth Press. Smith. 1998. and Reilly. Speer. Mintu-Wimsatt. Toby. Indian Management. Jacquelyn A. "Growing in the Green Market.. Binghamton. BIBLIOGRAPHY Seven Green Marketing Strategies to Persuade Americans to Go Green . Polanski. Lakshmi (2007). Lincolnwood. 1999. Chopra. S. London: Sage Publications. "Turning Over a New Leaf". Practice. there are significant indications that environmental issues will grow in importance over the coming years and will require imaginative and innovative redesign and reengineering of existing marketing efforts on the part of many businesses. 1998. Hence to have sustainable future companies need to work on Green Marketing as it is based on the premise that businesses have a responsibility to satisfy human needs and desires while preserving the integrity of the natural environment." American Demographics. Green Marketing: Opportunity for Innovation. IL: NTC Business Books. and Research. William K.December 1. eds. That this latter concern has been ignored throughout most of recorded human history does not mean it will be unimportant in the future. Strategies. Theory.marketing is still in its infancy and a lot of research is to be done on green marketing to fully explore its potential. August 1997. Indeed. 2007 by lamarguerite. April-2007 . and Michael J. Donald A. Toronto: University of Toronto Press. Vol-64. Alma T. Tibbett L.

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