You are on page 1of 30


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.

The term green marketing came into prominence in the late 1980s and early 1990s. The American Marketing Association (AMA) held the first workshop on "Ecological Marketing" in 1975. The proceedings of this workshop resulted in one of the first books on green marketing entitled "Ecological Marketing" Thus green marketing incorporates a broad range of activities, including product modification, changes to the production process, packaging changes, as well as modifying advertising.

My definition which encompasses all major components of other definitions is: "Green or Environmental Marketing consists of all activities designed to generate and facilitate any exchanges intended to satisfy human needs or wants, such that the satisfaction of these needs and wants occurs, with minimal detrimental impact on the natural environment." This definition incorporates much of the traditional components of the marketing definition that is "All activities designed

to generate and facilitate any exchanges intended to satisfy human needs or wants".

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 has not been proven conclusively, specially the mild effect which it had had on consumers has washed away by the present recession (2008-09) only.

Green marketers though argue that it is a way to use the environmental benefits of a product or service to promote sales. Many consumers will choose products that do not damage the environment over less environmentally friendly products, even if they cost more. With green marketing, advertisers focus on environmental benefits to sell products such as biodegradable diapers, energy-efficient light bulbs, and environmentally safe detergents.

People buy billions of dollars worth of goods and services every yearmany of which harm the environment in the way they are harvested, made, or used. Environmentalists support green marketing to encourage people to use environmentally preferable alternatives, and to offer incentives to manufacturers that develop more environmentally beneficial products.

Importance of green marketing

Man has limited resources on the earth, with which she/he must attempt to provide for the worlds' unlimited wants. There is extensive debate as to whether the earth is a resource at man's disposal. In market societies where there is "freedom of choice", it has generally been accepted that individuals and organizations have the right to attempt to have their wants satisfied. As firms face limited natural resources, they must develop new or alternative ways of satisfying these unlimited wants. Ultimately green marketing looks at how marketing activities utilize these limited resources, while satisfying consumers wants, both of individuals and industry, as well as achieving the selling organization's objectives.

When looking through the literature there are several suggested reasons for firms increased use of Green Marketing. Five possible reasons cited are:

Organizations perceive environmental marketing to be an opportunity that can be used to achieve its objectives Organizations believe they have a moral obligation to be more socially responsible Governmental bodies are forcing firms to become more responsible Competitors' environmental activities pressure firms to change their environmental marketing activities

Cost factors associated with waste disposal, or reductions in material usage forces firms to modify their behavior Opportunities

Goals of Green Marketing

Eliminate the concept of waste. Reinvent the concept of product. Make prices reflect actual and environmental costs. Make environmentalism profitable. Bringing out product modifications. Changing in production processes. Packaging changes. Modifying advertising.

Challenges in Green Marketing

NEED FOR STANDARDIZATION It is found that only 5% of the marketing messages from Green campaigns are entirely true and there is a lack of standardization to authenticate these claims. There is no standardization to authenticate these claims. There is no standardization currently in place to certify a product as organic. Unless some regulatory bodies are involved in providing the certifications there will not be any verifiable means. A standard quality control board needs to be in place for such labeling and licensing.

NEW CONCEPT Indian literate and urban consumer is getting more aware about the merits of Green products. But it is still a new concept for the masses. The consumer needs to be educated and made aware of the environmental threats. The new green movements need to reach the masses and that will take a lot of time and effort. By Indias ayurvedic heritage, Indian consumers do appreciate the importance of using natural and herbal beauty products. Indian consumer is exposed to healthy living lifestyles such as yoga and natural food consumption. In those aspects the consumer is already aware and will be inclined to accept the green products. PATIENCE AND PERSEVERANCE The investors and corporate need to view the environment as a major longterm investment opportunity, the marketers need to look at the long-term benefits from this new green movement. It will require a lot of patience and no immediate results. Since it is a new concept and idea, it will have its own acceptance period.

Benefits of Green Marketing

Todays 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, though initially the cost is more. It helps the companies market their products and services keeping the environment aspects in mind. It helps in accessing the new markets and enjoying the competitive advantage. Most of the employees also feel proud and responsible to be working for an environmentally responsible company.

Golden Rules of Green Marketing

1. Know Your Customer: Make sure that the consumer is aware of and concerned about the issues that your product attempts to address, (Whirlpool learned the hard way that consumers wouldnt pay a premium for a CFC-free refrigerator because consumers dint know what CFCs were.).

2. Empower Consumers: Make sure that consumer feel. By themselves or in concert with all the other users of your product, that they can make a difference. This is called empowerment and due to this main reason consumers will buy greener products.

3. Be Transparent: Consumers must believe in the legitimacy of the product and the specific claims made in regard.

4. Reassure the Buyer: Consumers must be made to believe that the product performs the job its supposed to do-they wont forego product quality in the name of the environment.

5. Consider Your Pricing: If youre charging a premium for your product-and many environmentally preferable products cost more due to economies of scale and use of higher-quality ingredients-make sure those consumers can afford the premium and feel its worth it.

6. Thus leading brands should recognize that consumer expectations have changed. It is not enough for a company to green its products; consumers expect the products that they purchase pocket friendly and also to help reduce the environmental impact in their own lives too.

G generalizes with care. Consumer behavior will not necessarily be consistent across different product types, and particular market segments may respond to certain issues on the green agenda but not others. R remembers, the validity of a piece of market research is not related to the degree to which it supports your preferred option.

E explores the context from which market research data comes. Be clear on the nature of the sample used, the questions asked, the way in which responses were recorded and the time and place from which the responses come E ensures that where market research is crossing international borderlines, that the terminology and interpretation remains consistent. Terms like environment, green and conservation do not always translate precisely between languages. N neutrality is important. Ensure that when you pose questions to consumers, that they can make any response without being made to feel guilty or uncomfortable, and ensure that your own preconceptions about the green agenda (such as an assumption that green products will cost extra) are not encoded within the questions.


Green marketing has been widely adopted by the firms worldwide and the following are the possible reasons cited for this wide adoption: 1) OPPORTUNITIES - As demands change, many firms see these changes as an opportunity to be exploited and have a competitive advantage over firms marketing non-environmentally responsible alternatives. .

2) GOVERNMENTAL PRESSURE - As with all marketing related activities, governments want to "protect" consumers and society; this protection has significant green marketing implications. Governmental regulations relating to

environmental marketing are designed to protect consumers in several ways, 1. Reduce production of harmful goods or by-products 2. Modify consumer and industry's use and/or consumption of harmful goods. 3. Ensure that all types of consumers have the ability to evaluate the environmental composition of goods

Governments establish regulations designed to control the amount of hazardous wastes produced by firms.

3) COMPETITIVE PRESSURE - Another major force in the environmental marketing area has been firms' desire to maintain their competitive position. In many cases firms observe competitors promoting their environmental behaviors and attempt to emulate this behavior. In some instances this competitive pressure has caused 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. 4) SOCIAL RESPONSIBILITY- Many 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. 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 is directly tied to the overall corporate culture, rather than simply being a competitive tool.

5) COST OR PROFIT ISSUES - Firms may also use green marketing in an attempt to address cost or profit related issues. Disposing of environmentally harmful byproducts, such as polychlorinated biphenyl (PCB) contaminated oil are becoming increasingly costly and in some cases difficult. Therefore firms that can reduce harmful wastes may incur substantial cost savings. When attempting to minimize waste, firms are often forced to reexamine 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.



PRODUCT Entrepreneurs wanting to exploit emerging green markets either: Identify customers environmental needs and develop products to address these needs or will develop environmentally responsible products to have less impact than competitors. The increasingly wide variety of products on the market that support sustainable developments are:

Products made from recycled goods, such as Quick 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. 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. Certified products, which meet or exceed environmentally responsible criteria. Organic products-many customers 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-toy libraries. Whatever the product or service, it is vital to ensure that products meet or exceed the quality expectation of customers and is thoroughly tested.

PRICE Pricing is the critical element of the marketing mix. Most customers will only be 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 will be often be the deciding factor between products of equal value or quality. Environmentally responsible products, however are often less expensive when product life cycle coast are taken into consideration, for example fuel-efficient vehicles, water efficient printing and non-hazardous products.

PLACE The choice of where and when to make products available will have significant impact on the customers you attract. 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 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 you want to project and allow you to project your own image rather than being dominated or

compromised by the image of venue. The location must differentiate you from the competitors. This can be achieved by in-store promotions and visually appealing displays or using recycled materials to emphasize the environmental and other benefits.

PROMOTION Promoting products and services to target markets include 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 communication 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 their green commitment, some retailers sell shopping bags and promote their green commitments.



Organizations Perceive Environmental marketing to be an Opportunity that can be used to achieve its objectives. Firms have realized that consumers prefer products that do not harm the natural environment as also the human health. Firms marketing such green products are preferred over the others not doing so and thus develop a competitive advantage, simultaneously meeting their business objectives.

Organizations believe they have a moral obligation to be more socially responsible. This is in keeping with the philosophy of CSR which has been successfully adopted by many business houses to improve their corporate image. Firms in this situation can take two approaches: Use the fact that they are environmentally responsible as a marketing tool. Become responsible without prompting this fact.

Governmental Bodies are forcing Firms to Become More Responsible In most cases the government forces the firm to adopt policy which protects the interests of the consumers. It does so in following ways:


Reduce production of harmful goods or by products Modify consumer and industrys use and /or consumption of harmful goods; or Ensure that all types of consumers have the ability to evaluate the environmental composition of goods

Competitors Environmental Activities Pressure Firms to change their Environmental Marketing Activities In order to get even with competitors claim to being environmentally friendly, firms change over to green marketing. Result is green marketing percolates entire industry.

Cost Factors Associated With Waste Disposal or Reductions in Material Usage Forces Firms to Modify their Behavior With cost cutting becoming part of the strategy of the firms it adopts green marketing in relation to these activities. It may pursue these as follows: A Firm develops a technology for reducing waste and sells it to other firms. A waste recycling or removal industry develops.


The New Green Revolution

Global Warming is the phenomenon of increase in Earths temperature caused by burning of fossil fuels and other pollutants in the air. As per the predictions by IPCC (Intergovernmental Panel on Climate Change) it is predicted that the global temperature is likely to increase by 1.1 to 6.4 degrees Celsius between 1990 to 2100. The key causes of global warming are summarized below:

Carbon dioxide emitted from the Power Plants, Cars, airplanes and other industries. Methane emitted from landfill, petrochemical factories and steel and fertilizer plants. Nitrogen dioxide emitted from waste combustion, agriculture water pollution and sewage. Other harmful gases emitted by industries, and manufacturing units, which are causing depletion of Earths ozone, layer. Deforestation is another major contributor towards global warming. The destruction of tropical forests is throwing millions of tons of carbon dioxide into the atmosphere. These forests are the main source of absorption of carbon dioxide, which we are losing at a great speed each year with increased deforestation.


For a long time now the effect of mans industrialization and technological progress ha s quietly yet continuously eked away at the delicate balance of the planets atmosphere and ecosystem, but within the last 30 or so years the place of this damage has markedly accelerated It is presently estimated that 700 tons of carbon dioxide are pumped into the earths atmosphere every second of the day. Carbon dioxide is the chief contributor to the greenhouse gases. It is these greenhouse gases, which cause global warming. It is not enough just to develop a brand or a logo, or invest in an advertising campaign, and then position a product as Green before consumers.

GREEN IN MANUFACTURING This focuses on using renewable energy for production and minimizing air and water pollution during the manufacturing process. Example: Energy Star is helping businesses and consumers save money and check pollution. Energy star has its own pre defined parameters and gadgets which conform to the energy efficiency standards. The businesses that join hands with energy star sign an MOU and upgrade their facility as per the requirement outlined by Energy Star. There are about 2,400 corporations, hospitals, schools and other organizations, which are energy star compliant in the US today. The real estate developers, architects and environmentalists across the globe are working together to create the next wave of modern eco-friendly projects: green

buildings and manufacturing facilities. They are using energy conservation appliances and recycling building products and water harvesting techniques in their project

GREEN IN PACKAGING Packaging is a key element of marketing mix for promoting Green Washing . It can also be an effective tool to display the Green component of the product. GREEN IN SERVICES With increased demand for value-based marketing, there is also growing demand of Green services. Global customers are not only interested in cost cutting through outsourcing but are also looking for energy efficient IT operations.

Green Strategy Formulation

As in formulation of green strategy, a firm may evolve it from a SWOT analysis or Environmental Audit. SWOT ANALYSIS STRENGTHS 1. Marketers get access to new markets and gain an advantage over competitors that are not focusing on greenness.


2. Marketers can charge a premium on products that are seen as more ecoresponsible. 3. Organizations that adopt green marketing are perceived to be more socially responsible. 4. Green marketing builds brand equity and wins brand loyalty among customers. E.g. research and development capabilities for clean processes and green products and human resources committed to environmental protection. WEAKNESS 1. Most customers choose to satisfy their personal needs before caring for environment. 2. Overemphasizing greenness rather than customer needs can prove devastating for a product. 3. Many customers keep away from products labeled Green because they see such labeling as a marketing gimmick, and they may lose trust in an organization that suddenly claims to be green E.g. products cannot be recycled, and hazardous wastes) of a company.

OPPORTUNITIES 1. Marketing to segment which are becoming more environmentally aware and concerned. These consumers are demanding products that conform to these new attitudes.


2. Organizations perceive green marketing to be a competitive advantage, relative to the competitors. Firms, therefore, strive to improve upon their societal awareness. This complements the increase in consumers socially conscious behavior and will therefore give them an advantage over competitors who do not address these issues.

E.g. offering an environmental friendly product and saving resources, and relating them to internal strengths.

EXTERNAL THREATS 1. Uncertainty as to the environmental impact of present activities, including that is perceived to be less environmentally harmful. 2. Uncertainty as to which green marketing activities are acceptable from a government perspective. 3. The possibility of a backlash from consumers or government based on existing green marketing claims, threat one and two above may cause backlash to arise. E.g. competitors gain market shares with green products and increased environmental regulations).


Green Products and its Characteristics

These products that are manufactured through green technology and that caused no environmental hazards are called green products. Promotion of green

technology and green products is necessary for conservation of natural resources and sustainable development. We can define green products by following measures: Products that are originally grown Products those are recyclable, reusable and biodegradable Products with natural ingredients Products containing recycled contents, non-toxic chemical Products contents under approved chemical Products that do not harm or pollute the environment Products that will not be tested on animals Products that have eco-friendly packaging i.e. reusable, refillable containers etc.


There are many lessons to be learned to be learned to avoid green marketing myopia, the short version of all this is that effective green marketing requires applying good marketing principles to make green products desirable for consumers. The question that remains, however, is, what is green marketings

future? Business scholars have viewed it as a fringe topic, given that environmentalisms acceptance of limits and conservation does not mesh well with marketings traditional axioms of give customer what they want and sell as much as you can. Evidence indicates that successful green products have avoided green marketing myopia by following three important principles:


Make environmental messages consistent with the companys existing voice in the market place. Empower consumers to get involved to make a difference. Enlist cultural icons to tell the story. Show that environmental initiatives lead to better quality products. Be ready to experiment publicly, even if it doesnt always lead to success. Price environmentally preferable products comparable to conventional ones. Link environmental innovations to other benefits, like quality and durability. Thanks customers for making good, green choices, and tell them how they are making a difference.


Green Marketing Strategies versus Conventional Marketing CONVENTIONAL MARKETING Consumers Products Consumers with lifestyles GREEN MARKETING Human beings with lives Cradle-to Cradle flexible services Educational Values Proactive, Interdependent, cooperative, Holistic, long term

Cradle-to-gave one size fits for all products Marketing and Selling oriented and benefits Communication Corporate Receptive, Independent, competitive, Departmentalized, Short term oriented profit maximizing.

Environmentally Conscious Consumer Behavior Environmentally Conscious Behavior (ECCB) is consumer behavior based on some awareness of the environmental impacts associated with a product or service, and a desire to reduce those impacts. Many researchers in the field of consumers psychology and market research have demonstrated a substantial growth in ECCB across a range of markets. It has been demonstrated through case studies that how product developers and marketers have capitalized on this positive attitude and effectively differentiated their product in terms of their environmentally friendly character. Environmental consciousness is the desire to protect flora and fauna, a willingness to scrutinize the consequences of economic activity and a willingness to combine long-term with short-term planning.



Social Stimuli, Marketers Efforts

Exposure, Attention, Comprehension, New Knowledge and Belief, Integration

Values and Beliefs, Motivation, Attitude, Knowledge

Product Knowledge, Involvement, Habit, Cost, Opportunity, Availability, Convenience

Attention, Product Comprehension, Purchase Avoidance

Cultural Norms, Group Influence, Family Influence, Unexpected Circumstances

CONSUMER ENVIRONMENT CONSUMER ENVIRONMENT CONSUMER ENVIRONMENT Research about the identity and nature of green consumer has been the central character in the development of green marketing, as business attempt to CONSUMER ENVIRONMENT understand and respond to external pressures to improve their environmental performance. Marketing practitioners and academics are attempting to identify and understand green consumers and their needs, and to develop market offerings that meet these needs.



It is important in todays world because mankind has limited resources on the earth and if we want long term sustainability of human life on this earths surface, then companies has to learn to conserve these scarce natural resources and create products that have less environmental damage. Otherwise the very existence of humankind will be under question mark. Corporate are going green from the grassroots level to sustain and win the customers expectations. The environment is becoming increasingly important part of the corporate reputations and they are actively participating in greening the corporate strategy. Companies have converted almost all the products to make them eco-friendly products. Following are the recent environment friendly initiatives taken by the companies. Sony: Green ODO Line Products


Sony has recently launched developed and launched a range of innovative products named as ODO line products also called as Eco-chic. These products do not require AC adapter as they were powered by kinetic or solar energy. Sony has used simplified packaging and recycled plastic in the manufacturing of ODO products as a Sustainable Product initiative. The ODO line products comprise of five products: 1. Spin N Snap: The spin and snap is a digital camera. It has two holes which are used as viewfinder and chargers. On spinning the camera on ones fingers generates kinetic energy and charges the device. 2. Push Power Play: Push power play is a display device with a roller on the base. The rollers are used to charge the device by the friction of the device with hard surface. 3. Crank N Capture: Crank and Capture is a digital video camera with a crank used to operate and generate power. 4. Pull and Play: The pull and play is a stereo headphone with a cord to simply pull and use. 5. Juice Box: The juice box is a credit card sized object used to recharge the other ODO products. Sony has also added a new Twirl N Take hand powered digital camera to the line series. Twirl N take digital camera has a sleek stem circle design. It is recharged by rolling the round wheel on the hard surface.


Sonys ODO line product series are the most innovative eco-friendly products which are very safe and handy. Even children can also use these products.








PRODUCT DIFFERENTIATION Organizations are putting continuous efforts to differentiate their products and services using green marketing practice. In a wide range of markets including retailing etc companies have used eco performance to differentiate and to compete. Products with poor eco performance can become targets for new substitution, as a result of this many organizations


are coming up with greener ideas to differentiate their products from competitors.



In this strategy marketers can identify customers environmental needs and develop products to address this issue, produce more environmentally responsible packages and insure that products meet or exceed the quality expectation of customers. In addition to that marketer can charge higher price with highlighting eco-friendliness of the products.



In case of this strategy obtaining dealer support to green marketing practice is essential. The location must differentiate from competitors and it can be achieved by in-store promotions and displays by using recycle materials to emphasize the environmental and other benefits.


LIFE-CYCLE ANALYSIS Brands which aspire to be sustainable must get their house in order before they start planning any green marketing initiatives. The best brands are performing life cycle analysis- complex assessments which provide critical data on social, environmental and economic impact of products

through the supply chain production process and after the purchase. Life cycle analysis tells a brand just how far it needs to go before it claims to be sustainable. Consumers dont expect perfection when it comes to sustainability but they want to see that brands understand the scale of the problem, have a plan and are in the process of implementing it.


INCENTIVES AND STRUCTURAL FACTORS Commercialization programs and incentives help get new technologies introduced examples include fleet programs to cultivate strategic niche markets and by providing financial incentives such as the advanced vehicle tax credit proposal in case of green vehicle purchase. Consumers can be motivated by incentives and awards to: Curtail reduce the impact on the environment by modifying extant living patterns. Maintain keep equipment in good working order. Be efficient undertake structural changes such as buying environmental friendly equipment.


Role of Information Technology in Green Marketing

IT departments are under increasing scrutiny and pressure to deliver environmentally sound solutions. Large data centers are one of the most significant energy consumers in an organizations IT infrastructure, so any measures that the organization can take to reduce this consumption (and therefore also carbon dioxide emissions) will have a positive impact on the organizations environmental footprint. Gartner reveals that during the last five years, the power demands of equipments have grown by five or more times. Additionally, a report issued by the environmental Protection Agency in US indicates that environmental issues have placed IT departments under pressure to develop green data centers. A green data centre is defined as one in which the mechanical, lighting, electrical and computer systems are designed for maximum energy efficiency and minimum environmental impact. The construction and operation of a green data centre involved in advanced technologies and strategies. Some examples include: Reducing the power consumption of the data centre. Minimizing the footprints of the buildings. Maximizing cooling efficiency. Using Low-emission building materials, carpets and paints. Installing catalytic converters on backup generators. The consumption of energy is considered the dominant- and often the only-factor in defining whether or not a facility is green. IT executives therefore need to start investigating alternative ways of building energy-efficient data centers. This paper focuses on How a Green Data Centre can be a Great Marketing Tool