If Products Could Speak Mar 2 2009

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the role of business drivers in the creation of green products and services.

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If Products Could Speak Mar 2 2009

  1. 1. IF PRODUCTS COULD SPEAK TOWARDS A MODEL OF SUSTAINABLE DESIGN JEN VAN DER MEER NYU ITP WEEK 5: MARCH 2, 2009
  2. 2. RECALLED 2_19_2009
  3. 3. RECALLED 2_28_2009
  4. 4. OBAMA BUDGET ASSUMES REVENUES FROM CAP AND TRADE
  5. 5. 2_25_09 TWEET A WATT WINS GREENER GADGETS COMPETITION MAKE MAG TO PUBLISH DIY HACK
  6. 6. TODAY’S FOCUS: THE ROLE OF BUSINESS IN THE GREENER PRODUCTS + SERVICES REVOLUTION _2 Business models _Limits to growth
  7. 7. REFRESHER: WEEK 1: Creators of products and services have a responsibility to know what’s in the stuff that we make.
  8. 8. REFRESHER: WEEK 2: The greatest environmental impact, in terms of product life cycle, is often in the hands of the end consumer – use and disposal of products and services. To improve environmental impact, give consumers the tools to be better owners/operators of their stuff. Challenge: Create Spimes.
  9. 9. REFRESHER: WEEK 3: Environmental advocates and activists have a role to play in alerting us to the green agenda, but often focus on campaigns that isolate a specific effect, or toxin, rather than a comprehensive, holistic view. Consumers feel they are being politically active when they change their buying behavior. Challenge: Design for the role of citizen/consumer
  10. 10. REFRESHER: WEEK 4: Attitudes towards regulation are undergoing a dramatic “sea change,” no longer will the world allow loose, laissez faire attitude towards environmental laws. Potential role of government: embed the “true costs” of environmental impact into the economic cost of business. Challenge: make government choices and impacts as transparent to citizens as business choices and impacts are to consumers.
  11. 11. 2 BASIC BUSINESS MODELS Before we begin- this class will condenses an entire MBA down into a few slides. Apologies in advance: an MBA teaches you how to become a master of the obvious.
  12. 12. 2 BASIC BUSINESS MODELS: There are 2 basic ways a company can make money outside of a monopoly market share…. 1.  Differentiation to earn higher margin than competitor 2.  Drive to be most cost efficient/high performance company in an industry Note: neither position is stable over time.
  13. 13. “MAKING THE CASE” FOR GREEN: 1.  Differentiation to earn higher margin than competitor: The biggest opportunity for growth from 2000 on has been the fast revenue and margin growth of organic food, hybrid cars, and “green” household products. Whole Foods. Prius. Method Home. What other products are on your radar?
  14. 14. “MAKING THE CASE” FOR GREEN: 1.  Differentiation to earn higher margin than competitor: How the case is made: Consumer research: pre concept development to understand motivations and drivers and identify unmet, untapped needs. Post concept development to ensure there is market and an appetite for premium (i.e. more expensive) positioning. Pricing model research to prove the premium positioning.
  15. 15. Build or Buy? These once small companies were bought by the large food processors - Because of their higher growth rates.
  16. 16. “MAKING THE CASE” FOR GREEN: 2. Drive to be the most cost efficient supplier. Green has not always mean more cost effective, undercutting the market on price. Clorox Greenworks. 42% market share in 1 year.
  17. 17. “MAKING THE CASE” FOR GREEN: 2. Drive to be the most cost efficient supplier. How the case is made: cost scenario development and efficiency reporting to prove that costs can be maintained and even further reduced. If consumer testing involved, it is to demonstrate that the functional performance is equal or better to competitors.
  18. 18. “MAKING THE CASE” FOR GREEN: In tech, the premium exists in the beginning, with diminishing margins as the product moves along the adoption curve.
  19. 19. Case Study: Interface FLOR carpets Long term commitment to transition the entire company towards zero environmental impact. How to make the case to investors that environmental strategy is a path to profit growth?
  20. 20. Case Study: GE ecoimagination Shift from fossil fuels to more efficient forms of energy. What was the eco-imagination brand marketing program all about?
  21. 21. Case Study: Beyond Petroleum. Which green business model is BP pursuing here?
  22. 22. WHY GREENWASHING OCCURS Aim to reap benefits of higher margins consumers attribute to green products, without understanding the actual environmental improvements of a product or service. Desire to neutralize the effect of environmental activists who have painted a negative picture of company. How do you know when a company is greenwashing?
  23. 23. GOOD IDEAS FOR GREENER GADGETS
  24. 24. HEIRLOOM GADGETS: DR. Saul Griffith
  25. 25. WATTZON.ORG ENERGY CONSUMPTION: HEALTHY CHANNELING OF OCD
  26. 26. GG COMPETITION: STANDBY MONSTERS
  27. 27. GG COMPETITION: WHAT’S WRONG WITH RECOMPUTE?
  28. 28. GG COMPETITION: ENVIRONMENTAL TRAFFIC LIGHT
  29. 29. GG COMPETITION: POWERHOG
  30. 30. GG COMPETITION: ECONEIGHBUZZ
  31. 31. GG COMPETITION: ENVIRO’CLOCK BANDAGE
  32. 32. HOMEWORK Project ideas.
  33. 33. NEXT CLASS: Assignment due next class: Write a one page proposal outlining the commercial benefits of your product/service idea.

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