Promoting and Marketing Green Products
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Green marketing is the process of promoting and selling products and/or services based on their environmental and social benefits. This presentation is about how to communicate your business sustainability effectively and credibly. You learn: * The strong demand for green products * How going green reduces risks and increases profits * Assessing your sustainability practices guides your communications strategy * Discover leaders in business sustainability * Understand the ethics of making green claims This presentation was delivered at the Entrepreneurial Growth Conference at Duquesne University on May 10, 2013.
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Promoting and Marketing Green Products
- 1. Greg DiMedio CEO and Communications Consultant Greening Your Business Promoting and Marketing Green Products @GreenerExpressgreg@greenerexp.com www.greenerexpressions.com
- 2. Green Marketing 2 Process of promoting and selling products and/or services based on their environmental and social benefits.
- 3. B2C Demand for Green Products 3 Consumer Demand Grows • Record high 71% of Americans consider the environment when they shop. • Half of all consumers actively seek out environmental information about the products they buy. • About 75% say it’s okay if a company is not environmentally perfect as long as it is honest and transparent about its efforts. • And 35% will pay more for environmentally friendly products.
- 4. B2B Demand for Green Products 4 Supply Chain – Green Rules of the Road • Walmart’s Supplier Sustainability Index • Detailed sustainable agriculture data from brands such as Pepperidge Farm, Arnold and Sara Lee for shelf placement • Unilever Sustainable Agriculture Code • “We expect all our suppliers of agricultural raw materials to commit to joining the sustainability journey…” • LEED – Green Buildings Criteria • Performance-based standards with constraints on building product materials and processes
- 5. 5 Reasons to Market Green Products Sustainability Can: • Appeal to and increase consumer demand. • Protect and bolster your brand. • Turn around a business through product innovation and differentiation. • Reduce risks and strengthen supply chain sales and relationships.
- 6. Green Means Business 6 Businesses are innovating and greening operations, supply chain, and brand. 80% of Standard and Poors 100 produced sustainability reports in 2006. An Accenture survey reveals 93 percent of CEOs see sustainability as important to their company’s future success. 125 million consumers are active in the green marketplace, with 76% believing it is very important for brands to embrace sustainability. Dupont reduced energy consumption by 6 percent, avoiding over $6 billion in energy expenditures from 1990 to 2010 while growing the company by 40%. UPS saved 3 million gallons of fuel by eliminating most left (cross-traffic) turns. Wal-Mart's sustainability program calls for all suppliers to reduce packaging by 5% by 2013. McGraw Hill Construction survey reveals green home construction is booming, growing between 29% and 38% of the market by 2016.
- 7. Level of “Green” and Marketing 7 Determine Level of “Green” Aspiring Demonstrating Integrating Leading Sustainability Practices Anecdotal Measured Measured against others Sets the bar and moves others Certs/Awards None Local or self- verifying Third-party verified Third-party and International Sustainability Policies Starting Fragmented but operating Formal policy Fully integrated into enterprise Audits/ assessments None Internal Internal & external Internal & external Sustainability Reports None Informal Formal GRI/CSR Reporting Global Support Structures Individual Green team Sustainability department Responsible at executive level
- 8. Level of “Green” and Marketing 8 Form a Green Marketing Strategy Aspiring • Strong internal communications and consensus building • Conservative messaging • Modest external communications Demonstrating • Focus on internal stakeholders needs • Growing understanding of external audience needs • Testing messages and validating claims Integrating • Intimate understanding of both internal and external audiences • Amplifying credible, green product attributes • Engaging peers about practices and performance Leading • Full blown public relations and marketing efforts. • Advanced sustainability reporting • Direct engagement with peers and influencing them
- 9. Internal Alignment - External Communications 9Public Relations Proposals & contracts Strengthen claims, bolster external communications, and expand commercial capacity! Policies and Procedures Sustainability Assessment Work Assess and communicate sustainability practices and credentials. Internal External External Marketing
- 10. Example 10
- 11. Example 11
- 12. Example 12 2013 Sustainability Leaders survey
- 13. Example 13 Since 2008 Unilever has avoided more than $395 million of costs: • $132 million in energy • $245 million in materials • $22 million in water • $13 million in waste disposal Company also has grown sales by 26% from $54.4 billion to $67.6 billion over the same period. “If we achieve our sustainability targets and no one else follows, we will have failed.” - Paul Polman - CEO, Unilever
- 14. Ethical Considerations and Conduct 14 • Avoid greenwashing • green (environmentalist) + brainwashing • “To make people believe that your company is doing more to protect the environment than it really is.” – Cambridge Dictionary • e.g., "All Natural" Pesticide • Follow FTC guidelines • Helps marketers avoid making misleading environmental claims • e.g., “non-toxic” claim requires scientific evidence • Be transparent and honest • Data and performance for external scrutiny
- 15. Summary 15 • Demand for green is strong and growing. • Going and marketing green can reduce risks, increase sales, and grow profits. • Assess your sustainability standing and communicate accordingly. • Look to the leaders for best practices and inspiration. • Understand the ethos, validate claims, and be transparent.
Editor's Notes
- What is in this presentation?My presentation today is about the benefits of going green and being able to communicate that to customers and partners in a credible and engaging way. Let’s Start with defining green marketingSometimes called “sustainable marketing”. Process of promoting and selling products and/or services based on their environmental and social benefits.
- Green is becoming increasingly top of mind for consumers. They see their consumption with greater meaning and purpose. Shopping/buying has more meaning, and buyers are part of the solutions to the problems of conserving natural resources and living a healthier life. [READ STATS – Survey Data][READ GREEN CONSUMER PROFILE DATA]Add skews ages 18-35.Takeaway: Green marketing assumes potential consumers will see a product’s "greenness" as a benefit and base their buying decision accordingly. +Brands that can educate, inspire, and provide expertise will have a clear advantage.
- Walmart[Read Slide bullet point]Sells more groceries than any other supermarket chain. 2012 revenues: $469 billion What percent of grain is provided by suppliers that track fertilizer use monitor soil fertility? fuel use? Water use? pesticides? 2. Unilever[Read Slide bullet point]Suppliers mustdemonstrate that they agree to minimum standards of performance and to continuously improve performance over time. Example - Committed to sourcing Lipton tea bag tea from Rainforest Alliance certified growers.3. LEED LEED is thenationally accepted benchmark for the design, construction and operation of high performance green buildings. LEED Point Contributions tally up to earn certification, and Green Products contribute to certification points. Example - Georgia-Pacific produces Sustainable Materials Data Sheets to help contractors know how each product can contribute points to earn LEED certification.
- Appeal to and increase consumer demand. - The green marketplace is growing and leaders can gain a competitive advantage.Protect and bolster your brand. - B2C side – social media and technology keeps consumer plugged into the environmental and health issues surrounding green products. - B2B side – you stay aware of sustainability trends and remain a viable business partner. Product innovation and differentiation - This gives you a great opportunity to create a new product line or move on making your operations more efficient and green. Example – Buckeye International, a supplier of industrial cleaning products, launched a green product line (Green Seal certified). They seized the opportunity to provide green cleaning supplies to schools and other institutions moving towards more sustainable practices. Reduce Risks and Strengthen Supply Chain - As you’ve just seen with Wal-Mart and Unilever, keeping up with sustainability trends is important.Example – Circuit board assembly company in Pittsburgh
- Green Means businessBusinesses are innovating and greening operations, supply chain, and brand.Consumers see it – 125 million of them with convictions and supporting technology to research and listen to friendsCEOs see it – 9 out of 10 see it as important for future successCompanies see it – Standard and Poors 100 producing reports, UPS saving fuel, Dupont saving energy, and Wal-Mart driving change.
- Where to start? My firm offers sustainability analysis and assessment work for business sustainability. I coach all of my clients using some rapid assessment method to understand where they are on the path to sustainability. An organization’s “greenness” is the start of any good green marketing strategy. Why? Because green marketing begins with transparency and credibility. You are lifting the veil on internal things you are not used to sharing with the public. - Operational practices and policies? - Auditing and Reporting on energy use, water use, labor? - Corporate governance and management/executive support.[READ SOME THINGS ABOVE]Practices, Certs, Policies, ReportingExample – For example, you may be recycling printer paper in the office, but are you measuring a reduction in how my paper you purchase? Take a minute and think about these elements in your company and where you are the path to sustainability?
- And with the knowledge of where you are on the path to sustainability, you can form a marketing/communications strategy that builds trust, credibility, and your business.
- Another way to look at this is to see this to see the need to create internal alignment and then bolster external communications. You want your sustainability credentials assessed and weighed in such a way that you feel confident making claims, marketing, and going for new markets. Remember what the market data are saying… honesty and clarity are more important than perfection. Claims and brand positioning must be authentic.
- Let’s walk through some examples. This is Buckeye Cleaning’s listing and profile on the green business directory we manage, GreenerPittsburgh.com. The website has an open system that allows companies, from aspiring to leading, to display credentials to attract new customers. Buckeye just lists the line of green products that are green seal certified, appealing to an audience looking specifically for green cleaning supplies. Buckeye is putting it out there. - Certification information - Statements about manufacturing process - Claims about product benefits and performance - Related, anecdotal practices about packaging, waste minimization, and product life cycle
- Here is a look are some nationally recognized brands.Heinz - See how sustainability is right there in their mission. - They are doing CSR (Corporate social responsibility) reporting like many others of their size. Starbucks - Starbucks provides measurable data. You can see how they are reporting on water consumption. Unilever - Unilever has three ambitious goals. And as we saw earlier, they are strong arming suppliers to achieve them. [READ THEM]
- Unilever continued its reign as the top-ranked company and actually increased its score, according to the survey, which is based on the responses of 1,170 “qualified sustainability experts” polled earlier this year. Companies are named on a top-of-mind basis — that is, they are asked to name leadership companies but aren’t given a list from which to choose.
- Univeler is not only a leader in sustainability, it is doing extraordinary things in marketing and communications. Educational programs for consumers and suppliersOnline channels dedicated to gathering ideas from external stakeholders for making Unilever more sustainable.Website makes sustainability front and centerCommitment is unshakeableAnd they are doing this while making handsome profits. [READ DATA] But take note of how Unilever is a true leader – If they cannot influence others, making sustainability systemic, then they have failed. Unilever has notes their main marketing challenge is to persuade consumers to change to more sustainable behaviors to help them reach their goals. Starbucks, too.[READ QUOTE]“If we achieve our sustainability targets and no one else follows, we will have failed.” - Paul Polman - CEO, Unilever
- GreenwashingThe 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. FTC Marketers should not make broad, unqualified general environmental benefit claims.Broad claims are difficult to substantiate.Marketers should qualify general claims with specific environmental benefits. Qualifications for any claim should be clear, prominent, and specific.Examples “Free of” – It would be deceptive, for example, to claim that a product is “free-of” a substance if it is free of one substance but includes another that poses a similar environmental risk.“Non-Toxic” – You need scientific evidenceTransparent and HonestI have covered some of this, but it all comes back to revealing intentions and performance in a credible and good faith manner.
- Starbucks…It has a goal of producing zero waste. You may have seen their inexpensive reusable cup they are selling to encourage consumers to get used to not using and throwing away cups. They are trying to change behaviors.FTC Guidelines for Purpose, Scope, and Structure of the Guides.Interpretation and Substantiation of Environmental Marketing Claims. General Principles.General Environmental Benefit Claims.Carbon Offsets.Certifications and Seals of Approval.Compostable Claims.Degradable Claims. Free-Of Claims.Non-Toxic Claims.Ozone-Safe and Ozone-Friendly Claims.Recyclable Claims.Recycled Content Claims.Refillable Claims.Renewable Energy Claims.Renewable Materials Claims. Source Reduction Claims