GREEN MARKETERS

BY: Nitish Khurana

Evolution of Green Marketing

The term Green Marketing came into prominence in the late 1980s and early 1990s.  The green marketing has evolved over this period of time. The evolution of green marketing had 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. This was the result of the term sustainable development which is defined as "meeting the needs of the present without compromising the ability of future generations to meet their own needs."

What is Green Marketing?



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

Thus "Green Marketing" refers to holistic marketing concept wherein the production, marketing, consumption and disposal of products and services happen in a manner that is less detrimental to the environment with growing awareness about the implications of global warming, non-biodegradable solid waste, harmful impact of pollutants etc., both marketers and consumers are becoming increasingly sensitive to the need for switch in to green products and services. While the shift to "green" may appear to be expensive in the short term, it will definitely prove to be indispensable and advantageous, cost-wise too, in the long run.

Growing Demand, Shrinking Resources

The cost of operating power for servers is to surpass the cost to buy them in the next five years IDC Report, 2007

Demand Users Services Access

Energy bills traditionally have accounted for less than 10% of an overall IT budget but soon could account for more than half-----Gartner, 2008

By 2010, environment-related issues will be among the top 5 IT management concerns for more than 50% of state & local government organizations in North America, EMEA and Australia ---Gartner, 2008

Power Costs Space Heat

Adoption by Firms
OPPORTUNITIES GOVERNMENTAL PRESSURE COMPETITIVE PRESSURE

SOCIAL RESPONSIBILITY

COST OR PROFIT ISSUES

SWOT Analysis
STRENGTHS WEAKNESS OPPORTUNITIES EXTERNAL THREATS

-Access to new markets -Can charge premium -Socially responsible -Builds brand equity & loyalty

-People choose personal needs than environmental needs Overemphasizi ng greenness can prove devastating for a product

-Demand of products with new attitudes Organizations perceive green marketing to be a competitive advantage

-Uncertainty as to which green marketing activities are acceptable from a government perspective. -The possibility of a backlash from consumers or government based on existing green marketing claims

Market Segments for green products:

Segment 1 General Consumer

Segment 2 Government Agencies

Segment 3 Private Industries

Segment 4 Non Profit Companies

CONSUMER VALUE POSITIONING



Design environmental products to perform as well as (or better than) alternatives. Promote and deliver the consumer desired value of environmental products and target relevant consumer market segments. Broaden mainstream appeal by bundling consumer desired value into environmental products.

UNDERSTANDING CONSUMER PERCEPTION AND PRIORITIES TO MAXIMIZE BUSINESS

a) What they are purchasing? b) How are they prioritizing- between organic, fair trade, carbon friendly and so on? c) Whether the consumers are getting what they want to purchase?

Implication for Green Marketers Target products to women who generally buy on behalf of men and families. Use the influence of children to encourage parents to try green products. Effectively communicate assurance of quality. Like environmental attributes such as energy efficiency or toxic substance reduction with other benefits such as lower price, convenience, or quality of life improvements. Emphasize personal benefits by using terms such as safe, non-toxic, cost effective Making the use of product. Select mainstream distributors wherever possible. Offer one-stop shopping and eye appealing displays. Reinforce product benefits with evidence of corporate performance and improvements. Educate consumers about environmental issues and your efforts through a variety of means. Communicate your steps towards sustainability and commitments to improvement. Seek feedback and promote your efforts to respond to customer concerns.

CONVENTIONAL MARKETING GREEN MARKETING Consumers Products Consumers with lifestyles Human beings with lives

Cradle-to-grave one size fits for all Cradle-to-Cradle products flexible services

Marketing and Selling oriented and benefits Communication

Educational Values

Corporate

Receptive, Independent, competitive, Proactive, Departmentalized, Short term Interdependent, oriented profit maximizing. cooperative,Holistic, long term

What drives Environmentally Conscious Consumer Behavior

Environmentally Consciousness Consumer Behavior (ECCB) as a process involving consumer environment, constructs, mediators and outcomes. The underlying influencers of ECCB are complex and different approaches to consumer motivation account for them in various ways.

SEGMENTATION OF GREEN CONSUMERS

True-Blue Greens Greenback Greens Spouts Grousers Apathetic

Consumer Information and Education

If managers believe that consumers view greenness as a motivating variable, they should invest in conveying information through advertising, direct mailing, brand labels, in-store displays and pamphlets. Green marketing can be successfully implemented by use of ICT in cost effective way

Identify and Target the Green Consumer

Green Activists 10%

Green Consumers 27%

Inactive 23%

Latent Green 40%

Types of Green Consumers

Identify and Close the Green Gap

The gaps cab be closed by innovatively addressing the following area: Green product: Green Value and lesser Price Customer Information Special and Green Place Green promotion Aided by ICT Partnership Trust
Publicize Stories of the Companys and Employees Green Initiatives

Compete for Environmental Awards

STRATEGIES TO BE IMPLEMENTED IN GREEN MARKETING

PRODUCT DIFFERENTIATION DESIGNING BIO-DEGRADABLE PACKAGING PRODUCT STRATEGY DISTRIBUTION STRATEGY LIFE-CYCLE ANALYSIS INCENTIVES AND STRUCTURAL FACTORS

Clear policy signals are essential to incentivise ecoinnovation

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Patenting activity in Annex 1 ratification countries (3-year moving average, indexed on 1990=1.0)

11 10 9 8 7 6 5 4 3 2 1 0 1980 1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004

Wind power Fuel cells Lighting Solar PV Electric cars All tech. sectors

1997- Kyoto Protocol

Source: OECD (2010), The Invention and Transfer of Environmental Technologies

Conclusion


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, then we should think again. We must find an opportunity to enhance product's performance and strengthen your 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.

Marketers also have the responsibility to make the consumers understand the need for and benefits of green products as compared to non-green ones. In green marketing, consumers are willing to pay more to maintain a cleaner and greener environment. Finally, consumers, industrial buyers and suppliers need to pressurize the minimizing of the negative effects on the environment. Green marketing assumes even more importance and relevance in developing countries like India. Successful green marketers will reap the rewards of healthy profits and improved shareholder value and help in making the world a better place for future generations.

Q&A

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