GREEN MARKETING

Introduction

In this day and age, societies are becoming more aware

of environmental issues and more conscious of the impact

their decisions can have on the environment. In turn,

consumers are increasingly incorporating their environmental

values into their purchasing decisions. Businesses have

started to realign their behavior to address the new influx

of environmental concerns by developing more environmentally

friendly organizational practices. One business area that

has taken particular interest in environmental issues is

marketing (Polonsky, 1994). Marketing is central to the

global society, and when used responsibly it can encourage

us to recycle, reuse, save energy and support good causes.

The term used to describe this “green” wave of marketing is

known as ‘Green Marketing’ (Polonsky, 1994). Ken Peattie

(1995), author of Green Marketing, describes green marketing

as: ‘the holistic management process responsible for

identifying, anticipating and satisfying the requirements of

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customers and society, in a profitable and sustainable way’.

This means that marketers can use their skills to encourage

sustainable consumption by influencing all the components of

the marketing process. This paper intends to examine green

marketing and the marketing process.

According to the American Marketing Association, green

marketing is the efforts practiced by organizations to

produce, promote, package, and reclaim products in a manner

that is sensitive or responsive to ecological concerns (APA

Dictionary). The term green marketing caught on in the late

1980’s after the first workshop on ecological marketing was

held in 1975 (Mishra & Sharma, 2012). According to Peattie,

green marketing has evolved through several phases. The

first phase was known as “ecological” green marketing and

marketing activities during this time were positioned to

solve environmental problems. The second phase was known as

“environmental” green marketing and the marketing activities

focused more on clean technology that took care of pollution

issues. The third phase was “sustainable” green marketing,

which came into prominence in the late 1990’s (Mishra &

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Sharma, 2012).

Greenwashing and Public Policy

However in the late 1980’s the green marketing movement

hit a bump in the road as many of the product claims to be

“green” turned out to be false. Consumers were not aware of

which products and services were truly green without

environmental labeling standards (Patil, 2012). The media

created the term “green washing” to describe instances when

companies mislead consumers to believe they were

environmentally responsible than they actually were. An

example of this can be found in Kimberly Clark's claim of

"Pure and Natural" diapers in green packaging. The product

uses organic cotton on the outside but keeps the same

petrochemical gel on the inside. Pampers also claims that

"Dry Max" diapers reduce landfill waste by reducing the

amount of paper fluff in the diaper, which really is a way

for Pampers to save money (Jeremiah, 2012).

In 1992, the Federal Trade Commission (FTC) created

guidelines for the use of environmental marketing. The FTC

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and the U.S. Environmental Protection Agency defined

"environmentally preferable products" as products and

services that have a lesser or reduced effect on human

health and the environment when compared to other products

and services that serve the same purpose. This labeling

considers how materials are acquired, produced,

manufactured, packaged, distributed, reused, operated,

maintained, or how the product or service is disposed

(Patil, 2012). Green marketing does not only refer only to

the promotion of products with environmental

characteristics. Green marketing is a large concept that can

be applied to consumer goods, industrial goods and even

services (Polonsky, 1994). Take ecotourism for example;

resorts around the glove are starting to promote themselves

as "ecotourism" facilities. These are facilities that focus

on experiences with nature or using practices that minimize

their environmental footprint (Ingram and Durst, 1989).

Benefits to Marketers

Why are firms using green marketing? In the USA the green

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market counts for about $250 billion. Green marketing was

inevitable. Natural resources are limited and human wants

are unlimited so it is important for marketers to use

resources as efficiently as possible from extraction to

disposal all while achieving the company’s objective.

Evidence shows that people worldwide are concerned with the

environment and are willing to change even their buying

practices to save it. In response to this, green marketing

has risen to put the word out to the growing market for

sustainable and socially responsible products and services.

Now is the era of environment-friendly goods and services

(Mishra & Sharma, 2012). Organizations are looking at a

variety of reasons to move towards green marketing such as;

competitive pressure, social responsibility, governmental

pressure and cost issues with waste (Polonsky, 1994).

Companies see the shift in demand towards greener

products as an opportunity to have an advantage in the

market (Polonsky, 1994). Companies marketing goods/services

with environmental characteristics will have a competitive

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advantage over those companies marketing non-environmentally

oriented alternatives (Mishra & Sharma, 2012).

Companies are also going green because firms are more

concerned about their social responsibilities. Companies are

realizing they are members of the community that is

concerned with environmental issues and must adjust their

behavior to follow suit. As a result, companies can either

exploit the integration of environmentally friendly

practices as a marketing tool, like The Body Shop, or they

can simply become responsible without using it to attract

customers, like Coca-Cola and Walt Disney World (Polonsky,

1994).

Governments of course play a role in protecting consumers

in regards to marketing activities. Government regulations

on green marketing are set up to reduce production of

harmful goods/by-products, change consumer and industry’s

use of harmful goods, and ensure all types of customers have

the ability to evaluate environmental composition of goods

(Polonsky, 1994). Governments want consumer’s to be

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environmentally conscious, which results in companies

wanting to become environmentally responsible in order to

satisfy customer needs. Governments try to protect consumers

from misleading ‘green’ claims by implementing policies on

labeling (Polonsky, 1994).

Another reason companies are using green marketing is to

try and address cost/profit waste related problems. Use of

green marketing usually leads to high revenues for

companies. Environmental standards may cause an increase in

start up costs for certain products, but by using

environmentally friendly practices that company may end up

with less waste which will reduce costs (Azzone and Manzini,

1994 ). Many attempts to reduce waste force companies to

examine their production processes and adjust them

accordingly. Other times companies look at “end-of-the-pipe”

solutions where their waste can be reused in another market

for production. Finding solutions for cost/profit problems

can result in the development of other industries. When

looking for another way to dispose of waste, companies may

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inadvertently develop a waste reducing technology that can

be sold or help create a new industry for waste removal

(Polonsky, 1994).

Marketing Strategies

Different companies use different strategies to emphasize

their amount of ‘greenness’ through marketing. Although it

is realized that there is not one uniform green marketing

strategy that will work for all companies, there are four

strategies that are recognized and used. These strategies

are lean green, defensive green, shaded green, and extreme

green (Ginsberg & Bloom, 2004). The lean green strategy

helps companies strive to be more socially responsible,

without focusing on exploiting their green initiatives for

marketing purposes. Companies using this strategy are not so

focused on publicizing their green practice as they are in

reducing their costs. The defensive green strategy is used

in response to a crisis, as a precautionary measure, or in

response to competitor’s moves. They do not use their

resources on aggressive tactics to promote their greenness,

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but rather see green market segments as a place to enhance

their brand images. The shaded green strategy is used in

companies who want to invest in long-term, organization

wide, environmentally friendly practices. Companies who use

the shaded green strategy could use it to gain a competitive

advantage but instead promote environmental features as

secondary benefits. Finally is the extreme green strategy.

This strategy is used in companies that desire to be based

off holistic values and use environmental issues to improve

all aspects of their business and product life-cycle. For

extreme green companies, greenness is usually the ‘driving’

force behind the company from the get go and aim to serve

niche markets (Ginsberg & Bloom, 2004).

A 2002 Roper Organization’s Green Gauge study found

that 58% of U.S. consumers try to save electricity at home,

46% recycle newspapers, 45% return bottles or cans and 23%

buy products made from, or packaged in, recycled materials

(Ginsberg & Bloom). Obviously consumers look at some

environmental implications when considering what to

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purchase. Knowing the target consumer for green products

helps marketers know whether “greenness” will help sell

their products, and how it should be integrated into the

marketing mix. Roper survey divides the consumers into

several groups depending on their various degrees of

environmental concerns (or, ‘various shades of green’)

(Ginsberg & Bloom, 2004). 9% of consumers are “true-blue

greens”; these consumers have strong environmental values,

take it upon themselves to seek change, and are 4 times more

likely to avoid products from companies that are not

environmentally friendly. 6% of consumers are considered

“green-back greens” and are similar to true-blues except for

the fact that they are not as politically active in

advocating for change. “Sprouts” make up 31% of consumers.

Sprouts agree with environmental causes but rather not buy a

green product if it means spending more money. Sprouts can

be persuaded to buy green with the right marketing tactics.

19% of consumers are “grousers”, who are not very educated

about environmental issues and thus don’t believe buying

green will help change anything (Rober ASW). They believe

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that responsibility of environmental problems lies with the

companies that cause them. Finally, the majority of

consumers (33%) are considered to be “basic browns”. These

basic browns care more about daily issues rather than the

huge underlying environmental issues (Roper ASW). By looking

at these figures, a marketer can assume that anywhere from

15% to 46% of the consumer market could be open to a green

appeal. However the size of this target market will

fluctuate with social, cultural, and economic trends. There

is a notable trend in the aging of the baby boomers to look

for environmentally friendly products because there is a

want to live longer and healthier lives (Ginsberg & Bloom,

2004).

Today’s consumers are increasingly more conscious about

the environment and the purchasing decisions they make that

affect the environment. It only makes sense that more

companies are responding to consumers’ desires for products

that are less harmful to the environment (Mishra & Shirma,

2012). By switching to green marketing companies are reaping

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several benefits. Green marketing ensures pretty steady

long-term growth alongside profitability. Markets are moving

in an environmentally friendly direction and although

companies who jump on the bandwagon early will have a

competitive advantage, eventually most companies will have

to join eventually. Green marketing also saves money in the

long run, all though it may cost more to begin with. In

addition, most of the employees also feel proud and

responsible to be working for an environmentally responsible

company. (Mishra & Shirma, 2012)

Challenges of Green Marketing

Green marketing is still an emerging type of marketing.

As with anything, there are still challenges that marketers

will face. First and foremost, companies need to make moves

with green marketing that will not confuse the consumers,

and will not break any regulations dealing with

environmental-marketing (Ghosh, 2011). It is found that only

5% of the marketing messages from “green” campaigns are

entirely true. The problem is the lack of standardization to

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confirm these claims. A standard quality control board needs

to be in place for such labeling and licensing. Again, green

marketing is still a new concept for society. The consumer

needs to be made aware of environmental problems, which will

take a lot of time and effort. Being exposed to

environmental issues will cause consumers to be aware and

they will in turn be inclined to accept the green products.

Effectiveness of green marketing is still debated even

though many companies are prosperous from it- for example

the Energy Star label now appears 11,000 different

companies' models in 38 product categories, from washing

machines and light bulbs to skyscrapers and homes. Companies

need to see that by integrating environmentally friendly

practices into their business, they could benefit in the

long term. Immediate results are not guaranteed. Consumers

are still confused and need clarification and honest green

claims. Marketers should focus on the benefits the consumer

will receive, which are why the consumer would look to buy

these green products products. When this is done correctly,

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it is easier to convince consumers to change brands and even

pay more for the added ‘greenness’. A product may be

considered ‘green’ but it will not sell if it will not

satisfy consumer needs (which is marketing myopia) (Mishra &

Sharma, 2012).

Just like any other type of marketing, there is a need

of marketing mix for promotion of green products. Marketers

develop a marketing mix in order to enhance branding, sales,

and profitability (Gittel, Magnusson, & Merenda, 2012).This

includes the 4 P's; product mix, price mix, place mix, and

promotion mix. Looking at the product, the producer should

offer products that do not harm the environment (Patil,

2012).Green marketing strategies should also look at the

values of the green consumers, because consumers make value

driven purchasing consumers. For example, 77% of consumers

believe they can make a positive difference just by

purchasing products from socially and environmentally

conscious companies.

Marketing Mix

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When looking at green products, attention should be

paid to sourcing of materials, ingredients used, and the

manufacturing of the product. This includes using all

natural and organic materials, sourcing local and through

fair trade suppliers, utilizing environmentally friendly

materials, and using lean manufacturing and distribution

methods that minimize the company’s environmental impact.

For example, Unilever (the corporate owner of Ben & Jerry’s)

has committed that all ingredients in Ben & Jerry’s ice

cream be sourced through fair trade suppliers and certified

as such by 2013 (Gittel, Magnusson, & Merenda, 2012).

Pricing for green products may be little higher than

their non-green counterparts but often green products have

higher initial costs and lower long term costs. Green

Pricing focuses the people, planet, and profit in a way that

takes the care of the health of employees and communicates

and ensures the effective and efficiently productivity

(Patil). Manufacturing and transportation costs can also be

higher. For example, if the transport costs use a higher

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cost but lower polluting renewable energy fuel source, this

will contribute to a higher price point. For the large

majority of consumers, if they do not receive additional

value from a sustainable product, for example, in the form

of reduced energy costs or longer product lives, they will

not pay a premium for the sustainable product. Marketers can

lower the price barrier by placing the price closer to that

of conventional competitors or by using marketing tools to

raise perceived value. You can also minimize price gaps by

targeting those who are better off financially, or by

targeting super green markets (Gittel, Magnusson, & Merenda,

2012).

As for place, a distribution channel is one of the

major and crucial tasks. Buying locally is a place-related

green marketing area. According to the 2011 Nielsen global

online consumer survey, belief in the positive impact of

local products is highest in North America, where 65 percent

of consumers reported that local goods have a positive

impact on the environment (Gittel, Magnusson, & Merenda).

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Green products can be found everywhere these days. Brick and

mortar storefronts are moving towards more sustainable

practices, such as Kohl’s implementing solar panels in some

stores. An increase in local retailers comes from the

concern to reduce carbon emissions from product transport

environment (Gittel, Magnusson, & Merenda, 2012). There is

also an increase in the use of devices like the Kindle and

Ipad which reduce the need to buy certain books or other

publications.

When dealing with promotion, a communication with the

market should establish the path with the environment aspect

or elements. Promotion is one of the most important parts of

the marketing mix. A brand is an image in the consumer’s

mind for a particular product or service. Strong green

brands should have a brand image of the product or service

having a positive impact on people and the environment.

Stonyfield’s brand positioning of “healthy food, healthy

people, healthy planet” comes from the company’s vision

(Gittel, Magnusson, & Merenda, 2012). Advertising, public

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relations, personal selling, consumer and trade promotion,

social media, and mobile marketing are all marketing

promotion tools. When determining which mediums to utilize,

marketers need to consider marketing objectives, effective

reach of mediums among identified target audiences, and

budget. Using a mix of marketing promotion tools is the best

way to consistently apply the branding and messaging to

maximize awareness (Gittel, Magnusson, & Merenda, 2012).

Advertisements are designed to increase awareness and

encourage the purchase of a particular product or service

and are a paid medium (usually). Different methods include

television, print, internet, radio, billboards and cinema

advertising. There are generally 3 types of ads used in

green marketing; ads that address a relationship between a

product/service and the biophysical environment, those that

promote a green lifestyle by highlighting a product or

service, and ads that present a corporate image of

environmental responsibility (Pirakatheeswari, 2012).

Nike has been using green marketing through its

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advertisements. It created the first 100 percent recycled

television advertising, reusing and remixing film from their

previous campaigns over the years to create a new commerical

to introduce their Better World campaign. By reusing

existing film, Nike did not have to spend the thousands of

dollars to produce a new television commercial nor expend

energy costs for a production shoot (Gittel, Magnusson, &

Merenda, 2012). Public relations is about influencing a

consumer, these mediums are not always paid for. Companies

can earn stories and coverage as did the Toyota Prius, one

of the first hybrid cars. Toyota received endorsements from

eco-friendly organizations like the Sierra Club. This helped

to establish Toyota’s green brand image. Personal selling

includes one-on-one selling, word of mouth, demonstrations,

etc. These methods can earn a company instant fame and

credibility.

Consumer promotions are programs that help influence

consumers to purchase certain products by using some price

incentive (Gittel, Magnusson, & Merenda, 2012). In the case

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of green marketing, incentives usually involve a donation

that helps people and the planet (Gittel, Magnusson, &

Merenda, 2012). Toms Shoes is a company that was started on

the premise that for every pair of shoes sold, one pair

would be donated to a child in need. This created a feeling

of altruism in customers and kept them coming back. Social

media marketing involves the use of social media sites like

Facebook and Twitter (Gittel, Magnusson, & Merenda, 2012).

This gets consumers engaged with a ‘relationship’ with a

brand and consumers feel they have control over their

exposure to the advertisements.

Another form of promotion is the use of mobile

marketing. This form is on the rise with the increase in

ownership of cell phones. Nielsen Company puts smartphone

household penetration at 40 percent, but it is growing

quickly (Gittel, Magnusson, & Merenda, 2012). Mobile

advertising and the use of QR (quick response) codes is an

effective way to engage consumers (Gittel, Magnusson, &

Merenda, 2012). QR codes are two-dimensional (2D) matrix

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barcodes that can hold thousands of alphanumeric characters

of information (Gittel, Magnusson, & Merenda, 2012). When

consumers “snap” them on their smartphones, the QR codes can

take them to a special mobile-enabled site that provides

content and incentives to promote a product. In today’s

digital world of immediacy, consumers want instant access to

what’s relevant and mobile marketing techniques are being

used to make that possible (Gittel, Magnusson, & Merenda,

2012).

Conclusion

The concept of green marketing is becoming widely

embraced by a variety of companies. By considering the

importance of this factor many companies have started to

manufacture, produce such a goods and the services with the

standard patterns of 'green marketing' as well as they have

taken one more step towards the formulating the marketing

mix in a green fashion. Finally we can conclude that green

marketing is gathering speed slowly as it is a new concept,

but it is becoming a staple in positioning the marketing mix

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towards green initiatives.

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