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GREEN MARKETING: OPPORTUNITY FOR INNOVATION
Chapter
3: Why Conventional Marketing Won't Work
Conventional
marketing is out. Green marketing is in. Effectively addressing
the needs of consumers with a raised environmental consciousness
cannot be achieved with the same assumptions and formulae that guided
consumer marketing in the high production-high consumption post-war
era. New strategies and innovative product and service offerings
are required.
?Conventional marketing entails developing products that meet consumers needs at affordable prices and then communicating he benefits of those products in a compelling way. Environmental marketing is more complex. It serves two key objectives:
- to develop products that balance consumers' needs for quality,
performance, affordable pricing, and convenience with environmental
compatibility, that is, minimal impact on the environment
- to project
an image of high quality, including environmental sensitivity,
relating to both a product’s attributes and its manufacturer’s
track record for environmental achievement
These objectives cannot be met using conventional marketing strategies. Marketers in the age of environmental consumerism are accountable to tough new standards. Environmental consumerism represents deep psychological and sociological shifts, as did its predecessors - Naderism and feminism. Naderism spurred marketers to produce safer, higher-quality products and to advertise those products with more credible claims. Feminism forced marketers to develop convenient products and to portray women with a new respect. Meeting the challenges of environmental consumerism presents its own mandates for corporate processes, product quality, and promotion.
To realize that conventional strategies won’t succeed, one need only recall the unsavory backlash that pioneering green marketers incurred over what was perceived by environmentalists, regulators, and the press as inconsistent and oftentimes misleading labels and claims. Marketers, desirous of keeping in step with competitors and encouraged by polls erroneously suggesting that overwhelming majorities of consumers would pay hefty premiums for greener goods, rushed headlong to underscore the environmental benefits of their offerings, however insignificant or coincidental. Indeed, according to J. Walter Thompson Company, green claims quadrupled between 1989 and 1990. Trash bags and diapers were touted as "degradable" and hair sprays were branded as "ozone-friendly". One product label even exclaimed "earth friendly since 1889."
The resulting deluge of skepticism, confusion, and regulatory nightmares that these green claims spawned quickly proved that environmental marketing involves more than tweaking one or two product attributes and dressing up packages with meaningless (and often misleading) claims. Too many marketers learned the hard way that partaking of environmentally related opportunities requires a total corporate commitment to
greening one’s products and communications. It affects how
a corporation interacts with all the groups and individuals who
may be affected by its environmental practices. As such, this commitment
needs to be founded on a thorough greening of one’s entire
company–and values.
The
New Marketing Paradigm
A new paradigm in the making. Basic assumptions about how best to cater to consumer needs are in question. Successful green marketers no longer view consumers as individuals with insatiable appetites for material goods, but as human beings concerned about the condition of the world around them, how they themselves interact with the rest of nature, and cognizant of how material goods impact their lives positively as well as negatively, short term as well as long term (see
Exhibit 3.1).
Products are no longer designed in a linear "cradle to grave" fashion, with no regard for the long term impact on society of their eventual disposable or no appreciation for the value of the natural resources they represent. A "one size fits all" system of nationally marketed brands now gives way to more flexible product offerings that best fit regional environmental considerations. Yesterday's resource-intensive products are being replaced by innovative products with radical new designs, even with "dematerialized services." These offerings are marketed with ads and promotions that derive added value from the educational messages they impart and the values they project.
The corporations that excel at green marketing are proactive in nature. Aiming
to surpass minimal compliance standards, they define the rules by
which they and their competitors will be judged. Ecologically responsive
corporations consider themselves to be like nature’s processes,
interdependent. They ally with corporate environmental stakeholders
in cooperative, positive alliances, and work hand in hand with suppliers
and retailers to manage environmental issues throughout the value
chain. Internally, cross-functional teams convene to find the best
possible holistic solution to environmental challenges. Long-term,
rather than short-term in their orientation, these companies manage
with a double bottom line–one bottom line for profits, the
other one reflecting their contribution to society.
The
Seven Strategies of Green Marketing Success
The currency of the green business world is innovation, flexibility, change and heart. New rules have emerged from the cloud of green marketing dust kicked up in the late 1980s and early 1990s. We know better what works - and what does not. Seven strategies that work are listed in Exhibit 3.2. Using these strategies,
eco-entrepreneurs Gary Hirschberg and Samuel Kayman set a greener
pace that others must follow.
Using these strategies, eco-entrepreneurs Gary Hirshberg and Samuel Kayman set a greener pace that others now must follow.
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CASE
STUDY: Stonyfield Farm Takes a Values-Based Approach
Stonyfield Farm of Londonderry, New Hampshire has witnessed explosive growth in its thirteen years of existence. Gary Hirshberg and Samuel Kayman, the founders of this now 125-person company, have seen their yogurt- and dairy-product-based business skyrocket from regional to national - and now international - distribution. A big reason for the company’s rapid growth and popularity are the products themselves. Stonyfield’s popular yogurt and other products represent healthy alternatives to other brands, giving them a competitive advantage in a market where more and more consumers are choosier about the food products they buy.
However, it isn’t only its yogurt that sets this company apart from its competition. Stonyfield began as a school to help revitalize New England agriculture and to educate people about environmental practices and issues faced by local dairy farmers. Building upon this history of environmental education, the company makes pioneering social and environment-related business practices central to business, values, and growth. Such business practices ensure markets for the pure dairy products produced on New England farms, all the while teaching industry a thing or two about how to run a socially and environmentally responsible business.
Hirshberg and Kayman, began making high quality yogurt in 1983 as a way to raise money for their nonprofit school. Today, Stonyfield produces the purest, most nutritious, and best-tasting yogurt available, all the while supporting various socially and environmentally beneficial causes. Environmental initiatives include annual contributions to worthy environmental groups, extensive recycling programs, and ongoing customer education.
Only the
Finest Will Do. Hirshberg
and Kayman run their company with five objectives; the first is
to "provide and sell the highest quality agricultural products
available." Stonyfield's makes its premium-quality yogurt from
milk supplied by dairy farms that do not use rBGH, a controversial
synthetic bovine-growth hormone. The yogurt contains none of the
gelatins, starches, thickeners, or other chemical additives used
in most other yogurts. To further notch its products above competition,
Stonyfield uses a less refined sugar and all Stonyfield products
contain both Acidophilus and Bifidus, active bacterial
cultures known to improve digestion, especially in children. The
result: a healthier, better tasting product appreciated by health-conscious
consumers.
And the unbeatable quality pays off in unbeatable margins. Stonyfield commands a 4-5 percent price premium, while generating continued markets for local dairy farmers.
Interactive
Marketing Programs. Stonyfield
markets its products and values through interactive marketing programs
designed to heighten customer awareness about the quality of its
products and the importance of supporting local dairy farmers and
other causes–the second of Stonyfield’s company objectives.
Getting consumers involved is key to Stonyfield’s success.
Consumers appreciate the company’s healthful approach to production,
but also like becoming empowered via the company’s programs.
One such program is "Have-A-Cow," a light-hearted approach to teaching consumers about where milk comes from. Consumers can "adopt" one of the cows whose milk gets transformed into Stonyfield Farm’s yogurt and ice cream. Sponsoring consumers receive a kit including a glossy cow photograph, an in-depth cow biography and a certificate signed by Stonyfield Farm president, Gary Hirshberg. In addition, twice a year, they receive a Stonyfield Farm "Moosletter" filled with news about each cow on the farm. Notes Hirshberg on the program's goals, "We started the ‘Have-a-Cow’ program in 1989 as a way to help consumers stay in touch with where the food comes from. By seeing how a farm works from the point of view of a cow, consumers gain a better understanding of the importance of agriculture and the need to protect the environment." This program has already empowered 30,000 participants to feel like they are doing good by supporting Stonyfield’s policies–a common theme with the company’s environmental efforts.
A related "Just Say Moo" campaign educates consumers about the extensive use of the controversial rBGH hormones and their potential negative implications for family farmers. Marshaling a variety of public outreach components, this effort aims to boost awareness of sound agricultural practices and publicize Stonyfield’s own stand on the issue. Billboards and radio spots urge consumers to call the company’s 800 telephone number to learn about other ways to get involved.
A third campaign, dubbed "Flip Your Lid", conducted in April 1996, empowered consumers to act upon various environmental and social causes (see Exhibit 3.3). In one
phase of the program, the plastic lids on the Stonyfield Farm yogurt
cups became ready-made letters to Congress. One side of the lid
read: "The planet is everyone’s business. We all must
work to ensure a healthy planet for generations to come. You can
act on behalf of your children today by 'flipping your lid.'" On
the underside of the lid is a letter to Congress ready to be signed
and mailed, saying "Government should be more efficient, but
not at the cost of a polluted planet. I don’t support cuts
in environmental funding for they deny our children their rights
to a healthy Earth. Please vote on behalf of the environment."
In addition, a toll-free number supplied information, name, and
voting records in Congress. During a four-week campaign, more than
1.5 million lids reached consumers through supermarkets, natural
food stores and college Earth Day events. Supporters of the campaign
included Ben & Jerry’s, Reebok, Fetzer Vineyards, The Audubon
Society, Greenpeace, and the Natural Resources Defense Council.
The Lid program’s other foci included the tenth anniversary of Farm Aid, the Real Goods catalog of products promoting energy independence and sustainable living; and prevention of hand gun violence. In each case, one million lids were produced and distributed nationwide over a four-week period, translating into coverage for Stonyfield Farm and the specific causes word-of-mouth in lid recipients’ newsletters, national TV exposure, and other forms of publicity.
Profits
for the Planet. Ever-mindful of the public pulse,
Stonyfield, financially supports environmental and agricultural
causes. Through its "Profits for the Planet" program,
the company donates 10 percent of its profits to organizations and
farmers who work toward advancing sustainable agriculture. This
practice demonstrates two key elements of the company. By supporting
a variety of advocacy groups, Stonyfield builds upon its agricultural
education base and shows concern for environmental awareness that
extends beyond the company’s own marketing persona. Such support
also proves that socially and environmentally responsible business
enterprise is profitable.
Though many
companies tout their "greenness" through environmental
group donations Stonyfield avoids what Gary Hirshberg terms "greenscamming"
by instituting various in-house practices that answer to the third
company objective of employee benefits and the need to "practice
what you preach."
The company’s full commitment to green includes such in-house practices as a company-wide recycling program, an energy-saving lighting system retrofitted in accordance with the US Environmental Protection Agency’s Green Lights program, and efforts aimed at creating environmentally preferable packaging. These changes resulted from an ecological audit performed in the company’s early years. Internal efforts, policies, and programs demonstrate Stonyfield Farm's commitment to being as green as possible on the inside as they are on the outside–a fact the company demonstrates through daily plant tours.
Stonyfield’s commitment has catapulted the tiny dairy upstart into the green spotlight. Health-conscious consumers all over the United States seek the benefits of Stonyfield’s yogurt and appreciate the company’s efforts to act in an environmentally and socially responsible way. Consumers also like Stonyfield’s educational programs, which speak to their own desires for responsible behavior. Additionally, Stonyfield’s customers appreciate the personal connection the company offers and the fact that Stonyfield puts profits into organizations they care about. Through its policies and programs, Stonyfield helps its consumers get involved and provides an outlet to "go green".?
In addition to consumer recognition, Stonyfield Farm has also drawn considerable media attention, including the highly coveted 1994 America’s Corporate Conscience Award for Environmental Stewardship from the Council on Economic Priorities, the 1991 Business Ethics Award from Business Ethics magazine, and the 1992 Manufacturer of the
Year from NH Business magazine, as well as a 1993 ranking
in Inc. magazine’s "Employers of the Year."
Stonyfield’s positive, values-based orientation has allowed the company to fulfill its fourth and fifth objectives: to recognize obligations to investors, and to serve as a model that environmentally and socially responsible companies can be profitable. In Gary Hirshberg’s words, "Consumers want businesses to do the right thing, and businesses that do the right thing get rewarded for it". Stonyfield’s social and environmental focus draws positive recognition, and the business benefits accordingly. Sales over the past decade at Stonyfield have grown tenfold - from $3 million in fiscal year 1990 to $31 million in fiscal year 1997. Stonyfield Farm distributes yogurt in all 50 states, as well as Britain and Russia.
These positive results, in combination with the fulfillment of its company objectives, allows Stonyfield to present itself as a model environmentally-responsible and profitable company. Gary Hirshberg sums up his company’s commitment to teaching, "We have experienced the direct benefits of going the extra mile in terms of environmental advocacy, employee wellness and participation, and other socially responsible practices. Our mission is to show the largest companies on earth that they, too, can reap such benefits. Most of the problems we face will only be reversed when businesses make the solution their priority."
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