Marketing Types

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Green marketing

According to the American Marketing Association,green marketing is the marketing of products that are

presumed to be environmentally safe.Thus green marketing incorporates a broad range of activities,

including product modification, changes to the production process, packaging changes, as well as

modifying advertising. Yet defining green marketing is not a simple task where several meanings intersect

and contradict each other; an example of this will be the existence of varying social, environmental and

retail definitions attached to this term.[1]

Other similar terms used are Environmental

Marketing and Ecological Marketing.

Green, environmental and eco-marketing are part of the new marketing approaches which do not just

refocus, adjust or enhance existing marketing thinking and practice, but seek to challenge those

approaches and provide a substantially different perspective. In more detail green, environmental andeco-marketing belong to the group of approaches which seek to address the lack of fit between marketing

as it is currently practiced and the ecological and social realities of the wider marketing environment.[2]

The legal implications of marketing claims call for caution. Misleading or overstated claims can lead to

regulatory or civil challenges. In the USA, theFederal Trade Commissionprovides some guidance on

environmental marketing claims.[3]

This Commission is expected to do an overall review of this guidance,

and the legal standards it contains, in 2011.[4]

Contents

[hide]

1 History

2 Framework

o 2.1 Ecological Marketing

o 2.2 Green/ environmental marketing

3 Greenhouse gas reduction market

4 Popularity and effectiveness

o 4.1 Ongoing debate

o 4.2 Confusion

4.2.1 Greenwashing

o 4.3 Statistics

5 Target market

o 5.1 LOHAS
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6 The Green Marketing Mix

7 Eco Labels

8 Life Cycle Assessment

o

8.1 Example for LCA9 Green marketing cases

o 9.1 Phillips's "Marathon" CFL lightbulb

o 9.2 Car sharing services

o 9.3 Electronics sector

o 9.4 Products & Services

o 9.5 Introduction of CNG in Delhi

10 See also

11 References

12 External links

[edit]History

The term Green Marketing came into prominence in the late 1980s and early 1990s.[5]

The American

Marketing Association (AMA) held the first workshop on "Ecological Marketing" in 1975.[6]

The

proceedings of this workshop resulted in one of the first books on green marketing entitled "Ecological

Marketing".[7]

The Corporate Social Responsibility (CSR) Reports started with the ice cream seller Ben & Jerry's where

the financial report was supplemented by a greater view on the company's environmental impact. In 1987

a document prepared by the World Commission on Environment and Development definedsustainable

developmentas meeting the needs of the present without compromising the ability of future generations

to meet their own need, this became known as the Brundtland Report and was another step towards

widespread thinking on sustainability in everyday activity. Two tangible milestones for wave 1 of green

marketing came in the form of published books, both of which were called Green Marketing. They were

by Ken Peattie (1992) in the United Kingdom and byJacquelyn Ottman(1993) in the United States of

America.[8]

According toJacquelyn Ottman, (author of "The New Rules of Green Marketing: Strategies, Tools, and

Inspiration for Sustainable Branding" (Greenleaf Publishing[9]

andBerrett-Koehler Publishers, February

2011)) from an organizational standpoint, environmental considerations should be integrated into all

aspects ofmarketing new product development and communications and all points in

between.[10]

Theholisticnature of green also suggests that besides suppliers and retailers new
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ips.27s_.22Marathon.22_CFL_lightbulbhttp://en.wikipedia.org/wiki/Green_marketing#Green_marketing_caseshttp://en.wikipedia.org/wiki/Green_marketing#Example_for_LCAhttp://en.wikipedia.org/wiki/Green_marketing#Life_Cycle_Assessmenthttp://en.wikipedia.org/wiki/Green_marketing#Eco_Labelshttp://en.wikipedia.org/wiki/Green_marketing#The_Green_Marketing_Mix


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stakeholders be enlisted, including educators, members of the community, regulators, and

NGOs.Environmental issuesshould be balanced with primary customer needs.[citation needed]

Thepastdecadehas shown that harnessingconsumerpower to effect positive environmental change is

far easier said than done. The so-called "green consumer" movements in the U.S. and other countries

have struggled to reach critical mass and to remain in the forefront of shoppers' minds.[11]

While public

opinion polls taken since the late 1980s have shown consistently that a significant percentage of

consumers in the U.S. and elsewhere profess a strong willingness to favor environmentally conscious

products and companies, consumers' efforts to do so in real life have remained sketchy at best.[1]

One of

green marketing's challenges is the lack of standards or public consensus about what constitutes "green,"

according toJoel Makower, a writer on green marketing.[citation needed]

In essence, there is no definition of

"how good is good enough" when it comes to a product or company making green marketing claims. This

lack of consensusby consumers, marketers, activists, regulators, and influential peoplehas slowed

the growth of green products, says Makower, because companies are often reluctant to promote their

green attributes, and consumers are often skeptical about claims.[citation needed]

Despite these challenges, green marketing has continued to gain adherents, particularly in light of

growing global concern about climate change. This concern has led more companies to advertise their

commitment to reduce their climate impacts, and the effect this is having on their products and

services.[12][13]

[edit]Framework

[edit]Ecological Marketing

Ecological marketing was based on the idea that environmental protection and resource conservation can

be better advanced through less regulation by the public sector and more enterprise in the private sector.

This idea, in turn, is based on the premise that the ecologically concerned consumer is a legitimate but

largely unused market segment one that is identifiable, accessible and measurable.[14]

In the 1970s the

importances of a small number of environmental issues like oil use or pollution for a narrow range of

industries (for example cars and chemicals) was framed as something that was relevant to engineers,

lawyers and marketers within companies.[2]

Originally proposed at the American Marketing Association first conference on ecological marketing in

1975,[15]

the idea was compatible with the antiregulatory mood of these days in the U.S. It found supporter

at the 1979 conference, who felt that government and business should strike a better balance in the

division of responsibility for the management of negative social externalities.[16]

[edit]Green/ environmental marketing
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Unfortunately, a majority of people believe that ecological (green) marketing refers solely to the promotion

or advertising of products with environmental characteristics. Terms like Phosphate Free, Recyclable,

Refillable, Ozone Friendly, and Environmentally Friendly are some of the things consumers most often

associate with green marketing. While these terms are green marketing claims, in general green

marketing is a much broader concept, one that can be applied to consumer goods, industrial goods and

even services. Thus, green marketing incorporates a broad range of activities, including product

modification, changes of the production process, packaging changes, as well as modifying advertising.

Green marketing came into prominence in the late 1980s and early 1990s, it was first discussed much

earlier. The American Marketing Association (short: AMA) held the first workshop on Ecological

Marketing in 1975.[15]

The proceedings of this workshop resulted in one of the first books on green

marketing entitled Ecological Marketing. According to Dainora Grundey and Rodica Milena Zaharia

Green or Environmental Marketing consists of all activities designed to generate and facilitate any

exchanges intended to satisfy human needs or wants, such that the satisfaction of these needs andwants occurs, with minimal harmful impact on the natural environment .

[17]

[edit]Greenhouse gas reduction market

The emerging greenhouse gas reduction market can potentially catalyze projects with important local

environmental, economic, and quality-of-life benefits. TheKyoto Protocols Clean Development

Mechanism (CDM), for example, enables trading between industrial and developing nations, providing a

framework that can result in capital flows to environmentally beneficial development activities. Although

the United States is not participating in the Kyoto Protocol, several US programs enable similar

transactions on a voluntary and regulatory basis.[1]

While international trade ingreenhousegas[18]

reductions holds substantial promise as a source of new

funding forsustainable development, this market can be largely inaccessible to many smaller-scale

projects, remote communities, and least developed localities. To facilitate participation and broaden the

benefits, several barriers must be overcome, including: a lack of market awareness among stakeholders

and prospective participants; specialized, somewhat complicated participation rules; and the need for

simplified participation mechanisms for small projects, without which transaction costs can overwhelm the

financial benefits of participation. If the barriers are adequately addressed, greenhouse gastradingcan

play an important role supporting activities that benefitpeoples lives and the environment.[1]

[edit]Popularity and effectiveness

[edit]Ongoing debate

The popularity of such marketing approach and its effectiveness is hotly debated. Supporters claim that

environmental appeals are actually growing in numbertheEnergy Starlabel, for example, now appears
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on 11,000 different companies'[19]

models in 38 product categories, fromwashing machinesandlight

bulbstoskyscrapersand homes. However, despite the growth in the number of green products, green

marketing is on the decline as the primary sales pitch for products. (NEEDS CITATION) On the other

hand,RopersGreen Gaugeshows that a high percentage of consumers (42%)[20]

feel that environmental

products dont work as well as conventional ones. This is an unfortunate legacy from the 1970s when

shower heads sputtered and natural detergents left clothes dingy. Given the choice, all but the greenest

of customers will reach for synthetic detergents over the premium-priced, proverbial "Happy Planet" any

day, includingEarth Day. New reports, however show a growing trend towards green products.[21]

[edit]Confusion

One challenge green marketers -- old and new -- are likely to face asgreen productsand messages

become more common is confusion in the marketplace. "Consumers do not really understand a lot about

these issues, and there's a lot of confusion out there," saysJacquelyn Ottman(founder of J. Ottman

Consulting and author of "Green Marketing: Opportunity for Innovation.")[21]Marketers sometimes take

advantage of this confusion, and purposely make false or exaggerated "green" claims. Critics refer to this

practice as "green washing".[citation needed]

[edit]Greenwashing

The term greenwashing refers to all industries that adopt outwardly green acts with an underlying

purpose to increase profits. The primary objective of greenwashing is to provide consumers with the

feeling that the organization is taking the necessary steps to responsibly manage its ecological footprint.

In reality, the company may be doing very little that is environmentally beneficial[22]

The term

greenwashing was first used by environmentalist Jay Westerveld when objecting to hotelier's practice of

placing notices in hotel rooms which asked their quests to reuse towels to save the environment.

Westerveld noted that there was little else to suggest that the hoteliers were interested in reducing their

environmental impacts, and that their interest in washing fewer towels seemed to be motivated by a

concern to save costs rather than the environment. Since then greenwashing has become a central

feature of debates about marketing communications and sustainability, with awards for greenwashing

established and numerous campaigns, law and advices developed in an attempt to reduce or curb it.[2]

[edit]Statistics

According to market researcherMintel, about 12% of the U.S. population can be identified as True

Greens, consumers who seek out and regularly buy so-called green products. Another 68%[21][23]

can be

classified as Light Greens, consumers who buy green sometimes. "What chiefmarketing officersare

always looking for is touch points with consumers, and this is just a big, big, big touch point that's not

being served," saysMintelResearch Director David Lockwood. "All the corporate executives that we talk
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to are extremely convinced that being able to make some sort of strong case about the environment is

going to work down to their bottom line."[21]

[edit]Target market

In 1989, 67 percent of Americans stated that they were willing to pay 5-10 percent more for ecologically

compatible products.[24]

By 1991, environmentally conscious individuals were willing to pay between 15-

20 percent more for green products.[25]

By 1993, Myburgh-Louw and OShaughnessy[26]

conducted a mail

survey of female consumers in the UK to investigate their perceptions of environmental claims on the

packaging of clothes detergents. They found that 79 percent of their sample agreed to pay up to 40

percent more for a product which was identical in every respect to their own brand and which had been

proven to be green. An important challenge facing marketers is to identify which consumers are willing to

pay more for environmentally friendly products. It is apparent that an enhanced knowledge of the profile

of this segment of consumers would be extremely useful. Efforts to identify environmentally friendly

consumers can be traced back to the early 1970s.,[27]

as well as Anderson and Cunningham,[28]

were

pioneers in studying the profile of socially responsible consumers. Overall, their combined results portray

a highly socially conscious person as female, pre-middle aged, with a high level of education (finished

high school) and above average socioeconomic status.[29]

[edit]LOHAS

LOHAS stands for Lifestyles of Health and Sustainability, and describes an integrated, rapidly growing

market for goods and services that appeal to consumers whose sense of environmental and social

responsibility influences their purchase decisions. The Natural Marketing Institutes (short: NMI) estimates

the US LOHAS consumer market of products and services to be USD 209 billion sold across all

consumer segments.[30]

The five LOHAS segments as defined by NMI include:

LOHAS: Active environmental stewards dedicated to personal and planetary health. These are the

heaviest purchasers of green and socially responsible products and the early adapters who influence

others heavily.

Naturalites: Motivated primarily by personal health considerations. They tend to purchase more

LOHAS consumable products vs. durable items.

Drifters: While their intentions may be good, DRIFTERS follow trends when it is easy and affordable.

They are currently quite engaged in green purchasing behaviours.

Conventionals: Pragmatists who embrace LOHAS behaviour when they believe they can make a

difference, but are primarily focused on being very careful with their resources and doing the right

thing because it will save them money.
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Unconcerned: Either unaware or unconcerned about the environment and societal issues mainly

because they do not have the time or the means these consumers are largely focused on getting

by.

The distribution of the different types of LOHAS.[30]

[edit]The Green Marketing Mix

A model of a green marketing-mix should, of course, contain all 4Ps:

Product: A producer should offer ecological products which not only must not contaminate the

environment but should protect it and even liquidate existing environmental damages.

Price: Prices for such products may be a little higher than conventional alternatives. But target

groups like for example LOHAS are willing to pay extra for green products.

Place: A distribution logistics is of crucial importance; main focus is on ecological packaging.

Marketing local and seasonal products e.g. vegetables from regional farms is more easy to be market

green than products imported.

Promotion: A communication with the market should put stress on environmental aspects, for

example that the company possesses a CP certificate or is ISO 14000 certified. This may be

publicized to improve a firms image. Furthermore, the fact that a company spends expenditures on

environmental protection should be advertised. Third, sponsoring the natural environment is also very

important. And last but not least, ecological products will probably require special sales promotions.

In their book of Sustainability Marketing Belz and Peattie go one step further in terms of not just

marketing but operating green. They transformed the 4 P's into the 4 C's. The four C's customer

solutions, customer cost, communication and convenience are taking the point of view of the customer

(not the producer).
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Customer solutions:These solutions go beyond selling physical products and present solutions to

customer's problems. They imply knowing customers and their needs well and offering products and

services that satisfy customer needs and that take into account social as well as environmental

aspects.

Customer Cost:Customer Cost does not only include the financial price a buyer has to pay for a

product or a service, it also considers the psychological, social and environmental costs of obtaining,

using and disposing of a product.

Communication: Green communication goes beyond promotion, which is a form of persuasion and

a one-way communication from seller to buyer. Communication is a process of interactive dialogue

within which it is essential to build trust and credibility.

Convenience: Means that customers want to use products and services that meet their needs and

that are easy and convenient to access and use.[2]

The level of greening-strategic, quasi-strategic, or tactical dictates exactly what activities should be under-

taken by a company. Strategic greening in one area may or may not be leveraged effectively in others. A

firm could make substantial changes in production processes but opt not to leverage them by positioning

itself as an environmental leader. So although strategic greening is not necessarily strategically integrated

into all marketing activities, it is nevertheless strategic in the product area.[17]
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Green marketing activities[17]

[edit]Eco Labels

An individual's belief that an environmental claim lacks honesty can have a negative effect on attitude

toward a brand. If, on the other side, the consumer grants credibility to the claim, the individual will
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behave more respectfully toward the environment. The problem in extending that credibility to a brand is

that consumers interested in ecological products generally are skeptical of commercial advertisements.

This skepticism is due to various factors such as lack of language, the absence of scientific knowledge

necessary to interpret advertising meaning, and, in particular, the falsehoods and exaggeration of some

advertising techniques. To resolve this problem, independent organizations may choose to guarantee

messages on the environmental benefits of brands with environmental labeling systems sponsored by

independent organizations. This practice tries to diminish perceived biases in environmental information

by promoting standardization of the information with the aim of improving confidence in the evaluation of

environmental benefits of productsall of which should positively affect the purchase intention.[31]

Overview of the different types of eco-labels used to indicate credibility to consumer.[32]

[edit]Life Cycle Assessment

During the late 1980's also new instruments such as life cycle assessment (short: LCA) were invented

which allowed ecological considerations to be introduced into marketing decisions.[2]
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The life cycle assessment model seeks to identify the main types of environmental impact throughout the

life cycle of a product. LCA was developed according to ISO 14040. The main goal of the LCA is to define

the energy and environmental profile of the finished products. The reasons to use LCA arose from the

need to have a precise process accounting and to highlight potential improvements that could be used in

order to increase the environmental, energy and economic efficiency and overall effectiveness of the

processes. In addition, the purpose was to quantify the environmental advantages deriving from the use

of recycled raw material.[33]

[edit]Example for LCA

LCA is used for example in the building sector. Buildings today account for the 40% of the worlds energy

use. The resulting carbon emissions are substantially higher than those of the transportation sector. New

buildings using more energy than necessary are being built every day, and millions of today's inefficient

buildings will remain standing until at least 2050. Its therefore necessary to start reducing energy use in

new and existing buildings in order to reduce the planet's energy-related carbon footprint. Growing

interest, space, and attention in the architecture sector are directed to environmental issues according to

the principles of green building. Mineral, vegetable, or animal materials such as perlite, vermiculite, rock

wool, glass wool, cork, plant fibers (cotton, flax, hemp, coconut), wood fiber, cellulose, and sheep's wool

can be used for the production of insulation panels.[33]

[edit]Green marketing cases

[edit]Phillips's "Marathon" CFL lightbulb

Philips Lighting's first shot at marketing a standalonecompact fluorescent light(CFL) bulb was Earth

Light, at $15 each versus 75 cents for incandescent bulbs.[34]

The product had difficulty climbing out of its

deep green niche. The company re-launched the product as "Marathon," underscoring its new "super long

life" positioning and promise of saving $26 in energy costs over its five-year lifetime.[34]

Finally, with the

U.S. EPA's Energy Star label to add credibility as well as new sensitivity to rising utility costs and

electricity shortages, sales climbed 12 percent in an otherwise flat market.[35]

[edit]Car sharing services

Car-sharing services address the longer-term solutions to consumer needs for betterfuelsavings and

fewer traffic tie-ups and parking nightmares, to complement the environmental benefit of more open

space and reduction ofgreenhouse gases.[citation needed] They may be thought of as a "time-sharing" system

for cars. Consumers who drive less than 7,500 miles a year and do not need a car for work can save

thousands of dollars annually by joining one of the many services springing up, including ZipCar (East

Coast), I-GO Car (Chicago),[36]

Flex Car (Washington State),[37]

and Hour Car (Twin Cities).[38]

[edit]Electronics sector
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The consumerelectronicssector provides room for using green marketing to attract new customers. One

example of this isHP's promise to cut its global energy use 20 percent by the year 2010.[39]

To

accomplish this reduction below 2005 levels,The Hewlett-Packard Companyannounced plans to deliver

energy-efficient products and services and institute energy-efficient operating practices in its facilities

worldwide.

[edit]Products & Services

Now companies are offering more eco-friendly alternatives for their customers. Recycled products for

example, are one of the most popular alternatives that can benefit the environment. These benefits

include sustainable forestry, clean air, energy efficiency, water conservation, and a healthy office. One

example, is the E-commerce business and office supply companyShopletwhich offers a web tool that

allows you to replace similar items in your shopping cart with greener products.

[edit]Introduction of CNG in Delhi

New Delhi, capital of India, was being polluted at a very fast pace untilSupreme Court of Indiaforced a

change to alternative fuels. In 2002, a directive was issued to completely adopt CNG in all public

transport systems to curb pollution.
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