Unit 1 B- Green Marketing

8/6/2019 Unit 1 B- Green Marketing

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Marketing


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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 oftime. 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.


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Second phase was "Environmental" greenmarketing and the focus shifted on cleantechnology that involved designing of innovativenew products, which take care of pollution andwaste issues.

Third phase was "Sustainable" green marketing. Itcame into prominence in the late 1990s and early2000. This was the result of the term sustainable

development which is defined as "meeting theneeds of the present without compromising theability of future generations to meet their ownneeds."


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What is green marketing?

Green marketing refers to the process of

selling products and/or services based on their

environmental benefits. Such a product orservice may be environmentally friendly in

itself or produced and/or packaged in an

environmentally friendly way.


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Thus "Green Marketing" refers to holistic marketing

concept wherein the production, marketing,consumption and disposal of products and serviceshappen in a manner that is less detrimental to theenvironment with growing awareness about theimplications of global warming, non-biodegradable

solid waste, harmful impact of pollutants etc., bothmarketers and consumers are becoming increasinglysensitive to the need for switch in to green productsand services.

W

hile the shift to "green" may appear to be expensivein the short term, it will definitely prove to beindispensable and advantageous, cost-wise too, in thelong run.


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Why Green Marketing?

As resources are limited and human wants areunlimited, it is important for the marketers toutilize the resources efficiently without waste aswell as to achieve the organization's objective. So

green marketing is inevitable.

There is growing interest among the consumersall over the world regarding protection ofenvironment. Worldwide evidence indicatespeople are concerned about the environmentand are changing their behavior. As a result ofthis, green marketing has emerged which speaksfor growing market for sustainable and sociallyresponsible products and services.


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The obvious assumption of green marketingis that potential consumers will view aproduct or service's "greenness" as a benefitand base their buying decision accordingly.

The not-so-obvious assumption of greenmarketing is that consumers will be willing topay more for green products than they

would for a less-green comparablealternative product


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Adoption of Green Marketing

There are basically five reasons for which a marketer should go for theadoption of green marketing. They are

Opportunities or competitive advantage

In India, around 25% of the consumers prefer environmental-friendlyproducts, and around 28% may be considered healthy conscious.There fore, green marketers have diverse and fairly sizeable segmentsto cater to.

The Surf Excel detergent which saves water (advertised with themessage"do bucket paani roz bachana") and the energy-saving LG

consumers durables are examples of green marketing.

We also have green buildings which are efficient in their use ofenergy, water and construction materials, and which reduce theimpact on human health and the environment through better design,construction, operation, maintenance and waste disposal.


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CHALLENGES OF GREEN MARKETING


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CHALLENGES OF GREEN MARKETING

1.How to define green

It is relative.

e.g.: McDonalds replaced paper hamburgerwraps with polystyrene clamshells.


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2.How to enlistconsumer support for lifestyle

changes necessary for greener behavior and

products.

While green products can often be less costly,

more convenient, or perform better than

alternatives, at times, theycan also be less

sanitary, less efficient, and less convenient.


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3. How to overcome

misperceptions and balance

environmental ills with

solutions.

Theycan pose significant

risks to industry, forcing

unnecessary andcostly

changes in products and

manufacturing processes.


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4.How to communicate without uniform guidelines for

environmental marketing terms.

There are currently no nationally accepted guidelines

for using environmental marketing claims for

advertising and product labeling.

This lack ofconsistency among industry, government,

and the scientificcommunity is confusing consumers

and is creating an uneven playing field.


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5.How to gain credibility and assert that the interests ofindustry do notconflict with greenness.

Industry is seen as creating the bulk of all pollution

andcontrolling most of the natural resources, but isnot perceived as having the necessary incentives toprevent further pollution or encourage cleanup. Thishas resulted in lowcredibility for industrysenvironment related messages.

E.g.: P&G


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6.Eco-Strategic Change Management Concept.

7.Marketing and Promotion of Green Products


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It is important to create

awareness among

consumers that there

are alternatives andthat even small

contributions that

involve little sacrifice

actually make adifference.


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Some Cases

McDonald's restaurant's napkins, bags are made of

recycled paper.

Coca-Cola pumped syrup directly from tank instead of

plastic which saved 68 million pound/year.

Badarpur Thermal Power station of NTPC in Delhi is

devising ways to utilize coal-ash that has been a

major source of air and water pollution.

Barauni refinery of IOC is taken steps for restricting

air and water pollutants.


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Introduction of CNG in Delhi

New Delhi, capital of India,was being polluted at a veryfast pace until SupremeC

ourt of India forced achange to alternative fuels.In 2002, a directive wasissued to completely adopt

CNG in all public transportsystems to curb pollution.


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Adoption of Green Marketing

There are basically five reasons for which a marketer should go for theadoption of green marketing. They are

Opportunities or competitive advantage

In India, around 25% of the consumers prefer environmental-friendlyproducts, and around 28% may be considered healthy conscious.

There fore, green marketers have diverse and fairly sizeable segmentsto cater to.

The Surf Excel detergent which saves water (advertised with themessage"do bucket paani roz bachana") and the energy-saving LGconsumers durables are examples of green marketing.

We also have green buildings which are efficient in their use ofenergy, water and construction materials, and which reduce theimpact on human health and the environment through better design,construction, operation, maintenance and waste disposal.


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Social Responsibility

Many companies have started realizing that theymust behave in an environment-friendly fashion.They believe both in achieving environmental

objectives as well as profit related objectives. TheHSBC became the world's first bank to go carbon-neutral. Other examples include Coca-Cola, whichhas invested in various recycling activities. WaltDisney World in Florida, US, has an extensive waste

management program and infrastructure in place.


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Governmental Pressure

Various regulations rare framed by the governmentto protect consumers and the society at large. TheIndian government too has developed a framework

of legislations to reduce the production of harmfulgoods and by products. These reduce the industry'sproduction and consumers' consumption ofharmful goods, including those detrimental to theenvironment; for example, the ban of plastic bags

in Mumbai, prohibition of smoking in public areas,etc.


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Competitive Pressure

Many companies take up green marketing to maintain theircompetitive edge. The green marketing initiatives by nichecompanies such as Body Shop and Green & Black haveprompted many mainline competitors to follow suit.

Cost Reduction

Reduction of harmful waste may lead to substantial costsavings. Sometimes, many firms develop symbioticrelationship whereby the waste generated by one companyis used by another as a cost-effective raw material. For

example, the fly ash generated by thermal power plants,which would otherwise contributed to a gigantic quantumof solid waste, is used to manufacture fly ash bricks forconstruction purposes.


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Green Marketing Mix

Green Marketing Mix

The 4 P's of green marketing are that of a conventional marketing butthe challenge before marketers is to use 4 P's in an innovativemanner.

Product

The ecological objectives in planning products are to reduce resourceconsumption and pollution and to increase conservation of scarceresources. The marketer's role in product management includesproviding product designers with market-driven trends and customerrequests for green product attributes such as energy saving, organic,green chemicals, local sourcing, etc.,

For example, Nike is the first among the shoe companies to marketitself as green. It is marketing its Air Jordan shoes as environment-friendly, as it has significantly reduced the usage of harmful glueadhesives. It has designed this variety of shoes to emphasize that ithas reduced wastage and used environment-friendly materials.


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PricePrice is a critical and important factor of greenmarketing mix. Most consumers will only be preparedto pay additional value if there is a perception ofextra product value. This value may be improved

performance, function, design, visual appeal, or taste.Green marketing should take all these facts intoconsideration while charging a premium price. E.g..Wal Mart unveiled its first recyclable cloth shoppingbag. IKEA started charging consumers when theyopted for plastic bags and encouraged people to shopusing its "Big Blue Bag".


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Promotion

There are three types of green advertising: -

Ads that address a relationship between a product/service andthe biophysical environment

Those that promote a green lifestyle by highlighting a productor service

Ads that present a corporate image of environmentalresponsibility

Place

The choice of where and when to make a product available willhave significant impact on the customers. Very few customerswill go out of their way to buy green products.


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Strategies

The marketing strategies for green marketing

include: -

Marketing Audit (including internal and external

situation analysis) Develop a marketing plan outlining strategies

with regard to 4 P's

Implement marketing strategies Plan results evaluation


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Conclusion

Green marketing should not neglect the economic aspect ofmarketing. Marketers need to understand the implications ofgreen marketing.

If we think customers are not concerned about environmentalissues or will not pay a premium for products that are moreeco-responsible, then we should think again. We must find anopportunity to enhance you product's performance andstrengthen your customer's loyalty and command a higherprice.

Green marketing is still in its infancy and a lot of research is tobe done on green marketing to fully explore its potential.


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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 assumeseven more importance and relevance in developing

countries like India.


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Green marketing is catching on in abig way. Marketers as well as

consumers are slowly but strongly

recognizing it. Awareness is being

created about the use of such

materials, which are helpful in

conserving the environment and are

eco-friendly. Green marketing isgaining prominence across the world

and in India too.

Documents

Unit 1 B- Green Marketing