How to be a trusted messenger on climate change

A recent study indicates that only 40 percent of Americans believe that they will be harmed personally by climate change. Instead, most of us view climate change as a phenomenon that will affect people in another region or a future generation.

Such detachment makes it challenging to motivate meaningful action to reduce climate change. Generally speaking, we are more inclined to act if we believed our personal well-being is threatened.

Such beliefs are not all that surprising, though, as most of us go about our daily lives insulated from changes that are happening in the natural world.

And, when we do experience Mother Nature’s wrath, we have a hard time telling whether human beings bear some of the blame. This is especially true when effects are transient. On one day, temperatures may set a record. On the next day, they swing back to within seasonal norms.

When we do experience Mother Nature’s wrath, we have a hard time telling whether human beings bear some of the blame.

Even extreme weather isn’t persuasive. Because storms are so familiar to us, we tend to discount evidence that climate change is increasing their intensity and frequency. Moreover, the passage of time makes it all but impossible for us to objectively compare any two events. And when we try, our memories easily can fool us, as it’s easy to exaggerate past events in our minds — extreme weather included. Remember, the fish grows bigger every time a fish story is told.

The local angle

Unbeknownst to most of us, however, climate change is already affecting our lives and our local communities. This impact tends to vary greatly by person and by region. Some of us have experienced only minor inconveniences, while others have seen our income, health or way of life compromised.

Here are a few examples:

• In Florida and along the Gulf Coast and Atlantic seaboard, drivers often find coastal roads not passable because king tides flood them even on sunny days.
• From Minnesota to Maine, moose hunters find the number of permits halved as populations decline. Warmer winters compromise moose survival by allowing ticks to gorge unchecked on their blood.
• In the Upper Midwest, allergies sufferers contend with allergy seasons that are lasting a month longer than before.
• In the Carolinas, commercial fishermen must steam hundreds of miles farther to catch local fish that have migrated north seeking cooler waters.
• In Alaska, homeowners find their foundations are no longer stable but tilting and collapsing as the underlying permafrost melts.
• In Louisiana, coastal property owners find their land no longer livable, but instead continuously flooded as sea levels rise. Now, residents are relocating to higher ground.
• In Montana, anglers no longer find trout at familiar places along the river, but upstream in cooler headwaters. Local guides lose money when streams are closed because warmer water temperatures put too much stress on the fish that remain.
• From New Jersey to Florida, home prices in flood-prone areas have fallen as flood insurance premiums rise. Investors across the country buy mortgage-backed securities that do not price in the risk that rising seas pose to coastal property values.

Despite these impact, many of us are not aware of their connection to climate change. Communicators have an opportunity to make that connection, and by doing so, motivate action to reduce climate change’s impact. Here are three ways how:

Local impact. Climate change already has caused harm to people in many local communities. Some recognize the impact, while others only sense that something has changed. Most do not yet attribute what is happening to a changing climate. Communicators have the opportunity to engage people about climate impact, particularly those living in affected areas. One way to do so is to contrast how things were before with how they are now, and explain the role that the climate has had in making this change happen.

Climate change already has caused harm to people in many communities. Communicators have the opportunity to engage people about climate change impact in local areas.

Trusted messengers. Climate change clearly has become a politicized issue. One way to overcome this is to tap messengers that are trusted across the political divide. For example, when it comes to the impact of climate change on human health, primary care physicians (PDF) enjoy significant public trust regardless of someone’s personal beliefs on the issue. Arguably, local guides, fishermen and others in the community whose livelihoods have been affected by climate change would make compelling messengers, too.

Broad storytelling. People who have been personally affected by climate change have a story to tell. Communicators should encourage everyone to share their stories on social media (tweet every time you witness climate change impact) or with neighbors. The more that we document the harm that climate change is having in our communities, the more compelling the message will be to those still on the fence.

Today, many of us have been personally harmed by climate change, although we might not recognize the cause. Communicators can best engage people if they focus on the impact that it has had in our local communities, and do so through a trusted messenger that transcends the political divide.

–Originally published on Greenbiz, 2017

What Green Businesses Can Learn from Obama’s Campaign

Although President Barack Obama ran a successful campaign and won a decisive electoral-college victory, the margin in key battleground states was slight. Indeed, a shift of 407,000 votes across four of them — Colorado, Florida, Ohio, Virginia — would have given Mitt Romney the 69 electoral votes he needed for victory.

Big data has been touted as key to Obama’s victory — and securing winning margins in swing states — by enabling the campaign to focus scarce resources on voters who could be persuaded to vote for Obama and, once persuaded, were likely to actually vote.

Critical to this effort was the Obama campaign’s recognition that voters may be demographically similar while at the same time strikingly different when it came to the issues that they cared about. As Dan Wagner, the campaign‘s chief analytics officer, told The Los Angeles Times, “White suburban women? They’re not all the same. The Latino community is very diverse with very different interests. What the data permits you to do is figure out that diversity.”

For the Obama campaign, a key to victory was to precisely understand which issue would be most persuasive to a voter’s choice and then microtarget like-minded voters with messaging that relayed the President’s stance on the issue and his action plan to address the issue going forward.

Underpinning this effort by the campaign was market research to determine the precise issue that most effectively influenced voter decisions — and which voters cared about which issues. The campaign also targeted known supporters, asking them to reach out to Facebook friends in swing states in hopes of influencing their voting decisions.

Such microtargeting is not limited to campaigns. Companies can also use this approach to identify and shape green brand preferences, and ultimately, purchase decisions. Here is how:

Focus on consumer persuadability. Politicians are known for boasting to voters about what they have done while in office and expecting voter support in return. This is similar to how many brands tout their green accomplishments today: more recyclable, safer chemicals, reduced material content. But, as in politics, such accomplishments may not be relevant to consumers, green or otherwise. Nor are they necessarily factors that influence brand preference and choice.

In contrast, the Obama campaign had a laserlike focus on the issues most associated with influencing voter decisions. Brands can learn from such an approach. By determining not only what consumers care about but also prioritizing messaging to focus on those needs most associated with consumer preference and choice, brands can have greater impact for a given investment. In each case, market research is required to reveal what cares or needs have the most influence on preference and choice and for which audiences.

Method’s recent Clean Happy video campaign illustrates such an approach. The campaign targets household decision-makers and focuses on a broad range of consumer cares and needs and how Method’s products deliver on each.

For example, one video titled “Clean Like a Mom” promotes Method household cleaning products that contain safer chemicals than traditional cleaners. But, instead of focusing exclusively on product attributes, the video highlights how Method products address specific consumer cares, namely, kids’ safety and the desire by moms to be perceived by their peers as doing the right thing. Presumably, Method did market testing and found out that with moms, these issues motivated greater brand preference and choice than alternatives.

Interestingly, green marketers can effectively influence consumer behavior even if consumers do not consider themselves to be green. One dramatic example comes from a Yale University/George Mason survey that segmented Americans based on their attitudes toward climate change.

The survey revealed that two consumer segments — the one most alarmed by and the one most dismissive of climate change — were the most future-oriented in terms of their outlook. Such attitudinal similarities provide a potential opening for marketers to try a more future-focused message when selling greener products to these segments despite their polar opposite views on climate change.

Be true to your brand. Some politicians try to reinvent themselves in order to tell voters what they want to hear. Arguably, this is similar to a brand that wants to engage consumers on green issues but is not currently perceived in the market as being green.

Brands do not necessarily have to be known for being green in order to be relevant to consumers. Instead, brands should tell their story in a way that is true to their existing brand positioning.

Unilever’s Axe is a great example. Known as an irreverent brand that uses the sex appeal of its products to drive sales, Axe launched its “ Showerpooling” campaign to engage its customer base on the issue of water conservation. The platform uses showerpooling — sharing showers — not only as a way to grab attention, but to make it relevant with the audience. The campaign jokes: “It’s not just environmentally friendly … it’s all kind of friendly.”

Target microsegments. The Obama campaign identified microsegments through research and projected these against a database of registered voters in a nationwide effort to influence voter choice. Of course, marketers could develop their own database by encouraging consumers to sign up for ongoing communications from a company.

But, even without a database, marketers can certainly target microsegments online. This can be done by targeting green consumers on contextually relevant sites, retargeting those visitors elsewhere online or by partnering with a demand side platform to identify and target audiences with like-minded profiles regardless of where they go online.

Turn loyalists into influencers. The Obama campaign successfully tapped its supporters to motivate friends in swing states to vote. Similarly, advertising campaigns should activate loyal customers to serve as influencers and advocates for the brand. Method deployed a similar approach in its recent campaign by distributing fun videos through social sites such as YouTube and Facebook and providing incentives for viewers to share them.

The Obama campaign demonstrated the power of microtargeting to influence voters, and arguably, affected the outcome of the election through this technique. Obama’s success was bolstered by focusing on specific issues most influential with specific voters, rather than a more general message. Such a campaign provides many lessons for green marketers — as well as the opportunity to take a similar approach to drive adoption of green products.

How to Grow Consumer Attachment to Green Brands

Marketers work hard to create an emotional link between consumers and the brands those marketers promote. But that kind of attachment is not easily won and must be nurtured over time. Experts say one way to create that emotional link is by aligning a brand’s identity with the consumer’s sense of self; that is, with a person’s understanding of who they are and what they want to be.

But which sense of self are we talking about? The actual one based on how consumers perceive themselves today – or the ideal one based on who they aspire to be? Answering that question has profound implications for brands, including green brands, in terms of how they should build brand attachment with consumers.

Lucia Malär, an assistant professor of marketing at the University of Bern’s Institute of Marketing and Management, and several of her colleagues recently published an article in the Journal of Marketing that explores the relationship between the consumer’s actual and ideal sense of self. While this academic study did not directly address green brands, there are important lessons green marketers can take away from it.

According to the paper, consumers generally form greater emotional attachments with brands that align to how consumers view themselves, rather than what consumers aspire to be. For green brands this is not a trivial consideration — especially when you consider that, for many consumers, the notion of being green is a goal they aspire to.

Malär et al. identify three attributes that have a significant impact on consumer attachment: the degree of product involvement, the level of consumer self-esteem and the propensity for public self-consciousness. Here are some thoughts on how these characteristics can help green marketers better engage consumers:

Product Involvement. The paper defines product involvement as a consumer’s engagement with a product, largely determined by how relevant consumers perceive that product to be in their lives.  Malär et al. observe that highly engaged consumers have a positive emotional attachment with brands that align to their actual sense of self, while less engaged consumers have positive attachment with brands that focus on consumers’ ideal sense of self.

At the same time, it’s not necessarily true that less eco-engaged consumers will respond positively to brands aligned to their ideal self. While consumers may be aspirationally green, they simply may not be familiar with the products that can help them achieve this aspiration.

Green marketers might first need to educate consumers about green brands before those brands can become relevant in their lives. One powerful tool is to communicate a goal-driven message around green products, while showcasing their actual use by people that consumers can readily identify with. That’s what Mitsubishi did when it created a demonstration program for electric car technology in the town of Normal, Ill.

Self-Esteem. Malär et al. say consumer self-esteem is an essential part of emotional brand attachment — as consumers seek out brands that reinforce or enhance their own perceptions of self worth. This means consumers with higher self-esteem have a positive emotional attachment to brands that reinforce their actual sense of self. At the same time, consumers with lower self-esteem have positive emotional attachment with brands that enhance perceptions of their ideal sense of self.

Given the relative newness of green as a branding category, it may make sense for green marketers to interpret self-esteem as a consumer’s confidence in their ability to make greener choices that are right for them. When engaging green-confident consumers, brands might therefore want to emphasize evidence that confirms the consumer’s self view.  For example, green brands should praise consumers for taking eco-friendly actions.

In contrast, when engaging less confident consumers, a brand may want to shape the perception of what it means to be a greener product, and to actively facilitate their purchase. Such brands might want to show consumers what they could achieve with these products, and provide a roadmap for them to get to their goals.

Patagonia provides a great illustration of this through its Common Thread Initiative.   While most companies market only new products, Patagonia launched a “Buy Less” campaign — to shape consumer perceptions regarding responsible consumption: reduce, repair, reuse and recycle. The campaign reinforces its point by actively facilitating the buying and selling of lightly-worm merchandise from Patagonia through eBay.

Public Self-Consciousness. Professor Malär and her colleagues identify public self-consciousness as a consumer’s awareness of how others perceive them. People with high public self-consciousness have a positive emotional attachment to brands that focus on consumers’ actual sense of self, while those with low public self-consciousness have a positive attachment with brands that focus on consumers’ ideal sense of self.

Green marketers should take advantage of this factor by providing ways for consumers to receive public accolades for eco-friendly behavior. One way might be to embed gaming elements such as badges, points and leader boards into networked products.

Reward companies such as RecycleBank and Practically Green have already made gamification a core part of their offerings. Moreover, car companies such as Ford and Nissan have begun to incorporate similar concepts into the dashboards of their hybrid vehicles to reinforce eco-friendly driving behaviors.

Alternatively, brands can encourage the use of social media apps, like the one Opower recently launched, can enable consumers to share and compare energy savings.

It’s interesting to note that, while Malär et al. address emotional brand attachment, they do not tackle rational brand attachment. But such an attachment can be an important brand driver for consumers — especially when products have a direct and measurable impact on the environment. As such, when it comes to green products, rational brand attachment has the potential to amplify the emotional.

One emerging example of how to cultivate rational brand attachment is the Obama Administration’s Green Button initiative.  This program will provide millions of consumers with access to their energy data. It might also spark the development of innovative ways to leverage that data, in an effort to motivate consumers to reduce their energy use.

Brand marketers face considerable challenges in establishing and nurturing brand attachment. Those attachments not only require an assessment of brand identity, but also exploring the mindset of the intended consumers — that is, how they actually perceive themselves today or ideally in the future. Green marketers can take advantage of this relationship by aligning their brands to the mindset that best promotes eco-friendly behaviors by consumers.

Three Lessons for Fulfilling on a Green Brand Promise

When it comes to the environment, consumer behavior can be inconsistent or even a bit hypocritical.  Two-car families will buy a hybrid and a gas guzzling SUV.  Parents will teach their kids to turn off the water while brushing, but take a few extra minutes in the shower to enjoy the peace and quiet.  Somehow, we tend to overlook our own inconsistencies, while holding others accountable for their actions.

Perhaps, then, it should not be surprising that consumers tend to be less forgiving of a brand’s missteps than their own.  They are quick to assume green washing regardless of good intensions.

Why is it that consumers hold green brands to a higher standard than they do themselves?

It is not an easy question to answer.  Certainly, as human beings, we have a harder time taking stock of our own actions than another’s.  But, the distinction goes further.

First, consumers turn to brands as a form of self-expression based on who they are today, or who they ideally want to be.  For consumers to do so, brands need to clearly articulate what they believe in and be consistent in how they express these beliefs.  Arguably, this is especially important for green brands, as most mainstream consumers tend to be less familiar with them or how they benefit the environment.  As a result, consumers tend to rely more heavily on green brands for guidance when making purchase decisions.

Second, consumers expect green brands to deliver on promised reductions in environmental impact.  When they don’t, consumers feel disappointed that expectations are not met, or frustrated because, despite good intensions, they are not able to make a positive impact that they anticipated.

A recent personal example:

For the past year, I have turned to OZOcar, the eco-friendly car service, to help me reduce my eco-impact from business travel.  On one recent occasion, OZOcar ran out of cars and farmed my ride out to one of several livery companies in its network.  Instead of a Prius, the vehicle that arrived was a gas-guzzling Suburban.  An eco-friendly car service providing about the least eco-friendly ride.   In marketing terms, the Suburban was off brand.

While this was not part of my typical experience with OZOcar, it offered clear lessons for all brands:

Be clear about what a brand promise is and isn’t.  Brands should set clear expectations about their brand promise.  For example, it is not unreasonable for a small company like OZOcar to send a gas-powered substitute – preferably a sedan instead of an SUV – when its fleet is being fully used.  That said, brands should clearly set expectations upfront so that consumers know what to expect and are not free to interpret perceived (or actual) inconsistencies in their own way.

Fulfill on a brand promise, or modify the promise.  A customer service manager at OZOcar did offer to change my individual profile to state that I did not want to be picked up in an SUV.  I asked if they would consider changing their policy so that their network would not send SUVs to any OZOcar customers.  They said that they would look into it.

Know how consumers perceive a brand. What matters most is not what a brand says about itself, but how consumers perceive it.  As such, marketers should stay abreast of how consumers perceive their brand by soliciting feedback during customer interactions or monitoring (and perhaps joining) online conversations in social media.  This will enable a brand to quickly adjust its messaging – or its offering – to reinforce its brand promise.

Pay-As-You-Go Pays for the Environment

Pay-as-you-go (PAYG) is emerging as a winning consumption model for the environment. It does so in two ways. First, by charging for incremental use, PAYG discourages overconsumption often associated with flat rate pricing. Second, it incentivizes shared use of resources during peak periods in order to avoid excess investments in capacity that would otherwise be underutilized for much of the time.

In recent years, several PAYG models have emerged that are having a positive impact on the environment. For example, smart grid initiatives provide consumers with tiered pricing models that incentivize them to reduce or shift energy use during peak periods. Additionally, PAYG models in cloud computing allow consumers the flexibility to add computing capacity in real-time, while avoiding the need to overinvest in server capacity utilized only during peak periods.

This month, another consumption model got a big boost when the California Insurance Commission approved the launch of PAYG car insurance in the country’s largest car market. Beginning in February, 2011, California residents will be able to purchase insurance from State Farm and the Automobile Club of Southern California and pay based on how much – and how safely – they drive. The less they drive, the less they pay.

Such a model is enabled through the tracking of personal driving data. Consumers self-report miles driven (and validate periodically through inspection) or do so automatically through an active OnStar system or small telematics device that plugs into a diagnostic port under the dashboard. Insurance companies then effectively create personalized rates based on actual car use.

Potential benefits for the environment from PAYG are significant: The State of California estimates that subscribers may reduce miles driven by 10% or more, saving consumers money while reducing accidents, congestion and air pollution.

A wide variety of companies are now in a position to consider testing PAYG models with their customers, especially those that are price sensitive, tend to use a product less than the average or demand additional services during peak periods. While consumers may focus on saving money, the real benefits may be saved for the environment.

Green Brand Leadership: a Fish Story

The customer is always right – so goes the mantra of every sales rep from time immemorial. But, as we know, what customers want may not be best for the planet. For some brands, this presents a dilemma: how do you satisfy consumer needs while remaining eco-responsible?

The dilemma can be quite daunting for a brand, especially if the eco-impact is caused by lifestyle choices consumers are long accustomed to. This challenge is only compounded when consumers are not yet aware that their very actions are having a detrimental effect – as no brand wants to be the bearer of bad news. Or, perhaps more challenging still, brands may find that the very behaviors and rituals that help define a brand itself turn out to perpetuate the very actions that are having a negative impact.

Whose responsibility is it to promote more sustainable consumer behaviors?

Many brands would say, it is the role of governments to regulate – and if they don’t, a corporate entity is not accountable for their failure to act. Others would say that it should be left to the discerning buyer. Should a brand itself take the lead? Some may argue yes. It is a demonstration of brand leadership, they say.

But, being out ahead of one’s customers may serve brands well only when their customers expect them to do so. Staking out a leadership position appeals to customers that want to know that they are doing good through the choices that they make.

Others may argue no. Brands sell products, not morality they might say. Worse, eco-responsible messaging may be antithetical to the experience a brand is trying to create. It is hard to enjoy pleasures guilt-free if one is constantly reminded of the impact that one is having on the planet.

But, regardless of where one nets out on this issue, one thing is clear: today, brands are increasingly left with little choice but to act – or react – whether or not their actions directly influence customer purchase decisions. Advocacy groups as well as individuals are leveraging the power of the media (and social media) to broadcast and amplify their voices to sway popular opinion.

Whether viewed as an opportunity to demonstrate leadership or take a defensive stance, it is likely that more and more brands will have to make such choices.

One example of such tension between brands and eco-decisions recently appeared in the New York Times Magazine article by Paul Greenberg, “Tuna’s End: The Fate of the Bluefin, the Oceans and Us.” (June 27, 2010), As Greenberg writes, Nobu, the internationally acclaimed sushi restaurant chain, faces a decision today over the selection of seafood that it serves.

The Atlantic Bluefin Tuna – a prized fish for sushi and sashimi – is now endangered. Continued commercial fishing may push it to extinction. Further, the timing of the BP oil spill in the Gulf likely exacerbated the situation by polluting one of two known breeding grounds in the Atlantic for these fish right as mating season was to begin.

Today, Greenpeace is pressuring Nobu – in large measure because it is a category leader – to no longer serve Bluefin to its patrons. Nobu has resisted. Nobu co-owner Richie Notar noted, “The Japanese have relied on tuna and other bounties of the sea as part of their culture and history for centuries. We are absolutely appreciative of your goals and efforts within your cause, but it goes far beyond just saying that we can just taken what all of a sudden has been declared an “endangered” species off the menu. It has to do with custom, heritage and behavior.”

Arguably, Nobu’s brand identity emanates from a careful balance of adherence to the tradition and ritual of sushi – its creation, its presentation, its consumption – and hip appeal: swanky ambiance, innovative food creations and celebrity ownership. Out of balance, the brand does not deliver on the experience consumers have come to expect.

With this balance in mind, Nobu has tried to stake out a middle ground by updating its menu with the following message: “Bluefin tuna is an environmentally threatened species. Please ask your server for an alternative”

Such a simple message informs patrons of the issue and then let’s each consumer make their own choice. Additionally, such phrasing invites a dialogue between the patron and server regarding food substitutes, though it is unclear as to how many patrons would be inclined to do so.

What Nobu has missed, however, is an opportunity to leverage this situation to evolve its brand appeal – keeping the balance between tradition and hip appeal while elevating each to the next level.

Nobu could find an alternative to Bluefin tuna and not jeopardize the brand, but arguably reinforce consumer perception of Nobu as hip and trendy. Greenberg asserts that what Nobu needs is a new substitute for tuna. As part of his research, he went searching for a Bluefin substitute and may have found one in a fish known as kahala. Arguably, Nobu is missing an opportunity to be one of the first to introduce kahala across its menus, reinforcing its trendy image.

Ironically, by introducing such a substitute, Nobu would not be breaking with tradition, but rather, returning to it, as Bluefin was not widely popular in sushi until just 30 years ago. It was nowhere to be found in sushi before 170 years ago.

Thus, shifting away from Bluefin and offering consumers a tasty substitute could actually enhance Nobu’s reputation for seeding new trends while maintaining close adherence to the tradition of sushi.

In this case, what is good for the brand may actually be good for the planet.

‘The Cycle’ at RecycleBank

Over the summer, I decided to move on from Digitas after four and a half rewarding years with the company and made green my full-time job. I now work for a venture-backed company called RecycleBank on their business development team. To say life at an early-stage company has been busy is an understatement, and Marketing Green readers have probably noticed a drop off in my blog entries over these past few months.  That is not a coincidence, and rest assured, I expect to be back with more routine entries on green marketing themes shortly.

 

A few words on RecycleBank by way of introduction. RecycleBank is a socially responsible company that makes money by doing good for the environment and local communities in which we operate. Our core business model is quite simple: we provide incentives for people to recycle more. And at the risk of sounding biased, our model’s pretty darn efficient. Wherever we deploy, we’ve been able to drive recycling rates through the roof.

 

Now that my current role allows me to practice some of what I’ve preached on this blog, I wanted to highlight a viral campaign we’re launching. In honor of National Recycling Day this Saturday, RecycleBank has launched The Cycle, a compelling video series that focuses on how materials are separated and reprocessed back into useful raw materials. 

 

 

Today, there is more and more emphasis being placed on cradle-to-cradle material use.  The Cycle provides an engaging and accessible story of how it is all done.    Click here to view the rest of the The Cycle series.

Green May Be Ho-Hum for the Holidays, But It’s Here to Stay

So far, this holiday season has seen a rather muted push on green by retailers, both in terms of the products they sell and the messages they communicate to consumers.  Marshal Cohen, Chief Industry Analyst at NPD Group, recently suggested that such lack of enthusiasm by retailers reflects waning interest in green.  Cohen stated: “It’s basically a card that a lot of people played while it was hot and trendy…and it got overplayed.”  

Indeed, early signs suggest that retailers left their Birkenstocks home for the holidays.  While most retailers are taking steps to green their operations and supply chains, few have taken steps to green the shopping experience.  Reuters recently reported that retailers such as Target, Wal-Mart and J.C. Penney recognized green as a trend but does not have plans to promote green merchandise this holiday season  (Barneys is apparently a notable exception).  A spokesman for J.C Penney added: “It’s something that is growing in importance with the customer…[but it’s in] its early days.”  

But, could it be the case that after so much hype early in the year, the green trend has faded just as it was getting off the ground? 

Marketing Green believes just the opposite: as a trend, green is just getting started.  Quite simply, the apparent lack of enthusiasm shown by retailers this holiday season reflects the fact that we are still early on the adoption curve.  Here’s why: 

Green products popular today are not necessary gift ready.  Green products that have been adopted by the mass market – including compact florescent light bulbs and hybrid cars – may not make the best stocking stuffers.  Moreover, unlike organic foods, clothes made from organic cotton have not been adopted by the mass market yet.  As such, it is not surprising that we do not see a sudden surge in demand for these items this season. 

Consumers may not equate green with spreading holiday cheer.  When it comes to giving a gift that is overtly green, consumers may worry that they may be perceived by friends and family as the Grinch.   While social norms are changing, being green today is still in many regards a personal virtue rather than societal expectation.  As such, gift-givers may fear that giving a green gift may be perceived by recipients as politicizing the holidays.   

Retailers fear being accused of greenwashing.  Today, few standards are in place to determine how green is green.  Without them, retailers are left to their own devices to determine what is eco-friendly – and, as a result, are left exposed to criticism by outsiders who may think otherwise.  As such, many retailers today are focused more on greening their internal initiatives than greening specific products. 

While interest in green may wax and wane, marketers must remember that we are still in an early adoption cycle for green.  Regardless of how successful this season is for green, as a trend, green is here to stay.  In fact, there are five global influencers that will ensure that as a trend it grows, spreads and matures.  

Changing physical environment.  While the melting of the ice caps may still be an abstract concept for most, consumers are beginning to experience erratic weather patterns that are likely – though not certainly – being caused and/or exacerbated by global warming.   Indeed, Oxfam recently reported that weather-related natural disasters have increased four-fold over the past two decades while geologic-related ones (eg, earthquakes, volcanoes, etc) have remained steady.   Such visible signs will likely increase and intensify with time, providing a constant reminder that something in our world is not in balance.   

Increasingly concerned consumers:  In the US today, consumers have a high awareness of climate change as an environmental concern, but arguably relatively low awareness of the severity of its impact – especially on the poor who are least responsible for its cause but most vulnerable to its adverse affects.  As Hans Verolme, Director of Global Climate Change Programmes for World Wildlife Fund stated, “There’s no escaping the facts: global warming will bring hunger, floods and water shortages.”

Marketers should be prepared that such a realization may cause a sea change in how American consumers view the brands that they purchase.   Americans may be voracious consumers, but they do not like to do so at other people’s expense.  As a consumer issue, therefore, climate change mitigation may be similar to enforcing fair labor laws or worker safety practices  – it is just what you do or risk a backlash from consumers. 

Leadership by business: Some may find it surprising that many global corporations are strong proponents of action on climate change.  Indeed, 150 leading companies – including US multinationals Coca-Cola, GE, Nike, Johnson & Johnson and Sun Microsystems – have already signed a communique on climate change and presented at the UN conference this month in Bali that calls for legally binding targets for carbon emissions. 

So why would global companies lead the charge?  Corporations know that mandates on carbon emissions are inevitable.  The sooner government acts to set acceptable carbon emission levels, the faster business can respond and plan for the future – by modifying capital investment decisions or commercializing new products, for example.  

Moreover, once global emission caps are put into place, standards will be developed within each product category that determine how green is green.  Without standards today, companies decide for themselves to what level they should green their products.  In this situation, the burden is on the consumer to decide how competitive products stack up while leaving well-intentioned companies vulnerable to greenwashing accusations by critics that disagree with their claims. 

Where standards have emerged though, green products have taken off.  One great example is the creation of the Leadership in Energy and Environmental Design (LEED) certification that set standards for green buildings.  The result: 20% growth in green buildings in 2005, followed by 30% growth in 2006.    

Watchdog role of Non-Governmental Organizations (NGOs):  In many ways, NGOs serve as watchdogs for industry on environmental issues.  Today, such organizations enjoy increasing clout, fueled by increased membership and financial backing over the past few years.  More than ever, NGOs are flexing their muscle by challenging corporate activities that they deem as destructive to the environment or deceptive to consumers.   

Interestingly, even companies that are viewed as leaders on green do not get a pass by NGOs when activities are deemed inconsistent with their competitive positioning on green.  For example, despite (or as a result of) earmarking a combined $70 billion toward green investments and loans, both Bank of America and Citigroup were recently the target of a grassroots campaign by Rainforest Action Network to the fact that these banks also fund coal-fired plants, a primary contributor to global warming.    

Today, consumers can also serve as watchdogs as well by rating corporate green activities through sites such as Greenwashing Index, Do the Right Thing and Climate Counts.    

Involvement by governments: Today, there is growing global support for action on global warming.  Signs of this momentum are perhaps nowhere more prevalent than in the US and Australia – two countries that have long been holdouts for global action.  Over the past couple of weeks, there has been a sea change in Australia, as Kevin Rudd, the newly-elected Prime Minister, signed the Kyoto accord as one of his first acts of government.  Moreover, the US Senate Committee on Environment and Public Works voted last week for an ambitious 70% reduction in carbon emissions by 2050.   

So, marketers should take note.  Early signs are that green may not bring holiday cheer to retailers. Nonetheless, green marketers should remain steadfast.  Though consumer focus on green may fluctuate, green as a trend is here to stay.  Five key influencers will not only ensure that is the case but accelerate its growth over time.   

Greening Consumption

An Interview with Michel Gelobter, Founder and EVP of Cooler

Long-time environmental activist Paul Hawkins once described “green consumerism” as an oxymoron.  Indeed, “green consumption” makes Wikipedia’s “List of Genuine Oxymora”.   The reason: consumption by its very nature has an impact on the environment – to some degree or another – and therefore, is hard to call truly green.

 

Yet, short of reducing consumption, many consumers, manufacturers and retailers are focusing on greener consumption – a term which implies shifting to products and services that have a lower environmental impact, though in many cases, not specifying by how much.

 

Today, there are positive signs that demand for greener products is increasing sharply.  In fact, the Natural Marketing Institute reports that the $200+ billion Lifestyles of Health and Sustainability (LOHAS) market is expected to double by 2010 and quadruple by 2015.  

There are many online retailers and content sites that offer green products directly or simply help consumers navigate the market.  They include three primary categories:

Green online retailers: Many online retailers have emerged that are dedicated to serving the green market including Buy Green, Earth Friendly Goods, Eco Choices, EcoWise, Gaiam, Green Feet, Green Home, Green Shop (UK), Green Shopper, Green Shopping (UK), Green Store, Indigenous, Natural Collection (UK), Nigel’s Eco Store (UK), Rogue Natural Living, Shop Green (PriceGrabber), The Green Office and VivaTerra among others.

General online retailers. Several general merchandisers and portals have embedded a green section into their existing offering, including Amazon and MSN among others.

Green directories: Finally, other online sites have positioned themselves as green directories, product search engines and shopping guides.  Sites include EcoBusinessLink, EcoMall, EcoSeek, Evolvist, Evolve Shopping, Green Deals Daily, Great Green Goods (blog), Green People, Green Providers Directory (UK), Green Shopping Guide (UK), Guide Me Green (UK), Haute*Nature (blog) National Green Pages, Pristine Planet, and TheFindGreen among others.  Perhaps the most comprehensive guide to online eco-friendly shopping is published by thepurplebook. 

Yet, despite this growth rate, LOHAS spending is still a drop in the budget when it comes to US consumer buying power – estimated at more that $10 trillion in 2007.  As such, the greater challenge is to shift spending on mainstream products to greener ones and do so in a way that also provides the incentive for mainstream manufacturers to reduce the carbon footprint of their products over time.

There are many ways to motivate the purchase of greener products across the purchase funnel.  Here are a few examples:

Make existing products greener.  Product companies have the opportunity to green their products – including sourcing, use and disposal.  Greening a product in the first place, of course, is the best way to reduce its environmental footprint.  Companies are motivated to do so for a variety of reasons including increased consumer demand, pressure from partners across the supply chain and risk to the brand simply by being complacent.

One of the best examples is Wal-Mart.  For example, it has identified $10 billion in potential savings simply by decreasing product packaging.  It has also required its suppliers to reduce the environmental impact of the products that it sells (eg, more concentrated laundry detergent formulas reduce the use of energy for transportation) while expanding the market for others (eg, by selling fluorescent bulbs at lower cost under its own private label). 

Due perhaps, in part, to Wal-Mart’s pressure and lead, Procter & Gamble has responded with a commitment to sell $20 billion worth of greener products over the next five years.  It has also joined the Supply Chain Leadership Coalition, an industry organization that pressures suppliers to publish information on carbon emissions, to help it reduce the impact of its suppliers as well.

 

Motivate greener choices.  Product companies and retailers can influence behavior by interjecting green as a considered attribute in the purchase decision.  There are several ways to do so including the use of eco-labels, ratings, promotional benefits or green rewards tied to a loyalty program.  Eco-labels and ratings impact consumer purchase decisions by providing relevant environmental information at the point of sale – and indirectly motivate greener product design and manufacturing decisions by making green a differentiating attribute. 

 

Today, eco-labels are actively being used or under consideration by manufacturers, (eg, HP, Dell), retailer (eg, Wal-Mart, Home Depot) and government regulators.   Moreover, several organizations have taken the lead in developing or aggregating green rating systems including Green Seal, Consumer Report’s Green Choices, the US EPA’s Energy Star and independent Better World Shopper.  Moreover, sites like Alonovo allow users to filter products based on their own green values.

 

Promotional benefits and rewards can also influence consumer purchase behavior.  Marketing Green explores both of these levers in two previous blog entries. (“Green Labels as Drivers of Consumption and Loyalty Programs”, March 19, 2007; “Testing Green Promotional Benefits to Drive Acquisition”, September 16, 2007).

 

Offset environment impact.  Today, more and more companies and consumers are turning to carbon offsets (and renewable energy credits or RECs) to mitigate the environmental impact of products manufactured or purchased.  While the offset mechanism may vary – from purchasing allowances on a carbon exchange to investing in renewable energy projects – the effect is similar: offsets reduce the carbon impact of consumption by effectively removing the equivalent amount from the environment elsewhere. 

 

While carbon offsets are not without controversy, they can be a powerful way to mitigate the impact of consumption.  There are several ways that carbon offsets are purchased today:

 

First, carbon offsets can be voluntary.  Retailers can provide options to do so – as most airline sites do today, for example – or consumers can purchase them directly from many brokers including Atmosfair (Germany) Better World Club, Carbon Fund, Carbon Leaf (UK), Carbon Zero (Canada), Climate Care, Climate Counter, Climate Friendly, ClimatMundi, CO2 Balance, My Climate, Native Energy, Offset Carbon Company (UK), Offsetters (Canada), Solar Electric Light Fund, Sustainable Travel International, Target Neutral (UK), Terrapass, The Carbon Neutral Company, TreeBanking, and Uniglobe Travel among others. 

Typically, retailers play no more than a passive role in facilitating carbon offset purchases by providing the mechanism to do so on their site.  In many cases, it is no more than an additional option available during the check-out process.  The case of Virgin Atlantic is different, however; in response to low voluntary purchases, Virgin is now actively selling carbon offsets to customers while in-flight.  Sunvil Holidays (UK) goes one step further by putting the burden on the consumer to opt-out of – rather than opt-in to – purchasing a carbon offset by embedding it directly into the cost of its vacation packages. 

Second, carbon offsets can be structured into the transaction itself – treated as a promotional expense, embedded in the purchase price or covered as part of the transaction fee.  Companies as diverse as insurance giant Allstate, UK’s Silver Jet and Fiji Water are making their products carbon natural (or even carbon negative) as a way to differentiate their offering.  In this case the product company is absorbing the cost directly or raising its price to cover the added expense. (Interestingly, Allstate is offering to offset the carbon emissions from the automobiles that it insures).

 

Alternatively, credit card transaction fees can be used to offset carbon emissions as well.  Recently, issuers including Barclays, GE, MetaBank, Triodos Bank and Wells Fargo have launched green cards while Bank of America and upstart Brighter Planet have announced their intentions to do so.  These cards divert a portion of their fees to mitigate the impact of the products purchased through a donation to a non-profit organization or direct purchase of carbon offsets. 

 

Such card programs have advantages and disadvantages.  Given their reach, credit cards can green a significant amount of consumer spending simply by providing the incentive to consumers to make their purchases on a card with green benefits.  Yet, to do so, cardholders must trade in personal benefits earned from traditional reward programs (eg, airline miles) for ones that provide more societal benefits.

 

Alternatively, a promising, new retail model has emerged that divert a portion of revenues earned through affiliate marketing programs to pay to offset the carbon from products purchased.  In doing so, sites such as Cooler and Earth Moment enable consumers to purchase products from traditional retailers while offsetting the carbon impact of these purchase in the process.  Such a model is compelling to consumers as, from their perspective, the cost of the carbon offset is absorbed by the retailer and they can green their purchases while using their existing credit cards. 

 

While numerous companies are involved in carbon offsetting, Cooler has clearly been one of the most innovative players in the space.  Distributing 8 million products from 400 retailers, Cooler provides consumers with the largest selection of products that can be purchased with an embedded carbon offset.

 

Recently, I had the opportunity of sitting down with Michel Gelobter, Founder and Executive Vice-President at Cooler.  We discussed the recent launch of his company, its B2B and B2C offerings and the challenges that we all face in greening consumption.  Here are his words:

Marketing Green:  By offsetting the carbon impact of products purchased, Climate Cooler has the potential to change the game in the online retail space.  What was the impetus for starting the company? 

Cooler:  We wanted to find ways to create the momentum in the consumer space for taking action on climate change.  That exploration led to what has now become Cooler.  Cooler is distinguished by being the first site where you can purchase practically anything you can buy on the Internet – except for maybe a plane ticket – in a way that eliminates the global warming impact through the point of sale.   

Our mission as a company is to connect every purchase with a solution for global warming.  We do that with three offerings.  The first is that we use the country’s only product and service carbon calculator that was developed jointly by Carnegie Mellon and Berkeley.   

MG: Does it calculate the entire impact of the product, that is, how it is manufactured, used and disposed of? 

C: It is just to the point of sale: how it is manufactured and transported.  But, the innovative piece is that it adds the retail component which ranges usually from 20-30% of a product’s carbon footprint. 

MG: How about shipping? 

C: Yeah, it includes that too.  But [the environmental impact] tends to be much lower which can be a surprise to our customer base. 

The second piece of this offering is our basket of carbon offsets or pollution prevention and renewable investments that have been unanimously approved by the world’s best environmental organizations.  And finally, we set out to create a basis on which consumers could take action in a way that was trusted and transparent.  And that is what Cooler is about.   

We also give people a way to track their impact and start thinking about carbon budgeting.  We already have the My Impact page which tells [consumers] what they are emitting.  After all, 40% of the average American’s carbon footprint is in consumption of goods and services.  

MG: So do you view part of the value that you bring is educating consumers on their true environmental impact? 

C: In the consumer space, absolutely.   

The bigger piece of the business is really the B2B offering.  Companies started coming to us and saying: “How can I put your works into my gears so when people come to my website – or bricks and mortar store – they can get a carbon neutral product.”

Our B2B offering is called Cooler Compete which is basically a way for companies to know, offset and reduce the global warming impact of the products that they sell.  And the difference is that those companies are going to make a choice about who pays for [the offset].  We think that most of our business customers are going to absorb the costs of carbon neutrality. 

MG: What services are you providing in the B2B space? 

C: First, we are providing the [carbon emission] calculation.  Our calculator is really revolutionary.  We are using a method that is, on average, more accurate [than existing calculators].  It is based on an approach called economic input/output analysis, whereby we calculate the footprint of a product directly through the economy.  Instead of looking at a shoe and saying “where did that leather come from?”, we say “how much of the leather industry did this company use?”.   

Peer-reviewed studies show that this method is, on average, more [inclusive] from an environmental perspective because it includes more of the carbon footprint than [other] analysis. 

The second service is really a reduction service, that is, a list of the top contributors to your carbon impact.  That is usually enough to motivate companies to bench mark against those numbers and reduce their impact.  

Finally, companies buy offsets with us.  We don’t actually make any profit from our offsets – we pass the costs directly through.  But our basket of offsets is very high quality.  

MG: You are ambitious in trying to serve two different audiences with very distinct offerings. 

C: Yes, but the website in some sense can be seen as a technology showcase.  The web site gives [companies] the sense like “Oh, this is what it could look like.”  So that is why the website is really critical.   

MG: In your B2C work, who is the typical customer that you are targeting? 

C: We are partnering with environmental organizations so our early go-to-market strategy is [targeting] the members of our partner organizations.  Now we are trying to move from the environmental group members to more of the LOHAS crowd.  Over time, we will target a broader and broader swath of the American public as more people become conscious of this issue. 

MG: How important is viral to your marketing strategy?

C: Viral would be great.  Right now, we are honing our technology platform to make that more potent.  For example, when you tell a friend, we are able to report back to you how much your friends offset.  We can also have people compete to see who is more carbon neutral.   

MG: How does the B2C business model work?  Is it an affiliate model? 

C: It is.  On average, if we refer someone [to an online retailer that subsequently makes a purchase], we get 6% [of the total sale].  The cost of the [carbon] offset ranges from 0.7 to 1.5% and we keep the rest for the business. 

MG: Are there plans to offset carbon emissions from the use and disposal of the products that you sell? CC: We do not have any plans to address that now. MG: How receptive are consumers today to carbon offsets? 

C:  I think we are easily 10 to 20 years out from having a stable, trustworthy, well-defined commodity market for offsets.  One of the reasons we partnered with the environmental groups is to give consumers assurances that at any moment in time, the best decisions are being made.  

MG: Do you think offsets take on more meaning when the US market moves from a voluntary to a mandated cap and trade system? 

C: No. I think personally that people need to take action now.  Our offsets are additional so they are already above and beyond everything done today.  We follow three criteria that are summarized as follows: real, additional and positive. 

“Real” means that we are taking carbon out of the atmosphere when you buy something.  We are not just meeting the next increment of energy demand with cleaner energy.  We’re actually capturing or reducing an emission somewhere else in the world, hopefully in the United States.   

“Additional” means that this would not have happened where it not for your purchase.   And “positive” means doing more for the world than just helping the climate.  It means helping to create jobs or generate more environmental protection or biodiversity. 

It is going to be a long time before governments are actually cutting emissions by 80%; by 2050, unfortunately.  Until that time and maybe well beyond it, we want to be the place where consumers can know that by acting their doing their part above and beyond what government is doing.  

MG: It is conceivable that your success could provide incentive for others to enter the market and that one day, offsets will simply be a threshold to compete? 

C: Of course, we would love it as a company and a social event if this became a must have.  And we are going to do our best to make sure that happens.  That is one of the reasons why we started the company. 

MG: Will this actually help solve global warming? 

C: I absolutely think it’s a huge part of the solution.  We can not be paralyzed by the fact that shopping and consumption is part of the problem.  We have to go in and fix it.  People have been trading goods for money for a long time and the system’s broken.  And climate change is actually a huge archetype for a wide range of ways to reknit the fabric of shopping with the fabric of community and earth care.

Green Brand Disconnect

This week’s cover story in BusinessWeek featured the experience of Auden Schendler, corporate director of environmental affairs at the Aspen Skiing Company (ASC), as he tried to convince his senior management that going green was worth the investment (“Little Green Lies,” October 29, 2007).

 

            

From an outsider’s perspective, one might think that ASC would be highly receptive to eco-friendly investment opportunities, as the company has incorporated green as a core brand pillar and a central theme in its marketing communications.  Yet, as Schendler points out, things are not always at they appear; apparently, ASC is not as green as its brand might suggest.

In one example, Schendler points out that in the past, senior management has resisted even modest investments in proven technologies – such as compact florescent light bulbs (CFLs) in hotel rooms – that yield measurable cost savings and a positive ROI.  The rationale: CFLs are not aligned with the brand experience ASC wants for its customers.  As one hotel manager said, “Fluorescent light would suggest a waiting-room ambience, jeopardizing the establishment’s five-star rating.” 

Such a world view, however, does not seem to acknowledge evolving social norms and consumer expectations regarding green.   According to a recent JD Powers Hotel Guest Satisfaction Survey, 75% of hotel guests are willing to participate in environmental programs.  In the luxury hotel category, an even higher percentage of guests are willing to participate: 87% of Baby Boomers, 95% of Gen Xers and 79% Gen Yers.  Based on this consumer data it seems that ASC may be underestimating their guests’ interest in and expectations for green as part of their hotel experience. 

As such, it seems that ASC’s decision not to invest in CFLs may be at odds with current consumer sentiment.  In fact, CFLs have already gone mainstream.  Today, many luxury hotels already use CFLs for lighting.  Their light quality has improved tremendously.  And, retailers are selling them aggressively, despite the fact that incandescent light bulbs are more profitable for them.  In fact, Wal-Mart has sold over 100MM of these bulbs this year alone.  

Moreover, not investing in CFLs seems contrary to ASC’s own brand positioning and communications in the market.  In fact, just weeks before the BusinessWeek article ran, ASC launched a new advertising campaign that, according to the Salt Lake Tribune, used “high-profile skiers and snowboarders to tout the resort operator’s environmental record and urging others to take action, too.”   This campaign is supported by a lightly branded microsite called Save Snow which educates visitors about what ASC is doing and what others can do to reduce climate impact.   

Ironically, the campaign also includes plans to send 40,000 CFLs to its customers.   

 

So, marketers should take note.  Consumers are increasingly willing to participate in environmental programs at hotels, and especially at luxury ones.  

Hotels should not be afraid to invest in green initaitives including CFLs.  Not only can such programs provide attractive ROIs, but, for companies such as ASC, they can ensure that the consumer experience aligns with their brand positioning in the market.  For ASC, the decision not to purchase CFLs is, at best, inconsistent with its brand.  At worst, the company risks that its marketing efforts are perceived as green washing.