Marketing as a Tool to Promote Sustainability - Assignment Example

Marketing as a tool to promote sustainability Marketing’s traditional axiom so far has been “give s what they want” and “sell as much as youcan” (Ottman, Stafford and Hartman 2006). However, in today’s environment, sustainability is the key word. “How to create sustainable products and position them to the consumers to achieve sustainable business growth?” is the key question all businesses are now looking at. This is because today’s commerce is dominated by issues like increasing energy prices, growing population and resource consumption in Asia, and political pressures to address climate change (Ottman, Stafford and Hartman 2006). Above all these factors, another trend is that of consumer knowledge increase with regards to impact of products and processes on their health, the environment and the overall well being of the world as a whole. All these factors require businesses to obtain sustainable models by what is called “product dematerialization” by Hawken, Lovins and Lovins (1999). This means that the focus will be on services than goods. Marketing has been the key to economic activity by stimulating demand. However, a marketing approach, aimed at serving the material wants of consumers through an ever increasing volume of goods without any attempt to maximize life quality, draws heavily and too quickly on already overdrawn environmental resources and is likely to mortgage the future (Polonsky and Mintu-Wimsatt 1997). Hence, such marketing techniques are no more sustainable as they draw on exhausting resources. Sustainable marketing strategy is evolved using the principle of 4 Rs which are – redirection (of customer needs and wants), reorientation (of marketing mix), reorganization (of firm’s processes and systems) and reconsumption (of used products for redevelopment into usable products (Polonsky and Mintu-Wimsatt 1997). These corporate strategies should be supported by government interventions in the form of programs and regulatory mechanisms that support the corporate initiatives. The following figure shows the various components of sustainable marketing strategies (Polonsky and Mintu-Wimsatt 1997). Redirection – Marketing efforts should be aimed at redirecting the human needs and wants towards those consumptions that are environment friendly. This can be done by arriving at the right combination of the 3C’s of green marketing, which are as follows (Ottman, Stafford and Hartman 2006). Consumer value positioning - The products should be able to perform at least equal to if not better than the current non-green products. The companies need to understand the consumer-desired value of the product and produce accordingly to target the relevant market segment. For example, organic food should be targeted towards health conscious customers who are not very price conscious. Bundle the consumer desired features into the green products to enhance appeal to the consumer. Calibration of consumer knowledge- This requires educating the consumers about the consumer desired features in the green products. For example, pesticide-free food is healthy and energy-efficient products save money. Another way is to show the characteristics of the green products as solutions to the customer needs. For example, rechargeable batteries have longer life. Finally, use the internet and television extensively to promote consumer-value features of the green products to enhance their knowledge and hence switch over from non-environment friendly products. Credibility of product claims – This can be done by ensuring that the consumer benefit claims of the green product are backed by substantial data. These claims are specific and are compared to the alternatives on unpretentious parameters. Certifications from trustworthy third parties should be used to promote the authenticity of the benefit claims which should be publicized with meaning of those certificates. Endorsements from such parties when publicized with importance of such endorsements help in gaining trust among the consumers and influencing their preferences towards the green products. Social internet sites and other communication networks should be encouraged to promote consumer evangelism which helps in promoting the benefits of the green product through informal channels. Since this is word-of-mouth publicity, it is more effective and sustainable. Reorientation – There needs to be a complete reorientation of the marketing mix to be able to design a sustainable plan. This means that the marketers need to have a fresh look at the 4Ps which are specific to green marketing. These are (Dash): Product - The product should be able to achieve differentiation by being eco-friendly from the perspective of not only its use but also by virtue of the processes used in its manufacture, the packaging used and innovative value it provides to the consumer. The consumer value positioning of green products can be done based on 5 benefits that are usually associated with these products. They are – cost effectiveness and efficiency, health and safety, performance, symbolism and status and convenience (Ottman, Stafford and Hartman 2006). Unless the products are designed around at least one of these 5 variables, the consumers will not see value in green products as compared to the other non-green alternatives. Price - Price is an important factor in promoting the green products. Only if the consumers are able to associate higher value with these products as compared to the non-green ones, will they be ready to shift to these. A major drawback of these products is the higher prices as compared to the others. Thus, the customers will be ready to pay the premiums only if they see value for themselves rather than the environment alone. Hence the pricing should be such that the premium is recoverable and worth paying for. For example, P&G showed to the consumers that they can save $63 per year by using their product “Tide Cold-water”. This is because they don’t need to heat the water to ensure clean washing. This was a successful strategy as the consumers were able to identify monetary saving for the premium charged (Ottman, Stafford and Hartman 2006). Price efficiencies can be reached by improving supply chains and using improvised technology that is also environment friendly. Promotion – Green product promotion basically focuses on three areas – address a relationship between a product/service and the biophysical environment, promote a green lifestyle by highlighting a product or service and present a corporate image of environmental responsibility (Dash). The advertising should be able to provide adequate knowledge to the consumers regarding the value along with the environmental advantage. The claims made in these promotions should be genuine and be available for testing if required. Place – The location of availability of these products is another important factor in their appeal and ability to attract consumers. If the products are not easily available or do not have the requisite servicing networks within the geographical location of the point of sale, then the consumer will be more inclined towards going for non-green alternatives. Hence, for sustainable marketing, the logistics of service centers and distribution points need to be taken into account. Reorganization – This requires restructuring the internal and external systems and processes to help achieve sustainable development. Reconsumption – This is the eco friendly disposal of its products either through recycling or using bio-degradable materials which are not a burden on the landfills. Before we conclude we will look at some corporate examples where the various green strategies discussed in our sections above have been used and some where they have been overlooked. We will see how such marketing efforts affect sustainability of programs. One of the very successful green product launches was that of P&G’s Tide Cold-water product. The company successfully engaged the 3Cs to ensure success of this product. First they advertised the yearly savings of $63 on using this product as it had the ability to provide the same cleaning effect as by other non-green products without the need to use hot water which they require. As heating required major power consumption, cold wash led to saving on that account. Thus, they did the consumer value positioning on money. They then launched a site called tide.com where people could post comments, register for trial challenge and also got free trial packs of the product on becoming a member. They could get tips to save energy and also could calculate the actual savings at this site. This site had the facility to refer e-mail addresses of the friends of people who registered here. Hence the company had a huge consumer database. Thus the company did calibration of consumer knowledge through the web site which helped in the fast promotion of the effectiveness of the product through word of mouth. Finally, the company used a credible non-profit organization, Alliance to Save Energy (ASE), to spread the consumer value of its product through e-mail of which the company had a good database from its web site. Thus it used ASE to make credible product claims to make the product successful. Another example where EPA’s message “EPA Pollution Preventer” was not very clear and did not show the consumer value that was in it for him/her. However, they later changed it to “Money Isn’t all You’re Saving” linking energy efficiency (which saves earth) with economic benefits for the consumers. Thus we can see that marketing can be a very useful tool in promoting sustainable strategies, by saving on the depleting resources of the planet and moving the focus from unchecked consumerism to thoughtful product development and creating sustainable demand for such sustainable products to achieve sustainable growth. References Dash, S.K, Green Marketing: Opportunities & Challenges, viewed on May 18, 2010. http://www.coolavenues.com/know/mktg/sanjit-green-marketing-1.php Hawken, P, Lovins, A and Lovins, L.H, 1999, Natural Capitalism: Creating the Next industrial Revolution. Englewood, NJ: Prentice Hall. Ottman, A, Staffor, E.R and Hartman, C.L, 2006, Green Marketing Myopia, Heldref Publications. http://www.greenmarketing.com/files/articles/Stafford-MyopiaJune06.pdf Polonsky, M.J and Mintu-Wimsatt, A.T, 1997, Environmental Marketing: Strategies, Practice, Theory, and Research, Routledge. Read More