Integrated Marketing Communication Plan: Australian Government Carbon Tax - Research Paper Example

___________Wise Choice Advertising Company, Australia Australian government Carbon Tax IMC Plan Executive Summary The Australian government intends to introduce a carbon tax beginning 1st July, 2012. The aim of the tax is minimise the greenhouse gas emissions to five per cent below the year 2000 level. This they hope to reach by the year 2020. The cost of the carbon tax is initially set at a$23 and will gradually increase until 2015 whereby it will shift to a trading scheme that will let the market set the cost. This will see products that were high intensive become more expensive thus making it possible for other products produced through cleaner processes to compete on price as they will cost cheaper, Gillard (2010), cited Nordhaus, 2011. A carbon tax is really an energy tax. Any policy brought forward to raise the price of energy will usually have an impact on poor households hence the concerns that come up whenever energy taxes are discussed, mainly Equity. Equity in the distribution of the energy taxes between high income households and low income households, Metcalf, 2008. It goes without saying that along with the Carbon Tax comes the increase of goods and services. The Australian government has put in place a full compensation plan for the price increases that will see pensioners and low income households benefit from this, Ewbank, 2011. As Stern (2007) is quoted, “Climate change presents a unique challenge for economics: it is the greatest and widest-ranging market failure ever seen. The economic analysis must therefore be global, deal with long time horizons, have the economics of risk and uncertainty at centre stage, and examine the possibility of major, non-marginal change” (Stern (2007), cited, Metcalf, 2008). Table of Contents 1.0 Introduction ……………………………………………………………………….. 3 1.1 Background Information ………………………………………………………….. 3 1.2 History Surrounding the Implementation …………………………………………. 4 1.2.1 The Copenhagen Accord …………………………………………………………. 4 2.0 Target Audience Analysis ………………………………………………………….. 5 2.1 Demographics ………………………………………………………………………. 5 2.2 Psychographics ……………………………………………………………………... 6 2.2.1 Early Adopters / Technological Pioneers ………………………………………… 6 2.2.2 Environmental Friendly ………………………………………………………….. 6 2.2.3 Futuristic or Visionaries …………………………………………………………. 6 3.0 Literature Review ………………………………………………………………….. 7 3.2 Limitation and arguments against the implemetatin of Carbon Tax ………………. 7 4.0 Communication Objectives ………………………………………………………… 8 4.1 Communication Activities …………………………………………………………. 9 5.0 Creative Strategies …………………………………………………………………. 9 6.0 Media Plan ………………………………………………………………………… 10 7.0 Conclusion …………………………………………………………………………. 11 References ……………………………………………………………………………… 13 1.0 Introduction 1.1 Background Information Due to the fact that Australia’s electricity is generated by burning coal, Australia carbon pollution per person is the highest among other developed countries, it is for this reason that the federal government established the multiplicity climate change committee to investigate ways of implementing a carbon pollution price and agree on how climate change effects could be handled. The outcome of these deliberations was a plan on clean energy with carbon emissions as the core price, Ricci, (2011). In a bid to reduce its carbon emissions to 5% below the 2000 levels by 2020, a voluntary international agreement target on carbon level reduction, the Australian government has announced that come 1at July 2012, it will introduce a carbon tax for its citizens, (Siriwarden et al, 2011). A carbon tax may be described as an environmental tax made on emissions of carbon dioxide plus other greenhouse emissions. The main aim of a carbon tax is to reduce Gas emissions thus minimise climate change effects. The carbon tax is usually charged on the use of fossil fuel such as petroleum, coal and natural gas that produces carbon when burnt. The main aim of a carbon tax is to reduce greenhouse gas emissions thus minimise climate change effects, Dong & Whalley, 2009. The tax is intended to commence on a fixed price of $23 per tonne of carbon equivalent (CO2-e) then transform to a market based emission trade scheme within three to five years, Gillard, (2010), cited Nordhaus, 2011. The carbon tax will impose costs on high carbon polluters, a cost that will reflect on higher end prices for some products. Treasury estimates an average family paying a$9.90 extra per week during the first year of its introduction. Treasure modeling on the impact of pricing carbon on household expenses 1.2 History surrounding the implementation The international climate change framework of agreement is the United Nations Framework Convention on climate change of 1994. It stated that its ultimate objective was to stabilize greenhouse gas concentrations in the atmosphere at a level that would prevent dangerous anthropogenic interference with the climate system, (UN, 2009), cited Nordhaus, 2011. The Kyoto Protocol of 1997 implemented this framework convention where by both emerging and high income economies agreed to limit emission form 2008-2012 periods. Developing countries were not included in this agreement thus causing discord among the member countries, Nordhous, 2011. 1.2.1 The Copenhagen Accord The 2009 Copenhagen conference aimed to negotiate a succession agreement for the post Kyoto period which led to the Copenhagen Accord, (UN 2009), cited, Nordhaus 2011. This accord adopted a limiting target in the increase of global temperatures and states “recognizing the science new that the increase should be below 2 degree Celsius. Although developing countries signed this accord, committing very little themselves to it, it is unlikely that the high income countries will achieve close to the two degrees Celsius target. Therefore, a more binding agreement needs to be met if climate change is to be curbed, Nordhaus, 2011. 2.0 Target Audience Analysis The target markets for the carbon tax awareness campaign are members of the public and high level carbon pollutants. Members of the public include different household groups but the tax will have a higher tax burden effect on the low income households, Sirwardans et al, 2011. The approach the Australian government is using involves the use of market to reduce emission through a carbon tax which will have an impact on the prices of goods and services. The high carbon pollutants will pass the tax costs to the consumers through their products which the carbon free goods and services will be cheaper for consumers. This will lead to a general reduction of high carbon inputs as producers will prefer low carbon input in order to make profits as households will go for the cheaper low carbon bundles, Siriwarha et al, 2011. 2.1 Demographics The household consumers are the most important market as they are the final consumers of the goods and services from the production line. These households comprise of male and female between ages 25-50 years old. They could be single or married and will most likely be career people or private business owners, thus they are educated affluent and well-informed, and would be in high professional occupation such as Administrative, Managerial or upper middle classes. These are people who are ready to purchase environmental friendly products and services as they have highly disposal able incomes and will be willing to pay more for environmental good. They will be people living in Australia and may be property owners or renting privately. They may be Australians with or without ethnic or religious backgrounds, Neumayer, 2004. The high carbon pollutants are production businesses that use fuel as a source of energy for their production. They are equally important as they will determine the price of goods and services. High population increases and high rate of urbanization cause high carbon emissions as the companies compete to meet the high demand of goods and services, Neumayer, 2004. 2.2 Psychographics Within the Psychographic profile, three mind-sets emerge. These are Early Adopters or Technology Pioneers, Environmentally Friendly and Futuristic or Visionaries, Waller 2004. 2.2.1 Early Adopters/ Technology Pioneers, These are those who readily accept new technological advancement are innovative and embrace this concept and implement. They usually benefit for being the first ones to venture into new markets hence they lead while others follow. These could come from households or businesses that are high carbon pollutants, Belch & Belch, 2007. Media usage under this mind-set include print media, quality daily newspapers such as the Australian, Daily Telegraph, Herlad Sun, New Scientist and Environmental magazines. Television such as Discovery Channel, SBS and ABC could also be used. Other media include internet, Mobile internet (WAP), radio, cinema advertisements, billboard and brochures. 2.2.2 Environmental Friendly These are those who are environmental friendly thus are environmental conscious of whatever actions they take. There are also those who are concerned and would like to express their concern through purchasing of products and services that have been produced using low-carbon emission as they do not want to contribute to further damage of the environment, Carbontax, 2011. Media usage under this print media such as daily newspapers, National Geographic Financial and business press. Television such as ABC could also be used. Others include ABC Classic FM, internet or stickers attached to products and services showing percentage of carbon emissions. 2.2.3 Futuristic or Visionaries These are those who believe in an ideal carbon free environment and will go out of their way to make life better for the future generations. Media usages for these include print media, television, internet and radio. Most of these consumers may belong to any mix of the three groups as not only one reason will motivate purchase. 3.0 Literature Review 3.1 Global Warming Global Warming is the rise in atmospheric temperatures on earth due to greenhouse gas emissions emanating from the burning of fossil (carbon basel) fuel such as coal, oil, natural ayes and so forth. When the greenhouse gas emissions like carbon dioxide accumulate in the atmosphere for a long time, say one hundred years, they cause high concentrations leading to the warming of oceans and land surfaces. Overtime, the high temperatures produce changes in the biological and human activities on earth, Bent, 2011. Unchecked, global warming comes along with catastrophic and undesirable environmental changes which affect the earth’s forests, plant growth, and rise in sea level as glaciers and Antarctic ice shelves melt. It also causes increase in diseases and health related problems as a result of the rise in temperatures. In an effort to slow down these effects on the earth, greenhouse gas emission must be minimised, Ricci, 2011. Figure 1: Response to the survey question "Do you think human activity is a significant contributing factor in changing mean global temperatures?" (Doran 2009) General public data come from a 2008 Gallup poll 3.2 Limitations and arguments against the implementation of the carbon tax are numerous. They include; The term carbon tax has not been well received by the public as any mention of tax increases receives a negative reaction by Australians. Another limitation is the fact that agriculture is not subject to the tax. This means that livestock’s, farming will not be subject to the carbon tax and yet they contribute 18% of the Greenhouse gas emissions. The other limitation is the fact that policies associated with the carbon tax emissions may favour the major pollutants such that they are reimbursed the money paid. This will mean that incentives to decrease carbon emissions will be lost and yet if the carbon tax becomes too enormous for certain businesses, it will force them to move to other countries Figure 1: Global temperature (red, NASA GISS) and Total solar irradiance (blue, 1880 to 1978 fromSolanki, 1979 to 2009 from PMOD). which do not impose the carbon tax or where carbon tax costs are minimal. Global warming related disasters 4.0 Communication Objectives Objectives are vital as they enable accomplishment of set targets through planned actions. Three levels of objectives exists in this scenario, these are: the Corporate, Marketing and Communication. Corporate objective may be termed as the Federal Governments objectives which include promotion of the carbon tax as a product in order to reduce carbon emission to 2000 levels by 2020 by developing non-carbon energy supplies at unsubsidised costs. Marketing objectives include introduction of the carbon tax to the Australian households by creating awareness and influencing positive consumer attitudes towards the tax. It is vital that positive aspects of the carbon tax to ensure that high pollutants embrace it thus look for alternative energy sources. Educating households on the positive image of the carbon tax is also an aim of the federal government, Belch, Belch, Kerr and Powel, 2011. 4.1 Communication activities In order to achieve the two objectives mentioned above, marketing communications have to be coordinated together with production industry, sales and purchasing sectors, Clow and Baack, 2010. First and foremost, there is need to increase the considerations of reduced carbon emissions into the atmosphere in the production of goods and services. Secondly, there will be need to reach the target market fully and encourage “picking winners”, Siriwardsna et al. Thirdly, pollutants and households have to be introduced to the carbon tax. The carbon tax, being a new brand with unique features, needs to be explained to the households by educating them on its benefits and how it works. The pollutants and households should be excited about the carbon tax and talk about it to their friends and relatives. Households and pollutants should be able to access information about the carbon tax via websites, media both print and radio and through billboards, brochures and making personal visits to the government offices. Carbon tax should be considered as a solid alternative solution to climate change for the future generations. Communications will ultimately lead to innovative ways of production of goods and services as using low carbon emissions which will eventually lead to a cleaner environment. It is expected that the market trends in the long run will lead to the stabilization of prices thus shift to market based emissions trading scheme by 2015, Gillard, (2010), cited Nordhaus, 2011. 5.0 Creative Strategies Carbon tax being unique and new in the Australian market will require numerous promotions for it to gain acceptance among the business people and households. The promotional messages should first start with creating awareness campaigns and educating the members of the public on this new product. As time goes on, promotional messages can be used to create excitement and emphasis on the benefits of the carbon tax to both the household consumer and the high level pollutants. In order for the promotions to appeal to the household and high carbon level pollutants, they must be imaginative, with a bold message, intelligent, innovative and revolutionary, Belch, Belch, 2007. Reduction in product cost will cause excitement to the household as this means more money in their pockets. Barriers to acceptance and adoption of the carbon tax such as high initial prices, product ignorance and unproven technology should be curbed by emphasising on the long term benefits of embracing the tax. Different executions to target one of the three mindsets identified in the target market will be created in order to emphasise on reasons to minimise carbon emission and refute limitations and barriers to acceptance. Members of the public will be continuously educated on environmental pollution with an aim of creating a ‘pollution free’ mindset. Efforts will be made to encourage a ‘low carbon life’ concept throughout the country starting with businesses and companies. A marked behavioural change in purchasing attitudes and lifestyles will be evident. 5.0 Media Plan A pre-testing promotional campaign should be the first media vehicle to be used on the carbon tax before its launch. This will give the target audience an opportunity to air their views and will help in the determination of the optimum mix to use while distinguishing imagery and copy thus reduce the risk of failure of the new product, Clow and Baack, 2010. The test audience will include the general public and the target audience. Style, concept and creative strategy of all the intended executions and communications should be considered. While creating aawareness of the carbon tax, press releases and press conferences could be used to create positive public relations. This can be used for the launch and the early stages of the introduction of the carbon tax to the public. It will help create awareness and raise interest for the new carbon tax and will go a long way in educating the public on how the tax works and its benefits. Direct mail may be used as a pre-launch awareness activity as the letters will be set to high carbon emissions pollutants. Additional databases could be obtained from the media for instance, the Daily Telegraph and then filter the two demographic profiles. Direct mail could also be sent to corporate buyers or users and enhance the carbon tax image. Emails could be used by the public to clarify issues on the carbon tax and gain more valid information thus appeal to the pioneer mindset. Newsletters will include brochures and CD-ROM. Advertising will be used as one of the most important Public Relations and Communication methods. Outdoor billboards, Television, Print and Internet will effectively reach the target market. Creative strategy will be used to place advisement in target media using variations in executing the message in order to meet the three mindsets in their own relevant media. Advertising will go a long way in creating awareness, educating and creating interest to the target audience which will result to positive buying attitude change and acceptance of the new tax. Benefits of embracing the Carbon Tax and adopting a ‘low carbon’ life style will be depicted through the Public Relations activities laying emphasis on the compensation that households will receive from the government and on the reduction on dependence on high carbon intensive products for maximum benefits, Ricci, 2011. The Television programs that deal with environmental issues will also concentrate on the target audience. Print adverts could also be placed in quality newspapers and magazines such as the Daily Telegraph, Herald Sun, Courier mail, Financial Times, National Geographic, and New Scientist among others. Outdoor billboards cold be placed in urban areas to reach a broad audience as placing them on busy junctions will complement TV and Print Media advertising. Internet and Direct Mail could also be used as they play a vital role in getting the message across. 7.0 Conclusion Global warming poses the greatest challenge facing the world today. It arises from the international dimension of a problem and the inability for countries the world over to solve the problem together. The costs and benefits of addressing global warming have different meaning to different groups,Metcalf, 2008. Climate change brings with it a unique challenge for the world economies, posing the greatest worldwide market failure. Hence tackling the problem needs global effort with long-term horizons, risk and uncertainty taking center stage and yet addressing the possibility of a great non-marginal change, Stern (2007), cited Metcalf, 2008. The introduction of the Carbon Tax in Australia has brought with it a lot of attention especially so due to its capacity to generate revenue. This means that the policy has capacity to compensate those who may be viewed as losers, these being the households and affected trade exposed industries. The varying tax scenarios and projections show that the tax is an effective tool that may bring levels of pollution down especially so as the tax works within the industrial structure of Australian economy. Through the twelve per cent carbon emissions reduction, Australia will be kept on track and thus achieve its voluntary target cut of below 5 per cent of 2000 levels by 2020, Gillard, 2010. . 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