One business area where environmental issues have received a great deal of attention in the press is marketing. Terms like 'Green Marketing' and 'Environmental Marketing' appear frequently in the media. Many governments around the world have become so concerned about green marketing activities that they have attempted to regulate them. For instance, in the United States, the Federal Trade Commission (FTC) and the National Association of Attorneys-General have developed extensive documents examining green marketing issues.
Unfortunately, a majority of people believe that green marketing refers solely to the promotion or advertising of products with environmental characteristics. Terms like 'Recyclable', 'Refillable', 'Phosphate Free', 'Ozone Friendly', and 'Environmentally Friendly' are some consumers most often associate with green marketing. While these terms refer to green marketing claims, in general it is a much broader concept, one that can be applied to consumer and industrial goods and even services. Thus green marketing incorporates a broad range of activities, including product modification, changes to production process and packaging changes.
Yet defining green marketing is not a simple task. Its most authentic definition by the scholars is: green or environmental marketing consists of all activities designed to generate and facilitate any exchanges intended to satisfy human needs or wants with minimal detrimental impact on environment. This definition incorporates much of the traditional components of marketing. The above definition covers protection of environment by attempting to minimise the detrimental impact on environment. Human consumption, by its very nature, is destructive to environment. Products making green claims should state these are 'less environmentally harmful' rather than 'environmentally friendly'. Thus, green marketing should look at minimising environmental harm, not necessarily eliminating it.
The question of why green marketing has increased in importance is quite simple. It relies on the basic definition of economics. Economics is the study of how people use their limited resources trying to satisfy unlimited wants. Thus mankind has limited resources on earth, with which s/he must attempt to provide for the world's unlimited wants.
There is extensive debate as to whether the earth is a resource at man's disposal. In market economies where there is 'freedom of choice', it has generally been accepted that individuals and organisations have the right to attempt to have their wants satisfied. As firms face limited natural resources, they must develop new or alternative ways of satisfying these unlimited wants. Ultimately green marketing looks at how marketing activities utilise these limited resources while satisfying consumers' wants, both of individuals and industry, as well as achieving the selling organisation's objectives.
It appears that all types of consumers, both individual and industrial, are becoming more concerned and aware about environment. In a 1992 study of 16 countries, more than 50 per cent of consumers in each country, other than Singapore, indicated they were concerned about environment. A 1994 study in Australia found that 84.6 per cent of the sample believed all individuals had a responsibility to care for environment. A further 80 per cent of this sample indicated that they had modified their behaviour, including their purchasing behaviour, due to environmental reasons. As demands change, many firms see these changes as an opportunity to be exploited.
Given these figures, it can be assumed that firms marketing goods with environmental characteristics will have a competitive advantage over firms marketing non-environmentally responsible alternatives. There are numerous examples of firms striving to become more environmentally responsible in an attempt to better satisfy their consumer needs. There are the following instances:
i) Xerox introduced a 'high quality' recycled photocopier paper in an attempt to satisfy the demands of firms for less environmentally harmful products.
ii) McDonalds replaced its 'clam shell' packaging with waxed paper because of increased consumer concern relating to polystyrene production and Ozone depletion.
 iii) Tuna manufacturers modified their fishing techniques because of increased concern over driftnet fishing, and the resulting death of dolphins.
Many firms are beginning to realise that they are members of the wider community and therefore must behave in an environmentally responsible fashion. This leads firms to believe they must achieve environmental as well as profit-related objectives. This results in environmental issues being integrated into the firm's corporate culture. Firms in this situation can take two perspectives; 1) they can use the fact that they are environmentally responsible as a marketing tool; or 2) they can become responsible without promoting this fact.
There are examples of firms adopting both strategies. Organisations like the Body Shop heavily promote the fact that they are environmentally responsible. While this behaviour has a competitive advantage, the firm was established specifically to offer consumers environmentally responsible alternatives to conventional cosmetic products. This philosophy is directly tied to overall corporate culture.
An example of a firm that does not promote its environmental initiatives is Coca-Cola. It has invested large sums of money in various recycling activities as well as having modified their packaging to minimise its environmental impact. While being concerned about environment, Coke has not used this concern as a marketing tool. Thus many consumers may not realise that Coke is a very environmentally committed organisation.
Another firm which is very environmentally responsible but does not promote this fact, at least outside the organisation, is Walt Disney World (WDW). WDW has an extensive waste management programme and infrastructure in place. Yet these facilities are not highlighted in their general tourist promotional activities.
As with all marketing-related activities, governments want to 'protect' consumers and the society; this protection has significant green marketing implications. Governmental regulations relating to environmental marketing are designed to protect consumers in several ways, 1) reduction of production of harmful goods or by-products; 2) modification of use of consumers and industry and/or consumption of not harmful goods; or 3) ensuring that all types of consumers have the ability to evaluate the environmental composition of goods.
Governments establish regulations designed to control the amount of hazardous wastes produced by firms. Many by-products of production are controlled through various environmental licences, thus modifying organisational behaviour. In some cases, governments try to 'induce' final consumers to become more responsible. For example, some governments have introduced voluntary recycling programmes, making it easier for consumers to act responsibly. In other cases, governments tax individuals who act in an irresponsible fashion. For example, in Australia, there is a higher gas tax associated with leaded petrol.
Another major force in the environmental marketing area has been firms' desire to maintain their competitive positions. In many cases, firms observe competitors promoting their environmental behaviour and attempt to emulate this. In some instances, this competitive pressure has caused an entire industry to modify and thus reduce its detrimental environmental behaviour. For example, it could be argued that Xerox's 'Revive 100% recycled paper' was introduced a few years ago in an attempt to address the introduction of recycled photocopier paper by other manufacturers.
In another example, when one tuna manufacturer stopped using driftnets, the others followed the suit.
No matter why a firm uses green marketing, there are a number of potential problems that they must overcome. One of the main problems is that firms using green marketing must ensure that their activities are not misleading to consumers or industry, and do not breach any of the regulations or laws dealing with environmental marketing. For example, marketers in the US must ensure that their green marketing claims can meet the set of criteria, in order to comply with the FTC's guidelines.
 The writer is a Senior Officer, Bank Asia Ltd (currently on deputation at the
bank's Lalmatia branch).
 reza.sty@gmail.com
Green marketing— global initiative
Md. Rezaul Karim | Published: July 13, 2014 00:00:00 | Updated: November 30, 2024 06:01:00
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