Green Marketing

Green Marketing – Introduction to Green Marketing

According to the American Marketing Association, green marketing is the marketing of products
that are presumed to be environmentally safe. Thus green marketing incorporates a broad range
of activities, including-

1. Product modification,
2. Changes to the production process,
3. Packaging changes, as well as
4. Modifying advertising.
The term green marketing came into prominence in the late 1980s and early 1990s. The
American Marketing Association (AMA) held the first workshop on “Ecological Marketing” in
1975. The proceedings of this workshop resulted in one of the first books on green marketing
entitled “Ecological Marketing”.
Thus green marketing incorporates a broad range of activities, including product modification,
changes to the production process, packaging changes, as well as modifying advertising.
In simple terms green marketing refers to the process of selling products and/or services based
on their environmental benefits. Such a product or service may be environmentally friendly in
itself or produced and/or packaged in an environmentally friendly way.
The obvious assumption of green marketing is that potential consumers will view a product or
service’s “greenness” as a benefit and base their buying decision accordingly. The not-so-
obvious assumption of green marketing is that consumers will be willing to pay more for green
products than they would for a less-green comparable alternative product an assumption that has
not been proven conclusively, specially the mild effect which it had had on consumers has
washed away by the present recession (2008-09) only.
Green or Environmental Marketing satisfies human needs with minimal detrimental impact on
the national environment. Green marketing not only includes consumer goods and industrial
goods but also the services sector. In the process of distribution of goods and services, both the
manufacturing and the services balance contribute towards the ecological imbalance and loss of
the ozone layer.
However, the role of the manufacturing sector in this regard is more significant. The process of
manufacturing and selling goods and services with the least threat to the environment is a big
issue before the business houses. Green marketing requires awareness not only from the
consumers but also from the manufacturers of such goods.
Ultimately green marketing requires extra cost but the stakeholders should be ready to bear that
cost. Business firms have also started responding to environmental challenges by adopting and
practicing green marketing strategies.
The most important advantage of green marketing is that eco-friendly goods have a competitive
advantage over other firms selling non-eco-featured goods. At the same time, it should be noted
that in the era of green marketing, each and every shareholder should take part in this process as
a social responsibility.
It is a fact that the natural environment is the basis of all activity. Natural environment and
ecosystem services provide us with food, water and material for living. Since the economic
activities directly depend upon the natural resources and the environment, the protection of
natural environment is the duty of all stakeholders.

According to American Marketing Association – “Green marketing is the marketing of products

that are presumed to be environmentally safe.”
According to Polonsky, 1994 – “Green or Environmental Marketing consists of all activities
designed to generate and facilitate any exchanges intended to satisfy human needs or wants, such
that the satisfaction of these needs and wants occurs, with minimal detrimental impact on the
natural environment.
Green marketing refers to the process of selling products and/or services based on their
environmental benefits. Such a product or service may be environmentally friendly in itself or
produced and/or packaged in an environmentally friendly way. The assumption of green
marketing is that potential consumers will view a product or service’s “greenness” as a benefit
and base their buying decision accordingly. The consumers may be willing to pay more for green
products than they would for a less-green product.
Green Marketing incorporates broad range of activities including product modification, changes
to the production process, packaging changes, and modifying advertising. The focus of Green
Marketing is on satisfaction of customers’ needs and wants with no or minimum harm to the
natural environment.
Marketing products and services based on environmental factors or awareness. Companies
involved in green marketing make decisions relating to the entire process of the company’s
products, such as – methods of processing, packaging and distribution. Investopedia explains
‘Green Marketing’ as the companies seek to go above and beyond traditional marketing by
promoting environmental core values in the hope that consumers will associate these values with
their company or brand.
 Engaging in these sustainable activities can lead to creating a new product line that caters to a
new target market, also known as sustainable marketing, environmental marketing or ecological
marketing.
According to the American Marketing Association, green or Environmental Marketing consists
of all activities designed to generate and facilitate any exchanges intended to satisfy human
needs or wants, such that the satisfaction of these needs and wants occurs, with minimal
detrimental input on the national environment.
Green Marketing has progressed over a period of time. There are three phases in the evolution
process of Green Marketing. First phase was ecological green marketing where environmental
problems and remedies for environmental problems were mainly focused.
Environmental green marketing was the second phase; the major focus was on clean technology
and designing of innovative new products, which can control pollution and waste issues. Third
phase was “sustainable green marketing”. This phase gained popularity in the late 1990s and
early 2000.
A variety of jargons are used in this area, like Green Marketing, Ecological Marketing and
Environmental Marketing. The term Green Marketing came into regulation in the late 1980s and
early 1990s.

Green Marketing Methods

Beyond making an environmentally friendly product, business owners can do other things as part of
their green marketing efforts. The following can all be part of a green marketing strategy:

 Using eco-friendly paper and inks for print marketing materials

 Skipping the printed materials altogether and option for electronic marketing
 Having a recycling program and responsible waste disposal practices
 Using eco-friendly product packaging
 Using efficient packing and shipping methods
 Using eco-friendly power sources
 Taking steps to offset environmental impact

Green Marketing – 5 Important Golden Laws: Customers should be Aware, Reassure the
Buyers, Transparency, Consider Pricing and Customer Participation
The important golden laws of Green Marketing are as follows:
1. Customers should be Aware:
If a company needs to sell the products, it should make sure that the customers are better aware
of the benefits of “green” products and their growing necessity. The customer should know the
main reason behind the issue of the products that are eco-friendly.
2. Reassure the Buyers:
Marketer should understand that they need to convince the customers by promoting the true
quality and ethically show the performance of the product, because it would be very difficult to
sell the products to customers only on the lines that they are eco-friendly.
3. Transparency:
Marketers should be ethical in claiming their products as eco-friendly. They should be genuine
and transparent about their claims. The business policies should also go with it.
4. Consider Pricing:
It is possible that marketers charge a greater price for their “green” products because of their
high cost of production and use of higher-quality ingredients. Many customers might not afford
these high prices, so company needs to consider a reasonable price and target the appropriate
audience effectively.
5. Customer Participation:
The marketer should involve the customers in the initiative of green marketing. Once the
customer is a part of this cause, he or she will understand the concept better and the issues of
pricing etc. can be resolved.

Green Marketing – Importance: Environmental Advantages, Economic Advantages,

Sustainability, Efficient Use of Resources, Planned Techniques and a Few Others
It is well known that increasing production and business activities are polluting the natural
environment. The damages to people, crops, and wildlife are reported in different parts of the
world. As resources are limited and human wants are unlimited, it is necessary for marketers to
use resources efficiently, so that organisational objectives are achieved without waste of
resources. So green marketing is inevitable.
There is growing interest among people around the world regarding protection of natural
environment. People are getting more concerned for environment and changing their behaviour
for the protection of environment. As a result of this, the term “Green Marketing” has emerged.
Hence, marketers are feeling their responsibility towards environment and giving importance to
green marketing.
Not only marketers but consumers are also concerned about the environment, and consumers are
also changing their behaviour pattern. Now, individual as well as industrial consumers are
becoming more concerned about environment-friendly products.
Importance # 1. Environmental Advantages:
Going green is an environmentally responsible choice. It is estimated that 40 percent of all
greenhouse gases in the United States comes from energy production that businesses use to heat,
cool and light workplaces. Reducing these energy needs reduces carbon dioxide output, helping
to control global warming. As businesses use more natural resources than individual consumers,
recycling business materials and conserving water contribute to conservation on a larger scale.
Importance 2. Economic Advantages:
The reduction in waste equals lower operating costs and more savings. Eco-friendly business
equipment and practices such as – low-wattage or LED lights, use of natural lighting, water
conservation policies, mandatory recycling and hybrid company vehicles save money on utilities,
fuel and office supplies. This generates instant cash flow. Further going green puts a business in
a positive light in the eyes of customers, potential investors, distributors, activists, watchdog
groups, communities and prospective employees.
Importance 3. Sustainability:
Going green is about sustainability; this sustainability translates to sustainable profits in green
sectors with secure futures. The future-safe markets include biomaterials, green buildings,
personal transportation, smart grids, mobile applications and water filtration.
Importance 4. Efficient Use of Resources:
Today, human demands and needs are unlimited but resources are short enough that cannot
fulfill the human needs. Markets need to facilitate the consumers by utilizing resources
efficiently.
Importance 5. Planned Techniques:
It needs to develop well planned techniques and innovative policies to achieve the organizational
goals effectively without any wastage of time and other resources. Green marketing examples of
different products and services develops a growing interest among customers throughout the
world.
Importance 6. Consumer Attraction:
Green marketing examples of different products attracts the consumers regarding environment
protection. People are so much conscious about their environment and variations in behavior.
Green marketing is considered as growing marketing that helps to design socially and sustainable
products.
Importance 7. Innovation:
Green marketing helps to design such kinds of products that are economically affordable and
satisfy the human needs efficiently. It produces innovative green products that consume less
resource.
Importance 8. Competitive Advantage:
Companies enjoy competitive advantage over other companies in the market through green
marketing examples. Today, companies which adopt green marketing techniques gain more
competitive advantage over other companies which are not conscious about such techniques and
environment. Companies which develop innovative products and services with innovative
qualities at affordable rates are successful in the market.
Green marketing is a group of activities that are designed to meet the consumer’s demands and
needs at affordable price range.

Green Marketing – 5 Main Examples: Maruti Suzuki, Bharat Petroleum, Hindustan

Petroleum, Proctor & Gamble and ITC
Corporate are going green from the grassroots level to sustain and win the customers’
expectations. The environment is becoming increasingly an important part of the corporate
reputations and they are actively participating in greening the corporate strategy. Companies
have converted almost all the products to make them eco-friendly products. Following are the
recent environment friendly initiatives taken by the companies.
Example 1. Maruti Suzuki:
The company has been promoting 3 R since its inception. As a result the company has not only
been able to recycle 100% of treated waste water but also reduced fresh water consumption. The
company has implemented rain water harvesting to recharge the aquifers. Also, recyclable
packing for bought out components is being actively promoted.
The country’s largest car manufacturer had managed to slash energy consumption per car at its
Gurgaon factory by 26 per cent over the past six years, while its carbon dioxide (CO 2) emissions
during car manufacturing processes has come down 39 per cent in the past five years. The model
with gas as fuel was adopted by Maruti Suzuki India Limited as their Green Marketing practices.
Example 2. Bharat Petroleum:
Bharat Petroleum launched a programme to cut production of greenhouse gases by 10% across
its units worldwide and achieved it much ahead of schedule. Cleaner fuels such as Greener
Diesel (ultra low sulphur content) and BP Autogas were developed. Almost all of its plants are
ISO 14001 certified. Currently it is running a programme to contain its net emissions at current
levels for ten years.
Example 3. Hindustan Petroleum:
Hindustan Petroleum owns a massive e-waste recycling plant, where enormous shredders and
granulators reduce four million pounds of computer detritus each month to bite-sized chunks the
first step in reclaiming not just steel and plastic but also toxic chemicals like mercury and even
some precious metals. HP will take back any brand of equipment; its own machines are 100
percent recyclable. It has promised to cut energy consumption by 20 percent by 2010.
Example 4. Proctor & Gamble:
Laundry detergents are also touting energy savings. Proctor & Gamble’s (P&G) newest market
entry, Tide Coldwater, is designed to clean clothes effectively in cold water. About 80 to 85
percent of the energy used to wash clothes from heating water.
Example 5. ITC:
ITC has been ‘Carbon Positive’ for three years in a row sequestering/ storing twice the amount of
CO2 than the Company emits. It has been ‘Water Positive’ six years in a row creating three times
more Rainwater Harvesting potential than ITC’s net consumption. It has obtained close to 100%
solid waste recycling. All Environment, Health and Safety Management Systems in ITC conform
to the best international standards. ITC’s businesses generate livelihoods for over 5 million
people.
ITC’s globally recognized e-Choupal initiative is the world’s largest rural digital infrastructure
benefiting over 4 million farming families. ITC’s Watershed Development Initiative brings
precious water to nearly 35,000 hectares of dry lands and moisture-stressed areas. ITC’s
Sustainable Community Development initiatives include women empowerment, supplementary
education, integrated animal husbandry programmes.

Green Marketing Mix – 4 Ps of Green Marketing Mix: Green Products, Green Price,
Green Place and Green Promotion
Marketers need to define and design the 4 Ps of marketing mix from the viewpoint of
environmental preservation. The green marketing mix elements address the key environmental
issues appropriately and effectively.
1. Green Products:
Consider products that consume more energy, use toxic chemicals, cannot be recycled, and use
extensive packaging. Such products are a threat to the environment as they lead to environmental
degradation and pollution. On the other hand, products that help in saving energy, use natural
ingredients, are recycled, or use reduced packaging make contributions to the environment.
Therefore, those products that are produced in harmony with the environment are known as
‘green products’.
Production of green products is based on green technology. Green products help in saving
natural resources and subscribe towards sustainable future.
Organizations should produce environment-friendly products as they help in saving energy
resources and do not affect the environment adversely. The various stages involved in the
production of environment-friendly products are efficient in terms of environment protection and
conservation.
Environment-friendly products use natural and organic ingredients that are sourced from local
suppliers and its manufacturing and circulation is done in a manner that has least or no impact on
environment. Different governing organizations and certification systems certify the product as
green after assessing it against environmental performance criterion.
2. Green Price:
Production of green products requires modification in the production processes and this
necessitates expenditure. Cost increase results in increased price point of green products that
makes acceptability of the product in the market difficult. The high price may act as a deterrent
as consumers may be either unwilling or unable to pay this green premium.
The gap between the price of a green product and a non-green product is known as ‘pricing gap’.
Price impediments can be tackled either by lowering the price point of green products to make it
contiguous with the prevailing products in the market or by enhancing the perceived value of the
green products in the eyes of the customer (by adding to the benefits derived such as improved
packaging, improved attributes, and making the product specific to customers’ needs).
3. Green Place:
Green place relates to the distribution of green products without doing any harm to the
environment. This is achieved through efficient utilization of fuel and energy and arranging for
logistics with the least emissions.
Transportation costs constitute a major part of business costs and resources spend in distribution
can be saved through local production. This decreases transportation costs and also reduces
carbon footprint. Selling over the Internet as compared to a shop also saves business resources.
4. Green Promotion:
Consumers need to be made aware about green products and motivated to purchase them.
Therefore, huge amount of money and resources are spent by companies nowadays on advertis-
ing and promotion of green products. Green promotion entails increasing the sensitivity of
consumers towards green products as well as promoting the products in an environment-friendly
manner like using social networking sites to post profiles related to green marketing.
Recently, Nike with its ‘Better World’ campaign launched its first 100 per cent recycled
television advertisement, which was recycled by reusing and remixing film of its earlier
campaigns.

Moving towards Green Marketing:

The era of green marketing has begun. It has already been granted wide acceptance by all
stakeholders. However, there is a need to lay down the standards and practices, in order to bring
in objectivity in the judgment of various national and international agencies. This will not only
encourage the activities of green marketing but shall also provide the much needed level playing
fields to all.

To elaborate on the “Green” Terminology:

1. “Green Product” is non-toxic and is made from recycled material. There is no absolute green
product. However the products, which consume less energy, cause less pollution and are
biodegradable, belong to this category. Thus “Green” is a relative term.
2. “Green Service” fulfills the philosophy of sustainable development, improving and
maintaining the quality of life for people without compromising the environment.
3. “Green Washing” is the process of making products and services “Green” in all respects.
To make products and services green the businesses need to focus on bringing the green in
various aspects such as:
i. Supply Chain
ii. Packaging
iii. Raw Material
iv. Product Innovations

Green Marketing – Role of Information Technology

IT departments are under increasing scrutiny and pressure to deliver environmentally sound
solutions. Large data centre are one of the most significant energy consumers in an
organization’s IT infrastructure, so any measures that the organization can take to reduce this
consumption (and therefore also carbon dioxide emissions) will have a positive impact on the
organization’s environmental footprint.
A green data centre is defined as one in which the mechanical, lighting, electrical and computer
systems are designed for maximum energy efficiency and minimum environmental impact. The
construction and operation of a green data centre are involved in advanced technologies and
strategies.
Some examples include:
i. Reducing the power consumption of the data centre.
ii. Using low-emission building materials, carpets and paints.
iii. The consumption of energy is considered the dominant and often the only factor in defining
whether or not a facility is green.

Green Marketing – Attributes of the Green Consumers

To take the advantage of the emerging green market, it is important to understand who green
customers are and the factors influencing their purchasing decisions and behaviour.
What Drives Environmentally Conscious Consumer Behaviour?
The proposed framework presents Environmentally Consciousness Consumer Behaviour
(ECCB) as a process involving consumer environment, constructs, mediators and outcomes. The
underlying influencers of ECCB are complex and different approaches to consumer motivation
account for them in various ways.
Apart from this Natural Marketing Institute (NMI) divides the market into following
categories:
1. Lohas – Very progressive on environment and society, looking for ways to do more; not too
concerned about price.
2. Naturalites – Primarily concerned about personal health and wellness, and use many natural
products; would like to do more to protect the environment.
3. Conventional – Practical, like to see the results of what they do; interested in green products
that make sense in the long run.
4. Drifters – Not too concerned about the environment, figuring we’ve got time to fix the
environmental problems; don’t necessarily buy a lot of green products.
5. Unconcerned – Have other priorities, not really sure what green products are available and
probably wouldn’t be interested anyway; they buy products strictly on price, value, quality and
convenience.
Towards a Green Marketing Partnership – ICT and Cost Management is the Key.
Worldwide evidence indicates people are concerned about the environment and are changing
their behaviour accordingly. As a result there is a growing market for sustainable and socially
responsible products and services.
The types of businesses that exist, the products that they produce and their approaches to
marketing are changing. Successful green marketers will reap the rewards of healthy profits and
improved shareholder value and help in making the world a better place for future generations.
Identify and close the Green Gap.
Right now, gaps exist on both sides of the market, between where customers are today and the
preferences that will help sustain a future market. There is also a gap between today’s products
and green designs of tomorrow.
Green Marketing – 5 Main Reasons for Adoption of Green Marketing by the Firms:
Opportunities, Competitive Pressure, Social Responsibility and Cost or Profit Issues
Green marketing has been widely adopted by the firms worldwide and the following are
the possible reasons cited for this wide adoption:
1. Opportunities:
As demands change, many firms see these changes as an opportunity to be exploited and have a
competitive advantage over firms marketing non-environmentally responsible alternatives.
Some examples of firms who have strived to become more environmentally responsible, in
an attempt to better satisfy their consumer needs are:
I. McDonald replaced its clam shell packaging with waxed paper because of increased consumer
concern relating to polystyrene production and ozone depletion.
II. Tuna manufacturers modified their fishing techniques because of the increased concern over
driftnet fishing, and the resulting death of dolphins.
III. Xerox introduced a “high quality” recycled photocopier paper in an attempt to satisfy the
demands of firms for less environmentally harmful products.
2. Governmental Pressure:
As with all marketing related activities, governments want to “protect” consumers and society;
this protection has significant green marketing implications.
Governmental regulations relating to environmental marketing are designed to protect
consumers in several way:
I. Reduce production of harmful goods or by-products.
II. Modify consumer and industry’s use and/or consumption of harmful goods.
III. Ensure 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.
3. Competitive Pressure:
Another major force in the environmental marketing area has been firms’ desire to maintain their
competitive position. In many cases firms observe competitors promoting their environmental
behaviours and attempt to emulate this behaviour. 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 suit.
4. Social Responsibility:
Many firms are beginning to realize that they are members of the wider community and therefore
must behave in an environmentally responsible fashion. This translates into firms that believe
they must achieve environmental objectives as well as profit related objectives. This results in
environmental issues being integrated into the firm’s corporate culture.
There are examples of firms adopting both strategies. Organizations like the Body Shop heavily
promote the fact that they are environmentally responsible. While this behaviour is a competitive
advantage, the firm was established specifically to offer consumers environmentally responsible
alternatives to conventional cosmetic products.
5. Cost or Profit Issues:
Firms may also use green marketing in an attempt to address cost or profit related issues.
Disposing of environmentally harmful by-products, such as polychlorinated biphenyl (PCB)
contaminated oil are becoming increasingly costly and in some cases difficult.
Therefore firms that can reduce harmful wastes may incur substantial cost savings. When
attempting to minimize waste, firms are often forced to re-examine their production processes. In
these cases they often develop more effective production processes that not only reduce waste,
but reduce the need for some raw materials. This serves as a double cost savings, since both
waste and raw material are reduced.

Green Marketing – 4 Benefits and Advantages

Today’s consumers are becoming more and more conscious about the environment and are also
becoming socially responsible. Therefore, more companies are responsible to consumers’
aspirations for environmentally less damaging or neutral products. Many companies want to
have an early mover advantage as they have to eventually move towards becoming green.
Some of the advantages of green marketing are:
i. It ensures sustained long term growth along with profitability.
ii. It saves money in the long run, though initially the cost is more.
iii. It helps the companies market their products and services keeping the environment aspects in
mind. It helps in accessing the new markets and enjoying the competitive advantage.
iv. Most of the employees also feel proud and responsible to be working for an environmentally
responsible company.
Green Marketing – 4 Popular Challenges: Need for Standardization, New Concept,
Patience and Perseverance and Avoiding Green Myopia
Challenge 1. Need for Standardization:
It is found that only 5% of the marketing messages from “Green” campaigns are entirely true and
there is a lack of standardization to authenticate these claims. There is no standardization
currently in place to certify a product as organic. Unless some regulatory bodies are involved in
providing the certifications there will not be any verifiable means. A standard quality control
board needs to be in place for such labelling and licensing.
Challenge 2. New Concept:
Indian literate and urban consumer is getting more aware about the merits of green products. But
it is still a new concept for the masses. The consumer needs to be educated and made aware of
the environmental threats. The new green movements need to reach the masses and that will take
a lot of time and effort.
.
Challenge 3. Patience and Perseverance:
The investors and corporate need to view the environment as a major long-term investment
opportunity, the marketers need to look at the long- term benefits from this new green
movement. It will require a lot of patience and no immediate results. Since it is a new concept
and idea, it will have its own acceptance period.
Challenge 4. Avoiding Green Myopia:
The first rule of green marketing is focusing on customer benefits i.e. the primary reason why
consumers buy certain products in the first place. Do this right motivate consumers to switch
brands or even pay a premium for the greener alternative. It is not going to help if a product is
developed which is absolutely green in various aspects but does not pass the customer
satisfaction criteria. This will lead to green myopia. Also if the green products are priced very
high then again it will lose its market acceptability.