In 1994, Philips launched "EarthLight," an energy-efficient compact fluorescent light (CFL) bulb with a clumsy shape that was incompatible with most conventional lamps; it had a confusing package—and a $15 price tag compared with 75 cents for the incandescent bulbs. Sales languished.
Smartly, Philips reintroduced the product in 2000 under the name "Marathon," to emphasize the bulb's five-year life. A new design offered the look and versatility of incandescent bulbs. Marketing communications promised $20 in cost savings over the life of the bulb, and an Energy Star seal emblazoned on a redesigned package provided credibility. This new value proposition triggered sales growth of 12% in a flat market.
Philips's experience provides a valuable lesson in how to avoid the common pitfall of "green marketing myopia."
While noble, the environmental positioning of the original EarthLight product appealed to only the deepest green of consumers. Inevitably, mainstream consumers ask, "If I use 'green' products, what's in it for me?" In practice, green appeals aren't likely to attract mainstream consumers unless they also offer a desirable benefit such as cost-savings or improved product performance.
To avoid green marketing myopia, marketers must fulfill consumer needs and interests beyond environmental requirements.
Green Marketing Myopia Defined
Green marketing must satisfy two objectives: Improved environmental quality and customer satisfaction. Misjudging either or overemphasizing the former at the expense of the latter is what can be called "green marketing myopia."
In 1960, Theodore Levitt introduced the concept of "marketing myopia" in a famous Harvard Business Review article that is still studied by business students. In it, he characterized the common pitfall of companies' tunnel focus on "managing products" (i.e., product features, functions, and efficient production) rather than "meeting customers' needs" (i.e., adapting to consumer expectations, anticipating future desires).
Levitt warned that a corporate preoccupation with products rather than consumer needs was doomed to failure because consumers select products and new innovations that offer benefits they desire.
Similarly, many green products have failed because of marketers' myopic focus on their products' "greenness" over the broader expectations of consumers or other market players (such as regulators or activists).
Another example: In 1994 Whirlpool launched the "Energy Wise" refrigerator, the first cooler free of ozone-depleting chlorofluorocarbon (CFC) chemicals and more efficient than the US Department of Energy's highest standard by 30%. For its innovation, Whirlpool won the "Golden Carrot," a $30 million award package of consumer rebates from the Super-Efficient Refrigerator Program, sponsored by the Natural Resources Defense Council and funded by 24 electric utilities.
Unfortunately, sales languished because the CFC-free benefit and energy-savings did not offset its $100-$150 price premium, particularly in markets outside the rebate program, and the refrigerators didn't offer additional features or new styles that consumers desired.
Green marketing myopia can also occur when products fail to provide credible environmental benefits. Introduced in 1989, packages for Mobil's Hefty photodegradable trash bags prominently displayed the term "degradable," with the explanation that a special ingredient promoted its decomposition into harmless particles in landfills, "activated by exposure to the elements" such as sun and rain.
Because most garbage is buried in landfills allowing limited exposure to the elements, the claim enraged environmentalists. Ultimately, seven state attorneys general sued Mobil on charges of deceptive advertising and consumer fraud, and the company withdrew the product from the market.
Green product fiascos such as Energy Wise and Hefty bags have convinced many consumers to associate green products with inconvenience, higher costs, and lower performance. However, ironically, many consumers are in fact buying green products, sometimes at a higher price! How to explain this?
When consumers are convinced of "non-green" benefits, they are more inclined to adopt green products (whether promoted as such or not). The Marathon bulbs and widely successful Toyota Prius are two outstanding examples. Others are energy-saving Tide Coldwater laundry detergent, nontoxic Method cleaning products, recycled paper products, "shade grown" coffees, and organic food.
Add these to the list: super energy-efficient appliances that bear the US EPA's "Energy Star" label, super energy- and resource-efficient "healthy" building products for LEED certified buildings, passive solar heating, and heat reflective windows, certified sustainably harvested lumber, natural fertilizers, and mold-resistant drywall.
Strategies for Success
The strategies of successful green products shows that their marketers have avoided "green marketing myopia" by following three important principles that can be called "The Three Cs":
- Consumer value positioning
- Calibration of consumer knowledge
- Credibility of product claims
Consumer Value Positioning
- Design environmental products to perform as well as (or better than) alternatives.
- Promote and deliver the consumer-desired value of environmental products and target relevant consumer market segments (e.g., target money savings benefits to cost-conscious consumers).
- Broaden mainstream appeal by bundling (or adding) consumer-desired value into environmental products (such as fixed pricing for subscribers of renewable energy).
Calibration of Consumer Knowledge
- Educate consumers with marketing messages that connect environmental product attributes with desired consumer value (for example, "pesticide-free produce is healthier," "energy-efficiency saves money," or "solar power is convenient").
- Frame environmental product attributes as "solutions" for consumer needs, for example, "rechargeable batteries offer longer performance." With indoor air quality a growing concern and fumes from paints, carpets, and furniture now linked to headaches, eye, nose, and throat irritation, dizziness, and fatigue, Sherwin Williams offers "Harmony," a line of interior paints that is low-odor, zero-VOC, and silica-free.
- Create engaging and educational Web sites about environmental products' desired value: e.g., Tide Coldwater's interactive Web site allows visitors to calculate their likely annual money savings based on their laundry habits, utility source (gas or electricity), and ZIP code location.
Credibility of Product Claims
- Make sure that environmental product and consumer claims are specific, meaningful, and qualified. Compare with comparable alternatives or likely usage scenarios. Recognizing the ambiguity of the term green, Toyota dismissed a slogan for Prius, "Drive Green, breathe Blue" in favor of "Less gas in. Less gasses out."
- Underscore credibility with product endorsements or eco-certifications from trustworthy third parties, and educate consumers about the meaning behind those endorsements and eco-certifications. Over 40 product categories can now bear the Energy Star seal.
- Encourage positive word of mouth via consumers' social and internet communication networks with compelling, interesting, or entertaining information about environmental products. Increasingly, consumers have grown skeptical of commercial messages, and they're turning to friends and peers for advice.
The Internet, through email and its vast and accessible repository of information via Web sites, search engines, blogs, product-ratings sites, podcasts, and other digital platforms, has opened significant opportunities for tapping consumers' social and communication networks to diffuse credible "word-of-mouse" (buzz facilitated by the Internet) about green products.
For example, the Web site for Tide's Coldwater Challenge includes a map of the United States so visitors may track and watch their personal influence spread when their friends request a free sample.
Note: This article is excerpted from "Avoiding Green Marketing Myopia: Ways to Improve Consumer Appeal for Environmentally Preferable Products" (PDF) originally published in Environment magazine, June 2006.