Source: E-mail dt. 17.10.2012
Green Marketing – A Success Strategy for Inclusive Growth And Sustainable Development in India
Mrs. Kiruthiga Shankaranand,
Lecturer, Department of Management,
Indian School of Science and Management-B School,
Taramani, Chennai, India.
We find various products in the global market, its uses differs but its nature of depletion and degradation depends on the materials trough which it is produced. 90% of products that are produced from natural resources are Eco- and Environment- friendly. It is easily destroyed, recycled and reused. India, a nation rich in national resources has a wide chance to produce needed goods and market it which would ensure the internal food chain and also results in the safeguarding of the future with constructively utilizing for
the present (Sustainable Development).
Green House effect
The greenhouse effect is a process by which thermal radiation from a planetary surface is absorbed by atmospheric greenhouse gases, and is re-radiated in all directions. Since part of this re-radiation is back towards the surface, energy is transferred to the surface and the lower atmosphere. As a result, the temperature there is higher than it would be if direct heating by solar radiation were the only warming mechanism.
This mechanism is fundamentally different from that of an actual greenhouse, which works by isolating warm air inside the structure so that heat is not lost by convection.
The greenhouse effect was discovered by Joseph Fourier in 1824, first reliably experimented on by John Tyndall in 1858, and first reported quantitatively by Svante Arrhenius in 1896.
If an ideal thermally conductive blackbody was the same distance from the Sun as the Earth is, it would have a temperature of about 5.3 °C. However, since the Earth reflects about 30% (or 28%) of the incoming sunlight, the planet's effective temperature (the temperature of a blackbody that would emit the same amount of radiation) is about −18 or −19 °C, about 33°C below the actual surface temperature of about 14 °C or 15 °C.
The mechanism that produces this difference between the actual surface temperature and the effective temperature is due to the atmosphere and is known as the greenhouse effect. Global warming, a recent warming of the Earth's surface and lower atmosphere, is believed to be the result of a strengthening of the greenhouse effect mostly due to human- produced increases in atmospheric greenhouse gases.
The three R s of environmentalism are:-
India has a total water surface area of 314,40 km˛ and receives an average annual rainfall of 1,100 mm. Irrigation accounts for 92% of the water utilisation, and comprised
380 km˛ in 1974, and is expected to rise to 1,050 km˛ by 2025, with the balance accounted for by industrial and domestic consumers. India's inland water resources comprising rivers, canals, ponds and lakes and marine resources comprising the east and west coasts of the Indian ocean and other gulfs and bays provide employment to nearly 6 million people in the fisheries sector. In 2008, India had the world's third largest fishing industry.
India's major mineral resources include Coal (third-largest reserves in the world), Iron ore, Manganese, Mica, Bauxite, Titanium ore, Chromite, Natural gas, Diamonds, Petroleum, Limestone and Thorium (world's largest along Kerala's shores). India's oil reserves, found in Bombay High off the coast of Maharashtra, Gujarat, Rajasthan and in eastern Assam meet 25% of the country's demand.
Rising energy demand concomitant with economic growth has created a perpetual state of energy crunch in India. India is poor in oil resources and is currently heavily dependent on coal and foreign oil imports for its energy needs. Though India is rich in Thorium, but not in Uranium, which it might get access to in light of the nuclear deal with US. India is rich in certain energy resources which promise significant future
potential - clean / renewable energy resources like solar, wind, biofuels (jatropha, sugarcane).
So such resources can be effectively used to produce new products and the demand can be created easily under a Private Public Partnership (PPP).
Marketing is the process of performing market research, selling products and/or services to customers and promoting them via advertising to further enhance sales. It generates the strategy that underlies sales techniques, business communication, and business developments. It is an integrated process through which companies build strong customer relationships and create value for their customers and for themselves.
The term marketing concept holds that achieving organizational goals depends on knowing the needs and wants of target markets and delivering the desired satisfactions. It proposes that in order to satisfy its organizational objectives, an organization should anticipate the needs and wants of consumers and satisfy these more effectively than competitors.
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 product modification, changes to the production process, packaging changes, as well as modifying advertising.
Yet defining green marketing is not a simple task where several meanings intersect and contradict each other; an example of this will be the existence of varying social, environmental and retail definitions attached to this term. Other similar terms used are Environmental Marketing and Ecological Marketing.
It refers to products and packages that have one or more of the following characteristics:
(1) Are less toxic
(2) Are more durable
(3) Contain reusable materials
(4) Are made of recyclable material. In short, these are products considered “environmentally responsible”.
The Four Ps of Green Marketing:-
Like conventional marketers, green marketers must address the ‘four Ps’ in innovative ways.
Entrepreneurs wanting to exploit emerging green market either:
identify customers’ environmental needs and develop products to address these needs; or
Develop environmentally responsible products to have less impact than competitors.
The increasingly wide varieties of products on the market that support sustainable development and are good for the triple bottom line include:
Products made from recycled goods, such as Quik’N Tuff housing materials made from recycled broccoli boxes.
Products that can be recycled or reused.
Efficient products, which save water, energy or gasoline, save money and reduce environmental impact. Queensland’s only waterless printer, Print point, reduces operating costs by using less water than conventional printers and is able to pass the savings on to customers.
Products with environmentally responsible packaging. McDonalds, for example, changed their packaging from polystyrene clamshells to paper.
Products with green labels, as long as they offer substantiation.
Organic products — many consumers are prepared to pay a premium for organic products, which offer promise of quality. Organic butchers, for example, promote the added qualities such as taste and tenderness.
A service that rents or loans products – such as toy libraries.
Certified products, which meet or exceed environmentally responsible criteria.
Whatever the product or service, it is vital to ensure that products meet or exceed the quality expectations of customers and are thoroughly tested.
Pricing is a critical element of the marketing mix. Most customers are prepared to pay a premium if there is a perception of additional product value.
This value may be improved performance, function, design, visual appeal or taste. Environmental benefits are usually an added bonus but will often be the deciding factor between products of equal value and quality.
Environmentally responsible products, however, are often less expensive when product life cycle costs are taken into consideration. For example fuel-efficient vehicles, water-efficient printing and non-hazardous products.
The choice of where and when to make a product available has a significant impact on the customers being attracted.
Very few customers go out of their way to buy green products merely for the sake of it. Marketers looking to successfully introduce new green products should, in most cases, position them broadly in the market place so they are not just appealing to a small green niche market.
The location must also be consistent with the image which a company wants to project. The location must differentiate a company from its competitors. This can be achieved by in-store promotions and visually appealing displays or using recycled materials to emphasize the environmental and other benefits.
Promoting products and services to target markets includes paid advertising, public relations, sales promotions, direct marketing and on-site promotions.
Smart green marketers will be able to reinforce environmental credibility by using sustainable marketing and communications tools and practices. For example, many companies in the financial industry are providing electronic statements by email, e- marketing is rapidly replacing more traditional marketing methods, and printed materials can be produced using recycled materials and efficient processes, such as waterless printing.
Retailers, for example, are recognizing the value of alliances with other companies, environmental groups and research organizations when promoting their environmental commitment. To reduce the use of plastic bags and promote their green commitment, some retailers sell shopping bags, under the banner of the Go Green Environment Fund.
The key to successful green marketing is credibility. Never overstate environmental claims or establish unrealistic expectations, and communicate simply and through sources that people trust.
Promote your green credentials and achievements. Publicise stories of the company’s and employees’ green initiatives. Enter environmental awards programs to profile environmental credentials to customers and stakeholders.
The legal implications of marketing claims call for caution. Misleading or overstated claims can lead to regulatory or civil challenges. In the USA, the Federal Trade Commission provides some guidance on environmental marketing claims. This Commission is expected to do an overall review of this guidance, and the legal standards it contains, in 2011.
Classical Vs "Green" Marketing Approach
Classical marketing Green marketing
Customers Customers with their Human beings with
Lifestyle their lives
Products "From the cradle to the "From the cradle to the
One size fits all products Flexible Services
Marketing concept Sales orientation Educational
Final values Values
Company Reactive Proactive
By department Holistic
Short-term orientation Long-term orientation
Profit maximizing Double final target
Global Companies that concentrates in and techniques for Green Marketing
Philips Light's "Marathon"
Philips Lighting's first shot at marketing a standalone compact fluorescent light (CFL) bulb was Earth Light, at $15 each versus 75 cents for incandescent bulbs. The product had difficulty climbing out of its deep green niche. The company re-launched the product as "Marathon," underscoring its new "super long life" positioning and promise of saving $26 in energy costs over its five-year lifetime. Finally, with the U.S. EPA's Energy Star label to add credibility as well as new sensitivity to rising utility costs and electricity shortages, sales climbed 12 percent in an otherwise flat market.
Car sharing services
Car-sharing services address the longer-term solutions to consumer needs for better fuel savings and fewer traffic tie-ups and parking nightmares, to complement the environmental benefit of more open space and reduction of greenhouse gases. They may be thought of as a "time-sharing" system for cars. Consumers who drive less than 7,500 miles a year and do not need a car for work can save thousands of dollars annually by joining one of the many services springing up, including Zip Car (East Coast), I-GO Car (Chicago), Flex Car (Washington State), and Hour Car (Twin Cities).
The consumer electronics sector provides room for using green marketing to attract new customers. One example of this is HP’s promise to cut its global energy use
20 percent by the year 2010. To accomplish this reduction below 2005 levels, The Hewlett-Packard Company announced plans to deliver energy-efficient products and services and institute energy-efficient operating practices in its facilities worldwide.
McDonald's restaurant's napkins, bags are made of recycled paper.
Coca-Cola pumped syrup directly from tank instead of plastic which saved 68 million pound/year.
Examples Of Green Marketing – Indian Context
1. Tata Group of Companies
Tata motors ltd. is setting up an eco-friendly showroom using natural material for its flooring and energy efficient lights.
The taj chain, is in the process of creating eco-rooms which have energy efficient mini bars, organic bed linen and napkins made up of recycled papers. The rooms will have CFL’s or Led’s.
Launched a low cost water purifier made up of natural ingredients.
Developing indica EV, an electric car that would run on polymer lithium ion batteries.
2. Recently launched Samsung solar mobile guru.
3. Battery operated L.G TV.
4. Introduction of C.N.G in Delhi.
5. Badarpur Thermal Power station of NTPC in Delhi is devising ways to utilize coal-ash that has been a major source of air and water pollution.
6. Barauni refinery of IOC is taken steps for restricting air and water pollutants.
Introduction of CNG in Delhi
New Delhi, capital of India, was being polluted at a very fast pace until Supreme Court of India forced a change to alternative fuels. In 2002, a directive was issued to completely adopt CNG in all public transport systems to curb pollution.
ITC has been 'Carbon Positive' three years in a row (sequestering/storing twice the amount of CO2 than the Company emits).
'Water Positive' six years in a row (creating three times more Rainwater
Harvesting potential than ITC's net consumption).
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 recognised e-Choupal initiative is the world's largest rural digital infrastructure benefiting over 4 million farming families.
ITC's Social and Farm Forestry initiative has greened over 80,000 hectares creating an estimated 35 million person days of employment among the disadvantaged.
ITC's Watershed Development Initiative brings precious water to nearly
35,000 hectares of drylands and moisture-stressed areas.
ITC's Sustainable Community Development initiatives include women empowerment, supplementary education, integrated animal husbandry programmes.
Maruti: Greening of Supply Chain :-
The company has remained ahead of regulatory requirements in pursuit of environment protection and energy conservation at its manufacturing facilities, and in development of products that use fewer natural resources and are environment friendly.
The company credited the 'Just-in-Time' philosophy adopted and internalized by the employees as the prime reason that helped to excel in this direction.
The company has been promoting 3R 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 company has been facilitating implementation of Environment Management System (EMS) at its suppliers' end. Regular training programs are conducted for all the suppliers on EMS. Surveys are conducted to assess the vendors who need more guidance. The systems and the environmental performance of suppliers are audited.
The green co-efficient of this system is much better than the conventional system
HCL's Environment Management Policy under HCL EcoSafe :-
In building a system to identify, develop and sustain the maintenance of an environment management system at corporate level we have formulated a program that we proudly refer as HCL's ecosafe.
The aim is to encapsulate knowledge, awareness, and key developments on all environmental issues faced by today's world and to incorporate these in HCL's
operations assuring our commitment in delivering quality products, solutions and services
The key objective under HCL EcoSafe is targeted at integrating environmental management procedures into its business processes thereby protecting the environment, health, and safety of all its stakeholders. HCL commits to manufacture products that are environment friendly in all respects and are free from hazardous chemicals.
HCL EcoSafe focuses on product lifecycle management to ensure that our products right from when they are manufactured, bought by customers, recovered at their end-of-life and recycled after useful life are done in an environmentally responsible manner.
1. Green products require renewable and recyclable material, which is costly, requires a technology, which requires huge investment in R & D water treatment technology, which is too costly.
2. Majority of the people are not aware of green products and their uses
3. Majority of the consumers are not willing to pay a premium for green Products
Thus implementation of Green marketing and green products development is not in the hands of government alone. It must encouraged by the government, it must introduces to the people formally by it and the government must encourage the private players to take part in it through tax exemptions and through other benefits, private players must also spend their CSR budget in such activities it not a one man’s performance it is the combination of Public and Private (PPP) together.