Going Green: Fad or Fundamental?

Saving the Earth has been a recurring consumer theme through the decades, especially since the first Earth Day celebration in 1970. Another recurring theme has been dissipating interest as gas prices decline or sorting recyclables gets tiresome. Is the current "green" mindset any different? "There are some faddish parts to the interest being shown," says Robin Albing, founder of Albing International Marketing in Flemington, N.J. Her firm tracks home-design and home-product trends, and she sees the "green" movement becoming more mainstream every day. "Fads peak at a high point really fast and drop off. We're not seeing any drop-off, and there is data showing longer-term changes are occurring."Chad Upham, founder of Covive Inc., San Francisco, agrees. His company helps corporations create a Corporate Sustainability Report that sets the company's vision and goals and creates performance metrics for maintaining sustainable activities. "I think we've seen a big enough shift among businesses and capital investment to these companies that it is affecting core business practices."Overcoming the MindsetBut there are considerable challenges to overcome in reprogramming the American mind, experts note. The 1970s oil crisis, which resulted in long lines and alternate-day fill-ups at gas stations, produced the first rush of energy-saving attitudes, selling a lot of insulation and weather-stripping. "But then the price of oil dropped, and the interest faded," says Steve Belletire, associate professor of industrial design at Southern Illinois University in Carbondale, Ill. "The public didn't feel it was worth it."Indeed, a July 2007, study by Yankelovich called "Going Green" indicated that consumers are not all aboard the Eco-Express. "Despite unwavering focus by the media, government and business, 'going green' is only of moderate concern to most consumers," it reported. Only one-third (34%) of the 2,763 consumers surveyed felt more concerned about environmental issues today than a year earlier. Less than one-quarter (22%) thought they could make a difference to the environment (see the chart).The entire "green" mindset goes against the existing consumer culture, says Upham. "Advertising has convinced us that we need to buy more things, buy them faster, and throw them away so we can buy next season's big thing," he explains.Creating a permanent green culture will require overcoming two major mindsets for today's consumer: the value of convenience and prestige. "Everyone wants low-maintenance products, that are easy to use and offer single-serve uses," he says. Ironically, small packages inside a larger package avoid waste in product use by providing more waste in packaging. People also want their products to reflect well on them--hence gigantic, high-end store shopping bags. But a variety of factors are working to change that culture, impacting it at every level of society, experts say. Those factors include: The Global Market. "Global climate change is driving a new consciousness," says Belletire. "The world is more wired, so it's more attuned to what's happening on a global scale." In particular, the European Commission (the governing body of the European Union) and individual European countries have developed an array of sustainable policies impacting manufacturing processes.The Environmental Protection Agency's Energy Star program is a key element in this, as it expands and gains visibility and credibility. California's Air Resource Board (CARB) also is aggressively instituting programs that are influencing other states. Design Efforts. For example, the Leadership in Energy & Environmental Design (LEED) program by the U.S. Green Building Council certifies buildings that achieve a certain number of points toward sustainable design. Corporate Concern. "Companies are transitioning to an environmental model from a traditional one," says JohnPaul Kusz, founder of the Center for Sustainable Enterprise at Illinois Institute of Technology in Chicago. It already has reached a critical mass or tipping point, and it is led by people who are sensitive to it. It's not completely altruistic, according to a November 2007 Yankelovich study. It surveyed 600 investors and found that nearly eight in 10 said they are more likely to invest in companies that are actively socially responsible. Nearly three-fourths said they are making more of an effort to learn whether companies are socially responsible--but they are somewhat more skeptical of the various sources they consult, including corporate annual reports. Indeed "greenwashing" activities, in which attributes are spun to produce a "green" claim when such results are debatable at best, have left consumers wary. "Social-responsibility efforts cannot be shallow attempts at jumping on the bandwagon, because investors will see right through that," says Holly Moore, a Yankelovich partner. Even so, the survey found that 94% of investors believe American companies can engage in socially responsible practices and still make a healthy profit. Consumer Activism. Such high-visibility events as food recalls, lead-painted imports, CFL light bulbs, and, of course, gas prices are keeping energy and health concerns at a high level of visibility. "There has been a sea change in the level of interest and knowledge," says Kusz. "People don't accept the status quo today. They are educating themselves, and they're not asking dumb questions any more." Bottom-Up Flow. Much of the interest is driven by two significant demographics: Baby Boomers and their children, called "The Millennials" in Albing's studies. "Baby Boomers have passed along the notion that you have to leave the world in better shape," she says. But consumers can be turned off if there is a "green" premium to their product choices, Albing notes. That requires products to equate their "greenness" with prestige, to make any premium worth the addition. No Green PremiumBut sustainability doesn't have to cost more, stresses Kusz. Efficiencies gained throughout the channel can reduce prices, as can looking at long-term costs. "The full lifecycle cost of a product is not readily obvious, and it can be a difficult sell," he says. But consumers are becoming more aware of the concept, especially due to the long life (but higher upfront cost) for popular CFL bulbs."We tell our clients to cut their margins at the start to improve sales and get consumers into a long-term model of buying that establishes the brands," says Albing. The key point, Kusz notes, is that the shift is making green attributes a standard. "Selling against it will be a losing proposition. The people who will win will be those who address the consumers' questions and bring new products to the market."Any premium or lifecycle calculation is overridden by a fundamental factor, says Albing. "The product has to perform." In the past, products such as cleaning fluids weren't effective. But today's lines, such as Clorox's Green Works and Imus's Greening the Cleaning lines get the job done. There is another driving factor, too, she adds. "People aren't interested in products that look hideously ugly. There is definitely an aesthetic element. It has to work, but it also has to look good. People, especially upscale consumers who drive these trends, want a stamp of approval."The marketers who can best drive these trends into products and displays are those whose products tie in naturally, she notes, including cleaning products, outdoor gear, natural foods and major energy consumers, such as cars or appliances. "If it fits with the corporate M.O., it really pays off."But there is still tremendous work to be done if this mindset is going to solidify across the culture. "The typical consumer is not thinking about these efficiencies and the environmental impact of their packaging," says Upham. "It's going to be a long-term process over the next 10 to 20 years to become a part of everyday practice. But the companies that get started now will be ahead of the game."

Going Green: Fad or Fundamental?

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