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PSB Publications
Green Brands 2.0 - Making Green Work
April, 2007
A recent study – Green Brands 2.0 – conducted by Penn, Schoen & Berland Associates, in cooperation with Landor Associates and Cohn & Wolfe, points to the growing importance of green in corporate brand image and perceptions, and suggests some of the key components of green success.
The study found that having a green presence in most consumer goods categories, including appliances and computers, positively alters consumer perceptions. They often perceive these products to be of higher quality, particularly in the food and personal care industries. For example, Whole Foods, which earned the Green Brand of the year award in this study, was also associated with offering better quality. Even auto-manufacturers like Toyota or Honda earn praise for simultaneously offering better quality products that are also environmentally conscious.
The impact of green is not just about products – it can have a huge impact on entire categories. Some corporations which were once considered to operate exclusively in a niche marketplace quickly became mainstream, attracting new users and creating competitive pressure within their respective categories. For example, Whole Foods’ quick expansion put pressure on other grocery stores to offer organic alternatives, but it retains a 23% market share in the natural food category.
So the key issue for corporations now is, what do we do, and how do we talk about it?
Understanding the green audiences
One of the most interesting findings in our study is that there is a kind of a paradoxical dynamic among green audiences. While almost everyone pays at least nominal attention to green, there are great differences among groups.
1 Survey methodology: 1,504 interviews among general population age 18+, conducted April 6-8, 2007. Sample was weighted to reflect US census information. Margin of error is +/-2.5%, higher for subgroups.
The most engaged group – the “Bright Greens” (34%) – are also the most skeptical and the most convinced that things are going in the wrong direction (a “bunker” mentality). Therefore they are the most likely to demand “green” steps on the part of companies – and at the same time the most likely to complain about these companies not taking green far enough.
These are, in the language of a political campaign, the key “swing” voters. They are younger and energized – the most likely to be speaking out, writing letters to the paper, etc., about global warming and government and corporate environmental responsibility. Because they feel things are going so badly, they raise the bar enormously high. Their touchstone is pure green, not shades of green. They look to Greenpeace and other environmental NGO’s for in-depth information about all green issues, including consumer products.
At the same time, however, the bright greens still need to buy groceries, household products, appliances, and cars. Within categories where there are greener choices, they will help anoint the best of breed. They are both your Opinion Leaders in the category and your most severe critics.
Beyond this one highly engaged segment, all the other groups we identified stand in a continuum in terms of corporate green efforts.
- The “Green Motivated” (10%) want green, but are optimistic about the way things are going. They are likely to accept corporate “green” programs at face value and as a step in the right direction.
- The “Green Hypocrites” (26%) like to talk about green, but don’t want to go out of their way – not even slightly out of their way for it. Slap a green smiley face on it and they’re on board.
- The “Green Ignorant” (19%) and the “Dull Green” (11%) segments are simply unengaged in the issue. Green isn’t particularly motivating, but it’s not a negative either.
Everyone in these groups will be happy enough to have companies offer green alternatives, and overall that has become pretty much of an expectation in the marketplace. But they will not be analyzing and scrutinizing company claims about their green progress.
Individuals in all of these groups have at least some willingness to buy (and pay more for) some green products – especially energy-saving appliances and light bulbs, and hybrid cars. But this is also coupled with an expectation that the energy/gas savings (along with tax rebates) may in fact make these products even more cost effective over time. Similarly, many people will pay more for organic food because they think it is healthier for them and their families. They like green with a direct personal pay-off. Paying more for green for its own sake is a much tougher hurdle.
The bar will keep on rising
As attention to global warming grows in the public and political arena, consumer pressures and expectations increase for companies producing every category of product. At the same time, however, for the most engaged group, the complexity of the science and of the issues continues to grow as well, making corporate green an ongoing process rather than a one-off effort (or even a series of one-offs).
Do you get applauded for your efforts, or get hammered for falling short of emerald green? This is the challenge that corporations face.
“Bright greens” – who are the most engaged on the issue – will be most outraged if they think a company is simply touting green as a marketing ploy. Corporations need to engage in a dialogue with consumers: demonstrate your good faith and explain the challenges to the key players in the green community and you may convert your image to being a company that is genuinely working on the issue and is a credible force for a greener planet.
BP is a good example of this approach. It knows it’s not credible for an oil company to claim to be truly green – but it can take the issue seriously, and make its own best leadership efforts in developing greener alternatives. In its ads, BP has talked frankly about the issues, and has highlighted its ongoing and evolving commitment to the green process. It has engaged its audiences in an open-ended dialogue. And it gets credit for its effort. In a category where almost every major brand now has come to tout some level of concern about the environment, conservation, or alternative fuels, BP stands out as the top-ranked green brand.
Whole Foods, of course, and brands like Starbucks, use green as an integral part of who they are, and use that to differentiate themselves from their competitors. For them, too, green is an ongoing process that continues to evolve, not a single product or program. Other companies, such as Toyota and GE, score major points for providing energy-efficient products, and implementing green-friendly manufacturing policies.
As we move forward, the bar will continue to rise on green – other companies will match what you do, price of entry expectations will become ever more demanding, and scrutiny of the “political correctness” of every initiative will become ever more rigorous. But green will also continue to play an ever-increasing role in brand image and brand differentiation and preference.
As the marketplace importance of green continues to grow, we may soon see major corporations begin to establish a new position of “green czar” to oversee green across all aspects of their products, operations, and communications. Between the increasingly complex nature of a company’s green initiatives in products and in operations, and the tremendous sensitivity of the environmental community about the reality behind the ads, this cannot simply be left as a “me-too” item on the agendas of very diverse departments.
For more information about green brands and green branding, please contact Tom Agan at tagan@ps-b.com or 404-434-8943.
Penn, Schoen & Berland Associates
245 E. 92nd Street
New York, NY 10128
Tel: (212) 534-4000
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