Book summary “The New Rules of Green Marketing”: summary

Introduction

You face a marketplace where traditional marketing fails to capture eco-conscious consumers. Environmentalism has shifted from a fringe counterculture to a mainstream priority driven by personal health fears and generational values. You must navigate this reality without alienating buyers through complex jargon or unproven claims.

Jacquelyn Ottman argues that green marketing requires a holistic paradigm shift rather than superficial adjustments. You will discover how to balance traditional performance needs with minimal ecological impact across the entire product lifecycle.

This book provides a seven-part framework to transform your sustainable business strategy. You will explore how to:

• Identify distinct green consumer segments and psychographic profiles
• Design superior products using life-cycle assessments and green chemistry
• Communicate sustainable benefits with absolute credibility and transparency

1. We Are All Green Consumers

Environmental consciousness is no longer a fringe phenomenon. It is a mainstream lifestyle that requires businesses to offer high-performing, accessible sustainable products.

Modern green consumers are motivated by personal health fears and universal desires for control, compelling marketers to understand diverse psychographic segments ranging from LOHAS to Conventionals.

Historically associated with 1960s counterculture, green choices are now embraced by the vast majority of adults. In 2008, U.S. consumers invested $290 billion in green products and services, up from $219 billion in 2005. Today 83% of American adults can be considered at least some shade of green.

Early forerunner products like natural laundry powders left clothes dingy. Today major brands like Kimberly-Clark use recycled content and Toyota sells hundreds of thousands of Prius vehicles.

Mainstream Shift and Consumer Motivations

Modern green consumers are primarily motivated by personal and familial health fears. They worry about water quality, toxic chemicals, air pollution, and global warming.

Chemical scares involving asbestos, PCBs, PVC, phthalates, and bisphenol A have led to water bottles and baby products being whisked off retailer shelves. Scientists predict a 1.8 to 4.0 degrees Celsius average global temperature rise during the 21st century. This brings projections of 500,000 deaths and $340 billion in damages from climate-change-induced calamities by 2030.

Every living generation embodies sustainability values. Baby Boomers initiated modern environmental legislation in the 1970s, and 54% of Baby Boomers are considered socially conscious shoppers. Younger generations integrate digital media and everyday habits into their daily lives. Generation Y consumers used social networks to challenge unauthentic marketing practices after Hurricane Katrina and the BP oil spill.

Psychographic Segmentation and Sub-segments

The Natural Marketing Institute segments the population into five distinct groups:

• LOHAS: 19% of U.S. adults belong to this deep green segment committed to holistic well-being.
• Naturalites focus on personal health and chemical avoidance.
• Drifters represent 25% of all U.S. adults as younger trend-followers.
• Conventionals are practical penny-pinchers focused on utility savings.
• Unconcerneds make up 17% of the population and show the least environmental responsibility.

Conventionals will pay a premium for an ENERGY STAR-labeled refrigerator knowing it will slash their utility bills. Deep green consumers can be further categorized into interest-based sub-segments: Resource Conservers, Health Fanatics, Animal Lovers, and Outdoor Enthusiasts.

Universal consumer motives shape modern purchasing strategies. Consumers take control, get information from 400-plus eco-labels, make a difference, maintain lifestyle, and look smart. Prius owners surveyed in 2007 cited the statement the vehicle makes about them as the number one reason for purchase.

Marketers can assess market readiness using structured questions:

• Is there an awareness within our company of the true extent of environmentalism within society today?
• What are the top environmental issues of concern to our consumers?Shareholders? Employees? Suppliers? Retailers? Community?
• What is our top environmental risk? Is there a PVC, BPA, or other chemical scare lurking in our brand's future?
• What are the natural resources that our brands depend on – and what are the long-term projections for their availability?
• To which generations do our consumers belong and what are the unique ways in which they express their environmental and social concerns?
• To what extent do environmental issues affect the way consumers engage with our brand and the products in our category in general?
• To what extent are our consumers politically and socially active about environmental issues?
• How has environmentalism affected the shopping habits of our consumers? What types of greener products and services are our consumers buying these days?
• What are our competitors' key sustainability-oriented initiatives? To what extent are they introducing or possibly acquiring new sustainable brands?
• What are the key sources of sustainability-related information on which our consumers rely?
• Which environment-oriented legislators and legislative initiatives affect our business?
• What opportunities do we have to grow our sales and enhance our image through greener products and green marketing campaigns?
• What personal rewards in going green might be meaningful in enlisting the support of colleagues and stakeholders in our company's sustainability efforts?

2. The New Green Marketing Paradigm

Green marketing demands a holistic paradigm shift that balances functional product quality with a triple bottom line, as demonstrated by disruptive innovators like Method.

Conventional marketing approaches are obsolete for eco-conscious consumers. The new paradigm requires two main strategies: developing products that balance quality, price, and low environmental impact, and creating demand through values-laden communications that empower consumers and reflect a triple bottom line.

Feminism historically forced marketers to create convenient products for two-income lifestyles; similarly, the modern eco-consumerism movement mandates deep corporate changes across branding, pricing, and product quality.

Ottman's Seven Strategies

Jacquelyn Ottman formulates seven winning strategies to help businesses navigate deep-seated changes in consumer sensibility and achieve sustainable branding success.

• Understand the deeply held environmental and social beliefs and values of your consumers and other stakeholders and develop a long-term plan to align with them.
• Create new products and services that balance consumers' desires for quality, convenience, and affordability with minimal adverse environmental and social impacts over the life of the product.
• Develop brands that offer practical benefits while empowering and engaging consumers in meaningful ways about the important issues that affect their lives.
• Establish credibility for your efforts by communicating your corporate commitment and striving for complete transparency.
• Be proactive. Go beyond what is expected from stakeholders. Proactively commit to doing your share to solve emerging environmental and social problems - and discover competitive advantage in the process.
• Think holistically. Underscore community with users and with the broad array of corporate environmental and societal stakeholders.
• Don't quit. Promote responsible product use and disposal practices. Continuously strive for zero impact.

Method Disrupts the Cleaning Industry

Method disrupted the sleepy household cleaning category by combining chemical engineering and marketing to create fun, premium-priced, eco-friendly products. Adam Lowry and Eric Ryan founded Method in San Francisco in 1999. By 2008, annual revenues exceeded 100 million dollars, and all-purpose cleaner sales grew nearly 18 percent over the previous year, generating 5 million dollars in sales alone.

Method distinguishes its brand experience by combining five critical product hallmarks: efficacy, environmental safety, sleek design, natural fragrance, and fun.

Unlike traditional cleaning brands that rely on drudgery and hidden storage, Method uses museum-quality design, 100 percent recycled PET plastic packaging, non-toxic plant-based ingredients, and appealing fragrances so that sleek bottles can sit proudly on kitchen countertops.

Method's baby and kid line features hypoallergenic bath-time formulas in penguin-shaped bottles, and all surface cleaner packaging uses 100 percent recycled and recyclable PET plastic.

3. Designing Greener Products

Sustainable product design utilizes life-cycle assessments, recycled materials, source reduction, and non-toxic chemistry to minimize environmental footprints from cradle to grave.

Life-Cycle Assessment and Sourcing

Evaluating a product through a complete life-cycle assessment helps businesses identify and prioritize environmental and social impacts across all stages, from raw material extraction to final disposal. You can apply life-cycle assessment (LCA) to quantify energy use, resource consumption, and emissions.

To conduct an assessment, follow these steps:

• Define the functional unit and the product system.
• Set boundaries on the data to be collected for analysis.
• Quantify the use of energy, resources, and emissions associated with raw-material procurement, manufacturing, packaging, distribution, in-use, and after-use or final disposal.
• Analyze the data, identify problems and opportunities, and allocate resources to address them in priority.

Procter & Gamble used life-cycle assessments to discover that the greatest energy impact of laundry detergent occurs during the usage stage due to water heating, which spurred the introduction of Tide Coldwater. This innovation saved 3 percent of total U.S. energy consumption and addressed 8 percent of the CO2 reduction target for the U.S. set in the Kyoto Protocol.

Manufacturers facing scarce raw materials must adopt sustainable harvesting and mining practices to protect endangered resources, preserve natural habitats, and safeguard human rights. Tiffany & Co. embraced Earthworks No Dirty Gold campaign and called for mining reforms because the production of just one gold ring generates 20 tons of waste. C.F. Martin & Company formed the Music Wood Coalition to promote better logging practices and shifted to alternative woods like birch and cherry.

Sourcing organically grown materials eliminates synthetic pesticides, herbicides, and fertilizers, protecting consumer health, preserving water resources, and driving mainstream retail growth. Nike became the world's largest buyer of organic cotton, ensuring that 9 percent of all cotton used in 2007 was organic and committing to blend 5 percent organic cotton in all cotton garments. This initiative utilized 11 million pounds of organic cotton in 2007, countering traditional cotton production that requires between 2,500 and 8,000 gallons of water to produce 2.5 pounds. Consumer purchases of organic products in the U.S. reached $24.6 billion in 2008, representing a 17.1 percent increase over 2007.

Fair trade practices improve the living standards and wages of disadvantaged producers in developing regions while funding local community development projects like clean water and schools. Divine Chocolate is 45 percent owned by the Kuapa Kokoo cocoa cooperative in Ghana, whose members receive fair trade prices, sit on the board of directors, and share in the company's profits. Worldwide sales of fair trade products reached $4 billion in 2008, benefiting over 7.5 million disadvantaged producers, while globally UNICEF reports that 158 million children aged 5 to 14 are engaged in child labor and over 70 percent of the more than one billion people living in extreme poverty are women.

Design Strategies for Sustainability

Using recycled content in products and packaging significantly reduces the energy required to produce virgin materials, diverts post-consumer waste from landfills, and saves businesses money. Hewlett-Packard makes more than 200 million inkjet cartridges using post-consumer plastics, utilizing 12 million pounds of recycled plastic in 2008. Creating aluminum cans from recycled content uses 95 percent less energy compared to virgin material, helping manage the 700 million inkjet and toner printer cartridges used yearly across the U.S.

Source reduction minimizes environmental impact by eliminating excess materials and packaging at the design stage, often yielding simultaneous cost savings and transportation efficiencies. Dropps sells ultra-concentrated laundry detergent inside dissolvable one-inch square capsules packaged in thin, collapsible plastic pouches instead of bulky plastic jugs, where 292 pouches equal the plastic of one empty traditional detergent jug. Wal-Mart pledged a 5 percent packaging reduction by 2013, targeting 700,000 metric tons of carbon emissions and $3.4 billion in savings.

Eliminating toxic chemicals and hazardous compounds from products and manufacturing processes reduces legal liabilities, protects worker safety, and prevents environmental contamination. Forbo Flooring produces Marmoleum from natural raw materials like linseed oil and wood flour, installed using safe water-based adhesives as an ecological alternative to toxic vinyl flooring, helping the company achieve $1.8 billion in net sales worldwide in 2009. Nike achieved a 61 percent reduction in manufacturing waste, 35 percent in energy consumption, and 89 percent in solvent use in its Considered line.

Sourcing and purchasing locally grown products minimizes transportation costs, slashes greenhouse gas emissions from food miles, and strengthens local communities and regional farmers. Wal-Mart increased local produce sourcing and expanded peach distribution to 18 different states, slashing 672,000 food miles and saving 112,000 gallons of diesel fuel in 2008 to reach $400 million in annual sales of locally grown produce. In 2009, 39 percent of U.S. consumers expressed concern with buying locally made products, supported by a rise to 6,132 farmers' markets in the U.S. in 2010, up from 1,755 in 1994.

Designing products for efficiency, reusability, and clean chemistry closes the loop and prevents permanent accumulation of waste.

Designing energy- and fuel-efficient products and utilizing renewable energy in manufacturing plants drastically cuts greenhouse gas emissions and lowers consumer operating costs. Kettle Foods installed 600 solar panels on its plant roof generating 120,000 kWh of electricity annually, converted 100 percent of its waste vegetable oil into biodiesel to run company vehicles, and achieved LEED gold certification for its Beloit factory. Standby power accounts for 5 percent of total residential electricity consumption in America, while efficient vehicles like the Toyota Prius hybrid sedan deliver an overall fuel efficiency of 50 miles per gallon.

Promoting reusable and refillable packaging systems cuts down on single-use waste, reduces oil consumption from manufacturing disposable containers, and saves money for businesses and consumers. Klean Kanteen experienced a massive surge in sales of its sleek stainless steel water bottles as consumers rejected disposable plastic water bottles that consume millions of barrels of oil, leading to $18 million in sales in 2008, up from $2.5 million in 2007. Bottled water transportation and packaging consume 17 million barrels of oil annually to support the 30 billion bottles of water consumed in the U.S. in 2006.

Designing products for easy disassembly and utilizing biodegradable or compostable biobased materials closes the loop and prevents permanent accumulation of waste in landfills. Frito-Lay introduced compostable SunChips packaging made largely of polylactic acid derived from corn fermentation, which decomposes in industrial composting facilities and helped drive sales to $308 million in 2009, nearly double its 2007 sales. According to the EPA, 30 percent of solid waste consists of biodegradable material that can be composted, and the Herman Miller Mirra work chair requires just 15 minutes to disassemble using standard household tools.

4. Innovate for Sustainability

Achieving deep environmental reductions requires jumping across innovation curves toward system-level changes, new bioplastic materials, clean technologies, and service-based business models.

Tweaking existing products through eco-design eventually hits a wall where the fundamental concept limits further improvement. You must question basic assumptions and transition to entirely new product concepts and sustainable technologies. This eco-innovation moves a toothbrush made from recycled materials to chewing gum that cleans teeth, and ultimately to a benign food additive that prevents plaque formation.

Eco-Innovation Curves and Systems

Products draw resources and deposit waste into a larger system. Innovators can alter individual elements, dematerialize the product, or create an entirely new product system.

WaterSaver Technologies created the AQUS greywater recycling system where sink runoff water feeds into the toilet for flushing. A typical two-person household saves 5,000 gallons per year with this setup.

Consider these strategic questions to guide your system-level changes:

• What policy changes do we need to prepare for? Can we get a jump on these changes by eco-innovating now?
• Where along the innovation curve is our product? How much more opportunity is there to minimize environmental impact? Might we be better off, strategically, to eco-innovate?
• What do we have to do differently to deliver our product with significantly reduced – or even zero – environmental and material impacts?
• What opportunities exist for us to eco-innovate around our product’s system? Can we change individual elements within our product’s system?

New Materials, Technologies, and Services

Utilizing renewable, biodegradable bioplastics can drastically reduce the waste generated by traditional petroleum-based plastics. Bioplastic volume grows by 20% to 30% each year, while the U.S. recycles just 5% of 30 million tons of plastic annually. Coca-Cola developed the PlantBottle using up to 30 percent plant-based materials like sugar cane and molasses, achieving up to 25 percent reduced carbon emissions compared to standard PET.

Advanced eco-innovative technologies mitigate past environmental problems and drive a sustainable future. Honda rolled out the FCX Clarity, a hydrogen fuel-cell car running on a chemical reaction between hydrogen gas and ambient air with pure water as its sole by-product, achieving a consumption calculation of 68 miles per gallon equivalent. Light-emitting diodes feature a typical lifespan of 50,000 hours.

Shift from selling physical products to offering product functionality as a service to retain material ownership and reduce consumer costs. Zipcar operates a car-sharing service charging a $50 annual membership fee and about $8 per hour. As of June 2009, Zipcar reached a scale of 300,000 members and 6,500 vehicles, allowing 65 percent of members to give up or delay purchasing a private car.

True eco-innovation goes beyond merely minimizing environmental impact to actively restoring the social, environmental, and economic systems that sustain human life. BASF PremAir catalyst converts 80% of ground-level ozone into oxygen. Procter & Gamble's PUR brand water purifier purified 1.6 billion gallons of water in developing countries using a powder packet to remove dirt, cysts, and pollutants while killing viruses and bacteria.

Explore these additional service and restoration opportunities:

• Can we offer services as a replacement for our products? Or, can we lease our product to customers? Can our products be shared?
• Can we replace our products with smarter alternatives (knowledge or more targeted products)?
• What business model might we need to adopt to make services affordable for consumers and profitable for our business?
• What opportunities exist to use new materials such as bioplastics?
• What ways exist for us to make renewable energy more affordable and portable?
• Can we offer products that might actually restore the environment?

5. Communicating Sustainability with Impact

Effective green communications avoid marketing myopia by prioritizing consumer self-interest, offering optimistic solutions, reassuring on performance, and leveraging social media.

Fundamentals and Avoiding Myopia

Successful green marketing requires meeting fundamental conditions such as consumer awareness, perceived empowerment, tangible primary benefits, and competitive performance. Marketers must ensure consumers care about the issue, feel empowered to make a difference, and receive tangible direct benefits without sacrificing product quality or paying unjustified price premiums.

• Be aware of and concerned about the issues
• Feel empowered to act
• Must know what's in it for them
• Afford any premiums – and feel they are worth it
• Believe you
• Find your brand easily

Whirlpool won a $30 million Golden Carrot award for a CFC-free refrigerator but misjudged consumers' willingness to pay a 10% premium without understanding the technology.

Marketers must avoid green marketing myopia by prioritizing core consumer benefits like health, cost savings, or style over abstract environmentalism. Consumers buy products to satisfy basic needs rather than pure altruism. Environmental benefits should be positioned as an important added value rather than the sole reason for purchase.

American Apparel shifted from emphasizing its sweatshop-free label to promoting a sexy, youthful image, helping reach $380 million in revenue and 180 stores three years after the marketing change.

Engagement, Segmentation, and Performance

Educational messages that provide actionable solutions can significantly boost purchase intent, build credibility, and give consumers a sense of control. Making environmental benefits tangible through statistics and clear illustrations helps consumers feel that their individual choices make a practical difference. Pepsi launched an empowering recycling campaign featuring fun facts on cans, such as saving 95 percent of the energy used to make a can and highlighting the 25,000 cans that form the average person's opportunity to recycle in a lifetime.

Tailoring communication messages to the specific lifestyle and values of distinct consumer psychographic segments ensures higher marketing relevance. Different consumer groups respond to different motivations, ranging from LOHAS consumers seeking to contribute to society, to Conventionals looking for immediate cost savings.

• Motivate deep green LOHAS consumers by demonstrating how they can make a contribution
• Show Naturalites that environmental benefits are consistent with healthy lifestyles
• Provide Drifters with easy and fashionable ways to contribute
• Encourage Conventionals with practical, cost-effective reasons
• Help Unconcerneds understand how individuals can make a difference

Toyota targeted tech-savvy early adopters with the Prius in 2001 by emphasizing its revolutionary hybrid technology and quiet ride over pure environmentalism.

6. Establishing Credibility and Avoiding Greenwash

Trust is built through radical transparency, leadership commitment, unexaggerated claims, third-party eco-labels, and active promotion of responsible consumer consumption habits.

To establish credible sustainable branding and avoid accusations of greenwash, you must follow five fundamental management strategies.

• Walk your talk
• Be transparent
• Don't mislead
• Enlist the support of third parties
• Promote responsible consumption

Corporate greening must start at the top with a visible CEO and extend deeply into every department. A committed chief executive acts as a symbolic watchdog and forges an emotional link with customers.

Apple CEO Steve Jobs responded to Greenpeace's Green My Apple campaign by publishing an open letter detailing efforts to remove toxic chemicals and expand post-consumer recycling.

Transparency and Leadership

Companies should voluntarily disclose full details of their products and corporate practices, communicating both positive progress and shortcomings. Radical transparency builds trust and prevents consumer backlash against green fatigue. In April 2008, 79.6 percent of respondents used the Internet to research green initiatives, while 48 percent rated corporate environmental information as fair or poor, and 1,500 companies adopted the Global Reporting Initiative.

Patagonia's Footprint Chronicles microsite lets visitors trace the environmental impacts of ten products, openly revealing that they still use 36 percent virgin polyester in specific items to achieve durability.

Third-Party Verification and Responsible Consumption

Green marketers must provide specific, complete, and unexaggerated claims that account for a product's entire life-cycle to prevent deception. In consumer tests, only 36 percent found the message environmentally friendly credible for a paper product, whereas 60 percent found made with 80 percent post-consumer recycled paper credible. The FTC sued four manufacturers of bamboo textiles for falsely labeling rayon products as natural, biodegradable, and antimicrobial.

Enlisting independent third parties to verify claims and award eco-seals provides a powerful indicator of business integrity and market differentiation. More than 400 different eco-labels exist in over 207 countries, but 93 percent of the American public recognize the ENERGY STAR label, and 73 percent said ENERGY STAR influenced their purchase. Toyota proudly touted that the Sierra Club, National Wildlife Federation, and United Nations had bestowed awards or endorsements on the Prius.

True sustainability requires companies to actively educate and encourage consumers to use and dispose of products responsibly to minimize total life-cycle impacts. Levi Strauss and Co. teamed up with Goodwill on A Care Tag For The Planet to encourage washing in cold water, line drying, and donating old jeans, estimating a 50 percent reduction in climate-change impacts. In a Sacramento utility test, 35,000 customers cut electricity use by 2 percent after receiving comparative peer feedback.

7. Partnering for Success

Collaboration with a broad network of stakeholders—including the public, youth, employees, retailers, suppliers, government bodies, and environmental groups—drives systemic green progress.

Historically, only investors, employees, customers, suppliers, and the press mattered. Today, the general public, citizen journalists, educators, activists, government bodies, religious groups, and future generations scrutinize environmental impacts and influence corporate sourcing, design, and promotion. You face scrutiny from a much broader range of environmental and social stakeholders than ever before, creating new demands and marketing rules.

Engaging the Public, Youth, and Employees

Organizations can deploy fact-based campaigns in major media outlets to demonstrate environmental commitment and highlight product safety and recycling support. In the summer of 2007, the International Bottled Water Association launched a fact-based campaign with full-page ads in the New York Times and San Francisco Chronicle to defend its environmental record. Youth are ardent about the environment and can dictate household buying behavior.

You can engage stakeholders using practical actions:

• Conduct media campaigns that can engage the general public in relevant environmental issues
• Empower educators to teach the facts about environmental issues and how to consume responsibly
• Find hands-on ways to engage youth in reducing their own and their family's impacts
• Sponsor eco-oriented programming for children, teens, and families
• Encourage college students, faculty, and staff to collaborate on exciting educational initiatives
• Create initiatives that encourage employees to make a positive impact on their communities and brands

Collaborating with Retailers, Suppliers, and NGOs

Global supply chains cloud visibility into raw material sourcing, making supplier collaboration essential. Mainstream environmental groups increasingly partner with businesses to provide specialized expertise, protect raw material supplies, and build brand credibility.

You can drive chain-wide improvements through focused steps:

• Help retailers train staff, promote more sustainable products, or conduct special media outreach
• Identify chemicals in your products to ensure they are safe
• Work with suppliers on innovative materials
• Encourage suppliers to provide solutions to packaging and waste challenges
• Encourage suppliers to provide innovative solutions to energy and carbon challenges
• Participate in voluntary programs
• Lobby for stricter regulations
• Partner on new product ideas
• Leverage the special expertise of specific environmental groups
• Protect supplies of raw materials and create new markets for sustainable products
• Leverage corporate philanthropy strategically on behalf of the environment

10 Key Ideas

1. Modern green consumers are driven primarily by personal health fears and universal desires for control, expanding environmentalism far beyond its early counterculture origins.
2. Jacquelyn Ottman's seven strategies provide a holistic framework for aligning business practices with consumer values, balancing functional quality with triple bottom-line impacts.
3. Sustainable product design utilizes life-cycle assessments, organic sourcing, and recycled content to minimize environmental footprints from raw material extraction to final disposal.
4. Method disrupted the household cleaning category by combining efficacy, non-toxic plant-based ingredients, sleek design, and fun into a premium eco-friendly brand experience.
5. P&G discovered through life-cycle assessments that laundry detergent's greatest energy impact occurs during the usage stage, prompting the creation of Tide Coldwater.
6. Achieving deep environmental reductions requires jumping across innovation curves toward system-level changes, new bioplastic materials, clean technologies, and service-based business models.
7. Effective green communications avoid marketing myopia by prioritizing core consumer self-interest, offering optimistic solutions, reassuring on performance, and tailoring messages to psychographic segments.
8. Trust and credibility are built through radical transparency, leadership commitment, unexaggerated claims, third-party eco-labels, and active promotion of responsible consumer consumption habits.
9. Patagonia's Footprint Chronicles microsite demonstrates radical transparency by letting visitors trace environmental impacts and openly revealing the use of virgin polyester for durability.
10. Collaboration with a broad network of stakeholders—including the public, youth, employees, retailers, suppliers, government bodies, and environmental groups—drives systemic green progress.