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GREEN PRODUCTS

Don't trash your future. Go green, live rich!!!

 

It's not just enough to keep churning the green products, but equally important is to sensitize the consumers of the environmental impacts of their purchases
TSI | Issue Dated: March 16, 2014, New Delhi
Tags : Consumer 2020 | GE | Detroit Duo | Toyata Prius | Honda Civic hybrid |
 

A  Deloitte report titled ‘Consumer 2020’ point out that by then 3.4 billion people will live in areas of high water stress as opposed to 2.8 billion in 2009. Thankfully, today’s consumers are becoming increasingly aware of the broad sustainability challenge that is facing the world; with more of them becoming active participants in the creation of a more sustainable economy. These optimistic scenarios, however, are balanced by a competing reality. The sustainable behaviour in the first place is founded on already high consumption levels and moreover, is still principally dictated by price, quality, and convenience rather than by origin of products and sustainable content. The issue remains niche, and the disconnect between awareness and action is quite stark.

However, countries like India present another paradox – as more and more people are uplifting from poverty into the middle class, this new-found purchasing power often leads to more conspicuous consumption with a little thought about environment. But then this rising educated middle class will be itself environmentally conscious and will keep the governments on their toes for environmental negligence. Good news is that Indians, as several survey indicate, exhibit greater consciousness than citizens of US and UK. Why? Because issues like water pollution, pesticides contamination, etc. affect us to a much greater extent. The middle class is likely to be less tolerant of societal failures – like that of IT revolution and easy accessibility to knowledge. Citizens of even emerging economies, including India, are increasingly rebelling against environmental pollution, becoming attentive to the environmental issues of products they purchase, and even more than ever concerned of issues relating to public health and societal will being. If the marketers in India fail to address these issues, they will certainly put their own business in jeopardy and that too soon.

Mixing business with environment is no longer a zero-sum game. What is good for common citizens is good for bottomlines too, as evidenced increasingly by number crunching done by financial honchos. Taking cues from their global peers, marketers in India too have decided to don green colour. Yet, one dare say as of now only bets are being placed and the gamble is on. GE came out with Ecomagination – a strategy involving technologies tackling scarcity and higher energy costs. Under it, GE developed a range of environmentally conscious products aimed at reducing its giant environmental footprints. Revenues from GE’s 70 Ecomagination certified products subsequently justified GE’s enthusiasm.

Now from food to clothing, auto to IT – everyone is looking for an eco-friendly label, in order to, on one hand, override objections from flag waving green activities, and, on the other, cut costs, improve performance, efficiency of the business, and overall image. Toyata Prius, Honda Civic hybrid and other green vehicles have received encouraging response from buyers worldwide (though in India consumers have cold shouldered these models, primarily due to high price). Most car makers are retooling their gas guzzlers to produce more fuel efficient transport, including CNG based fuel. After all, all businessmen worth their salt don’t turn green merely because a company has acquired philanthropic benevolence policy; rather it is hard nosed bottomline orientation that has prompted them to come out with green laptops, refrigerators, washing machines, ACs, etc. Eco altruism is never appreciated by penny pinching stakeholders.
When the oil shock first reverberated across the globe in early and then late seventies, the Detroit Duo refused to mend their ways, in the fond hope that green will continue to represent colour of envy for Japanese auto majors. But now when Toyota and Honda lovingly brandish their nimbler, fuel efficient machines to the American buyers, GM and Ford are gasping for fresh air (literally, and metaphorically). Albeit slowly, corporate India – from IT giants to luxurious hotel chains, from automobiles to mutual funds – is snuggling ahead with green initiative. Haier has launched a range of appliances where every appliance comes with two price tags, one showing the buying price, and another showing the cost to operate and maintain it. Ratings qualified appliances incorporate advance technologies which use 10-50% less energy than standard appliances, save money, and help reduce emissions of green house gases and air pollutants at source. Such ratings help the company due to greater acceptance by potential customers and earn trust and confidence – all this is eventually reflected in its sales and margin figures.

Actually the market for environmentally sound products is quite big, driven by the overarching environmental consciousness, energy security needs, and sustainable development imperatives. And trumpeting of green consciousness is not merely confined to tangibles; the impact is being equally felt in the services domain as well. Thus, the ITC Welcome Group of hotels has taken multiple initiatives in terms of water management, energy efficiency, etc. Orchid Hotels chain has received the globally renowned ‘Ecotel’ certificate, which they use as their USP now. Indeed, India Inc. is discovering that being environmentally conscious and fiscally smart are not two mutually inconsistent goals.
But the fact is also that in India, as indeed all around the world, while there is no dearth of awareness and positive goodwill towards green products, the premium that consumers have to shell out for such products (LED lights, organic foods, electrical appliances) acts as a deterrent in raising their acceptance and purchase quotient. Actually, environment consciousness has to convert us into a mindset. So what needs to be done to transform the buyers into green warriors?
The consumers need to be constantly educated about true resourcing costs of consumption (say, higher petrol prices affecting final purchase prices). They must to be tutored in inculcating socially acceptable behaviour, which would speed up adoption. And most importantly they must be realized that sustainable consumption benefits them personally in terms of value, lower price, health, or that the purchase makes a statement about their identity. In fact, in order to promote the right habits, a number of incentives (such as rebates, reduced energy bills etc.) and disincentives (for instance, fine for non-recycling, etc.) can be provided for environmentally sound consumption. This would help in incorporating sustainability into their lifestyle (shopping at local farmers’ markets, for example) till the time it becomes an involuntary act. In order to achieve the purpose, the marketers also need to think and operate alternatively. Today with the penetration of internet and people actively engaged on various social media networking sites like Google, Twitter, LinkedIn etc., this not a big task.

Companies will need to use sustainability as a lens for innovation in developing new products. And the consumers to adopt sustainability in their lifestyles.

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Issue Dated: Feb 5, 2017