Green opportunity: Are green products recession-proof ?
During a recession consumers become more sensitive to price as compared to other product attributes such as quality or brand. Consumers are trying to stretch their dollars and become more concerned about what they can afford across all product categories from laundry detergent and frozen pizza to clothing and furniture. A number of studies and articles and have shown most consumers change their purchasing behavior during a recession; not only the ones temporarily unemployed and laid-off. Green products seem to defy this trend and may be somewhat recession-proof. A number of reports in recent days from Forrester Research, the Carbon Trust Standard and IRI have shown environmental considerations remaining important even during a recession.
Environmentally conscious consumers seem to remain green even during hard times. They are willing to pay more for green and ethically produced products and they are brand loyal to companies with genuine environmental benefits. The market for green products was estimated at $209 billion in 2008. This represents an opportunity for green marketers as green consumers are truly distinct from mass consumers. Green consumers are willing to pay more or stick to brands that serve their ethical values and meet their needs for a more sustainable environment. Some authors such as J. Ottman suggest that products should not be sold on their green-ness alone. Obviously sub-par or lower quality products sold at a premium because they are labeled green will not fool consumers. However, these studies indicate that consumers with a positive perception of green products will continue buying them in harder economic conditions and will not compromise.
According to J.Ottman the five rules for green product marketing are:
1. Consumers must be aware of and concerned about the issues that your product professes to address. Don't sell a green features nobody cares about.
2. They have to feel that they'll make a difference by using your product. Are your eco-friendly light bulbs saving them $1.50 per year in electricity?
3. They have to believe your claims. Are you claiming to save the earth with your laundry detergent?
4. The product has to work. Even if your detergent is saving the earth it also has to remove stains!
5. If you're charging a premium, the consumer has to feel that it's worth it. Greenwashing is a no no. Show real green benefits.
There is a real opportunity for entrepreneurs to develop and market eco-friendly and green products given the size and growth of this market. We can think of a number of green products services that contribute to the environment and meet a genuine need for environmentally conscious consumers. There may be a way to eco-innovate our way out of this recession. Green jobs and opportunities are waiting. This economic crisis will end in a few months but the climate crisis will remain for decades to come and so will the opportunities for a better, cleaner environment.
Jean-Luc Marcoux, ecoEntrepreneur and Managing Director;EverQuest Design Inc, an eco marketing agency involved in marketing of products made from repurposed textiles(Cirque du Soleil tents, Apple advertising billboards, space mission parachutes). He has worked with Cirque du Soleil, CBS and large media and telecom clients in Canada and the USA. He also has significant experience as a business strategist in online marketing.
