Green Marketing

MAHARAJA AGRASEN INSTITUTE OF TECHNOLOGY

MARKETING MANAGEMENT

GREEN MARKETING

Submitted by:- Submitted To:-

TABLE OF CONTENTS

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CHAPTER 1Introduction to Green Marketing

CHAPTER 2Research Methodology

CHAPTER 3Data Analysis and Interpretation

CHAPTER 4 Conclusions of the studyRecommendations of the study

CHAPTER 5AnnexureQuestionnaires and references

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CHAPTER 1

INTRODUCTION

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According to the American Marketing Association, green marketing is the marketing of products that are presumed to be environmentally safe. Thus green marketing incorporates a broad range of activities, including product modification, changes to the production process, packaging changes, as well as modifying advertising. Yet defining green marketing is not a simple task where several meanings intersect and contradict each other; an example of this will be the existence of varying social, environmental and retail definitions attached to this term. Other similar terms used are Environmental Marketing and Ecological Marketing. Thus "Green Marketing" refers to holistic marketing concept wherein the production, marketing consumption an disposal of products and services happen in a manner that is less detrimental to the environment with growing awareness about the implications of global warming, non-biodegradable solid waste, harmful impact of pollutants etc., both marketers and consumers are becoming increasingly sensitive to the need for switch in to green products and services. While the shift to "green" may appear to be expensive in the short term, it will definitely prove to be indispensable and advantageous, cost-wise too, in the long run.

Pride and Ferrell (1993) Green marketing, also alternatively known as environmental marketing and sustainable marketing, refers to an organization's efforts at designing, promoting, pricing and distributing products that will not harm the environment Polonsky (1994) defines green marketing as .all activities designed to generate and facilitate any exchanges intended to satisfy human needs or wants, such that the satisfaction of these needs and wants occurs, with minimal detrimental impact on the natural environment.

Elkington (1994: 93) defines green consumer as one who avoids products that are likely to endanger the health of the consumer or others; cause significant damage to the environment during manufacture, use or disposal; consume a disproportionate amount of energy; cause unnecessary waste; use materials derived from threatened species or environments; involve unnecessary use.

WHY GREEN MARKETING?

It is really scary to read these pieces of information as reported in the Times recently: "Air pollution damage to people, crops and wildlife in US. Total tens of billions of dollars each year". "More than 12 other studies in the US, Brazil Europe, Mexico, South Korea and Taiwan have established links between air pollutants and low birth weight premature birth still birth and infant death". As resources are limited and human wants are unlimited, it is important for the marketers to utilize the resources efficiently without waste as well as to achieve the organization's objective. So green marketing is inevitable. There is growing interest among the consumers all over the world regarding protection of environment. Worldwide evidence indicates people are concerned about the environment and are changing their behavior. As a result of this, green marketing has emerged which speaks for growingmarket for sustainable and socially responsible products and services.

Thus the growing awareness among the consumers all over the world regarding protection of the environment in which they live, People do want to bequeath a clean earth to their offspring. Various studies by environmentalists indicate that people are concerned about the environment and are changing their behavior pattern so as to be less hostile towards it. we see that most of the consumers, both individual and industrial, are becoming more concerned about environment friendly products.

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GREEN PRODUCTS AND ITS CHARACTERISTICS

The products those are manufactured through green technology and that caused no environmental hazards are called green products. Promotion of green technology andgreen products is necessary for conservation of natural resources and sustainable development. We can define green products by following measures:

• Products those are originally grown,

• Products those are recyclable, reusable and biodegradable,

• Products with natural ingredients,

• Products containing recycled contents, non-toxic chemical,

• Products contents under approved chemical,

• Products that do not harm or pollute the environment,

• Products that will not be tested on animals,

• Products that have eco-friendly packaging i.e. reusable, refillable containers etc.

NEED OF GREEN MARKETING

Issues like Global warming and depletion of ozone umbrella are the main for the healthy survival. Every person rich or poor would be interested in quality life with full of health and vigor and so would the corporate class. Financial gain and economic profit is the main aim of any corporate business. But harm to environment cost by sustain business across the globe is realized now though off late. This sense is building corporate citizenship in the business class. So green marketing by the business class is still in the selfish anthological perspective of long term sustainable business and to please the consumer and obtain the license by the governing body. Industries in Asian countries are catching the need of green marketing from the developed countries but still there is a wide gap between their understanding and implementation.

CHALLENGES IN GREEN MARKETING

Need for Standardization

It is found that only 5% of the marketing messages from “Green” campaigns are entirely true and there is a lack of standardization to authenticate these claims. There is no standardization to authenticate these claims. There is no standardization currently in place to certify a product as organic. Unless some regulatory bodies are involved in providing the certifications there will not be any verifiable means. A standard quality control board needs to be in place for such labeling and licensing.New Concept

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Indian literate and urban consumer is getting more aware about the merits of Green products. But it is still a new concept for the masses. The consumer needs to be educated and made aware of the environmental threats. The new green movements need to reach the masses and that will take a lot of time and effort. By India's ayurvedic heritage, Indian consumers do appreciate the importance of using natural and herbal beauty products. Indian consumer is exposed to healthy living lifestyles such as yoga and natural food consumption. In those aspects the consumer is already aware and will be inclined to accept the green products.

Patience and Perseverance

The investors and corporate need to view the environment as a major long-term investment opportunity, the marketers need to look at the long-term benefits from this new green movement. It will require a lot of patience and no immediate results. Since it is a new concept and idea, it will have its own acceptance period.

Avoiding Green Myopia

The first rule of green marketing is focusing on customer benefits i.e. the primary reason why consumers buy certain products in the first place. Do this right, and motivate consumers to switch brands or even pay a premium for the greener alternative. It is not going to help if a product is developed which is absolutely green in various aspects but does not pass the customer satisfaction criteria. This will lead to green myopia. Also if the green products are priced very high then again it will lose its market acceptability.

GOLDEN RULES OF GREEN MARKETING

1. Know your Customer : Make sure that the consumer is aware of and concerned about the issues that your product attempts to address, (Whirlpool learned the hard way that consumers wouldn't pay a premium for a CFC-free refrigerator because consumers dint know what CFCs were.)

2. Educating your customers: isn't just a matter of letting people know you're doing whatever you're doing to protect the environment, but also a matter of letting themknow why it matters. Otherwise, for a significant portion of your target market, it's a case of "So what?" and your green marketing campaign goes nowhere.

3. Being Genuine & Transparent: means that a) you are actually doing what you claim to be doing in your green marketing campaign and b) the rest of your business policies are consistent with whatever you are doing that's environmentally friendly. Both these conditions have to be met for your business to establish the kind of environmental credentials that will allow a green marketing campaign to succeed.

4. Reassure the Buyer: Consumers must be made to believe that the product performs the job it's supposed to do-they won't forego product quality in the name of the environment.

5. Consider Your Pricing: If you're charging a premium for your product-and many environmentally preferable products cost more due to economies of scale and use of

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higher-quality ingredients-make sure those consumers can afford the premium and feel it's worth it.

6. Giving your customers an opportunity to participate: means personalizing the benefits of your environmentally friendly actions, normally through letting the customer take part in positive environmental action.

7. Thus leading brands should recognize that consumer expectations have changed: It is not enough for a company to green its products; consumers expect the products that they purchase pocket friendly and also to help reduce the environmental impact in their own livestoo.

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CHAPTER 2

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RESEARCH METHODOLOGY

Title Justification

This title is justified because it shows the Green marketing adopted by companies and

customer satisfaction level towards the Green Products.

Significance to the researcher

Wide exposure to the market

Studying about the customer satisfaction level of the company

Data Collection Techniques

This project consists of two parts.

The first part is a study of the Green marketing which has been adopted by several

companies. This information has been sourced from the internet and from business related

magazines and newspapers.

The second part of the study has been done using an exploratory research process and a

structured questionnaire was developed for this purpose. For the collection of primary data

this was the only method used. The reason I used this method is because a need was felt for

the free influx of information about the products. Also this method allowed the use of skills

gained in class.

Sample Design

The population considered for the purpose of the survey was people residing in Delhi and the

National Capital Region (NCR).

Sampling Technique Used

Since the information required was not of a very technical nature and also looking at the

scope of the project and the extent of the target segment, the sampling technique employed

was Convenience Sampling. I administered the questionnaires.

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Sample Size

I have restricted the sample size to 100 respondents. This was done keeping in mind the time

constraints and the fact that I felt that this number would be enough to serve the information

needs required to show the trends.

Few companies which adopted Green Marketing

Lead Free Paints from Kansai Nerolac

Kansai Nerolac Paints Ltd (KNPL), a leading paint manufacturing company, has transformed its entire range of decorative paints to suit environment and people's health. The company claims to be the first in India to manufacture lead-free paints.

The company went in for this product range as lead exposure is linked to learning disorders in children as well as health problems. Prolonged exposure to heavy metals present in paints can cause many health-related issues that range from irritation of skin & eyes, respiratory problems to chronic blood, liver and kidney disease. Keeping this in mind, it introduced a new range of emulsions that was low in Volatile Organic Compounds (VOC) and subsequently had low odour. This new concept of Nerolac is called Healthy Homes. In the recent past, with focus on safer and eco-friendly paints, the company launched Nerolac Impressions Eco Clean. This is an interior paint with low-VOC. It has low odour, easy to maintain and stains can be easily washed. It is aimed at creating a clean and healthy environment inside one’s home. This range is part of the decorative range of paints and reflects the five elements - earth, air, water, wood and fire. These palettes are represented by colours like Sweet Blossom, Stony Creek, Aegean Blue, Arizona Sun and Honey Roast respectively.

Talking more on this development, Anuj Jain, Vice-President, Marketing & Sales (Decorative), Kansai Nerolac Paints Ltd said, "We have always been concerned about the health and well-being of our consumers and have thus come up with this Healthy Homes range that contains new-generation green additives, so they do not emit any odour whether during and after the painting process."

The above products are offered in all the regular pack sizes. These products are available at all the company outlets and dealer shops pan-India. To propagate the concept, the company recently launched a new campaign of Healthy Homes with Shahrukh Khan as brand ambassador

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Wipro Green It.

Bangalore: Wipro Infotech has launched its eco-friendly 'Greenware' desktop range, which it says is manufactured with materials that are free from chemicals like polyvinyl chloride (PVC) and brominated flame retardants (BFRs). "In order to continue our green initiatives, we have launched this range, for the first time in India," said Anand Sankaran, Senior Vice President and Business Head, India and Middle East Business, Wipro.

"In our desktop, the PVC and BFR are replaced with alternate chemicals for which we worked with 36 overseas suppliers and it took us two years to develop these chemicals," says Ashok Tripathy, General Manager and Head, Computing Business, Wipro. According to Tripathy, the desktop is 100 percent recyclable and doesn't cause any harm to the environment, because the carcinogenic materials - PVC and BFRs - are not present.

BFRs are added to materials to slow down their rate of combustion and they have toxic properties and also have a tendency to accrue in the environment. PVC is a plastic material used widely by the electronics industry mainly as an insulator and coating for electric cables. Both PVC and BFR are not easily biodegradable and therefore pose a serious threat to the environment.

Though, the price of the desktop was not revealed, Sankaran says that there won't be much price difference when compared to the normal PCs. The company will manufacture these desktops in its manufacturing plants at Pondicherry and Kotdwar, Uttarakhand. Wipro also plans to introduce laptops to the Greenware range, in the next phase.

Sankaran says, that though there is no government regulations in India like Restriction of Hazardous Substances (RoHS) compliance, organizations should take initiatives to use such products. "From 2007, all products manufactured by us are RoHS compliant," says Sankaran. From February 2003, European Union has adopted the RoHS compliance.

Agartala to be India's first Green City

All public and private vehicles in Agartala will switch to compressed natural gas by 2013. The city’s largest crematorium already supports three ovens run on CNG, while countless citizens use piped natural gas in their kitchens

Residents of Agartala now have a choice of giving their loved ones an eco-friendly funeral. Instead of using the traditional firewood, they can opt for a cost-effective pyre run on compressed natural gas (CNG). CNG-run pyres are both cheaper and more environment-friendly and are becoming popular among the city’s residents. The Battala crematorium, the largest in Agartala, supports three ovens run on CNG.

Recently, the Tripura government announced plans to switch all public and private vehicles in the capital to compressed natural gas by 2013, making it ‘India’s first green city’. CNG is a fossil fuel substitute for petrol, diesel and propane. Although its combustion does produce greenhouse gas, it is cleaner than the abovementioned fuels, and safer in the event of a spill (natural gas is lighter than air and disperses quickly when released).

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Tripura Natural Gas Co Ltd (TNGCL), a joint venture of the Gas Authority of India Ltd (GAIL) and the Tripura and Assam governments, has undertaken to supply CNG to all private and government vehicles. GAIL is India’s largest natural gas transportation company, integrating all aspects of the natural gas value chain. GAIL was listed by Forbes as one of the world’s 2,000 largest public companies, in 2007. The first CNG station in eastern India was set up at Arundhuti Nagar, Agartala, Tripura, by TNGCL.

“The bottling of gas for cooking purposes is now done here itself though it comes from sources in the neighbouring state of Assam. CNG will also be available to those using electricity, petrol and diesel to run various machines,” says Das.

The trend has spread to all sectors. The Indira Gandhi Memorial Hospital in Agartala now has a CNG connection in its operation theatres, kitchen and bio-medical waste-disposal section. Almost 10 units at the Budjung Nagar industrial area use CNG as fuel in their furnaces; this has the added advantage of no power supply interruptions. Even laboratories at educational institutions are turning to natural gas.

Best Green IT Project: State Bank of India: Green IT@SBI

By using eco and power friendly equipment in its 10,000 new ATMs, the banking giant has not only saved power costs and earned carbon credits, but also set the right example for others to follow.

ATMs, just like any IT equipment, need a dust free environment running at optimal room temperature. ATM centers in India are often over- lit with conventional lights plus have high-capacity ACs running 24x7. In places with power problems, ATMs are run on generators adding to pollution. Sure, someone needs to do something about it.

SBI’s Green IT project is doing just that –

Savings of recurring costs to the bank. Project helps in reducing the carbon footprints impacting the quality of life of the

society at large. It supports the cause of the central bank’s objective of spreading retail electronic

payment culture and reduced dependence on paper based transactions in the country, through rapid expansion of ATMs and debit cards.

SBI opens green channel counterKANPUR: A green channel counter (GCC) was opened for the public at the State Bank of India's main branch on the occasion of its 56th anniversary.

Talking to media persons, SBI's deputy general manager Raj Tilak said at the counter, a customer could withdraw, deposit and transfer funds from one account to another up to Rs 40,000 in a day. A swipe machine is attached with a computer and the customer, while

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operating his account, can witness the entire process on the monitor. "The new facility is eco-friendly and a customer has no need to fill any form or append any signature," he added.

India's 1st Green Stadium

India's first eco-friendly sports complex Thyagaraj stadium, which was the venue for Netball competition of the 2010 Commonwealth Games in Delhi, was inaugurated by Delhichief minister Sheila Dikshit. Built over an area of 16,000 square metres, the Thyagaraj Stadium has been built with the latest green building technologies and eco-friendly material.

"This is our first green stadium and it is the only one which has been constructed right from the scratch with Commonwealth Games in mind. Other stadiums are just being upgraded," Dikshit said speaking on the occasion. The stadium would soon be equipped with a gas panel for energy supply. Currently solar energy is being used for lighting purposes. The stadium features effective water management systems such as rainwater harvesting and sewage treatment with two lakh litres a day capacity.

Sports minister MS Gill, who was also present at the function said the stadium is set to become "pride of Delhi". "There is no doubt that it is one of the finest multi-purpose stadium in the world". "I have been to a lot of places like Sydney, Beijing and London and seen their infrastructure. I will say, our stadium is incomparable and it is not an exaggeration," he added.

"Even after the CWG is over, this stadium can be used to host badminton, Table Tennis, basketball tournaments. We have spent enough money and I am confident of hosting a world class Games this year," he said. Dikshit also said the projects due for the Games would be completed on time. "Let me assure all of you that all the projects would be n time. Let there be no doubt in anyone's mind. The Games would be successful". The sports complex has a parking for 450 vehicles. The multi-purpose Air Conditioned Indoor stadium has a seating capacity of 5,823. The stadium has been built at a cost of Rs297 crore.

Eco-friendly Rickshaws before CWG

New Delhi Chief minister Shiela Dikshit launched a battery-operated rickshaw, “E-rick”, sponsored by a cellular services provider, to promote eco-friendly transportation in the city ahead of the Commonwealth Games.  Priced at 1.5 lakh, the company has so far sponsored 25 vehicles which will be plied on five routes — Greater Kailash-II, Saket-Press club road, IIT-SDA market area, Delhi University-North Campus and Chandni Chowk. “There is a need for collaborative efforts to make Delhi a pollution-free zone. We have always been conscious about environmental issues and hence are supportive of such initiative which would help ensure a healthier and greener city,” said Dikshit. IANS

In the first phase, the company will sponsor 25 vehicles on five routes, including

Chandni Chowk, Saket, IIT-SDA market area, GK-II and Delhi University-North Campus,

Vodafone told reporters in New Delhi. However, the company did not give the number of

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vehicles it would most probably increase during the Commonwealth Games to be held in

New Delhi October this year. E-rick is powered by batteries, aims to ensure reduction in

carbon footprint with zero emission. This technology will reduce the dependence on

conventional fuel, the company said.

"This initiative is a step forward in promoting green transportation for a cleaner and

greener environment in the capital," Vodafone Essar-Delhi, chief executive officer Sanjay

Warke said. Delhi today launched battery- operated rickshaws, sponsored by telecom major

Vodafone Essar as part its eco-friendly initiative, ahead of the Commonwealth Games. The

solution to the problem is provided in form of e-rickshaws. This new mode of transport is a

revolution in the world of transport. The new trend has begun recently in the capital city of

the country and Gurgaon being its close adjacent also has them in bulk. More about e-

rickshaws in Gurgaon is harmonized in the following piece of writing.

Features of E-Rickshaws

Each e-rickshaw has a battery which is required to be charged for six to eight hours. These rickshaws come fitted with satellite navigation devices to ensure timely and

safe service for passengers. The e-rickshaws are zero-emission means of transport for passengers and are

equipped with a remarkable shape, comfortable design and superior technical features. The e-rickshaw is capable enough to run at the speed of 25km per hr or 15mph. These rickshaws also have the facility to be fitted with GPS locator device.

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CHAPTER 3

DATA ANALYSIS & INTERPRETATION

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1. For carrying things which type of material you use?

Handbags 46Polythene 25Green Bags 29

Handbags46%

Polythene25%

Green Bags29%

Type of material people use

HandbagsPolytheneGreen Bags

2. Did You Know about Green Products earlier?

Yes 51No 17Somewhat 32

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Aware51%

Not aware17%

Knew a little bit32%

Awareness about green products

AwareNot awareKnew a little bit

3. How you came to know about the green products?

Print Media 29Audio Advertisement 23Video Advertisement 31Others 17

Print media29%

Audio advert-

isements23%

Vedio advert-isements

31%

Others17%

Source of awareness

Print mediaAudio advertisementsVedio advertisementsOthers

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4. Are you ready for extra expenditure to use green products for carrying goods?

Yes 32No 21Somewhat 39Can’t Say 8

Yes32%

No21%

Somewhat39%

Can't say8%

Ready for extra expenditure to use green products for carrying goods

YesNoSomewhatCan't say

5. Are you satisfied with the green products?

Yes 46No 12Somewhat 32Can’t Say 10

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Yes46%

No12%

Somewhat32%

Can't say10%

Satisfied with green products or not

YesNoSomewhatCan't say

6. Do you believe green products are helpful in reducing global warming?

Yes 46No 17Somewhat 28Can’t Say 9

Yes46%

no17%

Somewhat28%

Can't say9%

How many people believe green products are helpful in reducing global warming?

YesnoSomewhatCan't say

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7. Do you think companies are trying to cheat customers in the name of green products?

Yes 35No 21Somewhat 33Can’t Say 11

Yes35%

No21%

Somewhat33%

Can't say11%

Whether people think companies are try-ing to cheat customers in the name of

green products?

YesNoSomewhatCan't say

8. What Benefits do you think you get from green products?

Environmental Protection 45Health Protection 30Others 25

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Environment protection

45%

Health protec-

tion30%

Others25%

Benefits from green products

Environment protectionHealth protectionOthers

9. How much would you rate the green products?0-3 593-6 136-8 218-10 9

0 to 358%

3 to 613%

6 to 821%

8 to 109%

People's rating

0 to 33 to 66 to 88 to 10

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CHAPTER 4

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CONCLUSIONS & RECOMMENDATIONS

Green marketing is based on the premise that businesses have a responsibility to satisfy human needs and desires while preserving the integrity of the natural environment. That this latter concern has been ignored throughout most of recorded human history does not mean it will be unimportant in the future. Indeed, there are significant indications that environmental issues will grow in importance over the coming years and will require imaginative and innovative redesign and reengineering of existing marketing efforts on the part of many businesses. Solutions to environmental problems can be characterized into roughly three categories: ethical, legal, and business (economic and technological). Long-term sustainability of the planet is likely to require some rather distinct changes in the ethical behavior of its human population.

Barring a crisis, these changes will probably be a long time coming. Legislation is a useful tool for effecting social change; it has a tremendous advantage over moral persuasion in terms of speed and efficacy of implementation, although its results are not always as intended. In the short term, business solutions—the enlightened self-interest of commercial enterprises finding new ways to incorporate technology and carry on exchanges with greater concern for heretofore unpriced environmental goods and services—offer particular promise. Green marketing and the promotion of responsible consumption are part of that solution.

As   t he  demand   fo r   g r een  p roduc t s   undoub t ed ly   ex i s t s ,  Green  Marke t i ng  provides an opportunity to the companies to increase their market-share by introducing eco friendly products. Stricter environmental regulations across the world, growing consumer preference for eco-friendly companies, and the inherent cost advantages in lowering toxic waste, are encouraging industries big and small to clean up.

Result of a survey conducted showed that, consumers are not overly committed to improving their environment and may be looking to lay too much responsibility on industry and government. Though it’s the responsibility of the firm to produce products, which are having minimum impact on the environment, but ultimately it’s the consumer who is having responsibility to use eco friendly products. Consumers are not too much concerned about the environment but as they have become more sophisticated, they require clear information about how choosing one product over another will benefit the environment. Consumer education results in their empowerment. Empowered consumers choose environmentally preferable products when all else is equal

Ultimately green marketing requires that consumers ‘Think Green, Think clean, Think Eco-friendly’ i.e. they want a cleaner environment and are willing to "pay" for it, possibly through higher priced goods, modified individual lifestyles, or even governmental intervention. Until this occurs it will be difficult for firms alone to lead the green marketing revolution

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RECOMMENDATIONS

Finite resources such as oil, metal, and even fresh water will become scarcer and more expensive. If businesses do not become more efficient in using these resources it will have a huge impact on the bottom line. Investing in Green Products thus changes from ‘beyond doing good’ to ultimately ‘good business sense’.

➢Invest in research and create clean and environment friendly products.

➢Clean energy sources such as solar, wind, bio-fuels and hydra power.

➢Water harvesting.

➢Recycle at every level.

➢Move towards paperless office.

➢Educate masses of the environment issues because they are going to be the bulk consumers.

➢Socially responsible investing in environment driven projects.

➢Plant more trees.

The corporations must rethink:

➢About their raw material and procurement strategies.

➢They should develop new products

➢They should redesign existing products and service.

➢They should realize that pollution prevention can be a cost saving activity.

➢They should steer their product and packaging designs to use less material.

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CHAPTER 5

Annexure

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Questionnaire

GREEN MARKETING

Name of respondent:

Age of respondent

How many times you go for shopping in a month?

Less than 2

2-4

4-6

more than 6

For carrying things which type of material you use?

Polythene

Hand Bags

Green Bags ( jute bags, paper bags etc..)

Did You Know about Green Products earlier?

Yes

NO

Somewhat

Can't say

How you came to know about the green products?

Print Media

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Audio Advertisement

Video Advertisement

Others

Are you ready to spend extra amount on green products for carrying goods?

Yes

No

Somewhat

Can't say

Are you satisfied with the green products?

Yes

No

Somewhat

Can't say

Do you believe green products are helpful in reducing global warming?

Yes

No

Somewhat

Can't say

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Do you think sometimes companies are trying to cheat customers in the name of green products?

Yes

No

Somewhat

Can't say

What Benefits do you think you get from green products?

Health Protection

Skin Protection

Other

How much would you rate the green products?

0-3

4-6

6-8 8-10

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References

Kotler Philips & G. Armstrong. Principles of marketing. New Delhi,Prentice Hall.

Richa Agrawal, Green Marketing: An Emerging Trend (PJMR, Vol.5,April 2000)

Excerpts from the survey report conducted by BT-TERI.

www.ecomall.com

www.greenmarketingcorner.com

www.greenpeace.org

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