WNSF NET NOTES
VOLUME VI, NUMBER 6
“The Green Consumer: Fact, Fiction and the Future of Marketing” hosted by Herman Miller, New York City, June 30, 2009
II. Key Findings
Freya Williams; Co-founder and Global Planning Director of OgilvyEarth, Advertising Agency Ogilvy and Mather’s Global Sustainability Practice
Scott Charon; Product Development Manager, Herman Miller
Dave Stangis; Vice President for CSR and Sustainability, Campbell Soup Company
Kathy Robb; Partner, Hunton & Williams
IV. Questions for the Panel
V. Next Events
October 6: WNSF’s sixth annual Businesswomen’s Sustainability Leadership Summit Details and registration at http://www.wnsf.org
VII. WNSF Concept
I. NETWORK PRESENTATION
The luncheon panel looked at the growing trend of ‘green’ consumption. As consumer preferences turn increasingly to more responsible, sustainable products, companies are marketing ‘eco-friendliness.’ The panelists also discussed how companies can develop effective marketing strategies for ‘green’ products in the current climate of perceived scarcer resources (both economic and natural). Lastly, as ‘green’ marketing and publicity become more pervasive, the Federal Trade Commission is taking a closer look at product labeling to ensure consumers understand what they’re buying. Adding to the burden of a global economic downturn, these variables create a major marketing challenge.
The panel included Ogilvie Mather’s Freya Williams, who talked about changes in advertising and a recent survey showing a greater awareness of sustainability in general in light of the economic downturn. Scott Charon of Herman Miller presented the company’s environmental principles and its ‘perfect vision’ to become a completely sustainable company by 2020. Campbell Soup’s Dave Stangis explained the reinvention of the company’s social responsibility policy, which includes reducing the carbon footprint of the product portfolio. Finally, Kathy Robb of Hunton & Williams discussed the FTC’s current guidelines on green advertising and the potential for movement into policy changes and alterations in current regulations.
I. KEY FINDINGS
- As customers demand “green” products, companies must market their merchandise in ways that make the concept come alive to consumers.
- When marketing, companies must be truthful, avoid generalities, specify what they’re doing and focus on the consumer.
- Some companies (including Herman Miller) are striving for “perfect vision” by 2020–reducing hazardous waste and landfill to zero and purchasing 100 % renewable energy.
- The Federal Trade Commission’s (FTC) Green Guides advise, but do not regulate, companies’ “green” product claims.
III. Freya Williams, Co-founder and Global Planning Director of OgilvyEarth, Advertising Agency Ogilvy and Mather’s Global Sustainability Practice
Ms. Williams discussed the importance of making green marketing relevant and understandable for consumers. Rather than focusing on more distant ideas, like saving polar bears and rainforests, companies should help consumers understand how sustainability can deliver value in areas that are more personally relevant such as their health, their families’ health and the health of their communities. When advertising, companies must figure out what motivates people and frame the sustainability message in those terms.
With the recent economic downturn, a fear has been that the topic of sustainability might be pushed aside by both consumers and government. Luckily, this hasn’t happened. If anything, the downturn has made people more open to change and new ideas, which, in turn, is paving the way for fresh interest in sustainable solutions. However, with that change comes uncertainty. People are hungry for “trusted sherpas” to guide them safely through this new reality. There is a clear role for companies to paint a positive picture of a sustainable future and show consumers how the brands they know and trust are helping make that future a reality–and how they can participate in building it.
IV. Scott Charon; Product Development Manager, Herman Miller
Beginning his presentation by holding up a bottle of honey, Mr. Charon displayed Herman Miller’s long-time dedication to and interest in environmental sustainability. He quoted the company’s founder, D.J. De Pree, who, in 1953 said: In the mid 1990’s, as a way to combat unwanted wasps in Herman Miller’s early location, the company brought in honey bees to rid the office of the pests. This innovative solution meant that the company would not have to spray any pesticides or insecticides. In this and other ways, the company tries to fulfill the longstanding aims of founder D.J. DePree, who, in 1953 said: “Herman Miller shall be good stewards of the earth.”
The company’s design team devises products for the environment, based on three pillars: chemistry, disassembly, and recyclability. The team looks to the supply chain to find out exactly what chemicals are used to make each product, and, from there, they can determine if the chemicals are harmful to the consumer or the environment. The company looks at two cycles of product disassembly, including a technical cyclet (taking something from nature, turning it into a steel or aluminum product and then recycling that steel/aluminum), and a biological cycle (taking nature, making a product and then returning it back to nature).
While product design is a big part of the company’s sustainability focus, Herman Miller also aims for “perfect vision” by 2020– reducing hazardous waste and landfill to zero, purchasing 100 % renewable energy and minimizing its carbon footprint.
V. Dave Stangis; Vice President for CSR and Sustainability, Campbell Soup Company
Mr. Stangis discussed the importance of communicating the genuineness of a company’s green advancements, without misleading the consumer. Each company must decide who its customers are, what they want to know–and then communicate in a way that simplifies the message and conveys authenticity to the customer. The simple rules include: tell the truth, avoid generalities (e.g., ‘environmentally friendly’ is too vague), be specific about what the company is trying to do (e.g., if this product is better than the last, explain why, including the specific benefits of the new product), and finally, focus on the consumer.
Mr. Stangis also mentioned the Campbell Copy-Claim Review Board, a team that meets weekly to review all the potential claims and ensure that no mistakes are made, as a way to systematically manage advertising and marketing claims.
VI. Kathy Robb; Partner, Hunton & Williams
Following Mr. Stangis’s mention of the Copy-Claim Review Board, Ms. Robb went into further depth on jurisdiction and guidelines of the marketing of ‘green’ products. The Green Guides, as passed in 1992 and revised in 1998, is the FTC’s way of looking through the consumer’s eyes and at how they’ll interpret and react to packaging and what is written on product labels. Advertisements must be truthful, substantiated , and not confusing or misleading.
The FTC can bring enforcement actions. In the past, the FTC has focused primarily on claims of “recyclable” and “biodegradable” for products. While companies can list specific environmental innovations about their products, they cannot describe their environmental impact in a way that would be misleading to consumers. Ms. Robb then gave the example, from the FTC green guides, of paper trash bags labeled “recyclable”. While the bag itself may in fact be recyclable, this statement is misleading, because the average consumer in normal use of the bag would not separate the garbage from the bag to recycle it.
Since it has been over 10 years since the last revision of the FTC’s Green Guide, there are plans to reassess it. New provisions may include whether ‘carbon-neutral’ and ‘sustainable’ can be used on labels and what requirements a product must meet in order to earn such a label.
VII. QUESTIONS FOR THE PANEL
Q: How can a company develop effective marketing strategies that promote their ‘green’ items, with the increasing regulatory oversight. How can companies advertise honestly, while maintaining a balance of being outspoken but staying within the regulations?
Dave: Building consumer education, so that they learn more about products’ attributes i.e. recyclability.
Freya: Work with clients to understand their vision, and how best to say it. Transparency is critical. Example: Sun Chips’s bags are created by solar power and they recently launched the news that beginning in 2010, their bags will be 100 % compostable.
Q: How does the FTC use standards that are being self-created?
Kathy: The FTC is aware of the standards and there is compliance with self-regulation on green guides. Dave: Companies are also enforcing each others’ claims. They are regulating their competitors by checking on the labeling of competing products, and then bringing enforcement action against the companies.
Q: How, on the order of internal carbon footprint, have you looked at your companies’ packaging and tried to change from expendable to sustainable?
Dave: Campbell’s has looked at the supply chain and defining measures for suppliers. Small changed in packaging has save millions of dollars and millions of gallons in water/pounds in waste. Campbell has developed a set or Sustainable Packaging Guidelines. The important next step is to then show and share this with the customers and consumers. Scott: Herman Miller strives to select products that can be recycled, but that will also last and not break. The construction of products is a balancing act between being recyclable and being strong.
Q: With customers being worried about climate change, how does that change advertising?
Freya: We have developed four pillars of sustainability brand strategy to guide our and our clients’ thinking towards best practice:
- Synergy: Sustainability should enhance what a consumer is looking to a brand to deliver, to build the brand and strengthen consumer loyalty
- Transparency: be open and honest about your progress, both your strengths and where you still have work to do
- Relevance: find a way to tell a story that meets a consumer need or desire
- Sustainability can often deliver exactly what people are looking for
- Leadership: brands should strive to go beyond compliance to leadership to deliver the greatest value to consumer and to the business
- In May, WNSF held its third annual Businesswomen’s Sustainability China Dialogue in NYC with its Chinese partner, the China Association of Women Entrepreneurs (CAWE), welcoming a delegation of ten. This year’s dialogue focused on water issues in the US and China, featuring Yu Jian, chairman of Shenzhen Water Co., and Kathy Robb, chair of WNSF’s Board of Directors and Director of the Water Policy Institute at Hunton & Williams, where she is a partner.
- In June, former intern Sohana Barot, who began with WNSF just after her freshman year and worked with the organization over three years graduated from CUNY last spring with a Bachelors in Political Science, Magna Cum Laude, along with City College of New York Honors, Rosenberg Humphrey Honors and Political Science Honors. She’s off to an accelerated law school program at Rutgers University School of Law, where she will focus on international business and environmental law. The theme of her senior thesis centered on CSR in China and Saudi Arabia. Says Barot: “WNSF has definitely been a major contributing factor in my interest in corporate social responsibility as well as my future plans for law school. ”
VIII. THE WOMEN’S NETWORK FOR A SUSTAINABLE FUTURE
WNSF provides a forum for business and professional women to congregate, reflect, and act on the converging issues of corporate social responsibility and sustainable development. Through meetings and simple electronic support tools, the Network aims to facilitate the exchange of experiences and best practices on these vital workplace issues. By creating a new network of executive women, the Network seeks to improve responsible practices in workplaces; sensitize corporate culture more generally to issues of sustainability and social responsibility; and encourage a public commitment locally, nationally, and internationally to sustainability principles.
For more information, please contact:
Ann Goodman, PhD
BOARD OF DIRECTORS: CHAIR: Kathy Robb, Esq., Partner, Hunton & Williams; Marlys Appleton, VP, Alternative Investments and Sustainability, AIG; Dianne Dillon Ridgley, Director, Interface Inc. Board; Shelly Esque, VP, Intel Corporation; Karen Flanders, The Prince’s Rainforest Project; Joanne Fox-Przeworski, former Director, Bard Center for Environmental Policy, Bard College; Ann Goodman, Executive Director, WNSF; Sarah Howell, former Director, Corporate Communications, BP; Michele Kahane, Professor, The New School; Clair Krizov, Director, EHS, AT&T; Joyce La Valle, Senior Vice President, Interface Inc.
The Women’s Network for a Sustainable Future is a 501c3 organization. This issue of Net Notes was compiled by Kat Barnes