Major retailers, such as Target, Office Depot and Home Depot, report strong sales in green goods through the recession and studies indicate consumers’ commitment to buying environmentally friendly products has not fallen off.
Yet even as green product sales continue to thrive, industry insiders say, retailers need to tweak their message to emphasize quality and value in addition to the environmental attributes.
“The challenge is promoting the efficacy and innovation of the product, as well as the sustainable elements,” says Neil Stern, senior partner with retail consulting firm McMillan|Doolittle in Chicago and author of “Greentailing and Other Revolutions in Retail.” “The message has got to be about value.”
That consumers are continuing to buy items offering a combination of quality and green characteristics bodes well for retailers who've invested time, money and inventory in private label green brands and other green product lines. The 2008 Good Purpose survey from public relations firm Edelman overwhelmingly shows that buyers plan to remain loyal to products that they perceive to have strong social value.
According to survey results, 68 percent of consumers say that even in a recession they would remain faithful to a brand if it supports a good cause; nearly seven in 10 would be prepared to pay more for eco-friendly products.
The results don’t surprise Ron Jarvis, vice president of environmental innovation for Atlanta-based Home Depot. While sales are down overall at Home Depot, its Eco Options label of energy efficient products are outperforming conventional merchandise sales across the board. “We are seeing continued interest in socially conscious products in our stores,” he says. “American consumers still want choices that have less of an impact on the environment.”
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Jarvis points out that Home Depot sells non-luxury items that people need to buy, regardless of the economy, which gives the company and its green brand an edge.
“We aren’t selling designer luggage made from recycled material, these home essentials that people need.”
He notes that energy-saving products in particular, such as compact florescent light bulbs, are doing extremely well because they have such an obvious long-term financial and environmental benefit. “Customers may pay a little more up front but they see the payoff down the line,” he says.
Despite this strength, Home Depot is tweaking the marketing message -- and price points -- of its green products. The company has launched a price reduction program across the store, lowering prices on thousands of products to make them more affordable to struggling consumers. The Eco Options line is no exception.
| Selling Green Products in Trying Times |
| Be consistent. Communicate information about your green offerings across all media, including the website, advertising, catalogs and store shelves. Show the value. Consumers won’t buy low-quality products just because they have green attributes. You have to show that they perform as well or better than non-green competitors, ideally at a similar price point. Make them easy to find. The days of green products aisles and separate sections for green options in catalogs are over. Green products should be stocked side by side with similar non-green offerings so buyers can make comparisons and purchasing decisions on the spot. Understand why customers are buying green products. For many businesses, green choices are made to support certifications and regulations. If you can help them quickly identify products that meet their needs, you are more likely to make the sale. |
“Our advertising message is that these products are great for the environment with new lower price,” Jarvis says. The company is also focusing on "opening price points," which spotlight the lowest priced items in a category.
“Consumers are looking for green products that they can afford,” he says. “Focusing on opening price points in our advertising shows them that they don’t have to spend any more than they would on conventional products to buy green.”
This kind of dual message is critical for marketing green products in a down economy, says Stern of McMillan|Doolittle. He notes that those retailers who got involved in green branding early on, such as Home Depot, Target and Office Depot, are doing a better job of balancing the environmental message with quality and price.
Communicating the value statement is a key component of successful green marketing, agrees Anne Rodgers, spokesperson for Target in Minneapolis.
“Our focus has always been on value, giving consumers affordable options that enable them to live and work in eco-friendly ways,” she says. “That’s a consistent message for us, whether it’s a good economy or bad.”
Rodgers notes that along with pricing green products to be competitive with other product lines, the company stocks green items, such as its bamboo and organic cotton sheets, next to conventional ones so that consumers can make side-by-side feature and price comparisons.
The company also clearly states the environmental attributes on its packaging and signage to educate consumers about their choices.
“You have to offer an assortment of solutions at different price points so consumers can find multiple ways to be eco-friendly,” she says.
The Green Supply Cabinet
That combination of communication and education is critical to successfully positioning green product lines and establishing the corporate brand as an environmental leader, notes Stern.
