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The Changing Consumer Marketplace, the third webinar in the Sustainable Brands Boot Camp, provided up-to-date insights into the changing green consumer profile and what motivates consumers to buy green in today’s economy. Companies can use this market research to craft green product value propositions and make green profile decisions. Key takeaways? Green pricing premiums won’t work in a post-recession economy and sustainability has reached a tipping point into mainstream.
by Debbie Van Der Hyde, Green Economy Post
The Sustainable Brands Boot Camp session, The Changing Consumer Marketplace, was moderated by Sustainable Life Media columnist Maria Surricchio and featured consumer insight experts Amy Hebard, Chief Research Officer of Earthsense, a green market research firm, and Gwynne Rogers, Business Director, Natural Marketing Institute (NMI), a market researcher specializing in the health and wellness marketplace.
Surricchio introduced the session by outlining key questions:
• Has green gone mainstream?
• How has the economic climate impacted the green industry?
• What are the current motivators for consumers to buy green?
• Given the economy, how can companies craft a value proposition for green products?
• What is better: green operations or green brands?
Hebard began addressing these questions by introducing Earthsense’s semi-annual Eco-Insights study. Due to ongoing economic uncertainty, we are operating in a new reality, she said. But the most recent study indicates that there are still lots of green opportunities.
“Earthsense also monitors the Green Confidence Index, a monthly measure of the green marketplace in terms of optimism and intention—and it still has potential,” she said. Hebard cited food products as an example, noting that people who have bought sustainable products continue to do so, and as much as 15 percent of people who haven’t bought green in the past intend to do so in the future.
Part of this new reality means that the era of the green premium is gone. Earthsense research indicates that “consumers’ willingness to pay extra for green products has dropped almost in half,” Hebard said. She added that this paradigm shift is a huge challenge and opportunity for green product marketers.
Changing Green Consumer Profile
Switching gears to talk about today’s green consumer, Hebard said her company’s research indicates a tremendous variation in appeal of the green market—from the green core that makes 70 percent of green purchases to the green rim, which includes strivers and skeptics. She noted the recession had caused a polarization in the green market, increasing the number of consumers who were in the “detached” quadrant.
To address this polarization, marketers need to not only understand green consumer segments but also to think like green consumers. Hebard suggested that both the product content and the way in which it is manufactured can impact green buying habits. “When communicating to consumers, start where they start, speak how they speak, think about which aspects of the product life cycle are most important to them.”
The number one way to think like green consumers? Answer the question: What’s in it for me? Hebard outlined the top 10 motivators—as well as barriers—to buying green foods. As for barriers, price is a primary concern, followed by availability and lack of clear labeling. Understanding and addressing these barriers is critical to driving green sales.
Summarizing her presentation, Hebard reiterated: “The thinking that green deserves a premium has not only changed, but has decreased dramatically—and is not going to come back post-recession. Price has new role to play in green marketplace.”
Sustainability Hits Mainstream
Gwynne Rogers of NMI picked up the reins of the webinar by commenting that sustainability has hit a tipping point. “Sustainability has become a lifestyle; it’s affecting what we eat, how we live and what we hear in the media,” she said.
Based on NMI’s Lifestyles of Health and Sustainability (LOHAS) research, Rogers described five types of consumer segments:
• LOHAS—19 percent of population, who harbor the strongest attitudes toward taking care of the planet and their health.
• Naturalites—15 percent, who are interested in sustainability because it affects personal wellness.
• Drifters—25 percent (often with families), who want to be perceived as doing the right thing but need green to be easy.
• Conventionals—24 percent, who are practical and engaged in conservation behaviors when it saves money.
• Unconcerned—17 percent, who are simply not interested.
NMI’s research showed growth in the drifter and conventional segments. Rogers attributed the drifter growth to more media coverage of sustainability, which influenced the segment due to image, and the conventional growth to the recession because the segment did not want to be wasteful.
NMI uses the LOHAS population attitudes and behaviors as predictors to what the other segments will be doing and thinking in a few years. “LOHAS consumers were setting the pace in 2007 but mainstream consumers are essentially catching up,” Rogers said.
Rogers also noted the changing dynamics within the environmental movement. NMI’s research shows that consumers are less apathetic because it’s no longer as hard to think and act green. She cited a behavioral example of how approximately one-half of US adults take a reusable bag to the grocery once per month.
Understanding this research is critical to designing sustainable products that sell, Rogers submitted. “Almost 60 percent of surveyed people don’t want to sacrifice quality, convenience or price when buying environmentally-friendly products,” she said. Like Hebard, Rogers suggested that personal interest motivates much of people’s green buying behavior. “Counting on altruism is risky,” she added.
Where to Go Green First
In the final segment of her presentation, Rogers compared the pros and cons of green products versus green companies. She contended there were rewards in promoting a green brand or green operations but NMI research indicated that when consumers have access to information about a company’s total product life cycle (i.e., pre-usage, usage and post-usage), it can become more important to offer green products. “Reducing actual impact is more defensible in the long run, but consumers want something tangible and the product is the easiest manifestation,” she commented.
From June 7-10, 2010 get set for Sustainable Brands 2010 where The Power of And will be explored in depth and participants will be inspired, engaged and equipped to begin or continue down their own cycle of sustainable business innovation by building the discipline to continually observe, re-design, measure and communicate. Find out more.
*Note: The Green Economy Post is a Sustainable Brands media partner.
© 2010, Debbie Van Der Hyde. All rights reserved. Do not republish.
Author: Debbie Van Der Hyde (8 Articles)
Debbie Van Der Hyde is an experienced freelance writer with a strong interest in sustainability, clean energy and the green industry. For more than a decade, she has helped organizations effectively communicate their brand and promote their products and services through feature articles, brochures, video scripts, podcasts, web copy and more. Now Debbie is expanding her writing repertoire through blogging about the green economy—and what started as a pastime has become a passion. Prior to becoming a writer, Debbie worked in marketing and corporate communications for a global consulting company. When not wordsmithing, she usually can be found volunteering, attempting to perfect a yoga pose, or orchestrating dozens of family activities. More about Debbie is available at www.vdhc.com. She can also be reached at firstname.lastname@example.org.