What's the Future of Green Marketing?
By Vicki Powers, freelance writer, Deliver^® Magazine

If there’s one thing that we at Deliver^® discovered in putting together this article, it’s that we seem to have reached a tipping point when it comes to sustainable business practices. Clearly, green is here to stay. But, in the process of developing a more eco-friendly approach to business and marketing, what have we learned along the way? How far have we come from the roots of the eco movement? And where is it likely to head?

To explore those questions, we recently spoke with three green-business thought leaders: Jeff Renaud, director of marketing for GE’s ecomagination business; Paul Comey, vice president of environmental affairs for Green Mountain Coffee Roasters; and Andrew Winston, author of Green Recovery and co-author of Green to Gold.

Deliver: Why has green business become mainstream?

Winston: Green has become a central part of the business discussion for a lot of reasons. Companies are feeling pressure from a whole range of stakeholders, including customers, employees and vendors. Then there are tangible mega environmental pressures — such as climate change and water shortages — that are evolving no matter what the economic situation is. Combine all these forces, and there really is no choice anymore. But there are great proactive reasons to look at the business through a green lens. It saves money, reduces risk, drives innovation and new product development, and builds brand value and loyalty. Finally, it’s a great way to survive this recession.

Comey: We’ve reached the point where you can’t continue to consume your environment and think that it’s going to be OK. Through the ’90s, people became aware that we were consuming resources at a horrendous rate. Even so, we don’t currently pursue new green business ideas as environmental projects so much as good operational practices. If we want to change the way we handle waste at our company, for example, I’ll pitch it as an idea that will reduce waste cost, reduce hauling cost — and, oh, by the way, it helps our environment. Looking at it from two different lenses gives you a much better perspective.

Deliver: How have the eco-business efforts at your company changed over time?

Renaud: I think the general environment has certainly changed over the last four years since we launched ecomagination in 2005. The debate centered more around whether we — the broader business community, not just GE — should really be focused on the “green space.” And, if so, could we deliver returns to our shareholders in the process? The consensus seems to be a resounding “yes.” If you look at our ecomagination product portfolio, we launched with 17 products, and today we have more than 80 products. Customer demand drives our growth in the ecomagination product line.

Comey: Early on, most of our green efforts were employee-driven by a champion in the organization who had a passion. In the early ’90s, for example, a couple of engineering folks wanted to save money by developing a filtration system to replace the purchasing of liquid in small bulk tanks. We still have those champions sprinkled throughout the organization as our company has grown larger, but we also take a more systematic approach to it. This can involve processes like replacing lamp fixtures with more energy-efficient versions anytime we do renovations in acquired buildings. Our Knoxville, Tenn., location is getting ready to proceed with this. We have applied for Leadership in Energy and Environmental Design (LEED) certification for one of our recently remodeled buildings, and we’re currently looking for similar opportunities as we expand.

Deliver: Is the economy changing the way companies approach green business efforts?

Winston: Leading companies in green business are not slowing down. They’re still pursuing and, in some cases, accelerating their green efforts. Companies that consider putting their green efforts aside to wait out the economic downturn are making a big mistake. The smartest companies are recommitting to sustainability and using environmental thinking not only to stay profitable but also to drive innovation and help their customers. Green thinking can help companies get out of these challenges. Sustainability is at the very core of survival. Green is about doing more with less, which can save you money quickly.

Renaud: We are responding to the economy by continuing to invest in ecomagination. We believe you need to innovate even in a downturn to come out stronger. Our researchers are focusing on new technologies, such as new ways to maximize wind capture. Even in our current economic environment, the GE ecomagination initiative achieved $17 billion in 2008 revenues, which is a 21-percent year-over-year increase from 2007.

Comey: The downturn in the economy makes us look harder at what we do and justify our costs. There are green initiatives we do that cost money, such as removing the petroleum from our paper-cup liner and substituting it with polylactic acid. Our costs went up, but it wasn’t a cost we felt we should pass along to the consumer. We felt it was the right thing to do in an effort to get the industry to start looking at biopolymers and renewable resources as the correct way to go.

We also just installed a 100,000-watt solar array on top of our distribution building. We were able to put together a package — even in a down economy — that allowed us to spend $750,000 on a solar array and have it make good financial sense for the company. Typically, solar has a 15-year payback, but, by looking for tax incentives and energy grants from the state and accelerated depreciation from the federal government, we were able to make it work.

As a company with a very successful consumer direct channel, it was important for us to look for ways to reduce the environmental effect of our catalogs, so we sought ways to offset their impact. As a first step, we just converted our catalog to paper from sustainable forests, which is a big move for us. And our printer is using ink from 27-percent renewable resources.

Deliver: Where do you see things headed in the future with eco business?

Comey: I’d like to see renewable resources in packaging make greater gains. To keep coffee fresh, you need to keep out oxygen, moisture and sunlight. Once you’ve made a package that keeps out those properties, you’ve basically designed a package that isn’t going to break down, isn’t recyclable and isn’t made from renewable resources. It’s a petroleum, metallic package. We’re all looking for packaging innovations that can protect our products from the elements and be environmentally friendly. That’s what I’m hoping to see in the future.
Winston: Green business is becoming the norm. In the future, we may not talk about green business per se, just business in general. Companies will need to operate in a way that recognizes environmental pressures and strives to reduce them. Those that make these changes will survive and thrive. Those that don’t will find their cost structures are too expensive to operate and will have trouble competing for talent.

Renaud: In the near term, we’re focused on continuing to execute the commitments we made in 2005, which are achieving certain revenue targets, R&D targets and performance targets. We’ve got a substantial ability to deliver environmental changes today, but there’s still a lot of opportunity out there. We recently announced that we’d be launching a venture to manufacture advanced batteries for the transportation market. GE certified its first few products that are focused on recycling heat from different processes and using it to generate steam or additional power. These are big markets and large opportunities that we’re focused on.

Environmental Efforts
GE created its ecomagination initiative in 2005 to help solve the world’s biggest environmental challenges through new products targeting industries such as commercial, electric utilities, government, residential, and transport, to name a few. Through ecomagination, GE has developed more than 80 products ranging from solar, hybrid locomotives and compact fluorescent lighting to wind turbines, Energy Star appliances and aircraft engines. Jeff Renaud, director of marketing, spearheads efforts in ecomagination and is the lead for developing new products for the green building market.

Green Mountain Coffee Roasters was pushing organic and fairtrade coffee long before these coffee options were fashionable. Based in Waterbury, Vt., the company sells wholesale coffee as well as the single-cup brewing system by Keurig, which Green Mountain Coffee Roasters acquired in 2006. Long recognized as a leader in socially and environmentally sustainable business practices, Green Mountain Coffee Roasters continues to push the boundaries regarding green business initiatives while achieving double-digit revenue growth. Paul Comey, vice president, environmental affairs, guides the company’s green business efforts.

Environmental strategist Andrew Winston co-authored Green to Gold, a 2006 best-selling guide of what works and what doesn’t when companies go green. His latest book, Green Recovery: Get Lean, Get Smart and Emerge from the Downturn on Top, makes the case that companies that do not put their green efforts on hold during challenging economic times will survive and thrive.

---Source: Deliver Magazine Sept 8, 2009 (www.delivermagazine.com). Deliver is a USPS^® publication. Vicki Powers in an award-winning, freelance writer specializing in business and technology. Reach her at http://www.vickipowers.com/contact.htm