EMERGING TRENDS IN GREEN MARKETING: CHALLENGES, OPPORTUNITIES AND STRATEGIES IN INDIAN PERSPECTIVE

1393 | P a g e

EMERGING TRENDS IN GREEN MARKETING:

CHALLENGES, OPPORTUNITIES AND STRATEGIES IN INDIAN PERSPECTIVE

1

Martin L. Bhoompag,

²

Dr. Smitha Sambrani,

³

Prof. A. Prabhukumar,

1

Assistant Professor and Research Scholar,

³

Professor, School of Management Studies, Jawaharlal Nehru Technological University, Hyderabad, (India)

2

Sr. Assistant Professor, Department of Business Management, Osmania University, Hyderabad, (India)

ABSTRACT

Ecological issues of today are of great concern in nature to business entities, big or small, Indian or Multinational who are advised to maintain the ecological balance by manufacturing and marketing products and services that are bio-degradable in nature and at the same time do not harm the natural resources which are becoming scarce day by day. Along the line are the activities of Consumer Protection and Awareness Groups (NGO‟s) and legislations and norms enforced by both judiciary and local government‟s policies and procedures from time to time. These have compelled the organizations to a great extent to offer Green Products which are eco-friendly with minimum affliction to environment and marketing of them is called Green Marketing. Hence Green Marketing is the buzzword of organizations and quiet predominantly visible in their marketing map and at the same time how profitable these organizations make out of is the crux in ever changing vibrant markets to suit quickly fading customer preferences and tastes.

This paper examines the relevance of Green Marketing in today‟s context with special reference to Indian conditions keeping the environmental issues and sustainable development both as key domains for a profitable business generation. The paper is basically a conceptual one in nature.

Key Words

: Environmental Issues, Green Marketing, Sustainable Development

I. INTRODUCTION

According to the American Marketing Association, Green Marketing is the marketing of products that are presumed to be environmentally safe. Green Marketing can also refer to the process of selling products and or services based on their environmental benefits. And the obvious assumption of green marketing is that potential consumers will view a product or services “Greenness” as a benefit and base their buying decision accordingly.

Consumers are willing to pay more for green products than they would for a less-green comparable alternative product.

Green Marketing is an integral part of total Marketing Strategy of the organization and is basically applicable to products and services that are directly relating to physical environment. Multinational Organizations across the

1394 | P a g e globe are successfully venturing into implementation of practices pertaining to Green Marketing. Growing awareness among consumers for eco friendly products organizations are forced to market products, whose usage will result in less detrimental impact to environment and at the same time leading to sustainable development.

Due to change in customer preferences and tastes for green products the marketing of them includes variety of issues like modifications in the product range, altering the production process and other activities. Organizations across the nations are striving to reduce the impact of goods and services offered by them on the climate and other environmental parameters. Today consumers and organizations are more and more concerned about the environment for versatile reasons and as a result of this philosophy Green Marketing has emerged and created a niche in the market place for sustainable and socially responsible products and services.

Green Marketing is considered to be a relatively new concept into business and came into light in the late 1980‟s and early 1990‟s (Ottman 1998) and picked up momentum as certain products are found to be detrimental to the environment and society as a whole. Due to stringent norms to match environmental requirements both consumers and marketers have become eager to change to greener products. World commission on Environment and Development define sustainable development as meeting “the needs of the present without compromising the ability of future generations to meet their own need” (Brundtland Report, 1987). Lionel Robinson a noted economist is of the opinion that all economic resources are scarce and have alternate utility. As human wants are unlimited and resources are limited contextually, it becomes imperative to marketers to make of these resources effectively and efficiently without waste as well as to achieve the organizations objectives. And hence the need for Green Marketing is highly inevitable.

II. REVIEW OF LITERATURE

Twenty First Century saw vast changes in climatic conditions, depletion of natural resources and the growing prominence for ecological bio degradable products has put total humanity to alert. Green Marketing is part and parcel of the overall corporate strategy (Menon and Menon, 1997). Polansky opines that there are several reasons for organizations for adopting Green Marketing. Keller 1987, Shearer 1990 have identified Green Marketing as a means to achieve the overall objectives of the organizations. Various researches conducted have shown that most of the consumers are concerned about the environment (Roberts 1995, Roberts and Bacon 1997, Van Liere and Dunlop 1981, McCarty and Shrun 1994). Some more studies have indicated that concern for the environment is being reflected in changes in consumer-related perceptions and behavior (Allen and Ferrand 1999, Gamba and Oskamp 1994, Shrum et al 1995). Philips (1999) analyzed that about 87% of US population are concerned about environment and roughly 60% look for brands and products that are environment friendly. Jain and Kaur (2004) have found that Indian consumers surveyed report a high level of concern for the environment and engagement in environmental behavior. They are seeking eco-friendly actions, information and pursue activities that help to conserve the environment and prevent pollution (Jain and Kaur, 2004). Green Marketing is thus seen as a strategy of competitive advantage.

III. OBJECTIVES OF THE STUDY

The objectives of the study are

1395 | P a g e 1. To Investigate the challenges posed by adopting to Green Marketing and

2. To explore the opportunities emanating out of challenges and designing strategies.

IV. EVOLUTION OF GREEN MARKETING

The history of environmental movement can be dated back to a half a century; where in the concern for poor air and water quality rose due to industrialization, growth of urban areas and in Europe. After the proceedings of the first workshop on “Ecological Marketing” held in Austin, Texas (US), in 1975, the Green Marketing concept was given a greater impetus. The workshop released the first book on Green Marketing entitled as “Ecological Marketing” and several others followed.

The prominence of Green Marketing was visible due to the publications on the subject by Ken Peattie (1992) in UK and Jacquelyn Ottman (1993) in US. Ecological Marketing is coined by (Fisk, 1974; Henion and Kinnear, 1976). Environmental Marketing (Coddington, 1993), Sustainable marketing (Fuller, 1999) and finally Green marketing by (Charter and Polonsky, 1999). Thus Green Marketing has evolved over a period of time.

As per Peattie (2001), the evolution of Green Marketing has three distinct phases. First phase

“Ecological” Green Marketing in which activities of marketing are concerned to identify Environmental problems and provide remedies. The second phase “Environmental” Green Marketing the focus shifted on clean technology that involved designing of innovative new products, which takes care of pollution and waste issues.

Finally the third phase “Sustainable” Green Marketing came into prominence in late 1990 and early 2000.

V. GREEN MARKETING: GLOBAL SCENERIO

Paul Stoneman states that financial incentives are required if the market for green products is to improve and grow. According Mintel‟s report roughly about 70% do not buy Green Products because of high cost, while around 40% say lack of availability of Green Products in the market. A clear sign from the above statistics shows that vast potential for untapped market and customer demand and need for eco-friendly products which the companies can exploit for capturing the market share and thereby enhancing the profitability and sustainability of the organizations in the global competitive scenario. Majority of the organizations have taken steps to protect the environment including Greenhouse gas reduction, renewable energy and noise reduction, recycling and using alternate fuels for an increased accountability towards the environment and the society as a whole.

VI. GREEN MARKETING: INDIAN SCENERIO

Green Marketing has its implications for business strategy and public policy being vast in coverage and is part and parcel of overall corporate strategy (Menon and Menon, 1997). Green Marketing also ties closely with issues of industrial ecology and environmental sustainability such as extended producers liability, life-cycle analysis, material use and resource flows and eco-efficiency.

VII. GREEN MARKETING ADVANTAGES

The concept of Green Marketing has evolved over a period of time and taken shape from a mere thought to sustainable business for many companies. The importance of Green Business will directly impact the world and the environment. Companies are desperately trying to develop new and improved products and services with environmental inputs in mind and give themselves access to new markets, increase their profit sustainability and have an edge over competition by embracing to environment. The prominent advantages of Green Marketing are

1396 | P a g e 1. Ensuring sustained long term growth along with profitability

2. Designing the products and services keeping environment aspects

3.

Employees feel motivated while working for eco-friendly organizations

VIII. REASONS TO ADOPT GREEN MARKETING

8.1 Government – Policies

: Indian Government has developed a framework of legislations to reduce the manufacturing of harmful products and services to protect consumers and the society. Ex: ban of plastic bags, Smoking in public places etc.

8. 2 Competition – Pressure :

Many organizations have taken up Green Marketing to maintain their competitive edge. The initiatives have compelled others to follow.

8.3 Social – Responsibility:

Organizations have started behaving in an environmental friendly manner by developing technologies and processes for waste management and good infrastructure in place.

8.4 Cost Reduction

: Reduction and management of harmful wastages can lead to greater savings. One good example is fly ash generated from thermal power plants is used to make fly ash bricks for construction purpose.

Opportunity:

In India around 25% of the consumers prefer eco-friendly products and around 28% are health conscious. More and more companies in India are adapting to Green Marketing initiatives

.

IX. GREEN MARKETING: CHALLENGES

As per noted environmentalist and strategist Joel Makower, Green Marketing faces a lot of challenges because of lack of standards and consensus of society to what is meant by “Green”. Joel is of the opinion that lack of agreement among consumers, marketers, activists, regulators and influential people has slowed down the growth of green products due to company‟s reluctance to promote and consumer‟s skepticism about the claims and at the same time becoming more knowledgeable about green products through web and other resources. The main challenges for Green Marketing are

1. Requirement of renewable and recyclable material which is costlier 2. Need for sophisticated technology which is huge in investment in R&D 3. Waste and other pollutants management is costlier

4. Reluctance of consumers to pay premium for green products 5. Lack of credibility or trust by end users

6. Green or Sustainability confusion among various groups

X. GREEN MARKETING: STRATEGIES

Organizations build products and services based on societal and marketing research.While Societal marketing focuses on developing and executing programs that increase the acceptability of a social idea, cause or practice in a target group (Kotler 1994, Peattie 1999). They defined environmental marketing in terms of customer satisfaction in a sustainable fashion which refers as „the holistic management process responsible for identifying, anticipating, and satisfying the requirements of the consumers and society, in a sustainable and profitable way‟. This implies organizations to deliver to the needs of target markets and offer desired satisfaction to both consumers and society at large. Some of strategies which can be adopted are

1397 | P a g e 1. Adopt to New Technology/Process or modify so as to reduce environmental impact

2. Designing a Management Control System to adhere to norms 3. Explore the possibilities of recycling

4. Usage of eco-friendly raw material 5. Marketing Audit

6. Develop a Marketing Plan

XI. SUGGESTIONS

There is no strategy in the world which will work for all companies. It all depends on the Individual target market share, resources, objectives etc. Various authors proposed different models to develop strategy that includes Green Marketing Grid (Grant, 2007) and Green Marketing Matrix (Ginsbgerg & Bloom, 2004).

Polonsky & Rosenberger (2001) advocated holistic and integrated approach is necessary to implement Green Marketing strategies in all areas of marketing mix.

In order to optimize the economic return on their investment, companies must develop strategies that transform investment into competitive advantage (Orsato, 2006). There is a greater need for strategies to earn sustainable advantage in terms of profit to the firms and minimal impact on the environment. The suggestions are

1. To provide incentives to manufacturers and importers 2. To reward genuine initiatives by organizations

3. To assist consumers to become environmentally responsible 4. To motivate consumers to buy eco-friendly products

5. To improve the quality of the environment and encourage sustainable management

XII. CONCLUSIONS

In India, Green Marketing is relatively still in its infancy and a lot of efforts in terms of research and investigation has to be done to know full potential. Organizations and more so Marketers need to know the implications of Green Marketing and at the same time concern for environment across the world may differ due to age, educational levels, income and etc. Global warming one of the major concern of the environment of today posing a larger threat and compelling the organization to adopt Green Marketing. Re-Cycling of paper, metals, plastic etc should be made safe in a systematized and optimum processes leading to cutting costs, raise response rates and increase growth. While the shift to Green Products may seem to be expensive in the short term; but will prove to be indispensible, advantageous and cost-wise in the long run

REFERENCES

1398 | P a g e Jain S.K. and Kaur G., (2004), Green Marketing: An Attitudinal and behavioral Analysis of Indian Global Business Review, Sage Publications, Vol.5, Issue.2, 187-205

Jay, M (1995), Environmental Marketing: Strategic, Practice, Theory and Research, psychology Press.

Meenakshi Handa, Green Marketing: Drivers and Challenges, B-Cognizance IIITA e-Magazine, Oct-Dec, 2006 Vol. 2, Issue 11.

Menon, A., & Menon, A. (1997). Enviropreneurial Marketing Strategy: The Emergence of Corporate environmentalism as marketing strategy. The Journal of Marketing, 51-67.

Peattie, K. (1995), Environmental Marketing Management. London: Pitman.

Prof. Sanjith Kumar Dash, Green Marketing: Opportunities & Challenges, mba journal of marketing, May 27, 2010.

Vasanthkumar N. Bhatt (1993), “Green Marketing begins with green design”, Journal of Business and Industrial Marketing, Vol. 8, Issue, 4.

Kotler, Keller, Koshy and Jha, “Marketing Management” 13 ed, Prentice Hall, An imprint of Pearson Education.

Scott E. Harrington, Gregory R. Niehaus, “Risk Management and Insurance”, 2 ed, Tata McGraw Hill Education (P) Ltd.

Valerie A. Zeithaml, Mary Jo Bitner, Dwayne D. Gremler, Ajay Pandit, “Services Marketing”, 6 ed, McGraw Hill Education (India) Private Limited.

“Green Marketing: Challenges & Opportunities for the New Marketing Age”. http://www.amazon.com/Green- Marketing-Challenges-Opportunities.

Marketing and Sustainable Development”, 005. www.greenmarketing.net/strategic.html http://www.en.wikipedia.org/wiki/Green_Marketing.