Green marketing is the practice of creating and promoting products that are environmentally friendly.
Green marketing includes promoting low-emission production processes and the use of post-consumer recycled materials in product packaging. Some corporations promote their environmental stewardship by contributing a portion of their sales proceeds to environmental causes like tree planting.
- Key things to note
- How Green Marketing Works
- Example of Green Marketing
- What is Greenwashing?
- What Are Some Green Businesses?
Key things to note
- Green marketing is the promotion of a company’s environmental responsibility.
- Because consumers are becoming more concerned about the environment and social issues, green marketing has become an important part of corporate public relations.
- One critique of green marketing is that it favors large firms that can afford the extra costs.
- Smaller businesses may not be able to afford green marketing, but it does not mean they cannot.
- Greenwashing occurs when a corporation pretends to be participating in environmental initiatives but cannot back up their claims.
How Green Marketing Works
It is part of a larger trend towards socially and ecologically responsible business operations. Consumers increasingly expect organizations to demonstrate their commitment to improving operations while meeting various ESG criteria. To that aim, many corporations will regularly provide social impact statements in which they self-report their progress toward these goals.
Examples of ESG improvements include lowering carbon emissions, maintaining strong labor standards both nationally and globally, and supporting communities where a firm operates. While green marketing pertains to environmental initiatives, it is increasingly being used to describe social and corporate governance policies.
Green marketing actions that are not backed up by major investments or operational changes may be deemed deceptive or misleading. Greenwashing can result in huge fines and unfavorable press. For example, on April 8, 2022, the FTC said it was fining Kohl’s Inc. ($2.5 million) and Walmart Inc. ($3 million) a combined $5.5 million for making false environmental claims concerning rayon products.
Companies that choose to use green marketing have many advantages. To begin with, many consumers’ spending patterns are influenced by a company’s perceived environmental commitment.
Example of Green Marketing
Starbucks is frequently touted as a green marketing leader. The corporation has recently made significant social and environmental investments. Starbucks, for example, announced in its 2019 Global Social Impact Report that it had committed over $100 million to renewable energy projects. The corporation buys enough renewable energy to power all of its locations in North America and the UK.
Similarly, initiatives like the Starbucks College Achievement Plan have invested in social impact projects. Many US-based Starbucks employees who work more than 20 hours per week are eligible for fully-paid tuition to Arizona State University’s online undergraduate degree program. This project, along with others connected to veteran employment, is part of Starbucks’ green marketing strategies.
From an investor’s perspective, green marketing activities like Starbucks’ can help establish and preserve a valuable brand. Some critics say that green marketing can worsen larger corporations’ current advantages over smaller or mid-sized competitors.
After all, substantial social and environmental projects frequently entail extra overhead. Large corporations may readily bear these charges, which may even be included in their marketing budget. For smaller businesses, however, these expenditures may drastically reduce profitability or viability.
What is Greenwashing?
Greenwashing is when a firm makes favorable environmental claims but misleads the public or simply lies about them. The consequences of misrepresenting a company’s green marketing efforts can be severe.
What Are Some Green Businesses?
Starbucks, Patagonia, and Burts Bees are all involved in green marketing due to their excellent environmental and social activities.
Green marketing promotes products and services that are more beneficial (or at least less damaging) to the environment than other ones.