Satisfying consumers' desire for green

Recyclable, organic, ecofriendly, sustainable — sound familiar? Last year saw an explosion of 5,933 new green products entering the U.S. market, more than twice the number that appeared in 2005.(1) Equally striking is the rise in media coverage of environmental issues, which has nearly tripled in the United States since 2004.(2) Yet very little attention has been paid to consumer perceptions of the green climate. With so many products to choose from and so much — often conflicting — information at their fingertips, what are consumers thinking?

Landor’s 2008 ImagePower® Green Brands Survey aims to find out. Now in its third year, the study examines the general public’s view of environmental issues, which brands are perceived as the greenest, and consumer inclination to purchase green products and services. Along with partners Cohn & Wolfe and Penn, Schoen & Berland Associates, Landor conducted over 3,000 online interviews of consumers aged 18 and up, evenly split between the United States and the United Kingdom.

We found that consumers are more concerned about the environment than ever before, with a growing number planning to increase purchases of green products and services. Which brands and categories are most likely to benefit from this trend? And how can companies satisfy consumers’ quest for green?

Greenbacks for green products

Over the past three years, we’ve seen “green” used broadly and loosely for a range of topics including climate change, pollution, energy consumption, and waste. Our first survey, conducted in 2006, found that 58 percent of U.S. consumers didn’t care about green issues or products. But by 2007, one-third of respondents said they were actively doing something to positively affect the environment — an amazing shift for a single year. And for the first time, consumers declared their willingness to spend more on green products and services, expecting to double their expenditures within the year.

This year, concerns about the economy and personal well-being have understandably crept into the discussion. Approximately two-thirds of those polled considered the state of the economy even more important than protecting the environment. Nonetheless, a whopping three-fourths of respondents (73 percent in the U.S., 79 percent in the U.K.) say they will maintain or increase their level of spending on green products in the coming year. Why? To minimize their own environmental footprints.

This behavior reflects the growing belief that individuals rather than corporations or governments have the most impact on the environment (29 percent in the U.S., 26 percent in the U.K.). Consumers increasingly view the environment as a personal issue rather than an abstract one, and their focus seems to be shifting from larger concepts, such as climate change, to things they can influence directly in their daily lives, such as waste disposal and energy consumption.

Who’s the greenest?

In past surveys, consumers have told us that they believe green brands to be of higher quality, more trustworthy and innovative, and a better value than nongreen brands.(3) Which companies do they perceive as the greenest this year? And what products are most likely to earn their green dollars — or pounds?

When asked to name the company they considered the greenest, only half of those polled were able to provide a response without having a list to choose from, and even the brand named most often (the Body Shop in the U.K.) evoked only a 6 percent response. Such low figures indicate that no brand has successfully established itself as the greenest of them all, and the opportunity to do so remains wide open in all categories.

In the U.S., GE and Toyota were cited unprompted most frequently (by 5 percent and 4 percent of respondents, respectively) as the greenest companies. Americans also listed Wal-Mart among the top five green brands, putting it on par with Whole Foods (each cited by 2 percent of those polled).

In the U.K., the Body Shop placed first with 6 percent; Marks & Spencer tied with Tesco for the number two spot at 5 percent. Supermarkets in general scored high (four of the top eight brands), demonstrating their effectiveness at communicating their sustainability initiatives to customers. And interestingly, energy provider E.ON was named by 2 percent of those polled, probably because of a massive advertising campaign around its wind farms and other green energy offerings.

The green favorites

By contrast, when consumers were given a list of brands to rank for greenness, different companies claimed the leading positions in the United States Wal-Mart didn’t even reach the top 10, and Toyota fell to fifth.

Grocery and body care brands dominated the list for the third year running. In the U.S., five of the top 10 brands came from the personal care category, with Burt’s Bees at number two, followed by Tom’s of Maine, Seventh Generation, and Method.

Among British consumers, the Body Shop again headed the list. Six of the 10 brands considered greenest in the U.K. are supermarkets — reflecting both concerted green initiatives across the sector and consumers’ focus on the practical, everyday concerns of packaging, recycling, and reducing the use of plastic bags. The second greenest brand, Marks & Spencer, recently announced its plans to become carbon neutral within five years (without resorting to carbon offsetting). Its 100-point “Plan A” campaign will impact every aspect of operations including manufacturing, product labeling, waste management, and in-store heating. Phil Gandy, senior consultant at Landor, reflects:

The British public has clearly responded to initiatives, such as Marks & Spencer’s widely publicized Plan A campaign and most recently its move to charge for plastic bags. Companies and brands that aspire to be green need to connect with consumers and stakeholders in similarly direct ways. Brands that focus and deliver on simple, tangible initiatives in easily understood branded wrappers will gain the greatest traction.

The brands perceived as the greenest also scored well for being trustworthy, high quality, and socially conscious—attributes that the strongest brands in general usually share. In fact, consumers ranked these qualities as more important than whether a company is environmentally conscious. It’s an interesting circle. Consumers say they care more about whether a company is being honest with them and providing high-quality products and services than they do about its waste reduction or energy efficiency. However, companies who are perceived as green are also usually credited with being trustworthy, high quality, involved in their local communities, and innovative.

Greenness by industry

Based on the responses, grocery and body care are clearly perceived by consumers to be the greenest product categories for the third year in a row.

The categories that appear — rightly or wrongly — the most green to people are those that come in direct contact with them, particularly their bodies: products used “in me” (such as food or places to buy it), “on me” (cosmetics, toiletries, diapers), and “around me” (cars and appliances).

Do grocery and body care brands score highly because those companies have produced more green products or launched more green initiatives than other categories? It’s more likely that as consumers take a greater degree of personal responsibility for their impact on the environment, they are predisposed to view the brands closest to them and their everyday lives as the greenest. They may believe they have the greatest control over these areas and thus make the greatest effort to ensure those products and services are green.

Get the word out

One major lesson from this survey is that brands engaging in green practices need to communicate them better. Says Scott Siff, executive vice president of Penn, Schoen & Berland: “The brands with real potential to reduce energy usage, though high in the rankings, could still do a better job of connecting to people’s energy-saving impulses more directly, more personally.”

Mobile phone companies ranked ninth among green categories in the U.K., yet many of them have major environmental initiatives under way. This year at the Mobile World Congress in Barcelona, one of the world's largest trade shows for mobile services and devices, Nokia unveiled the world’s first recyclable phone. But the message is apparently not getting through to consumers. And although iPhone has one of the worst track records for greenness in the industry, the Apple brand was perceived as the greenest of mobile phones.(4) Could this be a halo effect emanating from people’s love for Apple?

There is no doubt that major branding and communications work can increase green perceptions of a brand. That energy is perceived as a much greener industry than travel in the United Kingdom is indicative of the significant environmental brand work done by BP, Shell, and E.ON. More companies would do well to connect with the public on tangible, personal levels, as E.ON did when it sent energy-saving lightbulbs to its customers.

Buying green

How do people’s perceptions of green categories affect their purchase decisions? Although participants on both sides of the Atlantic said they would not pay extra for services, such as dry cleaning and accounting, to be environmentally friendly, they willingly pay more for green groceries, appliances, and body care items, and plan to increase such spending in the future.

One notable trend that surfaced in this study is the attention consumers are giving to packaging. A massive 95 percent of respondents in the U.S. and 94 percent in the U.K. believe that products — especially groceries — are overpackaged. To reduce waste, many consumers are now turning to products with less or recycled packaging (39 percent in the U.S., 50 percent in the U.K.), showing almost equal support for both approaches.

Nearly six out of 10 Brits (57 percent) say they avoid using plastic bags when shopping for groceries, as do 41 percent of their American counterparts. And a clear majority of both Americans and Britons choose energy-saving appliances (64 percent U.S., 55 percent U.K.), recycle materials (63 percent U.S., 68 percent U.K.), and say that environmental buzzwords, such as “recyclable,” “renewable,” and “natural,” influence their purchase decisions (roughly 82 percent of both groups).

Green and simple

The results of the 2008 ImagePower Green Brands Survey reveal huge opportunities for brands to differentiate themselves through environmentally friendly practices and policies — and anticipate real benefits for those who do. Despite their concern about the economy, consumers intend to spend as much or more on green products in the future.

The opportunity for green leadership exists in every category; all businesses stand to gain from making inroads into sustainable practices. If you’re keen to grab that green label for your brand, remember that consumers still place a premium on values above and beyond greenness, such as honesty, safety, and quality.

And companies can’t just talk about being green, they need to act on it. When asked to rank a list of characteristics that drive their purchase decisions, respondents placed “having a green vision for the future” among their lowest priorities. People want to buy brands that are environmentally responsible today, not those that plan to go green tomorrow. This is why Marks & Spencer’s Plan A has been so successful: Consumers can see evidence that the company is following through on its intent.

Methodology

The ImagePower® Green Brands Survey is conducted annually to gauge consumer perceptions of the “green climate” in both the United States and the United Kingdom. This year, Penn, Schoen & Berland Associates conducted online interviews with 1,546 U.K. citizens and 1,521 U.S. citizens between April 17 and April 20, 2008. The margin of error for the sample is +/-2.49 percent. Only individuals aged 18 and over were included, and respondents rated only those brands with which they were familiar.

1 Todd Wasserman, “Mintel: ‘Green’ Products Top 5,933 in 2007,” Brandweek (20 May 2008). Study was conducted by Mintel, which considered products “green” if they had environmentally friendly packaging or contained label copy about humane treatment of workers or a lack of animal testing.

2 Statistic for 2008 estimated through a search on Factiva for “green + environmental” for the dates October 1, 2007–May 29, 2008, in U.S. media. Other figures were estimated the same way: 15,737 for the year 2004–05; 21,682 for the year 2005–06; 33,199 for the year 2006–07.

3 ImagePower Green Brands Survey 2007 conducted by Landor Associates; Cohn & Wolfe; and Penn, Schoen & Berland Associates.

4 For a brief overview of issues surrounding Apple’s iPhone and links to further information see, “Sustainability: Toxic iPhones Face Lawsuit,” Fast Company (16 October 2007), blog.fastcompany.com/archives/2007/10/16 ↵
/sustainability_toxic_iphones_face_lawsuit.html (accessed 22 June 2008).