Green investing is on the rise. With how investors are taking into considerations corporates’ role in environmental sustainability, more terms are emerging. One of the terms is green marketing. What is green marketing, and how does it benefit companies? Is it applicable for all companies? Find out the answers below.
Sustainability as a marketing strategy
The keywords for green marketing are: real and green. As quoted from Investopedia, green marketing is green companies’ attempts to develop and advertise their products by highlighting their real practices of environmental sustainability. Hence, in commencing with this strategy, companies can accentuate their attempt to reduce emission in the production, the practice of product or material recycling, donations to environmental conscious initiatives, and others.
Green marketing: pros and cons
Over time, consumers have started to be conscious of the products they buy. Investopedia chose Starbucks as a prime example. The company has recently been deeply involved in a variety of social and environmental initiatives. Starbucks has established a lot of projects such as the development of renewable energy sources, providing Starbucks College Achievement Plan scholarship, and others. Starbucks is also very open with its attempts to be environmental-friendly through their products.
These actions are essential in building and maintaining the brand’s value, especially to companies that directly contact with their customers like Starbucks. It is not only beneficial to companies’ sale, but also in luring investors in.
However, critics over green marketing soon surface. This strategy is most probably only applicable to larger corporates. Robust social and/or environmental projects cost a lot. While large corporates can easily allocate more budget into the projects without having to worry too much about the loss from a failure, it is a different matter for middle-size and even small corporates. Green marketing for smaller competitors is a big “hit or miss” situation. In fact, a “miss” can really cost small companies their whole business.