A Healthy Supply of Green
According to the 22nd Annual Holday Survey of the retail spending and trends commissioned by Deloitte and Touche, 17 percent of American consumers are willing to pay more for "green" supplies. Will this trend continue in a sluggish economy? It's all a matter of how people hedge their commitments between social resonsibility and their personal finaiances.
Recent consumer trends, however, clearly demonstrate that more and more American shoppers are purchasing products that help them maintain a greener home. Seventh Generation, a US-based brand, has averaged 40 percent growth annually over the past five years, with sales approaching US$ 100 million.
According to Seventh Generation's website, natural and organic brands in general are doing big business, with sales in 2005 just north of US$ 50 billion in the US alone. according to LOHAS.com (Lifestyles Of Health And Sustainability), consumers in the US spent over US$ 10.6 billion dollars on Natural Lifestyles productssuch as eco-friendly and environmental cleaning suppliesin 2006.
Seventh Generation CEO Jeffrey Hollender sees his brand as the sector leader, with more than 20 years in the business. "We have been in some ways the driving force in building the green products household category," says Hollender. "In the beginning we were exclusively focused on crunchy, granola consumers, but over the last five years, with the mass marketing of green products, we’ve widened our positioning to consumers who are interested in health and wellness as well as the environment."
Inspired by the Great Law of the Iroquois that states, "In our every deliberation, we must consider the impact of our decisions on the next seven generations," the brand name in and of itself implies a responsibility to teach others what it means to be truly green. "The difference between Seventh Generation and other brands is that we are always focused on our role as educator," says Hollender. "Not all of our communication is focused on selling product, but to give consumers information to lead healthier lives."
From its website to its packaging, Seventh Generation effectively leverages its position as a sincere environmental advocate and educator. "If you want to be a credible player in this market, you have to do a lot more than just green up a couple of your products. We have a bigger responsibility to consumers than that," says Hollender.
Huge proponents of chlorine-free living (the bleaching process is said to cause cancer in humans), Seventh Generation entered the marketplace with a focus on paper products. Today, it's widened the scope of paper offerings (and honed in on female consumers) into the realm of women’s personal hygiene and diapers, as well as a wide variety of eco-friendly home cleaning products.
With many mainstream brands scrambling to capitalize on this trend by rushing out green product offerings, Seventh Generation has one clear competitor. Twenty-eight year old Belgian brand Ecover also has a "green" legacy to leverage. The leading brand of eco-friendly home cleansers in Europe, Ecover is number two in the US. Both brands seek to appeal to the sensibilities of American consumers.
Sincerity appeals to the green consumer. Joel Makower, executive editor of Greenbiz.com, asks the pertinent question, "Everyone wants to be seen as green these days, so how do you tell the organic brands from the rest?" The answer gets to the heart of branding. Makower explains, "What consumers want is authenticity. Both Seventh Generation and Ecover are brands that are known as that."
According to its marketing materials, Ecover defines its brand as a "careful enterprise." Like Seventh Generation, Ecover’s blue and green packaging and clear liquid products do a good job of intimating its brand of cleanliness is next to greenliness. The brand is focused on developing household cleansers that preserve natural resources for DIY eco-friendly practices, like gray watering (reusing household water, other than toilet water, for other purposes), composting and the like.
Ecover takes a casual approach to its packaging and marketing materials, while reflecting the same level of commitment to educating consumers. "We keep our brand strategy pretty grounded," says Kipling Rutherford-Sameshima, marketing executive for Ecover. "We aren’t marketing to Prius owners, we are marketing to anyone who would like to make small, eco-friendly changes in their home."
Both brands have received respectable accolades for the their efforts. Ecover was awarded the Global 500 Roll of Honour of the United Nations Environment Program back in 1993. Hollender is on the Board of Directors of Greenpeace, and Seventh Generation recently scored a 2008 Fast Company Social Capitalist Award, recoginized for harnessing the tools of the marketplace for the greater good and helping solve some of today’s most urgent challenges in the process.
Hollender believes Seventh Generation leads the sector for practicing what it preaches. "It’s important for companies to be green on the inside as well as the outside," he says. "With the huge rush to introduce green products to the marketplace, many 'eco' brands have amazingly little focus."
Ecover also walks the walk, doing business the way it tells consumers to live their lives. "All of our products are made in our sustainable factories in Europe," says Rutherford-Sameshima. "Belgium is really cold. Our factory there has a glass roof the size of Wembley Stadium with an eco system that rarely requires it to be heated, and its own water filtration system."
With such heated competition in the "green" market, which brand will emerge the leader? "So much of sustainability is about storytelling," says Makower. "When consumers go into Whole Foods and buy poultry, they are told the name of the farmer and his wife, and the rest of the brand story. Seventh Generation has done a fabulous job of creating not just a brand, but a story behind the brand. Jeffrey Hollender is a maverick and a charismatic spokesperson. It’s always helpful to have a spokesperson like that. He spends a large part of his life talking to customers, talking to the public, not to wave the Seventh Generation flag, but to foster larger awareness and grow the natural/green marketplace. I’m not sure what Ecover’s story is, or who’s telling it."
"Ecover is not preachy," counters Rutherford-Sameshima. "Consumers tend to think the environment is a big scary place where the changes they make will make little to no impact. Through our website and our packaging, we show consumers that if you start making small changes in your home... it gives consumers a grasp on how to start."
She also says that, although Americans are newer to sustainable practices, they are catching on rapidly. "Europeans are very savvy about recycling and living sustainably. In Europe, our product isn’t sold in 'health' stores, but in grocery stores. The United States is catching up, but at twice the pace. Green thinking is not a trend in Europe. Most people compost. Most people gray water."
Makower sums up the challenges both brands face as the green market gets more competitive. "Brands like Seventh Generation and Ecover are now mainstream," says Makower. "The challenge is, how do you continue to leverage that authenticity and brand value when everyone from Tide to Windex wants to be green?"
Hollender, true to form, welcomes the competition. "The world faces too many challenges, we need all the partners we can get," he says. "Companies need to rise to the highest standards they can."
Both Ecover and Seventh Generation have set the precedent in the "greener" home category. Those brands looking to jump on the "green" bandwagon will have a tough time creating an aura of authenticity. In a meantime, it will be interesting to see which green brand is greener this time next year.