"Green" brands are those brands that consumers associate with environmental conservation and sustainable business practices.
Such brands appeal to consumers who are becoming more aware of the need to protect the environment. A green brand can add a unique selling point to a product and can boost corporate image. However, if a company is found or perceived to overstate its green practices its green brand may be criticised as greenwash. [1] [2]
Ethical consumerism has led to an increase in green brands. In the food and drinks industry only 5 green brand products were launched in 2002, increasing to 328 in 2007 (Mintel global database).[3] [4]
With an increased awareness of the problems associated with global warming, consumers are now generally more likely to support (through purchase) a green company.[1] As ethical consumerism is on the increase in Europe greening a brand can become part of brand management, and evaluated in terms of brand impact, brand value and brand risk.[5] Some leading brands, such as Coca-Cola, now recognise that environmental issues can potentially impact on the brand value.[5]
In the case of consumer brands packaging can be a key element in communicating a green brand. This is because packaging communicates information to the consumer at the point-of-sale, and because of the environmental impact of the packaging itself.
Companies may use environmentally friendly, recycled and/or recyclable material, or reduce excess packaging. [5] [6] [7] Packaging is of especially high brand importance when the packaging is part of the aesthetic appeal of the product and brand, as in the case of the cosmetics and toiletries sector. Packaging material may have to not only reinforce environmental credentials, but also communicate the high-quality and luxury image of the brand.[8]
Packaging also communicates the brand's green message to the consumer. For example the brand Innocent Drinks is recognised in Britain for its innovative ways of communicating its (green) brand via its packaging.[9] [10]
In Europe concerns have been raised that consumers might be confused or mislead as a result of a recent increase in green brands. Because green brands can add a unique selling point there is little consistency from brand to brand. In the food and drinks industry it has been observed that companies are reluctant to use existing and widely recognised green logos, such as the mobius loop, because using their own makes the brand more easily distinguishable for the consumer.[3]
In Britain the Advertising Standards Authority (ASA) has warned consumers in mid 2007, that some "green" claims might not be authentic. The ASA stated that green claims have become noticeably more prevalent in advertisement, and has investigated and upheld several complaints regarding "unsubstantiated environmental claims". The ASA Director General has stated that "the ASA needs to see robust evidence to back up any eco-friendly claims".[11]
The ASA in Britain has also raised concerns that as awareness about climate change increase among consumers, the cases of unsubstanciated carbon claims (e.g. carbon emissions and carbon neutral claims) rises.[12] The ASA has upheld a number of complaints against energy companies, including Scottish and Southern Energy[13] car manufacturers, including Toyota[14], Lexus[15] and Volkswagen[16] , and airlines, including EasyJet,[17] for misleading claims regarding carbon emissions and carbon neutrality.
Recent cases before the British ASA involved environmental claims such as "local". In December 2006 for example the ASA upheld a complaint against Tesco, where the company advertised British products as "local", which the ASA ruled to be misleading because in this particular case the consumers were likely to interpret “local” as referring to their immediate surrounding region. [18]
In August 2008 the British ASA ruled that Shell had misled the public in an advertisement which claimed that a $10bn oil sands project in Alberta, northern Canada, was a "sustainable energy source". The ASA upheld a complaint by WWF about Shell's advert in the Financial Times. Explaining the ruling the ASA stated that "We considered that the Department for Environment, Food and Rural Affairs (Defra) best practice guidance on environmental claims stated that green claims should not 'be vague or ambiguous, for instance by simply trying to give a good impression about general concern for the environment. Claims should always avoid the vague use of terms such as 'sustainable', 'green', 'non-polluting' and so on." Furthermore the ASA ruling stated "Defra had made that recommendation because, although 'sustainable' was a widely used term, the lack of a universally agreed definition meant that it was likely to be ambiguous and unclear to consumers. Because we had not seen data that showed how Shell was effectively managing carbon emissions from its oil sands projects in order to limit climate change, we concluded that the ad was misleading"[19]
In the US the Federal Trade Commission issues the "Green Guides" (last updated 1998) - environmental marketing guidelines. The guidelines advice on the types of substantiation needed to support environmental, and gives examples of claims that are to be avoided. The Federal Trade Commission has recognise that these guidelines need updating, as for example they currently contain no guidance on carbon neutrality, the term sustainable or renewable. The Green Guides do contain guidance on the term recyclable, recycled and biodegradable. [20]