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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.
Increase in green brands
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).
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 claim sustainable packaging, recycled and/or recyclable material, or reduce excess packaging. 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.
Advertisement and marketing standards concerns
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.
In Britain, the Advertising Standards Authority (ASA) 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".
The ASA in Britain has also raised concerns that as awareness about climate change increase among consumers, the cases of unsubstantiated carbon claims (e.g. carbon emissions and carbon neutral claims) rises. The ASA has upheld a number of complaints against energy companies, including Scottish and Southern Energy car manufacturers, including Toyota, Lexus and Volkswagen, and airlines, including EasyJet, 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.
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 the World Wide Fund for Nature 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"
In the United States the Federal Trade Commission issues the "Green Guides" (last updated 2012) - environmental marketing guidelines. The guidelines give advice on the types of substantiation needed to support environmental claims, and give examples of claims that are to be avoided. The Federal Trade Commission has recognised that these guidelines need updating, as for example they currently contain no guidance on carbon neutrality, or the terms sustainable or renewable. The Green Guides do contain guidance on the term recyclable, recycled and biodegradable.
The marketing and brand building experiences of many American green brands was documented in the book The Gort Cloud by Richard Seireeni, 2009. The gort cloud refers to the green community that provides support and a market to green brands.
- Walters, K, 2006, 'Certified Green', Business Review Weekly, 16 November 2006
- BBC NEWS | Science/Nature | 'Greenwash' is losing its shine
- Green logos create brand tension - Consumer Trends - FoodAndDrinkEurope - Food, Beverage & Nutrition. Decision News Media
- Consumers go for green products. Foodanddrinkeurope.com
- Profit from the growth in green packaging. Money Week.
- Computer Arts - The future of green packaging
- "Green agenda takes centre stage in beauty sector". Packaging Today.
- ASA Gets Tough On Advertising Green Claims
- Green ad claims on the rise as the climate debate heats up
- Scottish & Southern Energy Group
- Toyota (GB) plc
- Lexus (GB) Ltd
- Volkswagen Group UK Ltd
- EasyJet Airline Co Ltd
- Just popping down your local It might be further than you think
- Monadnock Paper Mills - Monadnock Issues Third Edition of Field Guide