An Executive Summary For Managers And Executives

An executive summary for managers and executives can be found at the end of this article

Green marketing of cosmetics and toiletries in Thailand
Lalit M. Johri
Associate Professor at the School of Management, Asian Institute of Technology, Klong Luang, Pathumthani, Thailand

Kanokthip Sahasakmontri
Retail Network Strategic Planning Assistant, Shell Companies in Thailand, Klongtoey, Bangkok, Thailand

Introduction The green marketing of products and services is an important development in the context of emerging economies in Asia. By adopting resource conserving and environmentally-friendly strategies in all the stages of the value chain the firms can satisfy the growing environmental concerns of humanity. In the West, business firms face social and legal pressures to adopt environmentally-friendly business strategies. Many corporations responded to these pressures and adopted environmentally-friendly strategies. For example, Earth Care in the UK built strong competitive advantage and grew very fast since it started its operations. Similarly Ciba Geigy, now part of Novartis, has improved its corporate performance by adopting resource and environment conservation programs. Environmentally-friendly attitudes In Thailand, international companies in personal care products, detergents and petrochemical industries have been pursuing green marketing strategies for some time now. Recently many construction firms, refrigerator manufacturers and processed food companies have also launched programs to contain damage to the environment and project themselves as environmentally-friendly companies. The Thai companies and consumers are increasingly becoming environment conscious and many environmental management initiatives have been launched by different segments of the society. These cover a wide spectrum of environmentally-friendly actions and strategies. Major corporations, both foreign subsidiaries and local companies, are investing in pollution-control equipment

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(1996), “Marketing strategies and market prospects for environmentally-friendly consumer products”, British Journal of Management, Vol. 7 No. 3, pp. 263-82. s JOURNAL OF CONSUMER MARKETING, VOL. 15 NO. 3 1998 279 This summary has been provided to allow managers and executives a rapid appreciation of the content of this article. Those with a particular interest in the topic covered may then read the article in toto to take advantage of the more comprehensive description of the research undertaken and its results to get the full benefit of the material present Executive summary and implications for managers and executives “Green” marketing is a long-term branding issue not a tactical concern In the West “green” marketing has become a staple of corporate positioning. At the same time firms have exploited environmentally-friendly messages for short-term marketing gains. The result of the “exploitation” has been a growing cynicism among the public about environmental claims. The sponsorship efforts of Shell UK and BP illustrate how firms seen, in the round, as polluters are using the environment and environmental campaigns to mollify public opinion about their extractive and polluting activities. In developing countries the picture is very different. Many emerging economies – and especially those in east Asia – have criticised the attitudes of Western countries towards environmental issues. At the recent Kyoto Earth Summit, developing countries complained that the West (and particularly Europe) was using “green” issues to place anti-competitive constraints on emerging economies. Again the desirable aim of international environmental action seemed lost among concerns about free trade and protectionism. Despite these concerns the rate at which developing countries such as Thailand adopt environmentally-friendly attitudes to economic growth and protection exceeds the same process in the West. From the emergence of environmentalism in the 1960s, the West has taken 30 years to get to the current position – a situation that many still see as inadequate to cope with international environmental problems such as global warming. The fact that Johri and Sahasakmontri can write about “green” marketing in Thailand suggests that, already, the Thai people are aware of environmental challenges and willing to respond to popular appeals based on “green” issues. Reading Johri and Sahasakmontri’s work, I’m struck by two crucial issues: the extent to which “green” issues are a long-term matter for firms and the changes in consumer attitudes towards the environment. “Green” marketing: long term or short term? In recent years some firms have, as I’ve noted, exploited popular concerns about environmental issues. Positioning a product, brand or company as “environmentally-friendly” provided a means of differentiation in many markets. And, for crowded, mature markets, the “green” message provided a new way to compete without losing premium pricing advantages. Johri and Sahasakmontri note that the initial dominance of marketing in the “greening” of business has now ended. Not only have consumers become inured to “green” messages, but many no longer trust the commitment of the businesses promoting themselves as environmentally-responsible. Today the corporate focus has shifted towards purchasing policies, corporate public relations and waste minimization. If there are marketing benefits they come from real actions taken by firms to reduce their environmental impact. In the examples here we see how the success of Body Shop International has encouraged other, competitive organizations to adopt similar marketing tactics. In some cases these tactics are just that – there is little or no action to reposition the whole firm. At the same time other businesses (and Oriental 280 JOURNAL OF CONSUMER MARKETING, VOL. 15 NO. 3 1998 Princess provides a good example) have adopted the same “green” positioning. The question for cosmetics firms is whether to compete head-to-head with The Body Shop or to sustain an “non-green” positioning regardless of the actual policies of the firm. There is no reason why a firm shouldn’t sell natural cosmetics without taking the “environmental campaigning” position typified by The Body Shop. The demand for natural products doesn’t necessarily mean that the firm should take an active stance against animal testing or the destruction of the rain forests. Nor should such a “traditional” positioning mean that a firm has to have purchasing or manufacturing systems unfriendly to the environment. Do consumers respond to “green” marketing appeals? We know that most consumers in the West – and many among the middle class in developing countries – express concerns about environmental issues. Many of these consumers have taken personal steps to reduce their personal impact on the environment (recycling, reuse, etc.). However, consumers now see responding to environmental challenges as a matter that is beyond individual action and choices requiring national and international government actions. We also know that many consumers will not pay a price or time premium for the sake of environmental responsibility despite a positive attitude to environmental issues. While the “green” policies and marketing of the two firms studied here do have an impact on consumer attitudes to the brands, issues such as price, product effectiveness and “traditional” branding still matter. A firm cannot expect to succeed purely as a result of a “green” positioning. In the cosmetics market, The Body Shop has secured such an “ownership” of the “green” positioning that other firms taking the same stance run the risk of being seen as copy-cat in adopting the same approach. Oriental Princess has succeeded in copying this strategy but the addition of a proud “Made in Thailand” positioning provides a different position and additional rationale for patronage. The future of “green” marketing The realization that consumers do like “green” messages – so long as they’re substantial – provides the basis for future “green” marketing strategies. At the same time the challenge for businesses lies in incorporating environmentally-friendly attitudes into their corporate policies rather than seeking to promote on the basis of “green” products alone. As Johri and Sahasakmontri point out “...many companies now see environmental orientation as a long-term issue rather than a way to gain in the short term”. Environmental responsibility is now seen as an important measure of business effectiveness. Firms with good records on the environment are seen as well-managed and committed to the long term. Just as consumers have switched to individual “green” actions rather than “green” purchasing behaviour, firms should look to changing their corporate stance to embrace sustainability to reflect good management and a long-term outlook. (A précis of the article “Green marketing of cosmetics and toiletries in Thailand.” Supplied by Marketing Consultants for MCB University Press) JOURNAL OF CONSUMER MARKETING, VOL. 15 NO. 3 1998 281