BrainTrust Query: How will assortments change in the green future?

Discussion
May 23, 2007

By Dan Nelson, Sr VP / Chief Operating Officer, GMDC

The Institute for the Future recently drew up a 50-year map detailing the seismic societal changes required to reduce greenhouse gasses and preserve ecosystems. The research institute believes efforts to understand and manage climate change will be at the top of the world’s agenda for the next decade.

For businesses, this means decisions will be greatly influenced by their impact on the environment. And decision-making will be provided with more precision as climate scientists and ecologists join together to build carbon-trading markets, measure the value of ecosystem services, and estimate the economic cost of global warming.

“Models of atmospheric chemistry and climate change could rewrite business plans and policy alike as we gain a deeper understanding of the impacts of greenhouse gases,” the researchers wrote.

The Institute of the Future’s report only adds to the dialogue and doomsday statistics surrounding global warming.

The Hartman Group has done considerable research on the increasing consumer awareness and attitudes towards new products and packaging that are better for our environment. Leonardo DiCaprio, Oprah Winfrey, and Al Gore as well as other high-profile celebrities continue to focus on driving the message home to shoppers that buying products that are more environmentally friendly – from laundry care to general merchandise to trash bags – is important for the future and the environment we leave for future generations.

Consumer companies are quickly responding to these studies, statistics, and sound blasts to their shoppers with a rush to introduce more environmentally friendly products, often in surprising forms. For example, Jarden Brands recently announced plans to launch disposable cutlery made from 100 percent recycled plastic, using 10 percent less plastic, and packaged in 100 percent recycled containers.

Clearly, manufacturers are refocusing their marketing, packaging, and advertising around this important and growing issue.
“Hedging against this scientific uncertainty, while taking advantage of commercial opportunities, will be a key strategic challenge for individuals, companies and states,” wrote the Institute of the Future.

Discussion Questions: How quickly and forcefully will mainstream consumers demand more environmentally-friendly products? What impact will this have on assortment changes across retail needed to meet this growing demand? Which categories do see as the biggest opportunities?

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8 Comments on "BrainTrust Query: How will assortments change in the green future?"


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John Lansdale
Guest
John Lansdale
14 years 11 months ago

Wind speed caused by environmental spin is approaching hurricane force. Any science not sponsored by a major oil company (or related tax avoidance family foundation) has been blown out to sea.

Retailers, always more concerned with style than substance, should stick up their sails, ride the wind; but with care; high speed wind is unpredictable and it might suddenly change directions or stop.

Michael Tesler
Guest
Michael Tesler
14 years 11 months ago

The choice for retailers is a common one, should we be proactive or reactive? Should we wait and see how this plays out and wait until customers demand things from us or should we anticipate and surprise our customers by giving them what the want before they even know that they want it? In this case the proactives will win, but isn’t that usually the case?

Camille P. Schuster, Ph.D.
Guest
14 years 11 months ago
European consumers have been enviromentally conscious for a long time. The term “environmental sustainability” is being used a lot in the US now. Al Gore’s movie helped raise the consciousness of the topic to the point where severe climatic change is immediately related to major problems such as hurricanes and droughts rather than just assuming them to be a unique circumstance. Rising gasoline prices are also affecting consumers’ perceptions. Discussions of how to be “carbon neutral” are becoming commonplace among some groups of consumers. Each of these things is bringing another group of consumers to the conclusion that humans do affect the climate and that we need to reverse our current trend. Manufacturers that identify the trend and take real steps toward designing products that help reduce or change their impact on the environment and climate will be seen as desirable choices by a growing group of consumers. Keeping the momentum going by giving consumers realistic choices is important or as the dedicated consumers become aware of the work being done at MIT to create… Read more »
Dick Seesel
Guest
14 years 11 months ago

The movement toward “green” consumerism is real and it’s accelerating. As a retailer or as a manufacturer, you need to think strategically about how you can grow your business or you will be left behind. The key is to approach this challenge as a volume- and profit-driving opportunity, not just as a way to do good.

The latest example in the headlines today: P&G’s decision to reformulate Tide and other detergents so they are available in double-concentrated formulas and therefore leave less packaging behind. Of course, the unspoken benefit of this strategy is to allow a lot more product density in the same shelf space and to gain additional facings of brand extensions in the same (or more) real estate. It’s an environmentally friendly move that will also benefit P&G and its retailers’ bottom lines.

Ben Ball
Guest
14 years 11 months ago
Our society’s interest in sustainability will be as fundamental as our interest in health and nutrition, fitness and aging. It is part of a growing awareness of our impact on our environment. Whether or not we can significantly redirect change is another discussion, but we will surely try. The “marketing truth” of this megatrend is the same as the others cited–that is, some people will embrace it fundamentally while others will try to exploit it to the extreme. Let’s take an example at either end of the spectrum. The recycled plastic park benches and other objects appearing in our green spaces and bus stops are a wonderful example of true sustainability. We not only recycle waste plastic, we also save trees and get a longer lasting, lower maintenance product to boot. Now for the other extreme. I was shocked out of my “driving trance” on a trip this weekend by some unexpected expletives from my normally demure spouse. The source of her ire? An ad for the new Levi’s environmentally friendly jeans at over $200.… Read more »
Mark Lilien
Guest
14 years 11 months ago

Timberland created a terrific model that everyone could learn from. Every product has a “nutrition label” detailing the ecological impact. The company web site has a detailed annual report on corporate social responsibility, including global labor standards, community involvement, and the environment. Every retailer and CPG firm with sales over $500 million a year could initiate the same sustainability communication Timberland does, with “nutrition labels” for every private label item. Even if it took time to assemble the information, they could start with parts of this activity immediately.

Warren Thayer
Guest
14 years 11 months ago
Manufacturers are either actively working on this opportunity, or are in denial. To my mind, big retailers like Wal-Mart have a greater potential to make real changes here, by altering their required product specifications that lean toward sustainability. Many manufacturers I speak with still believe that sustainability is a fad, like low-carb. They see it as a cynical attempt to do some window-dressing and attach a higher price tag to products, and take a higher profit. No doubt some of that is going on, so I understand the cynicism. On the retailer side, I was speaking with Bob Pittiger at Giant Eagle, who heads up FMI’s Sustainability Task Force, and he sees change coming faster now at least in part because technology has made payback on “doing the right thing” much faster. He also told me: “It’s clear to me that this is not a fad. In fact, I think there is a limited window of opportunity where you will be able to see the benefits of doing things that are environmentally friendly. Soon, having… Read more »
Stephan Kouzomis
Guest
Stephan Kouzomis
14 years 11 months ago

Unfortunately, it will take a major movement from the campuses, and Congress to gain any traction from our industry, and the related ones.

Once again, it’s our children (X and Y Generations) and grandchildren that will bear the consequences.

Hmmmmmmmmmmmmmmm

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