The number of brands tying their customer loyalty programs to the environment is surging. These include green-focused firms such as Seventh Generation, which sells chlorine-free diapers and recycled trash bags, as well as traditionally non-green companies such as airlines and banks.
According to Colloquy, a loyalty-marketing consultancy in Cincinnati, 34 companies have added green rewards to their loyalty programs in the past year alone. The problem is that many corporations without eco-roots risk being accused of green washing, or adopting eco-friendly practices only for commercial reasons.
"When you see such a flurry of activity in such a short period of time, [companies] risk coming off disingenuous to the consumer," Kelly Hlavinka, managing partner of Colloquy, told Brandweek. While there may be good intentions behind such efforts, Ms. Hlavinka believes brands need to ask themselves, "What charitable activities do we already support? Does a green rewards program align with those causes?"
Continental Airlines, for instance, launched a green energy program last year that offers OnePass frequent members the chance to earn miles by replacing their utility company with renewable energy provider, Gexa Energy.
"It is a bigger statement for an airline to be offering [green rewards]," Peggy Atkins, president of Imagine Works, an environmental advertising and communications company in Chicago, told the magazine.
According to the Colloquy 2007 Demographic Loyalty Study, green reward programs are most effective when they give back to consumers, as opposed to those that offer the chance to donate points toward green causes, The study found that more than 95 percent of consumers used earned points to reward themselves and showed little interest in using points to reward others or projects.
Wells Fargo launched green rewards last April enabling credit and debit card holders to donate reward points toward renewable energy projects. But it only appealed to a select group of customers. This past Earth Day, the program was enhanced to allow customers to also redeem points for any of 20 eco-friendly products, such as organic pet toys and personal air purifiers. "By putting green options" on the table, Nancy Beaver, Wells Fargo's vice president of customer marketing, tells Brandweek, "we might be prompting customers to at least think about an eco-friendly choice."
Discussion Questions: What do you think of green rewards programs? Should corporations without obvious eco-credentials get involved in these loyalty programs? If so, how do they avoid being accused of green washing?