Customers value environmental causes. Polls from a research survey conducted by Tandberg suggest that 53% of consumers prefer to buy from companies with a reputation for their commitment to the environment. As anyone who manages a business knows, reputation management is one of the most important processes for staying on top of growth and retention.
People enjoy being in nature. For example, weddingswith a lush, verdant backdrop are popular and studies show that access to nature is correlated with reductions in depression and obesity. Creating a reputation that embraces environmental consciousness and protection is a great PR move.
It’s straightforward. Staying committed to a green cause is not only great for the environment, but also great for your business. The only question is how do you actually brand your business as “environmentally friendly” or “ecofriendly” in a way that doesn’t look contrived or conceited. How much do you need to spend and how should you invest your money to make a difference in the perception of your business?
Accounting for Ecofriendly Brand Perceptions
The last thing you want to do is spend money preparing to transition your brand towards an ecofriendly image only to have it backfire on you when your customers don’t buy it. Frequently, business owners try a very direct approach to ecofriendliness by designing products with environmental targets in mind. However, brand perceptions are actually negative for initiatives such as these because the regular consumer sees this as an intentional attempt to manipulate their feelings towards that brand.
An ounce of prevention is worth a pound of the cure. In this way, accounting for ecofriendly brand perceptions at the start of your campaign is a way to control for unexpected costs such as a negative association rather than a positive association of your business’ brand with the environment. It will also help to stabilize and fix your business’ credit.
This counter intuitive attitude to ecofriendly brand perceptions is actually documented in a study published in the Journal of Consumer Research, which states that: “…consumers are less likely to purchase a green product when they perceive that the company intentionally made the product better for the environment compared to when the same environmental benefit occurred as an unintended side effect.” How you actually frame your results – which are beneficial to the environment whether or not they are intentional – shifts how customers will interpret them.
So, before your business even gets started on developing and working out the research necessary to actually produce and portray striking, documentable green results, it needs to figure out this key issue of frame. Based on facts, your company will want to frame the environmental benefit in a way that appears accidental rather than as an intentional effort. Also, consulting with a graphics design firm on how best to position and draw attention to your company’s green efforts can help your company refine its image.
For example, you don’t want to mention that your company spent millions in research just to develop a plastic water bottle design that reduced plastic usage by a significant percentage. Instead, your company can frame the effort as part of the campaign to reduce its own costs that have the added benefit of decreasing plastic consumption. This way, the customer is likely to attribute the environmental benefit to your company’s attempts to optimize its spending rather than a direct attempt towards ecofriendly branding.
It is also completely possible for your brand to succeed with a direct strategy, but only if it makes sense in the context of your product and if your company has been environmentally committed since the beginning. A great example of how direct environmental advertising has succeeded can be found in Patagonia, the clothing company, and their mission statement. The Harvard Business Report notes that Patagonia’s controversial campaign strategies that seem to sacrifice its profitability for environmental purposes actually have led to increases in revenue.
Research and Development Costs
Once you’ve figured out how you actually want to market and frame your ecofriendly branding attempt, it’s time to explore the costs of researching and developing products that will make a significant impact on the environment. R&D costs will be highly variable based on the size of your company, the extent of its commitment to environmental initiatives, and the type of product or services it offers.
Taking note from some of the companies with the highest R&D costs in general, a report from Fortune magazine sees industry leaders such as Volkswagen, Intel, and Roche spending anywhere from 5 to 20 percent of their revenue on R&D. Of course, the great variation in R&D costs is a result of how dependent a company’s revenue is on that R&D. For instance, you might expect a pharmaceutical company to have greater R&D costs than an automobile company.
We want to think about environmental branding in a similar way. The cost to brand something as ecofriendly should be considered in comparison to the total revenue that such a product or service produces in the first place. Further, the expected return on investment (ROI) should be calculated as well to produce to best company budgeting plans for ecofriendly branding.
Let’s walk through a concrete example. You’re in charge of dispensing marketing costs for a company to make one of their brands appear more ecofriendly. The first thing you want to do is pull up the revenue that’s generated by that product over time, estimate the costs of R&D, and estimate an expected return on investment.
Our supposed product may bring in $10 million a year. If the costs of R&D were something like $300,000 and the expected return on this branding was $1 million, it would be favorable. This is because we have a relatively low revenue to R&D cost (less than 5 percent) and our expected return on investment is higher than the cost.
2017 Was the Most Expensive Year Ever for U.S. Natural Disaster Damage
Devastating natural disasters dominated last year’s headlines and made many wonder how the affected areas could ever recover. According to data from the U.S. National Oceanic and Atmospheric Administration (NOAA), the storms and other weather events that caused the destruction were extremely costly.
Specifically, the natural disasters recorded last year caused so much damage that the associated losses made 2017 the most expensive year on record in the 38-year history of keeping such data. The following are several reasons that 2017 made headlines for this notorious distinction.
Over a Dozen Events With Losses Totalling More Than $1 Billion Each
The NOAA reports that in total, the recorded losses equaled $306 billion, which is $90 billion more than the amount associated with 2005, the previous record holder. One of the primary reasons the dollar amount climbed so high last year is that 16 individual events cost more than $1 billion each.
Global Warming Contributed to Hurricane Harvey
Hurricane Harvey, one of two Category-4 hurricanes that made landfall in 2017, was a particularly expensive natural disaster. Nearly 800,000 people needed assistance after the storm. Hurricane Harvey alone cost $125 billion, with some estimates even higher than that. So far, the only hurricane more expensive than Harvey was Katrina.
Before Hurricane Harvey hit, scientists speculated climate change could make it worse. They discussed how rising ocean temperatures make hurricanes more intense, and warmer atmospheres have higher amounts of water vapor, causing larger rainfall totals.
Since then, a new study published in “Environmental Research Letters” confirmed climate change was indeed a factor that gave Hurricane Harvey more power. It found environmental conditions associated with global warming made the storm more severe and increase the likelihood of similar events.
That same study also compared today’s storms with ones from 1900. It found that compared to those earlier weather phenomena, Hurricane Harvey’s rainfall was 15 percent more intense and three times as likely to happen now versus in 1900.
Warming oceans are one of the contributing factors. Specifically, the ocean’s surface temperature associated with the region where Hurricane Harvey quickly transformed from a tropical storm into a Category 4 hurricane has become about 1 degree Fahrenheit warmer over the past few decades.
Michael Mann, a climatologist from Penn State University, believes that due to a relationship known as the Clausius-Clapeyron equation, there was about 3-5 percent more moisture in the air, which caused more rain. To complicate matters even more, global warming made sea levels rise by more than 6 inches in the Houston area over the past few decades. Mann also believes global warming caused the stationery summer weather patterns that made Hurricane Harvey stop moving and saturate the area with rain. Mann clarifies although global warming didn’t cause Hurricane Harvey as a whole, it exacerbated several factors of the storm.
Also, statistics collected by the Environmental Protection Agency (EPA) from 1901-2015 found the precipitation levels in the contiguous 48 states had gone up by 0.17 inches per decade. The EPA notes the increase is expected because rainfall totals tend to go up as the Earth’s surface temperatures rise and additional evaporation occurs.
The EPA’s measurements about surface temperature indicate for the same timespan mentioned above for precipitation, the temperatures have gotten 0.14 Fahrenheit hotter per decade. Also, although the global surface temperature went up by 0.15 Fahrenheit during the same period, the temperature rise has been faster in the United States compared to the rest of the world since the 1970s.
Severe Storms Cause a Loss of Productivity
Many people don’t immediately think of one important factor when discussing the aftermath of natural disasters: the adverse impact on productivity. Businesses and members of the workforce in Houston, Miami and other cities hit by Hurricanes Harvey and Irma suffered losses that may total between $150-200 billion when both damage and sacrificed productivity are accounted for, according to estimates from Moody’s Analytics.
Some workers who decide to leave their homes before storms arrive delay returning after the immediate danger has passed. As a result of their absences, a labor-force shortage may occur. News sources posted stories highlighting that the Houston area might not have enough construction workers to handle necessary rebuilding efforts after Hurricane Harvey.
It’s not hard to imagine the impact heavy storms could have on business operations. However, companies that offer goods to help people prepare for hurricanes and similar disasters often find the market wants what they provide. While watching the paths of current storms, people tend to recall storms that took place years ago and see them as reminders to get prepared for what could happen.
Longer and More Disastrous Wildfires Require More Resources to Fight
The wildfires that ripped through millions of acres in the western region of the United States this year also made substantial contributions to the 2017 disaster-related expenses. The U.S. Forest Service, which is within the U.S. Department of Agriculture, reported 2017 as its costliest year ever and saw total expenditures exceeding $2 billion.
The agency anticipates the costs will grow, especially when they take past data into account. In 1995, the U.S. Forest Service spent 16 percent of its annual budget for wildfire-fighting costs, but in 2015, the amount ballooned to 52 percent. The sheer number of wildfires last year didn’t help matters either. Between January 1 and November 24 last year, 54,858 fires broke out.
2017: Among the Three Hottest Years Recorded
People cause the majority of wildfires, but climate change acts as another notable contributor. In addition to affecting hurricane intensity, rising temperatures help fires spread and make them harder to extinguish.
Data collected by the National Interagency Fire Center and published by the EPA highlighted a correlation between the largest wildfires and the warmest years on record. The extent of damage caused by wildfires has gotten worse since the 1980s, but became particularly severe starting in 2000 during a period characterized by some of the warmest years the U.S. ever recorded.
Things haven’t changed for the better, either. In mid-December of 2017, the World Meteorological Organization released a statement announcing the year would likely end as one of the three warmest years ever recorded. A notable finding since the group looks at global land and ocean temperature, not just statistics associated with the United States.
Not all the most financially impactful weather events in 2017 were hurricanes and wildfires. Some of the other issues that cost over $1 billion included a hailstorm in Colorado, tornados in several regions of the U.S. and substantial flooding throughout Missouri and Arkansas.
Although numerous factors gave these natural disasters momentum, scientists know climate change was a defining force — a reality that should worry just about everyone.
How to be More eco-Responsible in 2018
Nowadays, more and more people are talking about being more eco-responsible. There is a constant growth of information regarding the importance of being aware of ecological issues and the methods of using eco-friendly necessities on daily basis.
Have you been considering becoming more eco-responsible after the New Year? If so, here are some useful tips that could help you make the difference in the following year:
1. Energy – produce it, save it
If you’re building a house or planning to expand your living space, think before deciding on the final square footage. Maybe you don’t really need that much space. Unnecessary square footage will force you to spend more building materials, but it will also result in having to use extra heating, air-conditioning, and electricity in it.
It’s even better if you seek professional help to reduce energy consumption. An energy audit can provide you some great piece of advice on how to save on your energy bills.
While buying appliances such as a refrigerator or a dishwasher, make sure they have “Energy Star” label on, as it means they are energy-efficient.
Regarding the production of energy, you can power your home with renewable energy. The most common way is to install rooftop solar panels. They can be used for producing electricity, as well as heat for the house. If powering the whole home is a big step for you, try with solar oven then – they trap the sunlight in order to heat food! Solar air conditioning is another interesting thing to try out – instead of providing you with heat, it cools your house!
2. Don’t be just another tourist
Think about the environment, as well your own enjoyment – try not to travel too far, as most forms of transport contribute to the climate change. Choose the most environmentally friendly means of transport that you can, as well as environmentally friendly accommodation. If you can go to a destination that is being recommended as an eco-travel destination – even better! Interesting countries such as Zambia, Vietnam or Nicaragua are among these destinations that are famous for its sustainability efforts.
3. Let your beauty be also eco-friendly
We all want to look beautiful. Unfortunately, sometimes (or very often) it comes with a price. Cruelty-free cosmetics are making its way on the world market but be careful with the labels – just because it says a product hasn’t been tested on animals, it doesn’t mean that some of the product’s ingredients haven’t been tested on some poor animal.
To be sure which companies definitely stay away from the cruel testing on animals, check PETA Bunny list of cosmetic companies just to make sure which ones are truly and completely cruelty-free.
It’s also important if a brand uses toxic ingredients. Brands such as Tata Harper Skincare or Dr Bronner’s use only organic ingredients and biodegradable packaging, as well as being cruelty-free. Of course, this list is longer, so you’ll have to do some online research.
4. Know thy recycling
People often make mistakes while wanting to do something good for the environment. For example, plastic grocery bags, take-out containers, paper coffee cups and shredded paper cannot be recycled in your curb for many reasons, so don’t throw them into recycling bins. The same applies to pizza boxes, household glass, ceramics, and pottery – whether they are contaminated by grease or difficult to recycle, they just can’t go through the usual recycling process.
People usually forget to do is to rinse plastic and metal containers – they always have some residue, so be thorough. Also, bottle caps are allowed, too, so don’t separate them from the bottles. However, yard waste isn’t recyclable, so any yard waste or junk you are unsure of – just contact rubbish removal services instead of piling it up in public containers or in your own yard.
5. Fashion can be both eco-friendly and cool
Believe it or not, there are actually places where you can buy clothes that are eco-friendly, sustainable, as well as ethical. And they look cool, too! Companies like Everlane are very transparent about where their clothes are manufactured and how the price is set. PACT is another great company that uses non-GMO, organic cotton and non-toxic dyes for their clothing, while simultaneously using renewable energy factories. Soko is a company that uses natural and recycled materials in making their clothes and jewelry.
All in all
The truth is – being eco-responsible can be done in many ways. There are tons of small things we could change when it comes to our habits that would make a positive influence on the environment. The point is to start doing research on things that can be done by every person and it can start with the only thing that person has the control of – their own household.
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