Alternative Energy and Green Consumers 01/18/11
“organizations can turn sustainability into innovation’s new frontier – achieving competitive advantage and influencing economic recovery in much the same way that the breakthrough products and business models of computer companies led the way out of previous recessions.“ - The Harvard Business Review.
We are in the midst of the alternative energy revolution and the rise of green consumerism. From reusable supermarket bags to to carbon-offset schemes for air travelers, companies are responding to consumer demand for green and environmentally sound alternatives. Let’s take a look at Energy Supply, Cars, Airlines and Coffee.
Green Energy
If your electricity supplier offered you a home power-plant that ran on solar energy and generated enough electricity for your home and a little extra that you get paid for feeding back into the grid – Would you take it? This is already an option but with high setup costs, this remains out of main stream consumption. As a step in the right direction, power companies offer green energy plans where you can pay a small premium to ensure that some or all of your power supply comes only from renewable sources. You can switch suppliers and setup your account online.
Car Sharing
The average car is parked more than 90% of the time, indicating a terrible waste of our personal resources to buy and maintain such an underutilized capital investment. Car sharing, usually with hybrid electric vehicles, pioneered on a grand scale by ZipCar, has been replicated around the world. As a testament to the business model’s success, household name rental car company Hertz is getting in on the act:
Traditionally in the U.S, a mark of adulthood is owning a car. Those habits are changing in some places, especially cities and college campuses for some good reasons. They’re not just environmental but personal financial reasons. = Hertz head of communications, Rich Broome.
Coffee
- Fairtrade: A social good initiative, so we stop drinking what some call “the tears of columbian farmers”
- Organic: Pesticide free and naturally grown coffee beans that are better for us.
- Recyclable coffee cup lids: Plastic lids go to landfill and take 1,000,000 years to decompose! Alternatives exist.
- Free coffee grounds: Some stores make their used coffee grounds available for free to be used as fertiliser.
- Bring your own mug: Save a cup, a lid and get a discount on your coffee.
Airlines
source: World Travel Market Industry Report
Zagat Survey: If particular airlines introduced measures to become more “green” or eco-friendly, would you be…?
While it’s an emerging niche, there’s a clear disconnect here between general consumer preference for green travel vs. industry insider expectations of a surge in environmentally aware holidays. The decline in green preference since 2008 suggests people are feeling the financial pinch.- I have just paid hundreds if not thousands of my hard earned money to purchase a ticket and I am not feeling like shelling out anymore at this stage.
- How does it work? Without an understanding of carbon credits, all this fly carbon-neutral stuff sounds like mumbo-jumbo. If my donation were tied to a specific outcome, my arm might be twisted.
Here’s how to make it work:
- Why not award more miles to travelers who choose to take up the carbon-offset option? Or perhaps introduce another tier of miles: Green Miles that open the door to some exclusives.
- Furthermore, the carbon-offset option could be more than an after-thought and instead become a part of the pricing structure. airlines already offer multiple price points for the same seat on a flight, so I propose a “Green Seat” as well.
- Identify a specific green initiative that will benefit the environment as a result of my contribution. How many trees will be planted and where? What coral reefs will be preserved? For example, Virgin Blue’s statement is not specific or relevant enough:
- 4419 kgs sounds like a lot, but it is out of context. They should be specific about something they are doing.
- Furthermore, a less fictious sounding name would help: “Department of Climate Change Approved Greenhouse Friendly Abatement Projects?”
- KIVA.com knows how to attract the socially conscious dollar and airlines could take a page out of their marketing playbook if they want to see better uptake of their carbon-offset programs. They share real stories and show you pictures of specific people and projects you can help.
Conclusion
Delivering socially and environmentally aware products and services is in demand defining factor in the success of all organisations this decade. Like Apple fans, there’s a cult following of consumers out there just waiting for you to give them the choices they are looking for and they are willing to pay a premium for them. However, in the long-term, socially aware products and services will become commodities as consumers expect nothing less from the businesses to which they give their patronage. Greenmode.com.au presents an action plan:
- Viewing Compliance as an opportunity
- Making Value Chains Sustainable
- Designing Sustainable Products and Services
- Developing New Business Models
- Creating Next Practice Platforms
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