Sustainable Market Orientation a New Approach Research Paper

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Creating Opportunities for Sustainable Marketing

At first blush, many marketing professionals might believe that sustainable marketing simply means finding new approaches to keeping their jobs, and in many ways, this is certainly the case. In the not-too-distant past, marketing professionals were able to gain a competitive advantage by adding value along the supply chain or other innovation that provided them with the ability to produce more efficiently. Moreover, the lessons learned from these marketing exercises provided the basis for long-term marketing campaigns. By sharp contrast, marketers today are faced with an environment that is constantly changing and increasingly globalized. In this environment, achieving a competitive advantage has become increasingly challenging, but many companies are succeeding in sustainable marketing by segmenting their markets and targeting those that are most suitable for their products. To determine how organizations of all types and sizes that are interested in applying the tenets of sustainable marketing to achieve a competitive advantage, this paper provides the background of the study, a review of the relevant literature, a statement of the problem, the research question and methodology. An analysis of the findings that emerged from the research is followed by a discussion of findings, a summary of the research in the conclusion and potential directions for future research.

Background of study

Sustainable marketing is a method whereby companies seek to take advantage of specific consumer attributes that influence the purchase decision in favor of those products that are perceived by consumers as being environmentally friendly. For instance, according to Sinwell, "Under the rubric of sustainability, companies of every stripe have bent over backward trying to paint themselves 'green' in the hope of appearing environmentally responsible. In today s culture, 'going green' is being used as a tool to package and promote everything from energy to entertainment" (2010, p. 118). Companies of all types and sizes can take advantage of this trend to grow their market share and achieve a competitive advantage, provided they take certain factors into account as discussed further below.

Literature review

According to Varey (2002), the dominate institution in the business world today is the corporation, and these organizations therefore have a fundamental responsibility to the societies in which they compete to address to wide range of factors that contribute to sustainable marketing practices. Paramount among these factors are those identified by Fuller (1999): (b) "what it takes," (b) "what it makes," and (c) "what it wastes." In this regard, Varey (1999) reports that companies can successfully implement and administer sustainable marketing programs by address these issues as described and defined below:

1. "What it takes": These are the materials and energy resources that are removed from the earth's ecosystems;

2. "What it makes": These resources are the products of commerce, goods and services; and,

3. "What it wastes": Finally, this factor represents the collective cultural garbage/waste, pollution and the continuing destruction of natural systems.

Properly applied and thoughtfully administered, then, the marketing function provides companies of all types and sizes with a viable framework in which to achieve a competitive advantage using sustainable marketing techniques. For instance, Varey emphasizes that, "Marketing functions to further human and business purpose by providing benefits to customers through products. Decisions on what products to make and how to offer them to customers is the substance of marketing strategy; however, decisions on what to make also determine what resources are required to make and market those products - both making and taking have costs to the ecosystem (wastes, pollution, damage, and so on)" (2002, p. 344). Clearly, there are numerous opportunities available along the entire supply chain where sustainable marketing practices can be applied, but achieving a competitive advantage by doing so requires fulfilling a three-fold mandate: "Increasingly, marketing managers will be required to adopt sustainable-marketing practices to ensure that the business is operated in a such a way that customers obtain genuine benefits, while the corporation accomplishes their financial objectives and the ecosystem functioning is preserved or enhanced" (Varey 2002, p. 344).

Although authorities differ somewhat in their operationalization of the term, a useful definition of sustainable marketing that includes this three-fold mandate is provided by Fuller (1999) who describes it as "the process of planning, implementing, and controlling the development, pricing, promotion, and distribution of products" in ways that satisfy the following three criteria:

1. Customer needs are met,

2. Organizational goals are attained, and

3. The process is compatible with ecosystems (p. 4).

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Therefore, the fundamental objective of sustainable marketing practices involves formulating, implementing and administering "low-waste, no-negative-discharge" product systems (Fuller 1999). Achieving these challenging objectives requires that the corresponding sustainable marketing mixes must be formulated with the following goals in mind:

1. Significantly reducing the generation of waste, and,

2. Properly managing all remaining waste discharges into ecosystems (Fuller 1999).

Taken together, the foregoing criteria provide a useful framework in which to further examine the role of sustainable marketing in achieving organizational goals. It is important to point out, though, that while sustainable marketing can provide the framework needed to improve an organization's image and grow its share among a targeted market, there is a need for a real benefit to be accomplished for all of the stakeholders involved (Fuller 1999). In fact, Sinwell emphasizes that, "Sustainable marketing is not an exercise in corporate altruism, but a social obligation. The 'best' product from a purely environmental impact standpoint is no product at all (i.e., no product = no taking, no making, and no wasting)" (2010, p. 119).

A survey by the Roper Organization conducted in the United States described five basic consumer segments based on the level of their environmental commitment as set forth in Table 1 below:

Table 1

Five Basic Sustainable Marketing Consumer Segments in the United States

Consumer Segment

Description

True-blue greens (20%).

This segment consists of 37 million of the most active pro-environmental groups. This segment is most likely to avoid buying products from a company with a questionable environmental reputation. They are passionate about buying green products and are willing to pay 7% more on the average for ecologically-friendly products. They are the oldest, wealthiest and the most likely to be married with children. They believe that they can make a difference in solving environmental ills. As recyclers, composters and green volunteers, they give their time and resources for environmental causes. Sixty percent of them are women.

Greenback greens (5%)

So named because they support environmentalist causes, but only donate money rather than time or action. Numbering around 9 million, they are most willing to spend more for green products. They will shell out 20% more for green products. A little more than half (52%) of them are men. The best educated in the group, they are also the youngest. Although too busy to change their lifestyle, they express their environmental concern through their wallets.

Sprouts (31%)

Although one third of the U.S. population, the sprouts want pro-environmental laws but they do not believe that they can do much to preserve the environment. They are willing to pay for only 4% more, on average, for green products. They are active in environmental causes but they embrace green consumerism slowly.

Grousers (9%)

Numbering about 17 million, the grousers take few environmental actions. They believe that business should be fixing environmental ills and that green products cost more vs. non-green products. With below-average education and incomes, they feel that somebody else should fix environmental problems.

Basic Browns (33%)

The least involved in environment, the basic browns comprise the largest group. They are the least educated among all consumer segments. Disproportionately male, Southern, blue-collar and economically downscale, they believe that there is nothing that individuals can do about the environment.

Source: Suplico 2009, p. 72

Figure 1. Five Basic Sustainable Marketing Consumer Segments in the United States

Source: Based on textual data in Suplico 2009 at p. 72

Notwithstanding the characterization of Basic Browns as being so many uneducated hillbillies (mostly male) who are downright ignorant about the virtues of environmentalism, the existence of the environmentally conscious consumer segments in the U.S. resulted in the Roper Organization finding that the United States is becoming increasingly amenable to sustainable marketing methods, with several consumer segments being willing to pay a little or moderately more in return for assurances that products are brought to market in ethical and environmentally responsible ways (Suplico 2009). The most salient findings to emerge from the Roper study for sustainable marketing purposes were as follows:

1. Studies showed that consumers tend to be greener in direct proportion to their income and education,

2. Female consumers are greener than their male counterparts;

3. When shopping, women were more likely to exhibit green behavior in their purchases;

4. Women were more likely to recycle products; and,

5. Income, education, age, gender and place of residence were.....

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