Environmental Issues

Environmental issues are also playing an increasingly important role in product design and manufacturing. Many firms are considering ways to reduce the negative environmental consequences of conducting business, and some are changing the manufacture of their products or the ingredients that go into them. “Marketing Memo: A Sip or a Gulp: Environmental Concerns in the Water Industry” considers some of the environmental issues raised by the sale of bottled water.

In a fascinating twist, Levi-Strauss found a highly creative way to address the problem of proliferating plastic bottles.48

LEVI’S WASTE<LESS If someone said your jeans were “made of garbage,” you might be insulted, but not if they were made by Levi-Strauss. Levi’s new “Waste<Less” jeans and jackets carry a clothing tag that says exactly that—because they are! Twenty percent of the material in the denim comes from plastic bottles and black food trays re­cycled from municipal sites, including about eight 12- to 20-ounce bottles per pair. Much research and development went into creating the Waste<Less line, for which the plastic is cleaned, sorted, shredded into flakes, and made into a polyester fiber that’s then blended with cotton. The resulting fabric looks and feels like traditional denim except for the color of the underside, which varies according to the hue of the plastic. The jeans retail for $69 to $128. Levi’s is not a newcomer to the market for environmentally friendly products; sustainability is a company-wide priority. “Water<Less” jeans helped farmers grow cotton with less water, let Levi’s manufacture with less water, and educated consumers about cleaning and disposing of the garments with less water. Both lines have made a tangible difference: The Water<Less line saved more than 360 mil­lion liters of water in its first full year, while the Waste<Less line recycled 3.5 million bottles and trays in its first full year.

MARKETING MEMO A Sip or A Gulp: Environmental Concerns in the Water Industry

The huge popularity of bottled water has been a boon to many companies, but at a high cost to the environment. One estimate put the amount of plastic used in disposable bottles at 2.7 million tons a year, which requires about 47 million gallons of oil to manufacture. Unfortunately, fewer than 20 percent of these bottles are believed to be recycled in the United States. These high environmental costs have a number of implications for marketers.

Colleges all over the country—from Western Washington University to Brown University, the University of Vermont, and the University of California at Berkeley—have banned the sale of plain bottled water, typically as part of a student-led movement toward greater sustainability on campus. The College of Saint Benedict in Minnesota equipped 31 fountains with an extra spigot to make them “hydration stations,” a practice adopted by many other schools that banned bottled water. Nor are schools alone. Many public institutions from zoos to national parks are similarly installing water filling stations and banning the sale of bottled water.

As more consumers seek to reduce their personal environmental foot­print, sales of reusable water bottles have exploded. Sigg Switzerland sells cleverly designed lightweight aluminum water bottles for $25 to $30, choosing 100 new products from among 3,000 different designs each year. Features popular in other brands include caps with built-in micro-filtration systems.

Glass bottles promote their environmental advantages over plastic and re­assure consumers who fear chemicals can leak into foods and beverages from plastic. They now account for an increasingly large percentage of water bottle sales. Glass is also being developed for greater safety if broken; for instance, PURE glass bottles uses clear protective Safe-Shell coating.

Soft drink makers face similar pressures from environmentally aware con­sumers. Soda Stream sells equipment that allows people to carbonate and fla­vor plain tap water using reusable glass bottles. The company promotes three key benefits: Using tap water is cheaper, it can be slightly healthier, and there is no waste. Coca-Cola reports reclaiming more than one-third of its bottles and cans in North America, diverting 250 million pounds of waste from landfills each year. When PepsiCo launched Eco-Fina packaging for its Aquafina water brand, which uses 50 percent less plastic, it estimated it would save more than 75 million pounds of plastic annually.

Perhaps the most important lesson here is that environmental concerns matter to consumers, and they expect companies to make changes to address their concerns. Second, competition will emerge in all forms as companies try to find ways to better suit consumers’ unmet needs, even for a sip of water.

Sources: Caleb Melby, “SodaStream’s Moneymaking Battle Cry: Get Rid of Plastic Bottles,” Forbes, July 19, 2012; Stephanie Strom, “Wary of Plastic, and Waste, Some Consumers Turn to Glass,” New York Times, June 20, 2012; Kirsti Marohn, “Colleges Moving Away from Plastic Water Bottles,” USA Today, September 15, 2011; Lindsay Armstrong, “The Best Reusable Water Bottles,” Huffington Post, May 25, 2011; Helen Coster, “The $25 Water Bottle,” Fortune, March 19, 2009; “PepsiCo’s Aquafina Launches the Eco-Fina Bottle, the Lightest Weight Bottle in the Market,” www.pepsico.com, March 25, 2009.

Source: Kotler Philip T., Keller Kevin Lane (2015), Marketing Management, Pearson; 15th Edition.

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