MKTG 442 Fall 2024 Environmental Sustainability, Innovation and Marketing PDF

Environmental Sustainability, Innovation and Marketing Dr. Rajan Varadarajan Department of Marketing Mays Business School at Texas A&M University College Station, Texas [email protected] MKTG 442 Fall 202...

Environmental Sustainability, Innovation and Marketing Dr. Rajan Varadarajan Department of Marketing Mays Business School at Texas A&M University College Station, Texas [email protected] MKTG 442 Fall 2024  Sustainable Development: Definition “Meeting the needs of the present without compromising the ability of future generations to meet their own needs.” (Gro Harlem Brundtland, former prime minister of Norway). World Commission on Environment and Development (1987). Our Common Future. Oxford University Press. Economic growth and development that meets the needs of the present generations without compromising the ability of future generations to meet their own needs.  Sustainable Development: Demand Side Focus Identifying and Pursuing Product-Market Opportunities for: Consumption elimination Consumption reduction Consumption redirection from ecologically more harmful to less harmful substitutes that would not have an adverse impact on the quality of life. Consumption elimination  Demand elimination Consumption reduction  Demand reduction Consumption redirection  Demand redirection from ecologically more harmful to less harmful substitutes Varadarajan, Rajan (2014), “Toward Sustainability: Public Policy, Global Social Innovations for Base-of-the-Pyramid Markets, and Demarketing for a Better World,” Journal of International Marketing, 22 (2), 1-20. Sustainable Development: Demand Side Focus Demand Redirection from Ecologically More Harmful to Less Harmful Substitute Product Substitution of a Disposable Product with a Reusable Product Reusable Product (Permanent Filter) as a Substitute for a Disposable Product (Paper Filter)  Sustainable Development: Supply Side Focus Reduction in the amounts of various resources that are currently used to make specific products and in specific processes (more efficient use of resources). Elimination of one or more resources that are currently used to make specific products and in specific processes (resource use elimination is the upper limit for efficient use of a resource). Substitution of one or more resources that are currently used to make specific products and in specific processes. During various stages of the life cycle of a product: Raw materials extraction Production Distribution Use/Consumption Post use/post consumption disposal Varadarajan, Rajan (2017), “Innovating for Sustainability: A Framework for Sustainable Innovations and a Model of Sustainable Innovations Orientation,” Journal of the Academy of Marketing Science, 45 (January), 14-36.  Sustainability Imperatives Sustainability requires the simultaneous reconciliation of three imperatives: Ecological Imperative: Stay within the biophysical carrying capacity of the planet. Economic Imperative: Provide an adequate material standard of living of all. Social Imperative: Provide systems of governance that propagate the values that most people want to live by (Robinson and Tinker, 1997) Robinson, J., and Tinker, J., (1997), “Reconciling Ecological, Economic, and Social Imperatives: A New Conceptual Framework,” in Schrecker, T. (Ed.), Surviving Globalism: Social and Environmental Dimensions. London: Macmillan, New York: St. Martin’s Press. Triple Bottomline: Planet, Profit and People Environmental Performance, Economic Performance, and Social Performance  Sustainability and the Triple Bottom Line: Profit, Planet and People Triple Bottom Line: 3Ps Profit: Economic Performance / Economic Sustainability Planet: Environmental Performance / Environmental Sustainability People: Social Performance / Social Sustainability When evaluating and choosing from among alternative courses of action, financial performance (profit) is often the principal consideration. However, firms should also consider the potential impact of alternative courses of action on the environment (the planet) and society (people). CSR Reports: Corporate Sustainability Reports  Sustainable Development: Principles 1. Regeneration Capacity Principle / Replenishment Capacity Principle 2. Assimilation Capacity Principle 3. Precautionary Principle (United Nations Environment Program 1992) Principle: A general or basic truth on which other truths or theories can be based. A comprehensive and fundamental law, doctrine, or assumption. https://www.merriam-webster.com/dictionary/principle Regeneration Capacity Principle / Replenishment Capacity Principle Rates of use of various renewable resources should not exceed the capacity of the Earth to replenish them. Regeneration Capacity Principle / Replenishment Capacity Principle and the Tragedy of the Commons Regeneration Capacity Principle / Replenishment Capacity Principle and the Tragedy of the Commons The phrase “tragedy of the commons” is credited to ecologist Garret Hardin, who in a paper published in Science in 1968 described how shared resources (“commons”) are inevitably destroyed. Individuals use up the resources in a rational but selfish manner, causing long-term disastrous consequences for everyone. Tragedy of Commons versus Sustainable, Cooperative Governance of Shared Resources Economist Elinor Ostrom won the Nobel Prize in Economics for her work on sustainable, cooperative governance of shared resources. Her work showed that while depletion of shared resources sometimes occurs, it is not inevitable.  Sustainable Development: Principles Assimilation Capacity Principle Rates of emission of various wastes should not exceed the natural assimilative capacities of the ecosystems into which they are emitted. Pollution of oceans, rivers and lakes, soil and the atmosphere with toxic waste.  Sustainable Development: Principles Precautionary Principle Countries should extensively employ a precautionary approach to protect the environment. Lack of full scientific certainty should not be a reason for postponing cost-effective measures to prevent environmental degradation, where there are threats of serious or irreversible damage.  Sustainable Development: From Principles to Roadmap What Needs to Be Achieved? Significant reduction in carbon emissions, methane emissions, … emissions. Significant reduction in energy consumption, water consumption and waste disposed. Significant reduction in amount of material used for producing goods, performing services and packaging of goods. Significant increase in substitution of energy generated using nonrenewable resources with energy generated from renewable resources. Significant increase in substitution of nonrenewable materials with renewable materials. Significant increase in substitution of more abundant nonrenewable materials with less abundant nonrenewable materials. How? Through Product, Process and Business Model Innovations  Top Sustainability Related Priorities of Companies: The Innovation Link Improving energy efficiency Reducing greenhouse gas emissions, waste, water, and polluting effluents Reducing the environmental impact of products Developing new products to reduce societal or environmental risk Modifying existing products to reduce societal or environmental risk Implementing stronger controls over suppliers on environmental standards Implementing stronger controls over suppliers on workers’ rights standards Improving the local environment around operating facilities Working with governments to promote sustainable development in the countries where they operate Source: The Economist Intelligence Unit Global Survey of Executives (2008)  Major Sustainability Related Areas of Emphasis of MNCs: The Innovation Link Reducing energy use in operations Reducing waste from operations Reducing emissions from operations Reducing water use in operations Managing impact of products throughout the value chain Responding to regulatory constraints or opportunities Mitigating operational risk related to climate change Managing corporate reputation for sustainability Managing portfolio to capture trends in sustainability Committing R&D resources to sustainable products Leveraging sustainability of existing products to reach new customers or markets Achieving higher prices or greater market share from sustainable products Improving employee retention and/or motivation related to sustainability activities Source: McKinsey Quarterly (2011).  What Firms Hope to Achieve by Focusing on Sustainability Related Issues Reduced costs due to energy efficiency Reduced costs due to material or waste efficiencies Reduced risk Improved regulatory compliance Improved perception of how well the company is managed Improved brand reputation Increased competitive advantage Increased margins or market share due to sustainability positioning Better innovation of product offerings Better innovation of business models and processes Access to new markets Improved ability to attract and retain top talent Increased employee productivity Enhanced investor/stakeholder relations Source: Haanaes et al. (2011), MIT Sloan Management Review. (Boston Consulting Group- MIT Sloan Management Review Global Survey on Sustainability and Innovation)  Sustainable Development -- Nonrenewable Resources: Slowing the Rate of Unsustainability The world will eventually run out of non-renewable resources. Therefore, the sustainability problem with respect to nonrenewable resources is slowing their rate of unsustainability (i.e., slowing the rate of depletion of nonrenewable resources). Comments Problems with accurately predicting when the world will eventually run out of a specific nonrenewable resource (e.g., peak oil predictions that did not materialize). Role of technological innovations (e.g., fracking; deep-ocean drilling; deep sea mining) Environmental Sustainability: The IPAT Identity IPAT Identity: Impact of Population (P), Affluence (A) and Technology (T) on Environment I (Impact of human activities on degradation of the planet and the natural environment) = f [Population, Affluence, and Technology] Population (+): By 2050, the world’s population is projected to reach 10.5 billion. Affluence (+): An increasingly larger percent of the population is becoming increasingly affluent and emerging as a major market for a growing array of goods and services. If the living standards in China and India were to be the same as that of the USA, the world will need the resources of three Planet Earths. (A Harvard Business Review article published in the 1980s) If the living standards of the rest of the world were to be the same as that of the USA, the world will need the resources of six Planet Earths. (A Harvard Business Review article published in the 1980s) Technology (+/-): Technology (-)  Innovation: See Previous Slide Technology (+)  Innovation: The number of products owned by a typical household today versus 25 years ago versus 50 years ago versus 75 years ago versus 100 years ago versus … (Number of worldly materialistic possessions of humans yesterday versus today versus tomorrow) The IPAT Identity, Technology and Innovation Technology (+): Impact of technology on the degradation of the natural environment through P (Population) and Affluence (A). Technology (-): Impact of technology on slowing the degradation of the natural environment caused by P (Population) and Affluence (A). “But note that this rate of zero environmental impact is not achieved by a return to “primitive” conditions, but by an actual technological advance” (Commoner 1972; cited in Chertow 2001, p. 26). Commoner, B. (1972), “The Environmental Cost of Economic Growth,” in Population, Resources and the Environment. Edited by R. G. Ridker, Washington DC. US Government Printing Office, pp. 339-363. Impact of Technology on Slowing the Degradation of the Natural Environment Weight of an Empty Weight of empty soda can, 60 years ago: 80 Aluminum Soda Can grams. Current weight of empty soda can (same volume): 13 grams. With over half a trillion cans produced each year, the importance of this innovation cannot be overstated. … Food and beverage manufacturers wanted to reduce costs. So, they set out to design a better can. … Invested in innovation by hiring CAD engineers with the sole purpose of iteratively designing new cans that would continue to reduce the amount of aluminum over time. -- In the six decades following this investment, the industry has witnessed the massive reduction in materials and shipping costs per can. -- It has also benefitted not only from cheaper production and logistics costs but also from the reduction in materials going through the recycling and reuse process.  Innovating for Environmental Sustainability Eco-innovations Eco-friendly innovations Environmental innovations Green innovations Greenovations Sustainable innovations Sustainability driven innovations Sustainability driving innovations Sustainability enhancing innovations Sustainability focused innovations Sustainability oriented innovations...  Sustainable Innovation and Sustainable Product Innovation: Definitions Sustainable Innovation: The development and implementation of a novel idea for a new product, process, or practice, or significant improvement of an existing product, process, or practice that significantly reduces the environmental impact of the firm’s activities. Sustainable Product Innovation: The development and implementation of a novel idea for of a new product or significant improvement of an existing product whose environmental impact during one or more stages of the lifecycle of the product (resource extraction, production, distribution, use, and post-use disposal), is significantly lower than existing products for which it is a substitute. Adapted from: Varadarajan, Rajan (2017), “Innovating for Sustainability: A Framework for Sustainable Innovations and a Model of Sustainable Innovations Orientation,” Journal of the Academy of Marketing Science, 45 (January), 14-36. Innovating for Environmental Sustainability During the Use Stage of Life Cycle of the Product: Cold Water Formulation of Laundry Detergent About three-quarters of the energy use and greenhouse-gas emissions from washing a load of laundry result from heating the water. Sustainability Liability: Consumers’ perception (misperception) of ecologically less harmful products as less effective. Marketing Communication Challenge (through Advertising and in Product Packaging): Convincing consumers that a new detergent formulation developed for washing clothes in cold water is as effective as detergent formulations recommending use of warm or hot water.  Innovating for Environmental Sustainability: Product-Market Opportunities for Consumption Elimination, Reduction and Redirection Identifying and pursuing product-market opportunities for: Consumption elimination Consumption reduction Consumption redirection (from ecologically more harmful to less harmful substitute products) And thereby, achieving: Demand elimination Demand reduction Demand redirection (from ecologically more harmful to less harmful substitute products) And in turn, a reduction in the aggregate demand for: Renewable resources Non-renewable resources Consumption redirection from Product A to Substitute Product B = Consumption reduction of Product A Demand redirection from Product A to Substitute Product B = Demand reduction of Product A Varadarajan, Rajan (2014), “Toward Sustainability: Public Policy, Global Social Innovations for Base-of-the-Pyramid Markets, and Demarketing for a Better World,”  Innovating for Environmental Sustainability: Consumption Redirection from Ecologically More Harmful to Ecologically Less Harmful Substitute Products In 2007, Wal-Mart Stores Inc., began a transition in its U.S. stores toward selling only concentrated laundry detergents, which use much less water and therefore require less packaging and space for transport and storage. By 2009, this changeover was complete, with every major supplier in the detergent industry complying. (Exercising of channel power – Walmart) Source: S. Rosenbloom and M. Barbaro, “Environmental Sustainability, Now at Wal-Mart,” New York Times, February 5, 2009. Shaping Consumer Behavior toward Sustainable Behavior If you offer consumers liquid laundry detergents only in concentrated form, they will adapt to it. Ban on manufacture and/or use of tungsten filament light bulb in a growing number of countries.  Sustainable Innovations 101 (Low Hanging Fruits) Sustainable Innovation Focus and Type Reduction in the amount of a resource used in a product or process. Elimination of a resource used in a product or process. Substitution of a resource used in a product or process. Sustainable Innovation Focus: Resource Use Reduction A1. Resource Use Reduction An innovation that lowers the environmental impact of a product or process by achieving greater efficiency in the use of a resource used as an input. A1.1 Reduction in the amount of a renewable resource used. A1.2 Reduction in the amount of a nonrenewable resource used.  Resource Use Reduction Colgate Introduces a Toothbrush That Uses 80% Less Plastic The Colgate Keep has an aluminum handle with a replaceable plastic brush head. Colgate's new toothpaste tube is designed with slippery coating to let you squeeze out every last drop (Colgate in Partnership with LiquiGuide) Packaging Innovation Win-Win Innovation (Good for Me. Good for We – Environment)  Sustainable Innovations Focus: Resource Use Elimination A2. Resource Use Elimination An innovation that lowers the environmental impact of a product or process by eliminating the use of a resource as an input. A2.1 Elimination of an ecologically harmful ingredient from a product (Phosphorous free detergent) A2.2 Elimination of a filler ingredient from a product (Concentrated liquid detergents contain less water, a filler ingredient) A2.3 Elimination of the need to use a complementary product (bag-less vacuum cleaner; iPod) Elimination of an ecologically harmful ingredient from a product: Phosphate from Detergents Sustainable Innovation Focus: Resource Use Substitution A3. Resource Use Substitution An innovation that lowers the environmental impact of a product or process by substituting a resource used as an input with another resource. A3.1 Substitution of a nonrenewable resource with a renewable resource A3.2 Substitution of an ecologically more harmful nonrenewable resource with an ecologically less harmful nonrenewable resource A3.3 Substitution of a less abundant nonrenewable resource with a more abundant nonrenewable resource, subject to the substitution not having a negative impact on the overall sustainability profile of the product. A3.4 Substitution of a raw material mined from below ground (below ground mining) with a raw material mined from above ground (above ground mining) -- reuse of a resource extracted during the post use or post consumption stage of the life cycle during the production, out bound logistics, or use/consumption stage. resource with a renewable resource Schick Designs a Disposable Razor to Appeal to Environmentally Conscious Consumers -- Schick's new bamboo razor is the brand's effort to offer consumers a product made with renewable materials. -- Substitution of a non-renewable resource (plastic) with a renewable resource (bamboo) -- The new product is part of the parent company’s pledge to be Disposable Razor to Appeal to Environmentally Conscious Consumers Schick's new bamboo razor is the brand's effort to offer consumers a product made with renewable materials. Consumers willingness to pay a higher price for a product that causes less Consumption/Demand Redirection from Ecologically More Harmful to Less Harmful Substitute Product From Incandescent Light Bulb to LED Bulb Demand Redirection from Incandescent Lights to LED Lights through Legislation: Laws and Regulations -- LED lights last as much as 50 times as long as incandescent bulbs and use a fraction of the electricity. -- Households in the US will collectively save $3 billion a year on their utility bills, following the phase out of sale of incandescent bulbs in the US in 2023. -- The phase out will cut emissions of planet-warming carbon dioxide by an estimated 222 million metric tons over the next 30 years, an amount equivalent to the emissions generated by 28 million homes in one year. (US Department of Energy Estimates).  Sustainable Innovations 101: The Innovation Space A. Innovation Focus Resource Use Reduction D. Innovation Stage: (Innovations for greater Stage of Life Cycle of efficiency in resource use) Product Resource Use Elimination Raw materials Resource Use Substitution extraction and upstream supply chain B. Innovation Type Manufacturing Product Innovation (e.g., Distribution and Resource use reduction or logistics (Downstream efficiency focused product supply chain) innovation) Product Consumption / Process Innovation Use (e.g., Resource … use reduction focused incremental product C. Innovation Type Incremental Innovation innovation during the product use stage – (e.g., Resource use Gasoline-Electric reduction focused Hybrid cars) incremental product Post Consumption / innovation) Use Disposal  Sustainable Innovation Opportunities Arena: A Framework (Varadarajan 2017) B. Sustainable Innovation Opportunity Stage A.Sustainable 5. Post Use/ Post 1. Upstream 3. Downstream 4. Use/ Innovation Supply Chain 2. Production Consumption Consumption Supply Chain Opportunity Type A1. Resource Use (Efficiency) Reduction Innovation A1.1 A1.2 A2. Resource Use Elimination Innovation A2.1 A2.2 A2.3 A3. Resource Use Substitution Innovation A3.1 A3.2 A3.3 A3.4  Sustainable Product Innovations: An Exposition of the Sustainable Innovations Framework Innovation Type Description and Illustrative Examples A. Resource Use Reduction Innovations: Reductions in the quantities of various renewable and nonrenewable resources used during the life cycle of a product – extraction, production, distribution, use/consumption and disposal. 1. Technology Push Innovation More resource efficient new technology Example: Celluloid film-based cameras versus digital cameras  Sustainable Product Innovations: An Exposition of the Sustainable Innovations Framework Innovation Type Description and Illustrative Examples A. Resource Use Reduction Innovations: Reductions in the quantities of various renewable and nonrenewable resources used during the life cycle of a product – extraction, production, distribution, use/consumption and disposal. 2. Product Miniaturization Innovation More resource efficient new technology. Greater resource use efficiency through improvements in current technology. Example: Evolution of music storage devices and players from vinyl records and record player, to cassette tapes and cassette player, to compact discs (CDs) and CD player, to even more compact music players with built in hard drives for storage of music (e.g., the iPod)  Sustainable Product Innovations: An Exposition of the Sustainable Innovations Framework Innovation Type Description and Illustrative Examples Resource Use Reduction Innovations: Reductions in the quantities of various renewable and nonrenewable resources used during the life cycle of a product – extraction, production, distribution, use/consumption and disposal. 3. Product Convergence Innovation Development of a new product that subsumes in a single product multiple erstwhile distinct standalone products. Example: Smart phones which incorporate in a single device the features and functionalities of multiple devices. Phone, digital camera, music storage and playback, information storage and retrieval, sending and receiving e- mails, etc.  Serendipitous Sustainable Innovations Convergence Product Innovation: Integration of Multiple Standalone Products in a Single Product  Serendipitous Sustainable Innovations Convergence Innovation: Integration of Multiple Standalone Products in a Single Product (Dyson Heater, Fan, and Air Purifier in One Device)  Sustainable Product Innovations: An Exposition of the Sustainable Innovations Framework Innovation Type Description and Illustrative Examples Resource Use Reduction Innovations: Reductions in the quantities of various renewable and nonrenewable resources used during the life cycle of a product – extraction, production, distribution, use/consumption and disposal. 4. Product Versatility Innovation Vacuum cleaner that can be used on carpet, hardwood and tiled floors in place of vacuum cleaners specifically designed for use on carpets versus hard surfaces. Sustainable Product Innovations: An Exposition of the Sustainable Innovations Framework Resource Use Reduction Innovations: Reductions in the quantities of various renewable and nonrenewable resources used during the life cycle of a product – extraction, production, distribution, use/consumption and disposal. 5. Complementary Product Elimination Elimination of consumption of Innovation / demand for complementary product during use stage of life cycle of product Example: Vacuum cleaner with canisters whose contents can be directly emptied into a waste basket, in place of vacuum cleaners that require use of disposable bags for capture and storage of dirt and dust. Complementary Product Elimination (Bagless Vacuum Cleaner) Sustainable Product Innovations: An Exposition of the Sustainable Innovations Framework 6. Complementary Product Use Amount Reduction Innovation Reduction in consumption of/demand for complementary product -- Use amount reduction during use stage of life cycle of product Examples: Single rinse formulations of laundry detergents. Cold water formulations of laundry detergents: About three-quarters of the energy use and greenhouse-gas emissions from washing a load of laundry result from heating the water. Automobiles designed for greater fuel efficiency, less frequent oil change: For example, intervals of 15,000 miles rather than intervals of 5,000 miles, and using longer lasting parts, components and subassemblies (e.g., spark plug replacement, tire replacement, etc.) Printers (copiers) designed to print (copy) on both sides of the paper. About three-quarters of the energy use and greenhouse-gas emissions from washing a load of laundry result from heating the water. Sustainable Product Innovations: An Exposition of the Sustainable Innovations Framework 7. Product Substitution Innovation Video conferencing as a substitute for travel by plane, train or car for face-to- face business meetings. Sustainable Product Innovations: An Exposition of the Sustainable Innovations Framework 8. Variable Use Amount Innovation Reduction in consumption of/demand for core product during use stage of life cycle of product Example: Paper towel rolls with perforations to facilitate use of smaller amounts (e.g., one-half or one-quarter of regular size sheet in a roll) of paper towel Sustainable Product Innovations: An Exposition of the Sustainable Innovations Framework 9. Upgrade vs. Replacement Innovation Reduction in quantities of various resources used by replacing only certain components and subassemblies to upgrade a product Example: As an alternative to full product replacement, designing a product such that it can be upgraded, or its useful life extended by replacing subsystems or modules (Guiltinan 2009) Circular Economy: Decoupling economic growth from new resource consumption through recycling, reuse and repair Dell’s New Laptop Is Repairable, Reusable, Low-Carbon— and Not for Sale Laptop maker says its latest circular-economy prototype cuts greenhouse-gas emissions roughly in half compared with a recent model. Dell Technologies Inc.’s new, more environmentally friendly prototype laptop has a tenth as many screws as a regular laptop, fewer components and modular parts that can be reused. The laptop will never be sold and instead shows how Dell is positioning itself in the so- called circular economy. By 2030, Dell says it plans to recycle or reuse a product for every equivalent product it sells, and to use recycled or renewable materials for half its product content, a “circular” process of manufacturing that moves away from traditional large-scale production. … More companies are espousing the idea of circularity—decoupling growth from new resource consumption through recycling, reuse and repair. (Wall Street Journal, December 14, 2021). Linear Economy (Take-Make-Waste / Extract-Produce-Use-Dispose in Landfills) versus Circular Economy (Recycling and Reusing Resources  Sustainable Packaging Innovations: An Exposition of the Sustainable Innovations Framework 1. Reduction in the Amounts of Materials Used Various materials used for packaging 2. Change in Materials Used From non-biodegradable to partially biodegradable or fully biodegradable packaging materials. 3. Increase in Percent of Specific Materials Used Increase in percent or recycled paper products used as packaging material content 4. Elimination of Packaging Elimination of paper/cardboard packing for deodorants and antiperspirants and incorporating all product-related information in the product container  Innovating for Environmental Sustainability: Packaging Innovations Directing (stipulating) manufacturers to eliminate cardboard box package for deodorants, after-shave lotions, etc. Provide all information about the product on the product container itself, rather than an additional layer of cardboard packaging (Exercise of channel power – Walmart). Product packaging – in store, display on website, and package shipped. Elimination of bells and whistles packaging from goods that are shipped from a warehouse to customers (Amazon). Bottled Water in Bottle Made with 53% Paper and 47% Plant-Based Plastic (Product contexts in which packaging innovation is more impactful than product innovation) Just Water’s bottle is made of 53 percent paper, sourced from trees that have been certified by the Forest Stewardship Council. The rest is plant-based plastic, along with a small amount of  The Specter of Devastation of Planet Earth Why Are Homo Sapiens (Wise Humans!) Horrifyingly Nonchalant? The Evolutionary Biology Explanation “Some research in social psychology suggests that our brains are not well adapted to protect ourselves from gradually encroaching harms. We evolved to be wary of saber-toothed tigers and blizzards, but not of climate change — and maybe that’s also why we in the news media tend to cover weather but not climate. The upshot is that we’re horrifyingly nonchalant at the prospect that rising carbon emissions may devastate our favorite planet.” (Nicholas D. Kristof, “Our Beaker Is Starting to Boil,” New York Times, July 16, 2010). http://www.nytimes.com/2010/07/18/opinion/18kristof.html?src=me&ref=general Environmentally Responsible Behavior: The Attitude-Behavior Gap Findings of Global Survey Percent of respondents indicating a willingness to buy green products: 40% Percent of respondents who had actually bought green products: 4% Gap between consumers’ attitudes toward sustainable products and actual behaviors: 36% The Holy Grail for Marketers: Overcoming barriers to sustainable consumption while making a profit. UN Report on Advancing Sustainable Lifestyles through Marketing and Communications (United Nations Environment Programme 2005) Discuss Why is there a gap between consumers’ sustainability related attitude and behavior? How can the gap be narrowed or bridged?  Environmentally Responsible Behavior: The Attitude- Behavior Gap Who Benefits from Individual Consumers Engaging in Pro-environmental Behavior? Persuading consumers to engage in environmentally responsible behaviors is a challenge since the beneficiary may not always be the consumer who engages in pro-environmental behavior, but other consumers, the society at large, or the planet Earth (Grinstein and Wathieu 2012). Innovations for Environmental Sustainability Vending Machines Offer Subway Credit for Recycled Bottles and Cans (Istanbul, Turkey) ( Ceylan Yeginsu, NY Times, Oct. 17, 2018) Takeaways (1) Make it easy for people to recycle. At a metro station. (2) Reward recycling behavior. (3) Reward recycling behavior with an ecologically less harmful product. Credit for future travel on a mass transit system.  Sustainability Repurposing: Bag made with recycled plastic bottles. Creativity in Marketing Communications to Foster Sustainable Behaviors: Promoting Conspicuous Consumption of Virtuous Products  Corporate Social Responsibility  Corporate Sustainability Responsibility Corporate Sustainability Responsibility Government Sustainability Responsibility Consumer Sustainability Responsibility Consumer, Corporate and Government Sustainability Responsibility Corporate Business Imperative and Sustainability Responsibility Concurrent pursuit of a larger market footprint and a smaller environmental footprint, with an emphasis on a steep rate of reduction of the environmental footprint. Varadarajan, Rajan (2020), “Market Exchanges, Negative Externalities and Sustainability,” Journal of Macromarketing. Concurrent Pursuit of a Larger Market Footprint and a Smaller Environmental Footprint By 2020*, Unilever aspires to: Double the size of the business while reducing the company’s environmental impact. Help more than one billion people improve their health and well-being (i.e., add one billion new customers to its existing customer base). Halve the environmental impact of its products. Source 100% of agricultural raw materials sustainably. http://www.triplepundit.com/2011/04/sustainability- unilever/ *It is 2022. Worth revisiting Unilever’s 2011 aspiration statement for 2020. https://www.unilever.com/sustainable- living/ Consumer, Corporate and Government Sustainability Responsibility Government Economic Imperative and Sustainability Responsibility Concurrent pursuit of a larger economic footprint and a smaller environmental footprint, with an emphasis on a steep rate of reduction of the environmental footprint. Varadarajan, Rajan (2020), “Market Exchanges, Negative Externalities and Sustainability,” Journal of Macromarketing.  Sustainability Imperative at the Country Level: Concurrent Pursuit of a Larger Economic Footprint and a Smaller Environmental Footprint  Government Sustainability Responsibility, Corporate Sustainability Responsibility and Consumer Sustainability Responsibility Government Sustainability Responsibility: Policies, Program, Laws and Regulations Conducive to a Larger Economic Footprint and a Smaller Environmental Footprint Trendlines: GHG Emissions Per Capita. GHG Emissions Per $ of GDP Consumer, Corporate and Government Sustainability Responsibility Consumer Sustainability Responsibility Concurrent pursuit of a desired quality of life enabled by consumption or use of various goods and services and a concerted effort to significantly lower one’s environmental footprint. Varadarajan, Rajan (2020), “Market Exchanges, Negative Externalities and Sustainability,” Journal of Macromarketing.