Innovation

Is There a Market for Green Products?

It's Earth Day—should you care? The business opportunities for "green" exist, but they may not be what you think

Written by mira.shenker@profit.rogers.com

Millenials want green products. More than that, they want everyone to know they care about the environment. But are they actually buying green?

According to Joel Makower’s (greenbiz.com) sampling of the crop of environmental opinion data that’s released every year in the run-up to Earth Day, the majority of millenials, when surveyed, will say that they recycle and buy eco-friendly products. But their behaviour doesn’t back up those claims.

“If you ask most people if they’re interested in buying green, they’re going to say yes. Who’s going to say no?” says Jacqueline Ottman, New York-based author of The New Rules of Green Marketing. “But something changes from the time most people say, ‘Yes, I’m into green,’ to the time they actually buy it.”

Gen Y isn’t spending any more than their parents on eco-friendly products now, but their posturing indicates that they at least have the desire to go green. According to a recent survey, only 40% of Canadians say they’re willing to pay more for environmentally friendly products, while the overwhelming majority (70%) want manufacturers to cover the costs of production and offer environmental benefits without increased costs.

That’s a major opportunity for any business who can figure out how to offer products that are both affordable and easily integrated into the consumer’s everyday.

ENJO Canada president Trish Ronan did exactly that with her line of “clean” cleaning products. ENJO understood that the desire to be green is partially tied up with the desire for other people to know you’re green. While the health benefits (for yourself and the environment) are part of the sell, ENJO is also selling the green lifestyle. “Make an ethical or environmentally conscious purchase, and you can tell yourself—and the people around you—that you’re a good person,” says Ronan.

Read Clean up With Conscious Consumers

Authentically “green” products may just be able to stand up against a deluge of similar products. But, they still has to be cost competitive with mainstream products to appeal to most consumers.

Alex Steffen says the real opportunity isn’t in detergents or hybrid cars. In a blog for HBR, he says that the most lucrative ventures centre on products that have yet to be invented.

“Entire business categories are coming into being,” says Steffen. “Who took seriously car- and ride-sharing services as profitable businesses ten years ago? Who thought fifteen years ago that urban multifamily would be the next boom housing market? Who twenty years ago believed that green building would become not a good deed but an industry standard? The changing reality of cities in the age of climate consequences is throwing aside whole systems we’ve taken for granted and in their places are springing up new opportunities.”

Read A New Tech Niche: the Explosive Growth of Car Sharing

The greatest opportunity is for tech companies. Steffen says, “The potential upside of climate action dwarfs even the great success story of the last 20 years, the rise of the technology industry. Companies can seize these opportunities, if they learn to see the landscape ahead through a new lens of climate necessity magnified by new capacities.”

“This is not about corporate sustainability,” says Steffen. No, these products and innovations are becoming necessary as climate change becomes more reality than sets of numbers.

“It is the 21st century economy,” sats Steffen.

Originally appeared on PROFITguide.com