Ask businesses why they don’t tout green achievements more often, and their answer will likely be fear of greenwash.

Before you let such fears deter you from making investments in sustainable technology or promoting your green achievements, consider how difficult it is for any advertiser to gain consumer trust.

Consumers have always been skeptical of advertising. Take the food industry, for example. Food brands have long been under government scrutiny for their advertising claims. Today, companies are getting smeared for overpromising health benefits, leaving consumers confused about what’s actually true. But we don’t call that “food wash.”

As I write in my book, The New Rules of Green Marketing, skepticism is so rampant in all industries that consumers trust each other more than they trust brands, ads and media messages in general. That’s one reason social media is soaring right now.

Skepticism is par for the course. Besides, a little skepticism is good – it keeps us on our toes. The now “Wild West” green marketplace will mature. But as is the case for many established industries, the potential to screw up will always be there.

So, proceed with caution. But for the sake of the planet and your business, do proceed. The following strategies will help you avoid greenwash and gain competitive advantage in the process:

1. Walk your talk.

Thwart the most discriminating of critics by visibly making progress toward measurable goals. Being proactive in responding to the public’s concerns and expectations starts with a visible and committed CEO. That’s because CEOs can create an emotional link between the company and its customers. Empower your employees, too. Educate them on environmental issues and the specifics of their company’s processes so they can fuel authentic communications about your company’s green initiatives.

2. Be transparent.

Provide access to details about your products and corporate practices, and continuously report on your progress. In the future, disclosure of environmental impacts may be required by law. Get a jump on competitors and regulators—and score some points with consumers—by voluntarily disclosing as much as possible. During this process, don’t hide bad news. Acknowledge your weaknesses and explain how you’re proactively trying to improve.

3. Don’t mislead.

Be specific, prominent and comprehensive so as not to confuse. Consumers may claim to know what commonly used terms such as “recyclable” and “biodegradable” mean, but they can be easily mistaken—creating risk for unsuspecting sustainable marketers.

The best advice for green marketers is to adopt specific standards for disclosure of green initiatives and to follow the FTC Green Guides or other appropriate government guidelines. If possible, consult with lawyers who specifically address green claims.

4. Enlist the support of third parties.

Let stakeholders in on the steps you’re taking, and educate the public on how they can help. You can also align positively with third parties that perform independent life-cycle inventories, certify claims and award eco-seals. Certifying your product under appropriate eco-labels lends credibility to environmental messages. When choosing eco-labels, be sure to choose wisely based on how relevant the label is to your brand image. If your product has multiple eco-labels, make sure the standards for each do not conflict with one another.

5. Promote responsible consumption.

It’s one thing to design a product to be greener, but you can’t minimize impact throughout the total product life cycle unless consumers eventually use and dispose of your product more responsibly. Enlisting consumer support for responsible consumption is a sure-fire way to build credibility and reduce risk. Products can be designed to make it easier for consumers to minimize resource use. In turn, people will appreciate your efforts to make responsible consumption more manageable.

******

Jacquelyn Ottman is the founder and principal of J. Ottman Consulting, Inc., an expert advisers on green marketing to consumer product marketers and U.S. government labeling programs. She is the author of four books on green marketing, including the recently released The New Rules of Green Marketing: Strategies, Tools and Inspiration for Sustainable Branding (Berrett-Koehler, 2011).

Download a free chapter and get more information here.

After reviewing the numerous trend articles out there and considering my own perspectives I have put together some that I think are relevant to LOHAS. Here are a few that I feel are relevant for the coming year:

1. Whiskey is for Drinking, Water Is for Fighting Over
The famous Mark Twain quote will become more prevalent in society as new realities of its scarify will become better known to an ever growing global thirst.  Everyone will talk about it but few will do anything. Sadly, it may only start to take off if humanitarian crises hit.  A focus on water use is an admission that climate change is our new reality and it's time to start managing its effects. The material risks associated with increased droughts and flooding will be among the most poignant effects of climate change. You may already be talking about this with the lack of snowfall around the country during the early part of this year.

2. Capitalism as We Know is Changing and it Should
Since the Industrial Age, businesses have built their wealth off of the extraction of natural resources. Unless businesses start to value and protect these resources, this cycle will have a devastating impact on the lives of our children and grandchildren.  Richard Branson echoes this sentiment and also believes it cannot survive in its current model. This can also cause possible ecoflation that was identified in 2008.  Many people are beginning to realize that business as usual is no longer an option. What is an option is to reinvent capitalism to truly be a force for good in the world. Certification groups such as FairTrade and Benefit Corporation are working to use the power of business to solve social and environmental problems.  The current changing economic scene provides unique opportunity for innovation and success in unconventional settings. The sky is the limit as new ways to do better business are taking root everyday.

3. Blurring the Differences Between “For-Profits” and “Non-Profits”
There has been a surge of entrepreneurs providing innovative business solutions with the purpose of “doing good”.   In these tumultuous times where unemployment is high many are turning their backs on the job fairs and putting their efforts into creating new businesses that fill needs such as TaskRabbit, and Viatask.   Non-profits will incorporate more for-profit business models into their programs. There is a strong growth in social entrepreneurialism globally and this will increase with the emergence of new solutions for world issues. Groups like the Social Venture Network, Sansori and Unreasonable Institute will increase to provide resources for start ups. Social enterprises will encompass the very definition of business and 2012 will be an important year.

4. Gamificating Your life
Expect and increase in the game addiction methods to make a world a better place this next year. Game and point system rewards programs such as My Recycle Bank , My Energy and Greenopolis will see newcomers such as Ecobonus that rewards points to green and organic shoppers. More smart apps will be provided for LOHAS shoppers and energy efficiencies for homes and automobiles. 

5. Evidence Based Sustainability
Proof of sustainability will be emphasized more than ever as businesses will seek cost effective measure to reduce bills and be a good environmental citizen. Purchasing departments will be requiring vendors to document how they address sustainability issues within their own businesses will become more commonplace. As facilities and businesses increasingly operate in a more sustainable manner, they will turn to "dashboard" systems to help measure, manage and report progress.

6. We'll All Want to Plug in to Plug-in Hybrids
Hybrids are not new but the latest improvements in technology will allow them to be more affordable to the average consumer. If electric cars like the Nissan Leaf and Chevy Volt are the trail-blazers, plug-in hybrids could be the game-changer the auto industry has been looking for. The prospect of a car than can travel distances of up to 40 miles using electric power before switching to a gas engine for longer journeys promises to overcome the biggest objection to electric cars: the fear the battery will run out mid-journey.  Design also looks exciting. We only need to look into BMW i8 roadster concept and visualize where this might take the car industry in near future. The high profile Vauxhall Ampera and Toyota Plug-in hybrid will create a lot of buzz this year and assuming the cars offer reasonable performance they could quickly become the default option for green-minded motorists and cost-conscious fleet operators

7. More Fun with Sharing Stuff
Sharing will not only be a part of social media but of reality. Considerations of downscaling due to financial, lifestyle reasons or social pressures will increase in sharing the excesses of the past decade as we become more conscious of what we have that we don’t use that others can borrow. Rent Stuff, Loanables andRent Stuff Easy allow you to do exactly what they say to others online.  A while back Sharable listed eight ways to share your stuff. That's about few of those thousands of ways of giving your stuff (or money) away for charity. Couchsurfing connects travelers with people who offer their homes as an economical place to stay. Rising oil costs will put pressure on transportation and the demand for shared and public transportation. Transportation share programs such as Zipcar, Bixi or Bcycle will increase. In four years the number of registered users have gone up from less than one million to more than four million. By Carpooling shared trips have gone up from less than three million to almost eight million.
 
8. Responsible Profitability Attracts Attention
Responsibility has been strongly associated with greater profitability, equity and asset returns, and shareholder value creation. But that’s no longer good enough. Today, the bar is being raised; success is itself changing. Companies are beginning to be judged against a whole new set of criteria by customers, governments, communities, employees, and investors. They’re already saying, so you made a profit. Yawn. Did you actually have an impact? Did what you do have a positive, lasting consequence that was meaningful in human terms? Several studies have provided evidence suggesting that betterness yields greater equity returns, asset returns, and profitability. This not only makes sense for those who are mission oriented but also for risk management.  One recent study found Firms that score strongly in terms of corporate social responsibility (CSR) find that their cost of equity capital financing is consistently lower than firms with weaker CSR track records. Responsibility fuels outperformance because it is risk management: better insurance against adverse future events.

9. Emphasis on Corporate Culture
Successful startup companies such as Method, Zappos and New Belgium Brewery are all preachers of their unique culture developed around their workplace. They preach not to chase the profits but to chase the dream. Engaging employees as a collective of ideas and not compartmentalization is a new form of corporate structure. It is not just about the fun office parties and surroundings but understanding the larger mission of the company and empowering employees. Creative agencies and culture builders have seen the need to train and educate companies on these emerging traits that are attractive for the young new work force.

10. Natural Disasters Will Continue
Expect your homeowners insurance rate to rise in 2012 as weather related damages cost $70 billion in U.S. economic losses in 2011.  All the indicators on climate risk are pointing the wrong way.  The financial and human cost of extreme weather and climate-related disasters is on an unmistakably upward trend. Meanwhile, our energy infrastructure remains as risky as ever with the Fukushima disaster following the BP oil spill in highlighting how fragile our energy supplies really are. It is a safe bet that 2012 will again be marred by a large-scale environmental tragedy of one form or another. Meanwhile, sensible businesses and policymakers will start taking climate adaptation more seriously.

References for these trends are:
Ecopreneurist.com
Taombo.com
Greenbiz.com
Huffington Post
PR Newswire

Are there any missing? Let me know what others trends you forsee for 2012 and LOHAS.

Our economy is slowly but surely heeding the signal that carbon is the new watchword. During the past few years, a steady stream of so-called “biobased” products have been making their way to retail shelves — compostable dinnerware made from corn, plant-based laundry detergents, and bamboo flooring among them. Coke and Pepsi are now competing to be first to market with a soft drink bottle derived entirely from sugarcane or other plant materials.

The emerging biobased economy even has its own label — USDA Certified Biobased, pictured here. It’s part of a federal BioPreferred program designed to help grow “green” jobs, stimulate the rural economy, promote energy independence and prompt a shift to renewable resources from petroleum, helping to manage the carbon cycle.

Launched in February 2011, the label needs a little introduction since the term “biobased”, although familiar sounding, represents more than meets the eye. We advised the USDA on strategic marketing considerations related to the launch of the USDA Certified Biobased label. Here’s a primer — and why you need to be thinking about forming your own biobased strategy during 2012.

What is “Biobased”?
Ask a consumer what “biobased” means and they might respond with somewhat erroneous definitions such as “natural” “biodegradable” or “renewable”.  Consult Webster and you’ll come up short. But the USDA (and federal law) defines it quite specifically as “commercial or industrial products, other than food or feed, that are composed in whole, or in significant part, of biological products or renewable agricultural materials (including plant, animal, and aquatic materials), or forestry materials” — hence the label depicting the soil, sea and the sun.

More important than this definition are the program’s intention — to expand the market for alternatives to petroleum-based products by promoting new uses for agricultural commodities such as bioplastics, biofibers and biobased chemicals. It thus excludes products such as office paper, cotton t-shirts and wooden furniture introduced before 1972. (See BioPreferred.gov for more details.)

Both finished consumer and commercial products as well as intermediate products (e.g., platform chemicals, fibers, etc.) are currently eligible to earn the USDA Certified Biobased label. Standards for “complex” products (consisting of many components, such as automobiles) are being developed. Among the many products that have already earned the label are: Procter & Gamble’s Gillette ProGuide Fusion razor package; Papermate mechanical pencils made from Mirel biodegradable plastic, the Greenware line of cold cups made from NatureWorks’ plant-based Ingeo polymer; and intermediates such as Lenzing’s TENCEL lyocell fiber made from eucalyptus and DuPont’s Sorona polymer. Seventh Generation is so bullish about the label that they have certified over 60 of their household cleaning and personal care products — virtually their entire product line-up.

Why Pursue a Biobased Strategy
The credibility and broadscale awareness of the brand USDA positions labeled products to stand out to consumers. In an age where consumers actively seek environmentally preferable biobased products with comparable price and performance, having the USDA certified biobased label increases shelf appeal. And marketing benefits don’t stop there. The federal government, by law and executive order, now gives purchasing preference to over sixty categories of biobased products. Biobased alternatives can also help businesses to manage volatile petroleum-driven costs and ensure sustainable supplies.

Measurement, Transparency and Product Performance
Not every product made with plants or other renewable resources can qualify for the USDA Certified Biobased label. That’s because the USDA has set strict minimums for biobased content in a wide range of “designated” products. For instance, a lip balm may only need 11% biobased content to qualify, while a disposable food container needs 72%. Any product category for which a target has not yet been established must achieve minimum biobased content levels of 25%. Although this 25% bar may at first glance seem low, keep in mind that minimums are based upon the highest levels of biobased content possible without compromising performance, and to encourage participation in a market now ramping up.

Biobased content is measured using a radiocarbon dating test standard, ASTM D6866. This test measures total carbon content and distinguishes the amount of “new” organic from fossil or petroleum-based carbon. This enables the “new” organic (biobased) carbon to be expressed as a percent of the total carbon. To foster transparency, encourage a level playing field and promote continuous improvement, the USDA Certified Biobased label requires disclosure of the percentage of biobased content for the product and/or package.

Caution Advised When Making Environmental Claims
Marketers may realize advantages if they can substantiate a product’s biobased content in support of environmental marketing claims such as “natural”, “biodegradable”, “renewable” or even “non-toxic”. However, none of these environmental attributes are automatic because of a product’s certified biobased content. Whether a claimed environmental attribute can be supported depends upon the amount of biobased content, as well as how the product was processed and transported, and other life cycle considerations.

Keep in mind too, that much consumer confusion surrounds the biodegradability and recyclability of bioplastics. For instance, some resins may not be biodegradable but can be recycled (like Coke’s bioplastic PET PlantBottle, recyclable with petroleum-based PET).  In addition, some traditional petroleum-based plastics are compostable in industrial (municipal) facilities, but not in backyard composters. And no plastic, biobased or otherwise, is designed to readily biodegrade in landfills.

The revised proposed FTC Green Guides, anticipated in 2012, will likely include specific guidance for biobased marketing and related claims. (We’ll discuss this in more depth in future posts.)

What’s Your Biobased Strategy?
According to Kate Lewis, Deputy Manager of the USDA BioPreferred program, since its introduction in February 2011, over 500 products have been certified to use the USDA Certified Biobased label and over 400 applications are in the pipeline.  She reports that her group is “looking forward to working with proactive brand owners to capitalize upon their certification and really drive this new bio-industrial revolution forward.” Now entering the market, these labelers will enjoy first-mover advantage as well as the opportunity to educate their consumers and other stakeholders about the benefit biobased content brings to their products.

Whether one leads or follows, it’s clear biobased products figure prominently in our future. We predict that all products will ultimately be judged by their carbon content and their potential to effect global climate change. So, credible biobased products are and will continue to be a critical component of a long-range strategy. Short-term motivations for developing a biobased strategy, while company and brand specific, can include minimizing cost, enhancing image, reputation and consumer perception, and avoiding potential regulatory risks. So key questions for every brand owner, product manager and CEO in 2012 are What’s your biobased strategy? Do you have a team in place to bring biobased innovation into your brand and product portfolio?

Jacquelyn Ottman and Mark Eisen wrote this article. They are colleagues at New York-based J. Ottman Consulting, Inc. They advised USDA BioPreferred on the launch of the USDA Certified Biobased label during 2011 and are now advising labelers on how to market their participation in the program. Ms. Ottman is the author of The New Rules of Green Marketing: Strategies, Tools and Inspiration for Sustainable Branding (Berrett-Koehler, 2011). Mr. Eisen is the former environmental marketing director at The Home Depot.

Copyright © 2012 J. Ottman Consulting, Inc.

By Nathan Rice of Haberman

Where does a pioneering filmmaker with the idea to celebrate agriculture in the U.S. go for funding? What about a scientist with an innovative plan for improving the growing potential of urban gardens? What about someone kicking around a design for a new farmer’s market? Kickstarter.com, or its crowd-based funding brethren Kiva, is a great place to start. Kickstarter (www.kickstarter.com) is a relatively new website designed specifically to support the funding of creative projects. These projects can range from promising innovative concepts to some that might be categorized as duds. That is the beauty of the system – those with a pioneering attitude and an entrepreneurial spirit can both get funding, while kicking the tires on an idea at the same time.

The inspiration behind Kickstarter is to get a large community of people backing a project in an all-or-nothing funding style (i.e., only fully-funded projects receive the money donated to them). Users of the platform offer various incentives to encourage backers to rally for their product. These incentives can vary significantly – a personal visit from the funder to report the results directly to you, a DVD of a documentary of a film, a personalized thank you card, or in one case of a $1 donation to help scientists study soil saturation in an urban garden – “a wink and a nod for being sustainable.”

A few examples of some kick-starters from food pioneers shows the great thinking and innovative concepts seeking crowd-sourced funds:

Small Farm Rising is a documentary short “inspired by first generation farmers who are redefining agriculture in America.” It is also a recipient of 103 microloans totaling more than $14,000 to help get the film finished. They blew past their goal of $9,000, giving these filmmakers both the funds and the inspiration to carry out their objectives. Thanks to the micro investors on KickStarter.com it looks like the  story will get told.

Even the big boys are getting involved. Earlier this year, Sundance Films partnered with Kickstarter and Facebook in an initiative to help their aspiring film makers get a leg up through crowd-based funding.

Seeing Green: The Value of Urban Agriculture is a research project designed to “measure storm water management potential of two urban farms; Brooklyn Grange (a rooftop farm) and Added Value (raised beds) in NYC. The project is currently $2,600 short of its $12,000 goal. This looks like a cool project but fundraising is still fundraising whether it is online or offline – investors need to be inspired.

Atwater Village Farm Market (Northeast Los Angeles) is billed as a connection point between neighborhood, community, city and the environment. The village is projected to allow for “a healthy lifestyle to be sustained or developed,” a truly LOHAS-inspired goal. The group behind the idea is seeking funding to purchase things like refrigeration, food storage and equipment. The project has already received donations totaling  $11,000 but is still short of its  $20,000 goal with 34 days to go.

As innovators seek funding to expand their ideas and grow the market-share and awareness of Lifestyles of Health and Sustainability, digital, crowd-based funding offers exciting possibilities.

My company has been firmly planted in the green space since our birth in 2003.  We were not first, but we were pretty early.  A lot has changed.

We have made our way through the rapid change by studying the culture.  We produce content that is relevant to the various sustainability movements (there are multiple) taking shape around us.  Here are some examples of the type of content we produce to understand it all:

• Biennial Green Language Survey of 100 Print Ads
• Pop-Culture Lens studies exploring the meaning of sustainability in our culture
• Our soaplabs design, test and prove innovative strategies with very trusting clients
• An upcoming report that breaks emerging marketing trends into 6 narratives

Our latest green language study will be available (for free) later this month (if you’d like an advance copy, let us know here).  As a sneak peak, here is one of the findings: 

Green is no longer a driving element in print ads.

As we write the report, I’m reminded of a talk I gave at the LOHAS Forum in 2007.  The talk was called A Beautiful Ambiguity: Language, LOHAS and the Mainstream (If you’d like to download the nostalgic pdf, go here).  I remember saying to the crowd, "once green is mainstream our competitive advantage is gone."  My point was that we were all hyper focused on green as THE thing.  And at the time it was THE thing.  But at some point the rest of the market was going to catch up with us, and we would need to evolve.  That time has come.

I used pop-culture to illustrate the point and show how trends evolve.  For example, when bubblegum pop music starts using hardcore street language (or gang signs), the street must change how it represents itself – it’s no longer dangerous. It pushes it further.  When the skinny suburban kid steals your language, urban kids don’t want it back.  Or, more contemporarily, when your mom comes home in skinny jeans, things must change.  This is the way culture evolves – change happens in the margins, mainstream absorbs and the margin pushes it further. 

Fringe – Margin – New Fringe – New Margin – New New Fringe – New New Margin…and so on.

And throughout this continuous cycle of cultural evolution, the entire system becomes more and more complex.  It’s not unlike energy efficiency. The first 40% of efficiency (perhaps sustainability in general) was the easiest.  But by now we have changed the light bulbs and weatherized the house.  The next 40% will get progressively more complex and challenging.  It will require new technologies, processes, innovations and ways to measure impact. 

Similarly, sustainability marketing  programs need to engage consumers in new ways.  They need to be measured in new ways.  They must push the dialog further.  The programs that companies design to embody LOHAS are growing in complexity out of necessity.  I think this is a good thing.  It is part of cultural evolution.  One of the projects that graduated our soaplabs was More Than Promote - a strategy that measures marketing by its corporate, civic and cultural impact. 

If we’re not innovative in how we fundamentally approach marketing, we end up looking like a modern version of Vanilla Ice sampling Vanilla Ice sampling Queen. 

By John "Ice Ice Baby" Rooks

If a watchdog group, a government, publication or a citizen uprising forces you to be transparent, you have already lost.  Any trust, marketshare and reputational bonus points your advertising and/or actions earned you is depleted.

QSRweb.com a publication for the Quick Serve Restaurant industry (sounds better than "Fast Food, eh?) wrote this headline about Taco Bell's recent "beef authenticity" issue:  "Taco Bell fights back with Transparency".  They miss the point - it's not fighting back, it's rolling over.  It's getting caught.  If you are forced to be transparent, it's too late.  If you get caught polluting, you pay a fine.  But that doesn't make the violation go away, it's just the price you pay.  For brands (green, lohas, blue or otherwise), the price is marketshare and reputation.  And the costs to regain those losses are tangible and impact your bottom line.

From the article on QSRweb:

"According to YouGov BrandIndex, which interviews 5,000 people daily from across the country, Taco Bell’s Index scores fell from 25.2 to 11.7 since the suit was filed Jan. 19. It is now below the sector’s average score of 12.2."

Here's the other way to "do transparency" - from a manufacturer of outdoor gear describing their backpack:

“…the Chacabucco Pack embodies no environmental innovation. The nylon is virgin, its polyurethane coating is solvent-rather than water-based, and like all of our products and rainwear, it has DWR (durable water repellent) surface water-repellent that involves the use of PFOA [author’s note: perfluorooctanoic acid]. The pack is not recyclable”

"No environmental innovation", "...not recyclable"; it's hard to believe this language coming from one of the most environmentally progressive companies on the planet.  But that's what  Patagonia's Footprint Chronicles is designed to do - to be radically transparent.

These moments of radical transparency are coming.  But still, most of what we see is really  translucency and selective data-points in sustainability reports.  But moments of hyper-transparency will change the game again.  I don't like to think Taco Bell was being necessarily deceptive about their beef - they just didn't know people cared.  And we all have operational blind spots.  But now is the time to start looking for them and fixing and disclosing them.  Transparency is not a very successful reaction strategy, but it is an amazing proactive strategy.  Those who master it early will endure and profit.

This is the revolution we have been waiting for.  All that dialog about "going green" or "blue" was just an important evolutionary step on the road to the uprising.  The real prize is authenticity and transparency.  This is going to be good....

Spending over $300+ billion dollars annually, the demographic called LOHAS, continues to change the way marketers conceptualize the 4 P's of marketing. LOHAS is Lifestyles of health and sustainability. The consumer group identifying themselves with LOHAS are a megatrend not to be overlooked or taken for granted. Consumers have traditionally expected governments to take the lead in protecting the environment, but now they are looking more to the corporate world to take action, rather than individuals. Increasingly, Asians want economic growth but believe it should be achieved through greener industry Market research conducted in 2010 revealed an untapped multi-billion dollar demand from households with significant purchasing power that relates to exactly this. THE LOHAS Asia and NMI research on China, for example, questioned 1,000 consumers across the five cities of Beijing, Chengdu, Dalian, Guangzhou and Shanghai. Results showed that 88% agreed that it is important for companies to be mindful of their impact on society. With China having overtaken Japan as the world’s second-biggest economy, the LOHAS consumer demand is on the rise month by month and there is an urgency for the market to respond. Asia isn’t regarded as a pioneer on the CSR front, but in recent years, action on CSR is growing amongst Asian firms. In Hong Kong, Malaysia, China, and more recently Singapore and Thailand, stock exchanges are playing an increasing role in raising the visibility of businesses and encouraging reporting on sustainability. However, despite years of education on the issue, businesses across Asia still carry the common misperceptions of CSR being equivalent to philanthropy, which is what you do with your profits while CSR is what how you go about making those profits. Given the real concern from knowledgeable consumers, this also means companies have to deliver more than just lip-service and stand true to what they claim. Governments are also helping to develop CSR practices, such as in Singapore with the Green Mark Scheme for buildings as a key initiative to promote sustainability in the building sector. The Singapore Government is also pursuing sustainable fashion as another sector, and launching new subsidies for industry training.
 
Results of LOHAS Market Research 2010
In January 2010 LOHAS Asia partnered with The Natural Marketing Institute in pioneering LOHAS Consumer Research in Asia-Pacific, conducting an online survey across 10 countries. More than 18,000 consumers were surveyed, to provide in-depth research on the LOHAS consumer and marketplace across the following countries: Australia, China, Hong Kong, India, Indonesia, Malaysia, Philippines, Singapore, South Korea and Thailand. Some of the highlights show very real desire for sustainably-made products in Asia, with Indonesia, China and India leading the way. As always, we have to look closely at China and India as the biggest market opportunities, and here we have high numbers seeking sustainably-manufactured products. This is a clear message and opportunity to manufacturers but even more encouraging, they will buy them if they are more available and most are willing to pay a 20% price premium for them. By contrast, there are significantly fewer consumers willing to pay a 20% premium in Korea, Singapore and Australia. But, these are rich economies, so the market opportunity per share point is higher and worth chasing. In one of the clearest messages from this research, consumers in Asia-Pacific are prepared to boycott brands they feel are over-packaged. This behaviour contrasts with experience in other markets in the West, where the likelihood of over-packaging actually damaging purchases is low. This is an area where the biggest markets show the most extreme reaction to the question, with China, Indonesia and India leading the way with a strong likelihood to boycott over-packaged brands.

In April 2010, LOHAS Asia Pte. Ltd launched The HUB, a business network for companies and service providers in tune with LOHASian values to network, market and collaborate in new opportunities and joint-ventures.

Contributed by Liz Smailes, Communications Director, Asia Pacific LOHAS

I scanned the web for some of the latest food trends and here are a few that caught my eye. They are from a variety of sources including Rachel Ray, Mintel, The Food Channel and Good Food World.

Organic Gardening and Urban Agriculture
Canned, tinned and frozen foods are likely to benefit from consumers’ bunker mentality and the search for stability in a tumultuous world. Certainly there is greater awareness that freezing foods early locks in their nutritious benefits. The continuance of record setting seed sales from garden centres and supermarkets indicates the continued trend towards self-sufficiency such as organic gardening and herb window boxes. Market research firm Packaged Facts in January 2009 estimated that the organic lawn and garden sector reached $460 million in retail sales in 2008, a gain of 12% over 2007. This trend is also created from the foods scares we saw in 2010 of contaminated tomatoes, peanut butter and eggs. People want to take control of what they have on their tables. This also develops self-customization of food. Home canning lets you control the amount of sodium, sugar, or spice. You can season those fruits and veggies to suit your own taste or dietary needs. You can make salsas or pasta sauces that are as spicy or mild as your family likes them, or as low in sodium as your doctor advises. Plus – homemade handmade treats are great inexpensive gifts to others in a time when money is tight.

Role Reversal in Kitchens
The economic slump has hit men hard in traditionally male dominant fields such as finance and construction. Women in the workforce are now better qualified, command higher salaries and work longer hours – which mean men need to do more of the shopping. Plus, many women are employed in fields that are expected to thrive the next few years.  This is leading to a new balance of power and the rise of the “Sheconomy”. About a third of women outearn their husbands according to Reach Advisors. Men will do a lot of bread buying instead of bread winning. Compared to 1970, men have tripled the amount of time they’re spending in the kitchen. The rise of the male metrosexual in recent years may have something to do with it as well. With the success of cooking shows featuring male cooks or hosts have made it more than permissible for men to don an apron; it’s actually become quite fashionable to do so while chopping vegetables and experimenting with obscure spices and exotic ingredients. But as the jobless rate continues to hover near 10 percent, look for more men to cook, not just for fun, but also because their wives will be working late to help fuel the Sheconomy.

Rise in Food Oriented Apps
As smart phones become commonplace more apps will be available for people to find local organic restaurants and grocery stores, Open Table helps reserve a table at a restaurant. Groupon provides specialty coupons to your email inbox, Facebook or Twitter profile from local stores. With the recession not likely to change soon consumers are hungry for bargains, and the new deal-oriented apps let you find them without the need for clipping coupons. It’s the new weapon of choice for the bargain hunter stalking his dinner prey. New apps allow customers to scan barcodes on products for instant savings or by checking in on social networking sites like Foursquare and connecting with other shoppers we’re becoming rewarded in more ways than ever!

Supporting Local growers and Specialty Shops
More people want their local economies to succeed and are choosing to support local farms and restaurants. For many of us, eating honest, fresh and real food has taken on a higher priority in our lives. More consumers are willing to take the time to visit specialty shops for foods of a higher quality and relationship with the merchant. There is a movement that is returning to neighborhood butcher shops, specialty bread stores, and boutique shops for buying food needs. Grocery stores aren’t going away but there is a surge in farmer markets with one-on-one relationships. These may cost a bit more but is attractive for people with the time and money to do it, such as empty nesters and those young singles we used to call yuppies. This trend is about growing and tending—if someone, somewhere, is personally growing and tending to this product, as opposed to packing and sorting on the assembly line, then it’s local. It means someone is personally committed to it. Someone has made sacrifices to bring it to market.

Rise of Superfoods for a Healthy Active Life
Boomers will be seeking natural solutions for energy, health and even sex from cultural foods such as acai, gogi berry, mangosteen and nutmeg.  Many boomers will continue to work—and they’ll demand foods that provide the energy and vitality to get them through the day. And, as sales for Viagra prove, boomers want to stay in shape for nighttime activities, too.  People are working longer into retirement, there is a greater need for products geared towards vitality and health in a more senior workforce. Products such as energy drinks so far have been targeting the younger demographic. Get ready for them and others to be targeted to an older crowd.

Obesity is the New tobacco
We all know the obesity epidemic is rampant in the U.S. More awareness of issues have been brought up by efforts from Jamie Oliver and The Biggest Loser. But despite these efforts it doesn’t look like it is slowing down. There is more social pressure on people to eat healthily. Obesity is being called “the new tobacco” as people are unhappy about their taxes being used to pay for gastric band surgery. Fast food restaurants are facing a decision as to whether they cater to it, or try to counter it with healthier alternatives. We may see some brands embrace gluttony as we saw with the KFC Double Down sandwich. However doing too much of this can damage a brand. Other companies like McDonalds are re-designing their restaurants to have a healthier appeal but they still revolve around essentially unhealthy burgers. But there have been some noticeable changes in food options in places like airports where they are providing healthy food options such as salads, fruits and vegetables and organic chocolate. We are also seeing the rise of natural sweeteners such as agave and stevia in brands such as Fanta and Odwalla We will see fast foods adjust to the demands that their foods are unhealthy in order for them to stay relevant to consumers.

GMO Awareness
With food scares continuing many people have taken it upon themselves to investigate sourcing and ingredients of products and have become more aware of genetically modified foods (GMOs). Despite the claim from companies like Monsanto that GMOs are sustainable and are the only way to feed the world’s growing populations, opponents contest that they do more harm to the environment, farming economies and our health than good. Books such as the Unhealthy Truth and websites such as the Non GMO project that provide scientific data and ways for consumers to identify and shop for non GMO foods. Companies such as Horizon Dairy, Whole Foods 365 private label, and Natures Path are now using labeling to identify themselves as non GMO ingredient products. Unfortunately it is an uphill battle. However there has been a rise in superweeds – weeds resistant to pesticides – and increasing evidence of biotech companies inflating yield estimates and the industry on its heals and plummeting stock.  But GMO products are currently ubiquitous in our food supply. If you are not choosing organic or if it doesn’t say non-GMO on the label, chances are your food contains GMOs, as it is estimated that 80% of conventional grocery products now contain GMO ingredients.

Organic Acreage Continues to Grow
Compared to overall acreage dedicated to conventional agriculture production, the amount of land under organic production is still very small. But it is growing. In the first wide-scale survey of organic farming, published this past year, USDA counted 14,540 U.S. farms and ranches that were under organic production, comprising 4.8 million acres of land in 2008. Certified U.S. organic cropland acreage between 2002 and 2008 averaged 15% annual growth. Globally, organic acreage grew by 9% in 2008, with more than 35 million hectares in organic production. The highest increases came in Latin America and Europe, according to the Research Institute of Organic Agriculture (FiBL) in Switzerland.


BPA Awareness
2010 saw a rise in concen with BPA (Bisphenol A) used in containers for food and drinks - mostly canned goods. BPA was developed in the 1930s, and commercial uses exploded in the 1950s after scientists discovered its ability to make plastics more durable and shatterproof. BPA is used in thousands of consumer goods, including compact discs, dental sealants, and credit card and ATM receipts, but health advocates say they are most concerned about BPA's presence in plastic food containers, bottles and the epoxy linings of metal cans because it can leach into food and beverages. It is found in the urine of more than 90 percent of the U.S. population, according to federal estimates. Recent FDA research has linked the chemical to cancer, heart disease, Type-II diabetes, obesity, sexual dysfunction and early-onset puberty. FDA officials said they are especially concerned about its developmental  impact on fetuses, infants and young children. Various indepented tests have shown that there are higher levels of BPA exposure than the FDA reports in canned goods. Despite these findings there is resistance by Congress to ban it. As consumers and new parents become more aware of BPA they will seek alternatives to plastic and canned goods such as glass bottled or frozen foods.  Concerns such as BPA will also drive people to freeze and can their own foods and shop locally as previously stated.


Sustainable Packaging on the Rise
Despite the failure of the biodegradable but ultra-loud SunChip bag, there is more interest in biodegradable packaging options and less packaging to emphasize sustainability.  Pike Research estimates that eco-friendly packaging will nearly double in revenues between 2009 and 2014, rising from $88 billion to $170 billion. According to Mintel there will be a greater focus on reduced packaging that promotes environmental responsibility in combination with uniqueness, such as boxless cereal bars or more cereals without the inner bag. Paper Mate recently introduced biodegradable pens with compostable outer shells that break down into organic matter within a year. Following a more traditional route, Kraft Foods plans to reduce its carbon footprint in 2011 by decreasing waste from its plants, eliminating 150 million pounds of packaging material, and cutting CO2 emissions by 25 percent.

Do you have others that you feel I have missed or wish to add? I’d love to hear them.

Have you ever felt guilty about watching your favorite sporting event or drama instead of the documentary that you should be watching?

CNBC has created two environmentally relevant docu-reports covering the worldwide water shortage and trash/landfill problems that are so good you won't mind missing the other stuff. Liquid Assets: The Big Business of Water and Trash Inc: The Secret Life of Garbage are in-depth original shows developed in-house at CNBC that will reward you with insights, interviews and data. Both shows move quickly and will leave you wanting more.

The water piece is downright scary, articulating what we all know deep inside: the Western U.S. is so beholden to the Colorado River that if anything goes wrong with it, and/or, we don't as a nation learn how to truly conserve water, a crisis will be upon us and before we know it. Did you know it takes 3 gallons of water to make one piece of paper? Or that 118.8 gallons of water are used to process one six-pack of beer? How about 12.69 cups of water to produce one plastic water bottle?

A little-known but relevant case history is Chile. Reporter Michelle Caruso-Carbrera takes us there to see the driest place on earth, where not surprisingly, an old small town is dying by the day. Contrasted with, a truly free market for water which Chile claims is a big success for landowners, holders of water rights, business and consumers. CNBC raises the idea that markets not governments should control the flow of water, a provocative idea indeed.

   
    Photo By: Tomas Munita as seen in the New York Times

The trash expose isn't just trash talk, either. We see the largest trash removal operation in America, Manhattan, and how it disposes of 12,000 tons of trash per day. A lot of which is actually taken to landfills in other states by truck or train. Apparently Manhattan does a good job with its $1.3 billion annual budget, there just isn't any place else to put the waste...

   
    Pelham Bay Landfill, New York

A genuinely disturbing investigation of trash accumulating unabated and unregulated in and around Beijing, China shows us one of the unfortunate byproducts of hypergrowth in a booming new economy. In general, a lack of adequate landfills and the difficulty in preventing seepage of trash and methane gas into the water table is explained clearly and succinctly by CNBC reporter Carl Quintanilla, who traveled to Beijing for the story. It makes you wonder how they managed to get this report past the Chinese government, which usually does not concern itself with "first amendment" rights when the publicity is negative?

There is hope, as evidenced by some of the scientists, students and entrepreneurs who are hard at work developing solutions for these problem areas. A surprise is former Secretary of the Interior Bruce Babbitt, who served the Clinton administration, when he says we have plenty of water to sustain us indefinitely. I was aghast at this, although he does redeem himself somewhat by saying that farmers in particular need to be much more efficient in how they irrigate, as they are wasting almost 50 percent of the water used at present. Babbitt also favors free market pricing of water, which he thinks will eliminate water waste in a big hurry. Another surprise is the favorable treatment given to trash removal behemoth Waste Management, Inc. that is portrayed as a company spending major research dollars to make landfills better. Also featured is BMW's Spartanburg, S.C. plant that devised an ingenious way to provide power from methane gas, which runs through a 10-mile-long pipeline, from beneath a landfill all the way to the plant's generator.

So what can you do to help remedy these critical environmental problem areas? The answers come clear in both shows: conserve water, and recycle every bit of waste material possible. Recycling of plastic water bottles in particular is absolutely critical as only five percent of bottles consumed are currently recycled. There are a number of new companies that have made a business out of transforming used water bottles into tiny plastic chips that ultimately become fabric and other materials -- plastic water bottles, for instance. And don't forget home composting, which is not mentioned but is also critical in our waste reduction efforts.

CNBC typically airs these special shows a number of times so check your local cable company and/or the CNBC website for broadcast times. And again, kudos to CNBC for putting material like this on the air when unfortunately, middle America seems to prefer "Housewives of Orange County" and "Celebrity Rehab" to this type of programming.

After almost three years of consultation and planning, and following a great deal of anticipation in recent months, the Federal Trade Commission has finally published “Proposed, Revised Green Guides.”  This latest version of the Green Guides will be open for public comment until December 10, 2010.  After that, according to an FTC press release, the agency will issue a final, official version of the Guides. 

It’s a sad truth, but consumers and regulators view environmental marketing claims with increasing skepticism.  While many companies make fair claims about the environmental attributes of their products, others are exploiting consumer demand for sustainable products with false or unsubstantiated marketing claims.  Thanks to such tactics, the term “greenwashing” has entered the marketing lexicon.  The environmental marketing firm TerraChoice brilliantly describes and defines greenwashing in its 2009 Greenwashing Report, and concludes that many, if not most, environmental marketing claims are unfounded. 

In this climate, it’s no surprise that the FTC is stepping up efforts to combat greenwashing.  A key step in this new enforcement effort is to provide more guidance on environmental marketing claims through the Green Guides.  The Guides (last updated in 1998) provide non-binding “interpretations” of federal consumer protection regulations, namely Section 5 of the FTC Act (15 U.S.C. § 45), which is the law that empowers the agency to punish deceptive practices. 

The Green Guides provide common-sense instruction on green marketing strategy, and more specific guidance on particular marketing terms that were popular in 1998, including “biodegradable,” “compostable,” “recyclable,” “refillable,” and “ozone safe.”  The new proposed Green Guides address those terms, but also provide guidance on new terms and concepts found in present-day green marketing, such as:

• environmental seals of approval,
• “free-of” and “non-toxic” claims,
• carbon offsets,
• claims concerning renewable energy, and 
• claims concerning renewable materials. 

Given the explosion of environmental marketing claims in recent years, revised Green Guides are well overdue.  But what kind of impact will they have?  The new Guides do not really change the rules; the FTC has always identified the Green Guides as “guides” useful in applying consumer protection law.  Ultimately, product claims for clean technologies will be evaluated under the FTC Act itself, for their potential to deceive consumers.  If claims are vague and unqualified, or cannot be substantiated by scientifically proven facts, they are going to be suspect. 

The FTC provides a brief summary of the proposed Green Guides here, provides the complete Guides with analysis and comment here; public comments on the proposed Guides may be submitted here.  Read more insightful commentary on the new Green Guides here, and here.

Guest Blogger Joseph ("Jay") Eckhardt is an attorney at Stoel Rives LLP, based in Portland, Oregon.
 

While companies have always engaged in philanthropy, when American Express began raising money for the Statue of Liberty restoration 25 years ago, engaging consumers directly in the fundraising process through a transactional connection was unique. Since then, cause branding has become increasingly prevalent though the benefits of corporate social responsibility (CSR) are sometimes difficult to quantify. One way companies derive Calculated Intangible Value (CIV) is by comparing their three year profits to that of competitors with similar tangible assets.

For Paul Herman of HIP (Human Impact + Profit) Investor, there are more precise measures, and many examples of companies that solve problems and serve human needs experiencing better revenue and tax positions, and lower costs of operation, raising capital and issuing stock. Examples include Toyota’s assent to number one automaker by capitalizing on a new market with the highly profitable Prius, Liberty Property Trust spending 2% more on LEED conpliance reaping 30 – 40% operating cost decreases, Walgreens tax breaks and lower operating costs from installing solar panels on 100 stores, and Burt’s Bees acquisition by Clorox for almost $1 billion. Finally, Herman points to Interface Flor’s re-branding around sustainability resulting in a billion dollar market cap and higher PE ratio than competitors.

Concurrently, companies like Mattel, once profitable based on what Herman calls “the China price”, are seeing their sales and stock plummet while “HIP price” products are increasingly popular and profitable. The furniture company Herman Miller, for example, charges premium prices while investing in sourcing sustainable materials, leading to enviable profit margins.

Nike views corporate responsibility as a catalyst for growth and innovation, concentrating efforts on improving conditions in factories, designing for a better world, achieving climate neutrality and unleashing potential through sports. They call the return on these integrated CSR programs “ROI2”. Youth focused community efforts using sports to inspire social change have obvious benefits for Nike by creating future loyal consumers. Nike has also reduced manufacturing waste by 45% since 1998, in part through closed-loop systems, with vendors receiving back waste materials from the shoe-making process to recycle into new materials for Nike.

PR Week and the marketing firm Barkley released a survey quantifying the positive effects of corporate philanthropic activities. According to their results, 72% of consumers have purchased a brand because it supports a cause they believe in. Corporations report positive PR (65.3%), an increase in sales (26.7%) and an enhanced relationship with target demographics (52%) as a result of cause marketing. 56% of companies also report heightened staff morale and retention and 14.7% cite improved recruitment of quality candidates.

According to Barkley CEO, Mike Swenson, program effectiveness is measurable through cause marketing sales (events with product sales involved), cause event visibility (runs, walks, etc.), and cause branding traction (programs that define the company). In 1995, Barkley’s own client Lee jeans, looking to take advantage of trends toward casual Fridays and more casual workplace dress codes, and improve perception of the Lee brand among 24- 49 year-old women, started Lee National Denim Day benefiting breast cancer research. Brand tracking studies report 60% of women have a more favorable impression of Lee and 33% are more likely to purchase the brand based on its sponsorship of Lee National Denim Day. Further, women aware of the sponsorship are more likely to view Lee as a fashionable brand. Swenson also points to the Dove Self Esteem campaign repositioning a commodity product into a brand with a clear point of differentiation.

Other companies, World of Good for example, successfully established entire brands around CSR practices. The 3 ½ year-old company sells international, fair-trade style sourced hand crafts online and through strong partnerships with retailers like Whole Foods. With 300% annual growth, World of Good appeals to traditional venture capitalists and serves as an example of marrying positive impact with bottom line profitability.

According to another Barkely survey, growing evidence shows that cause branding also positively effects Generation X and Y stock purchases. For companies courting consumers and investors in their 20’s and 30’s, CSR is now an important decision point. At the same time, employees looking to find more meaning in their work are demanding that companies get more involved in problem solving and have a positive social, environmental or health impact.

No longer just something a company has to do for PR purposes, corporate social responsibility has become a significant differentiator for consumers, employees, investors and shareholders. CSR companies are simultaneously investing in the greater good and their own good, resulting in an increase in multiple bottom lines.
 

Increasing Antioxidant Levels through Organic Farming and Food Processing

By Charles M. Benbrook, Ph.D., Chief Scientist, The Organic Center

Science is digging deeper into the roots of food quality.  Thousands of scientists worldwide are probing the secrets of antioxidants in food.  Why do plants produce them? What factors govern their levels?  How do they promote human health?  These natural plant chemicals help prevent or reduce tissue damage in cells caused by free radicals.  Free radicals are oxygen and nitrogen-based molecules with unpaired electrons that are generated by several of the body’s metabolic processes.  Antioxidants inhibit damaging reactions within human cells by providing the positively charged atoms needed to neutralize free radicals.  They bring stability to cells in the throes of inner chaos.

Plants produce more than 50,000 “secondary plant metabolites” (SPMs) in response to stresses in the environment.  Some 4,000 of these SPMs are polyphenol flavonoids and many of these are antioxidants.  Plants provide essentially all dietary sources of antioxidants.  Antioxidants in milk and meat are initially from the plant-based feed consumed by farm animals.

By lessening free radical damage in human tissues, antioxidants reduce inflammation and can lessen joint and muscle pain. Through this mechanism, antioxidants can play a role in promoting cardiovascular health, lessen the risk and severity of neurodegenerative diseases like Alzhiemer’s and Parkinston’s disease, and in general, help slow the aging process. 

 A wide range of studies has shown that plant antioxidants are also anti-proliferative (i.e., they slow the proliferation of cells). In this way, antioxidants can prevent or slow the growth of some cancerous tumors. And recent research suggests that some plant polyphenols can increase the sensitivity of the body to insulin, thereby delaying the onset of type II diabetes or slowing the progression of this increasingly common disease.
The many health benefits associated with antioxidant consumption is why the U.S. government has recently recommended as part of the new dietary guidelines – see “My Pyramid” on the web -- that the average American double consumption of fruits and vegetables.  The uniquely broad array health benefits associated with antioxidants also explains the enormous investment in science searching for the magic ingredient in blueberries, or cucumbers, or tomatoes that will help prevent disease or promote graceful aging.

The Organic Center carried out a State of Science Review (SSR) on the impact of organic farming methods, and organically acceptable food processing techniques, on average antioxidant levels in food.  Their full reports are freely available on the Center’s website.  We found that a shift to organic farming methods can increase average antioxidant levels from a few percent to over 200 percent, with the average increase being about 30 percent.  We also document that organically acceptable food-processing methods can lessen the percent of antioxidants lost when fruits and vegetables or grains are processed and cooked, sometimes dramatically.
Antioxidant Levels Vary Widely

The ten foods richest in antioxidants include blueberries, plums, broccoli, strawberries, and red cabbage.  These antioxidant-dense foods provide, on average, 35 times more antioxidant capacity per calorie than the ten foods that rank lowest on the scale of antioxidant capacity per calorie.  Low-antioxidant foods include cucumbers, granola, cereal, canned corn, and lima beans.  So why not simply add antioxidant supplements to the diet?  Dietary supplements do not appear to deliver the full range of health-promoting benefits that stem from consumption of whole foods that are rich in antioxidants. In addition, plant antioxidants modulate a number of biosynthetic processes in the human body.  To optimally promote health though, they must be present in the right proportions relative to a variety of other vitamins, minerals, fats and proteins.

USDA scientists have discovered that organically grown tomatoes produce catsup with higher levels of lycopene and other antioxidants.  The bright red color and rich taste of organic catsup, compared to conventional brands, is linked to the higher antioxidant capacity.

Because antioxidants cannot substitute for each other and some do not last long once ingested, people need to consume antioxidants in plant-based foods with most meals in order to sustain optimal levels in the body.  A variety of strategies should be pursued to increase average antioxidant intakes including, first and foremost, eating additional servings of a diverse selection of fruits and vegetables.  Buying locally grown and fresh produce that has been harvested relatively ripe is another proven strategy to increase antioxidant intakes. 

Many mysteries about antioxidants remain buried in the root system of food quality.  The Organic Center is monitoring ongoing studies to map this new territory because we are confident that new tools and techniques will emerge to help organic farmers and food companies deliver more nutritional value per serving of a wide range of foods.  Stay tuned for progress reports and new insights.