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October 16, 2022

Greenwashing in Marketing: How to Avoid Faux Sustainability

Whether intentional or accidental, greenwashing in marketing can quickly tank your brand reputation, relationship with customers, and thus, your revenue.

The modern consumer is becoming more and more conscious by the day. In other words, consumers want to feel good about their purchases whether in the form of sustainable packaging or recycled materials, and they’re willing to pay more for a product that minimizes its impact on the environment. According to a survey by Mckinsey & Co., 66% of overall respondents look at sustainability when deciding to purchase a product. That number jumps up to 77% of millennial respondents. Consumers are increasingly worried about the environment and people, and they want to support companies that are implementing sustainable practices. This trend will only grow with younger generations – our future buyers.

Unfortunately, many brands have turned to greenwashing to appease sustainably focused customers. And because of numerous recent cases of greenwashing, many of these customers are beginning to question and scrutinize green marketing claims.

So, how do you avoid faux sustainability in your marketing? Read on to learn about greenwashing in marketing and best practices for avoiding it.

What is Greenwashing?

Greenwashing is a deceptive marketing practice – intentional or accidental – that makes a company appear to be taking steps toward sustainability without putting in actual effort. Many companies have recently been exposed for their purely marketing-based sustainability claims, which has resulted in a loss of public trust.

The term “greenwashing” originated in a 1986 critical essay by Jay Westerveld about the “save the towel” movement. In the essay, Westerveld noted how hotels were still producing vast amounts of waste despite “save the towel” movements and environmentally-conscious claims, making no efforts to be more sustainable. In fact, the “save the towel” movement did little for the environment or people and was only found to save the hotel some money in laundering costs.

Greenwashing in Marketing

Greenwashing in marketing can range anywhere from unintentional claims that make a product seem “eco-friendly” to outright lies about a company’s sustainability impact. Either way, greenwashing at a minimum erodes the trust of your customers, and at worst harms both the planet and people only to benefit the bottom line.

Here are some examples of what greenwashing in marketing might look like:

  • Baseless terminology. Using terms like “green,” “eco-friendly,” or “natural,” without clarifying what they mean.
  • Misleading images. Using pictures that evoke a sense of “greenness” without any justification.
  • Sustainable product tagging. Touting a product as eco-friendly while the rest of the company uses dirty practices.
  • Misuse of third-party certification. Creating labels that falsely suggest a third-party designation for sustainability.
  • Greening products that could never actually be beneficial to the environment or people, i.e., “green” cigarettes.
  • Unreliable data. Using false data and fabricating claims.

Greenwashing Examples

Since the term greenwashing has been coined, many corporations big and small across industries have been caught greenwashing in their marketing. These companies have been widely exposed, from the New York Times to Tik Tok. It’s not a great look, and consumers are widely taking note.

Here are some real-life examples of recent greenwashing:

Fast Fashion Greenwashing

Only 20% of the world’s clothing is reused, while the rest ends up being burned or piling up in a landfill. Regardless, sustainable fashion is beginning to trend, even in the historically unsustainable fast-fashion industry.

H&M, for example, is a popular, world-renowned fast fashion brand that contributes a huge amount of textile waste to the environment. In 2019, H&M launched a green line of clothing called “Conscious”, which claimed to use organic cotton and recycled polyester. H&M spent a lot of time, effort, and money marketing the clothing line, which was only a very small part of the clothing they produce. Rather than trying to produce all their clothing in a more sustainable way, or revamping their business model to be less waste and fast-fashion-based, H&M used one sustainable line of clothing to make sustainability claims as a marketing tactic to make their efforts appear more environmentally friendly.

Recycling Greenwashing

Only 9% of plastic in the world ends up recycled. Companies that really care about sustainability should, in theory, reduce the amount of plastic they use, and ensure the utmost circularity of that plastic. However, many companies that claim circularity or recycling often place the responsibility on the consumer, or create initiatives that do more harm to the environment than good.

For example, in 2018 Starbucks announced the release of its strawless lid as an effort to reduce the amount of plastic straw waste. However, it was ultimately discovered that the “sustainable” lid actually contained more plastic than the original straw/lid combo. The company then asserted that the lids were made from a type of plastic that was easier for the consumer to recycle. However, placing the burden on the consumer to ensure the circularity of the product rather than the company itself begged the question of Starbucks’ actual sustainability impact versus their claims.

How Greenwashing Can Hurt Your Brand

Today’s modern consumer wants to support brands that they can trust—especially when claiming to use sustainable practices. Greenwashing often results from an attempt to persuade Millennial and Gen Z buyers to purchase products. In addition to being unethical, greenwashing can be harmful to your brand in a number of ways:

  • Loss of trust and reputation: With so much information readily available online, consumers are better able to research which companies are working toward sustainability. If your company is making exaggerated or false claims, your customers are likely to find out. That trust is hard to regain.
  • Risks of Legal Conviction. Consumer law in both the US and EU stipulates that consumers have a right to be informed before purchasing a product. Greenwashing is seen as a violation of that right, which could lead to a legal conviction, hefty fines, and bad press. For example, The Federal Trade Commission protects consumers by regulating the way companies market their products through its Green Guides. More recently in the headlines, Norway ruled that H&M and Norrona could no longer use data from the Higg Index to back their sustainability claims, and would need more reliable data to make such claims.
  • Loss of Investment Opportunities: Today, climate-friendly funds are exploding in popularity. But if your company uses greenwashing in marketing, investors are more likely to avoid purchasing your company’s stock.

How to Avoid Greenwashing

In many cases, greenwashing in marketing isn’t done with bad intent. Usually, it’s an overenthusiastic representation of a product’s sustainability and impact. So how do you avoid greenwashing in your marketing?

  • Use clear, concise language. Vague terms like “eco-friendly” might sound good, but with no clear meaning, they can be deceptive. Instead, use specific details, certifications, and endorsements. For example, you might note that your packaging is made with 50% recycled plastic–if you can prove that it is.
  • Lean on current, reliable data to back up your claims. Ensure any sustainability claims are backed by data, preferably through a supply chain digitization/traceability solution.
  • Use fair comparisons. When comparing your product to a competitor’s, make sure to compare the same kind of product.
  • Make sustainability part of your business model. Making green claims on your products needs to be followed up with sustainable practices, such as reducing the amount of waste overall that your business creates.
  • Stick to accurate colors and images. Avoid using too much green or excessive images of nature to suggest that your product is eco-friendly when it isn’t.
  • Be honest about your current state and future goals. Be honest with your consumers about your practices and goals. Give specific timelines and measurable goals to demonstrate your efforts at sustainability so that consumers can trust you to be accountable and transparent.

Corporate Social Responsibility

Corporate social responsibility, or CSR, is the idea that businesses are responsible to act in ways that contribute to the well-being of a community. CSR is regulated by the company itself rather than outside entities and might be seen in efforts to improve the environment, promote equality, improve labor practices, or volunteer in the community.

Unfortunately, companies often greenwash their CSR efforts, using the positive press to improve their reputation all the while making minimal efforts. However, the price of greenwashing is high. Getting caught can cost you your reputation and may result in legal trouble. So how can you avoid greenwashing in your CSR efforts?

Greenwashing vs Green Marketing

Although greenwashing is unethical, green marketing can still be used to honestly communicate your company’s sustainability efforts. So how do you make sure you’re not crossing the line?

One of the biggest differences between the two tactics is how transparent you are. Green marketing uses precise numbers and language to communicate your company’s efforts. Back up your claims with data and avoid fluff terms like “natural” or “eco-friendly.”

If you plan to use green marketing, you’ll want to make sure your product:

  • Is manufactured sustainably
  • Does not contain toxic or polluting materials
  • Can be recycled or was made from recycled or renewable materials
  • Does not use materials that are harvested in a protected area
  • Is not manufactured using unethical labor practices
  • Minimizes the amount of packaging used
  • Can be repaired/reused rather than disposed of

Last, but certainly not least, ensure that whatever your product is (i.e., why or how it is sustainable) is exactly as you market it. No fluff. No baseless claims.

Sustainability can feel like a huge feat for your business, so the more honest and transparent you can be, the better.

In sum? Be transparent.

Show consumers your specific goals so you can be held accountable. Using traceability software like BanQu is essential to accurately tracking and reporting on your sustainability claims and efforts. Plus, BanQu will ensure that you achieve ESG compliance and make an impact for the better wherever you do business.

BanQu creates blockchain solutions for some of the modern world's biggest challenges, such as supply chain transparency and identity platforms for impoverished populations. We believe that with blockchain's bright future, world poverty can become a thing of the past.

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