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May 27, 2011

Green Products Are Alive and Well

A recent New York Times article declared that the bevy of green consumer products introduced over the past five years is going the way of the buffalo and Circuit City, i.e. headed for extinction. It should be noted that normally, I consider the New York Times to be the best journalism around (along with ProPublica) so much so that I am happy to pay over three dollars a week to read it via iPhone.

Not surprisingly, this got a number of folks from the green movement -- including yours truly -- up in arms. Not only do I strongly disagree, but, to borrow not quite literally from Mark Twain, reports of the premature demise of green products have been greatly exaggerated.

In the story, the dramatic rise then decrease in sales of Clorox Green Works is cited as the most overwhelming proof of the Times' assertion. It is true that GreenWorks home products took off like a Roman candle when initially launched in 2008, and sales were down nearly 40 percent from that peak as of last year. (I should note here that Green Works has an endorsement from Sierra Club). Being very close to this subject at Sierra Club Green Home, I can tell you that indeed, consumers are spending less on elective premium priced green products as a result of the recession. If a green product does not offer marginal utility vs. a non-green competitive product that sells for less, odds are it will be second choice for a general public that is struggling with $4 gasoline and skyrocketing grocery prices.

That said, just this week I saw a brand new launch ad for a green motor oil, of all things. Valvoline introduced its NextGen motor oil made with 50 percent recycled content. It will be sold right next to comparable Valvoline and competitive products, and at the same price! This is great news because our research at Sierra Club Green Home.com shows that over 70 percent of consumers are sympathetic and supportive of using green products -- so long they perform the same as "regular" products as it does not cost them a premium. Valvoline seems to really understand this with the pricing and positioning of their new recycled product.

Another potentially important new product introduction is from Alcoa; it's an aluminum architectural panel with special titanium dioxide coating that literally "eats" smog when sunlight contacts the surface. In sunny weather, the chemical reaction with the panel actually cleanses the air, says Alcoa. Then when it rains, harmless matter collecting on the panels is washed away. Alcoa is not often accused of being green, but it should be noted that they were one of the very first major corporations to promote recycling. The Pittsburgh-based aluminum giant ran programs in support of aluminum can recycling as early as 1980. Remember Armstrong floor and ceiling tiles? They just announced a new formaldehyde-free ceiling tile, which improves indoor air quality. Admittedly these products would most likely be found in office buildings where consumers work as opposed to your home.

Back to consumer "everyday" products. Pentel sells its RSVP retractable pens, made from 59% recycled plastic. This product is doing well in sales, as are Earth by Staples notebooks made from 80 percent sugar-cane based recycled waste. They are offered in a variety of earth tone colors and interestingly, are made in Egypt. At a $2.49 price point, they are cost competitive with comparable items. In fact, they are cheaper than fashion notebooks which are made with coated plastic over cardboard.

The Times used Clorox Green Works as an example of green products costing a lot more; the Staples Sustain Earth brand is actually less expensive than non-green national brands at $1.99 for their multi-purpose cleaner. I could go on -- and on. The point is, these are not "fringe" products from tiny mom and pop green firms. These are all important product launches from major national companies.

The Times story was based upon a study which concluded that green products sold by major national marketers are on a serious downward trend. We would submit that the examples cited above are but a few of dozens and dozens of current and planned introductions of new green products by national marketers. If they didn't think these products can be profitable and grow market share, they would not spend the time and effort to introduce them. To paraphrase leading green industry researcher Suzanne Shelton in a recent blog, the key is for marketers to research, position and price their green products carefully and strategically. Finding that sweet spot of all these variables can be a challenge, but we are confident that ultimately, there will be many more success stories about green products that consumers can't live without in coming years.

What is your experience with green consumables? Are you willing to pay more for them? Please comment to let us know your thoughts, and as always, thanks for reading!

-- Jennifer Schwab, Sierra Club Green Home


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