As environmental awareness grows, large firms are increasingly adopting eco-friendly packaging and advertising practices. For example, just a few years ago Coca-Cola pledged to ensure that all their packaging is 100% recyclable by 2025. Not only does this have a positive impact on the planet, but it can also significantly impact the sales and revenue of famous brands since by taking these steps, companies are able to appeal to the increasing consumer sentiment that businesses should contribute to improving the environment.
A true win-win situation for everyone involved! Sounds awesome, doesn’t it? Well it isn’t, there’s quite a few problems still. For one, for a firm to make all their products or even just their packaging completely eco-friendly is a very, VERY expensive task. Not only will a firm have much higher R&D costs, the raw materials required are also more expensive (there’s a reason almost all products we consume every day come in plastic packaging!) and these costs are imposed on the consumer, making the product less attractive to anyone who is less sympathetic towards the problem of climate change, disincentivising firms from actually going through with this strategy.
Additionally, there’s also potential problems for the consumer that come with something called ‘greenwashing’. Simply put ‘greenwashing’ refers to deceptive advertising practices on the producer’s part and involves them making false or exaggerated claims about their environmental practices to appeal to the consumers that care greatly about the environment without aiding the cause in any substantial manner.
For example last year, with its flagship series, Samsung claimed to be using discarded fishing nets from the oceans for parts. They stated that they ‘could’ (that is, at an ideal maximum) reduce 50 tons of fishing nets from the oceans by the end of the year. That is less than the amount of plastic that is dumped in the oceans, every hour! Meaning that they were advertising their product as an ‘eco-friendly’ option while having a negligible impact on the situation.
What this whole situation means is that firms have recognised the value that using eco-friendly tactics holds in terms of making greater profits through higher sales, however most businesses still hold a very uncertain position on the matter. Making ambitious claims like Coca-Cola’s requires lots of funds and not keeping a promise can lead to consumers abandoning the brand altogether. This results in most companies making easily kept commitments that solve little to no problems.
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