As the market for ethical products and services continues to boom, some companies are desperate to clamber aboard the green bandwagon. All kinds of businesses are now marketing themselves as socially or environmentally friendly. But if these claims are hollow, they can backfire in spectacular fashion.
The National Consumer Council recently chastised energy companies for their misleading marketing. Four out of 10 people say they will pay more for "green" electricity, and providers have moved to meet that demand. But after a look at some of the offers in the market, the NCC told energy suppliers to be more honest and upfront about the way they market their green offers, many of which deliver scant environmental benefits.
"It's too easy for consumers to be confused and misled," says NCC chairman Lord Whitty. "They may think they are helping save the planet, but it's not clear that they are." According to Ian Cracknell, marketing director at UIA Insurance, which calls itself an ethical insurer, a business shouldn't market itself as ethical, socially responsible or green unless it can back up those claims. UIA's marketing describes its offering as "insurance with principles", reflecting a set of values that is ingrained in the organisation. "It isn't just something we stick on our marketing materials to try and sell more policies," he claims.
The pay for UIA sales staff is based on the quality of service they give, not just on the amount of business they do. "The marketing material might promote insurance with principles and it might be printed on paper from sustainable sources," says Cracknell, "but if people scratch the veneer they can see that we are living and breathing a way of doing things that is principled and ethical. It isn't just marketing puff." It does make a difference, he claims: nine out of 10 customers renew their policies each year, compared to an industry average of six or seven.
Kerry Wicklow, MD of ethical marketing agency Blue Ginger, agrees that companies have to "walk the talk" when it comes to ethical claims. If you create expectations and fail to live up to them, "you will lose all credibility and alienate the very people you want as customers," she says.
Her advice is to start with a clear idea about what makes your business ethical, develop some core messages and focus on these when you talk to customers and the press. Avoid making claims you cannot support with evidence, adds Kim Stoddart, MD of Blue Rocket, an ethical media relations agency.
Even companies with a strong ethical story to tell need to be careful about how they market themselves. Says Stoddart: "Consumers are becoming more and more sceptical about business claims. Be honest and somewhat modest in your approach. People don't like arrogant marketing anymore."
