Comments on: Does it pay to be green?

By: Does it Pay to Be Green? | Information Engineering and Management

Does it Pay to Be Green? | Information Engineering and Management — Mon, 08 Mar 2010 14:13:02 +0000

[...] originally published on dalecallahan.com under the title “Does it Pay to Be Green?” A recent post by Small Business Trends hailed that businesses need to do more than claim they are [...]

By: Dale

Dale — Tue, 23 Feb 2010 16:45:38 +0000

Good points Kevin – I am sure we do see some outside motives pushing companies to be green – pushing the marketing buttons and getting “qualified” for certain contracts. And if you are an established business – perhaps this can make sense to play the game.

But what is disturbing is the article about small business – many without established brands. I have met with many who are spending real money being green thinking that this will be what pulls the customer in the door.

All thinking about segmenting and potential markets aside – it still costs money to do that. My question – does it pay for itself?

By: Kevin Hodgkins

Kevin Hodgkins — Mon, 22 Feb 2010 22:01:33 +0000

It is all about signaling. As consumers we calculate value as tradeoffs – I value your soda more than I value my dollar. As a producer you value my dollar more than you value your soda. As a consumer I have many choices of soda; all else equal I will purchase the cheapest soda. Add in marketing and my valuation of your product changes vis-a-vis both my money and other similar products.

Now, what I really think is going around the green is good movement is in response to homogeneous purchaser effects. You don’t see alot of consumer products companies selling how green they are – you just see them segmenting their product lines to ensure penetration in that potential market. You do see large industrial concerns talking about how green they are overall trying to be – and I would bet you can trace some of that back to behavior in response to government purchasing decisions.