This Week's Herman Trend Alert

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  The Herman Trend Alert

November 30, 2011

Consumers Abandon Green to Save Money

Not surprisingly, fewer consumers are buying green products. An extensive survey conducted by Grail Research finds that almost two-thirds (65 percent) of consumers changed their green buying habits due to the Great Recession.

We find these data thought provoking in light of other recent studies that consumers patronize companies that demonstrate the "same values" as they do in the area of social responsibility. Interestingly, the availability of green products and green alternatives has been increasing.

Created to gauge consumers' sentiments and behaviors related to sustainability and "green" products, the study, titled "The Green Evolution", also evaluated how consumers interpret the marketing efforts of the companies that offer them.

The report cites that consumers who previously purchased green products have decreased their green purchasing. More precisely, those consumers who bought "some green products" (characterized as "light green") decreased from 76 percent to 60 percent of the population. Thatís an over 20 percent reduction that changed their usage of green products or switched to conventional ones.

At the same time, there was a rise in the percentage of non-green consumers ---from 15 percent to 22 percent. Among green consumers, 43 percent cited the economic recession as their reason for not purchasing green products---the top reason given.

Unfortunately for the planet, the number of 'dark green' consumers (those who pick earth-friendly products for most of their purchases) increased by a mere one percent; they now make up only ten percent of the consumer market.

Greenwashing*, confuses consumers. The report also found that consumers find it hard to differentiate among the many products claiming green attributes. However, "knowing how to effectively articulate green attributes can improve top-of-mind awareness".

"It's no longer enough to just say you're green. Consumers now expect comparable value", said Annica Blake, global head of research services at Grail Research. For marketers, understanding the distinction between dark green and light green consumers will be increasingly important.

Caught between rising prices and shrinking disposable income, consumers have chosen to economize. As this period of economic hardship continues, we expect to see fewer and fewer green customers. When economies recover, this trend will reverse itself. However, that will be years, at least.

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