As resources are always limited and customers’ concerns over “green” and sustainability is increasing. Many companies start to adjust their strategy to make their production process and supply chain more efficient and suitable. Companies like Lego have started to invest into R&D to make their material more recyclable and Ikea is considering bringing furniture recycling to Canada which they has been doing in France.
In my opinions, I think such strategy will bring many different benefits to the companies in terms of reducing cost in the future and building up brand reputation. As the result of society turning towards to more environmentally friendly, many studies suggest that customers are willing to pay more for “green” products. By having the recycling furniture program, or Lego’s recycle material, it would potentially increase customers’ willingness to buy a new furniture or toy without making them feel guilty or wasted. It simply gives customers a reason to replace the old one with new one if customers are environmentally minded. In addition to attracting customers, either the Ikea’s recycling program or Lego’s R&D initiative both have gained certain amount of media exposure, which serve as a free advertisement for companies to build up their brand association with sustainability. Furthermore, in terms of return on investment, these “green” strategy will not only bring short term benefit to the company, but also provide company with cost cutting opportunity (if the initiative is well designed and implemented)
Developing green initiatives that promotes sustainability, such strategy make me think of Coke Cola’s Share a Coke campaign. When the machine arrived at UBC you can see long line up there, people just can’t wait to get a coke with their name on it. This marketing campaign in my understanding, not only promote coke’s core value, friendship, fresh and share but also increase its sales. It is a campaign which you only have to invest in making the machines, and create huge amount of buzz and sales. Overall, achieving sustainability is a key successful factor for business nowadays
yajur sondhi
April 9, 2016 — 10:04 pm
Sustainability is definitely the future of business. Look at what consultancies like BrownFlynn say (Link A). It goes beyond just the supply chain and the customers. Employees, especially highly skilled, motivated millennials are looking for companies that align with their social and environmental values. Furthermore engaged employee are more productive, healthier, loyal, less likely to leave have a higher return per person. Furthermore investors, stock-exchanges and banks are taking note of these trends, the general shifts in the business environment and willing to put their money where their mouth is!
Check out the pdf and let me know what you think!
Link A
http://www.mha.org/mghc/docs/wallace_mghc_.pdf