Procurement

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Interview with GreenMarketingTV on Sustainability

Hi all – I was pleased to be featured on GreenMarketingTV in late May, and wanted to share the article with you.  Here’s a link.  I have also included the text of the interview below:

Green Entrepreneur Interview: Ben Grossman, Sustainable Direct Mail | Green Marketing TV

http://www.greenmarketing.tv/2011/05/24/green-entrepreneur-interview-ben-grossman-sustainable-direct-mail/

Award-winning green entrepreneur, Ben Grossman of Grossman Marketing, talks about how to develop a sustainable direct marketing campaign and what it takes to transform a fourth-generation business into one with a strong environmental focus.

What was your inspiration for starting Sustainable Ink? When and how did you get started?

I started my blog, Sustainable Ink, in 2007.  I had joined my fourth-generation family business, Grossman Marketing Group, the previous year and was often thinking about sustainability and green business issues.  Our business was founded in 1910 as Massachusetts Envelope Company, and it’s evolved into an integrated marketing services firm.

Today, our main service lines are a design studio, envelopes and direct mail services, printing of all kinds, and promotional products.  In addition, we have a fast-growing e-commerce and rewards and incentives business.  As oil prices were rising, and global warming had gone from a fad to stated fact, I saw the writing on the wall – that we live in a world with finite resources, and consumers are increasingly interested in companies’ environmental footprint, commitment to environmental causes, and the sustainability of their products.

I wanted to start a blog through which I could discuss these issues, with an emphasis on marketing services and my industry.  I have been very proud to see the site’s readership grow over time, and have some of my posts picked up by national green news sources, most recently Environmental Leader and Ecopreneurist.

I launched our firm’s green marketing and sustainability practice the previous year with the goal of working with my team to help clients identify environmentally-conscious business practices as a way to differentiate them from their competition and establish a competitive advantage in their respective fields.  For this work I was the 2009 recipient of the New England Direct Marketing Association Prodigy Award.  The Prodigy Award is given to one marketing professional each year in New England under the age of 30 who has added the most to the art and science of direct marketing in the prior year.

Is interest in sustainable marketing growing or declining?

Green marketing is definitely not out, but consumers have been inundated with an array of green logos, claims and messages, and they are becoming increasingly skeptical of the green claims they read and hear.  Much of the research I have seen, as well as my own experience, point to the need for transparency in green marketing claims.  People want to know not only how a product is green, but according to whom.  The third-party reference needs to be a legitimate one – not an unknown group with a confusing website.

In the print world, the best example of a strong and respected third-party authority is the Environmental Defense Paper Calculator.  On this site, people can calculate the savings derived from using papers with post-consumer recycled content.  These savings include energy, wastewater, trees, etc.  I like this because it’s a resource that is industry independent.  Although I respect the savings calculators put together by paper companies, using a third-party resource rings truer to consumers.

How do you help your clients target and reach green consumers?

There is a wide range of ways to target and reach green consumers.  They include buying ads on websites that cater to these consumers, as well as on-the-ground outreach at community events.  In addition, using sophisticated direct mail techniques, the right brand can reach the right people with useful, actionable direct mail.

How do you help businesses communicate their green-ness to their customers?

The most important advice I can give to companies is to tell the truth and be transparent in their claims.  Companies get in trouble by greenwashing – when they mislead consumers about their environmental practices or the environmental benefits of a product, and consumers are getting fed up.  As I mentioned earlier, when making a claim, try to use a respected third-party resource to verify it.

How do you find your customers?

The best customers come by referral, but we also find them through speaking engagements, direct mail, networking, social media and online ads.  We believe the best campaigns are integrated ones, and we try to practice what we preach!

What are consumers looking for in a green company? What messages do they want to hear?

Consumers are looking for green products to be made from renewable resources, use recycled content, or with less materials than in the past.  For service providers, consumers are looking for consistency.  For example, if a hotel claims to be green because of an array of practices, it is somewhat of a contradiction when there are no easy ways to recycle plastic bottles, cans, paper, etc.  I have seen this too often when traveling on business, and I wish some hotels would give greater consideration to waste management practices.

Does sustainable marketing typically cost more money?

Sustainable marketing shouldn’t necessarily cost more money.  In the print business, people can generally use recycled papers, vegetable-based inks and renewable energy in the production process for no extra cost.  There are of course premium eco-friendly papers that add cost (New Leaf, Mohawk Options, Neenah Environment, to name a few), but if a marketing professional is working with the right vendor partners, they should be able to reduce their footprint without adding much cost.

What recommendations do you have for businesses to green their marketing without breaking the bank?

As I mentioned earlier, people can use vegetable-based inks, renewable energy and recycled materials for little or no extra cost.  Some practices can cut costs – like considering the production of an item during the design stage, so it gets optimized for printing to use the least amount of paper.  In addition, when people manage their mailing lists well, they mail fewer pieces to a better audience, thus cutting postage and printing costs.

Are all your marketing services eco-friendly? How is your business greener than your competitors?

Our services are fairly resource intensive, so we try to be conscious of our footprint at all steps in the process.  For example:

1)      All metal printing plates are collected after use and given to a recycling company.

2)      All press solvents and washes are low VOC (volatile organic compound) formulas that minimize impact on the environment as they contain no acetones.

3)      All non-metallic inks are vegetable-based (i.e. non-petroleum based).  The ink contains approximately 35% oil, all of which is vegetable-based (soy and linseed).

4)      Our inks are made from a “stay open” formula – meaning that the top layer does not skim over and form an unusable layer – this reduces ink use by about 10% annually.

5)      All waste ink is sent to a recycler where it is mixed with other waste to form a low-grade heating oil.

6)      All paper waste and cardboard packaging are sent to a paper recycling company.

7)      Our prepress system is entirely chemical free – only water is used to rinse the plate after imaging.

8)      All waste oil is recycled with an oil recovery service.

9)      All wood pallets are returned to our paper merchants for re-use.

10)   In addition, here’s a blog post I wrote about recycling, in which I explain that we allow our employees to bring in batteries, CFLs, fluorescent tube bulbs and paint from home to be recycled by a partner of ours. We recently added a Big Green Box to our office so our colleagues can bring in electrical waste from home as well.

What kinds of mistakes do green businesses generally make that you would advise against?

The worst mistake is to not tell the truth or to make misleading statements and we strongly advise against them.  In addition, we make sure that green marketing underpins an organization’s overall commitment to sustainable practices.  If they are just surface changes, consumers will see through them.  In addition, employees want to work for socially responsible organizations.

What mistakes have you made as a green entrepreneur and what advice would you give others looking to start a green business?

Sometimes I have had the tendency to try to make a product or offering perfect before rolling it out.  One piece of advice I would have is to “beta” test everything, as early customer feedback will always help you improve.

You can get in touch with Ben through Twitter.

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Video of Panel Discussion at Columbia Business School: The Returns to Social Enterprise


I had the privilege of serving on a panel in April at Columbia Business School during Reunion weekend titled “The Returns to Social Enterprise.”  The panel was moderated by Ray Fisman, the Co-Director of the Social Enterprise Program at Columbia Business School. Please click on the image above to watch the video from our talk. 

The conversation covered trends in social enterprise, renewable energy, as well as green marketing and the issue of transparency around green claims.  There were also some excellent questions from the audience about sustainable procurement strategies.  I was really impressed with my fellow panelists, and I think the whole video is interesting.  In case you’re wondering, my portion starts around the 13-minute mark.The other panelists were:

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A Negative Tipping Point for FSC Certification

Turning the page on FSC?

Over the past few years, awareness has grown about FSC-certified papers and printing.  FSC stands for Forest Stewardship Council, a group that works to ensure that the materials used are sourced responsibly.  Each step in the chain (i.e. from forest to printer) must be traceable.  The intent of the FSC system is to eliminate habitat destruction, water pollution, displacement of indigenous peoples and violence against people and wildlife that can accompany logging.

Although I believe this is a meaningful cause, I wanted to report to my readers that I believe that FSC certification in the commercial printing and marketing communications industry has hit a negative tipping point.  By this, I mean that the future of FSC certification in these fields is murky at best.

I base my assertion on a lot of anecdotal evidence I have seen in the field, both from printers, and especially from marketing professionals and print buyers.  Back when I started conducting green marketing seminars (and writing on Sustainable Ink) in 2007, there was growing interest in FSC, and a sense that it would become the industry standard, on the level of recycled paper.  It was on its way there, but I believe it was hurt in three major ways:

  1. Lack of awareness of what FSC means. As I mentioned before, FSC is a system designed to ensure the chain of custody of paper, from when it was a tree to its final printed form.  The fact is, many people in our industry do not know what FSC is, and therefore do not sell it.  More importantly, I have seen many research studies that show that most consumers do not know what it means and are therefore not interested in it.
  2. Lack of tangible environmental benefit versus other green attributes. When people use recycled paper, they know they are consuming less natural resources than they would if they chose virgin fibers.  Vegetable-based inks sound like they make a positive difference, as they cut down on the use of oil, and are renewable.  Papers made with renewable energy send a message that an organization wants to reduce its carbon footprint and support a green economy.  Those terms, recycled, vegetable-based, and renewable energy, all are easy to understand and therefore end consumers of print and marketing collateral feel comfortable around these terms.  If they feel comfortable around these terms and believe they know what makes them green, they will continue to ask for papers and printers that meet these standards.  FSC, on the other hand, is difficult to understand, and the green attributes may not be immediately obvious.
  3. The combination of the difficult economy and the perceived greed of the Forest Stewardship Council. It is not surprising that FSC grew dramatically in 2007 and 2008, when the broader economy was stronger, and the environmental movement was top of mind.  However, as printers fell on tough times, FSC continued to charge large annual fees from printers to allow them to maintain their individual plant certifications.  One printer told me the following: “Look, I’m a small company – we do $3-$4 million in sales per year, and when I had to sign up for FSC certification in 2008, and spend $10,000-$15,000 to make this happen, with ongoing overhead expenses, I did it.  I thought it would be a cost of doing business, and that I would lose business from eco-minded clients if I wasn’t FSC certified.  When sales fell in 2009 and 2010, I appealed to FSC to get a reduction in my fees, as I was facing the choice between paying my FSC bill or my payroll.  FSC wouldn’t budge, so I didn’t renew, as I was more interested in protecting my employees than I was in paying what I saw as an FSC tax.  I haven’t noticed a sales drop off due to this decision.”  After hearing this, I spoke to several other printers, many of whom no longer maintain their FSC certification, as they said the costs outweighed the benefits.  Some questioned the mission of FSC, with one saying it seemed to be an “overhead-heavy organization” that “charged small printers large fees to pay for their bloated staff.”  I found this large organizational chart on their website which did not contradict this assertion.

In some sense, printers have been FSC’s sales force.  Once printers became certified, they sold FSC as an incredibly valuable brand, and one that all companies that wanted to send a green message should strive to put on their printed pieces.  Now that many of these smaller printers have declined to renew, FSC has lost a powerful constituency that will not continue to spread the word about FSC.

One other constituency FSC has partially alienated is designers, due to their strict rules around usage of the term “FSC.”  Several years ago, if an organization wanted to explain their green choices with words instead of symbols, they were allowed to do so.  As an example, if they printed a brochure on Neenah Environment PC 100, one of my favorite green papers made from 100% post-consumer recycled content, at an FSC-certified printer, they could use a simple sentence like “Printed using FSC-certified 100% post consumer recycled content.”  Now FSC no longer allows this, and insists that the term “FSC” only be used along with its official logo.  FSC is clearly trying to build awareness of its brand, but this shouldn’t be the responsibility of the end user.  I have seen this rule cause designers to sacrifice the use of the “FSC” term.

FSC is a worthwhile organization, and serves a good cause.  However, I believe its lack of obvious green benefits relative to other green elements like recycled paper is hurting adoption.  More than that, however, are the large fees charged to FSC’s sales army (printers) during this recession.  Those, coupled with strict rules around design, are a sign that FSC may have overplayed its hand in the marketing communications industry, and its best days are behind it.

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Interesting Survey on Green Supply Chains

Hi all – this is from Stephen Jannise, who writes a blog on the software industry.  He is hosting a survey on how a vendor”s efforts to go green can influence corporate purchasing decisions.

This survey coincides with an article he has written about five companies that are greening their supply chains. In the article, he discusses the efforts of IBM, Whole Foods, Wal-Mart, Patagonia, and Pepsi to reduce their respective impacts on the environment.  He also asks whether they should be doing more, what are the real motivations behind a greener supply chain, and whether consumers are aware of these efforts.

Please click here to visit his survey as well as read his article.

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Deloitte Report – Sustainability in Business Today: A Cross-Industry View

By Marisa Greenwald (Green Marketing & Sustainability Practice, Grossman Marketing Group)

Despite widespread support for sustainability reforms, lofty rhetoric from CEOs and government incentivizes for businesses to “go green,” corporate sustainability improvements have been limited.  To further probe why companies are not moving more aggressively on this front, Deloitte recently published a study that delineates corporate perspectives on sustainability based on responses from 48 companies across different industries.  The report studies these perspectives in five contexts: general sustainable practices, sustainability related to innovation, corporate responses to sustainability incentives in the stimulus package, the relevance of new skills in pursuing sustainability efforts, and future sustainability trends.  Several compelling trends emerged from this study which I thought would be worth sharing with the Sustainable Ink community.

First, it is interesting to note the challenge companies face trying to innovate through sustainability.  The study found that in the area of product innovation, 23% of companies surveyed were developing entire sustainable product lines while only 25% of all companies surveyed indicated they were pursuing efforts to make their products more sustainable.  So while a considerable portion of companies are devoting entire lines to greening efforts, only a fourth of all surveyed incorporate the sustainability factor into innovation.  A major problem companies identify when trying to create sustainable products is the tension between willingness to pay and cost.  Even though customers may want sustainable products, they are not necessarily willing to pay more for them, so companies must find ways of keeping the sustainable measures cost-neutral.

Another interesting finding from this report is the corporate reaction to sustainability incentives in the stimulus package enacted last year.  While there was an overall mild recognition of energy efficiency incentives in the legislation (5.29 on 10-point scale, with 1 being not at all familiar and 10 being very familiar), there was the largest gap in understanding between the automotive industry, 6.38, and the technology industry, 3.91.  The gap in policy awareness between the industries supports the broader idea that there is a heightened emphasis on greening in the automotive industry, where carmakers have been under considerable scrutiny and consumers have a relatively high willingness to pay for a hybrid vehicle, compared to a willingness to buy energy efficient technology products.

Overall, this report offers strong insights into corporate perspectives and decision making criteria in the context of proposed sustainability reforms.  Sustainability advocates and policymakers must continue to consider the needs of corporations who are open to pursuing stronger sustainability standards but whose aims continue to be maximizing shareholder value and maintaining profitability.

Click here to download the full report from Deloitte.

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Making Apparel Transparent: Companies Team Up to Measure Sustainability of Shoes, Clothes

Source: Levi's

By Marisa Greenwald (Green Marketing & Sustainability Practice, Grossman Marketing Group)

We have written often at Sustainable Ink about the importance of transparency, as well as the need to account for the environmental impact throughout a product’s lifecycle.  With that in mind, we are pleased to see a positive step taken by some well-known corporations.

At next month’s Outdoor Retailer trade show in Salt Lake City, retailers will receive a new tool to help them pursue their sustainability goals.   A group of about 100 retailers and manufacturers, including Nike, Levi Strauss, and Target, have joined forces to develop software that makers of apparel and shoes can use to measure the environmental impact of their products and assign to each an “eco-value” similar to the Energy Star rating of appliances.

Known as the “Eco Index,” this software tool works by posing a series of questions to companies on their environmental and labor practices, including some questions directed towards the companies’ suppliers.  The software then assigns a score that represents a percentage of a perfect score.  The goal of the Eco Index is to showcase competing items in retail settings with various “eco-value” scores so consumers can easily factor sustainability considerations into their purchase decisions.  Firms like Timberland and Patagonia have publicly expressed their desire to move the conversation forward and gain consensus among similar companies so that an effective and meaningful eco index program can be implemented.

With the heavy use of chemicals and crude oil to produce and ship these items, apparel production takes a heavy environmental toll that warrants accountability.  While many consumers are increasingly motivated by sustainability concerns, it is often difficult for them to understand the environmental consequences involved in producing many of their favorite products.  If companies begin to report the environmental impact to create their products, and consumers react by choosing certain items over others on environmental grounds, companies may become even more motivated to improve their sustainability efforts.

For more information about the Eco Index, check out this article from The Wall Street Journal or this recently featured piece in Fast Company.

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Green is Lean: An Inside Look at Sustainable Purchasing at DHL Americas

Wayne Evans, Sr. Vice President for Procurement, the Americas, DHL

In our effort to explore green business issues and the impact sustainability has on organizations’ purchasing patterns, we are proud to interview  Wayne Evans, Senior Vice President for Procurement, the Americas, DHL.  During the interview, Wayne reflected on his team’s commitment to sustainability, and how he and his colleagues have found that green business practices can help save money.  If you have any questions that you would like to submit to Wayne, please let us know.

1.    Could you tell our readers a little bit about DHL and the kind of work you do there?
DHL is part of Deutsche Post DHL. The Group generated revenue of more than 46 billion euros in 2009. DHL commits its expertise in international express, air and ocean freight, road and rail transportation, contract logistics and international mail services to its customers. A global network composed of more than 220 countries and territories and 300,000 employees worldwide offers customers’ superior service quality and local knowledge to satisfy their supply chain requirements. DHL accepts its social responsibility by supporting climate protection, disaster management and education.

In my role as Head of Procurement for DPDHL Americas I am responsible for purchasing more than $1b of goods and services across 22 countries.  I manage a team of 70 individuals that have buying and sourcing experience in categories such as transportation, fuel, packaging, travel, production equipment, etc.  My day-to-day activities are focused on leading the team, meeting with business partners to understand their needs, and meeting with suppliers to better understand new products in the market.

2.    When did DHL first start talking seriously about green strategies?
DHL has been working on green strategies for many years.  In 2008 the company completed a major initiative designed to baseline the carbon footprint of the Company.  This was a critical step as it established criteria by which we can measure progress against an established goal.

3.    Would DHL pay more for a green-sourced product?
There are many considerations involved in a sourcing decision but in fact it is possible to pay more for a green product.  This can happen as the Total Cost of Ownership (TCO) is factored because initially it might appear that the cost is higher but when you factor the operational costs the product might in fact be lower in cost.  As an example, if we look at the TCO for a truck we may find Vehicle A has a slightly higher cost than vehicle B.  However, the higher-priced vehicle has greater fuel efficiency which is greener and over a period of time the total cost of ownership (TCO) is lower.  In another situation we did make a conscientious decision to buy recycled paper at a slightly higher cost because it is better for the environment.

4.    In which areas does DHL most frequently make green-minded business decisions?
Transportation has the largest impact on our carbon footprint and therefore it is the critical area to focus on.  This is a large part of our business and there are many levers that we can use to reduce the carbon impact.  We are heavily engaged in hybrid vehicles including trucks and we also look for ways to use electric vehicles and even bicycles where possible.

5.    What have been the major trends in green procurement over the last few years?
One of the core goals of procurement is to identify different ways to drive down costs. There are different ways that procurement organizations can combine cost savings with green initiatives.  One example is recycling items such as stretch wrap.  Many companies use a significant amount of this product to package and ship.  In the past during the unpacking process the materials were removed and thrown in dumpsters for disposal.  One of the more recent trends was to add a bailer which is a container used to gather the plastic waste materials and they are picked up by recycling companies who process this material into something like a pallet.  Companies can actually receive money for the used packaging materials and they use less space in dumpsters which lowers the cost of trash pick up.

Procurement professionals are also starting to look at ways to evaluate suppliers with regards to their “greenness”. Based on this evaluation, suppliers will be given credit for being a green company and in close bid situations it could be a deciding factor.

Another trend is demand management, where procurement professionals are getting engaged in minimizing the amount of product needed.  By using only what companies need there will be less waste and less cost.

6.    Can you tell our readers a bit about the GoGreen strategy at DHL?
Our goal is to improve our CO2 efficiency by 30% by 2020, compared to a baseline of our 2007 performance.  To help us monitor our progress towards our 2020 goal, we have set ourselves an interim target to improve the CO2 efficiency of our own operations by 10% by 2010. The ability to calculate our own carbon footprint is a key prerequisite of our GoGreen Program. We need to identify opportunities for reducing our footprint and to track how much we have changed our ways.  We also need the data to offset our GoGreen products and services, and in due course to calculate our customers’ individual footprints.

7.    Do you think the organization thinks about green issues differently since it is based in Germany?
It’s not so much that we think differently but more that we act differently.  Because we are a global company we act in a global way.  When we identify a key strategic initiative such as this it is rolled out across the world and implemented accordingly.  The green movement is a bit more obvious in many parts of Europe as they have been following some of the best practices in conservation for quite some time

8.    What kind of impact has the recession had in shaping or modifying the green strategy at DHL?
The recession has not had much of an impact because as previously mentioned “green is typically lean.”  Some of the projects with longer term ROI and high capital investments could have been impacted as companies were trying to conserve cash flow during the recession.

9.    What kind of difficulties have you faced implementing GoGreen with workforce and management?
Since the green initiative is a CEO-sponsored and lead initiative it has not been difficult getting support.  The only challenges come when there are large capital outlays required without a sufficient business case.

10.    What has been your greatest triumph in implementing the Go Green campaign?

We support four (4) businesses in the US and each is very independent.  We have been successful in pulling them all together and aligning strategies.  We have many projects that were initiated such as recycled paper, hybrid vehicles, alternative lighting, etc.

11.    What has been the biggest struggle or challenge in implementation?
In some cases it is not always easy to make clear sourcing decisions based on the supplier’s “greenness” as there are no real standards for accurately rating a supplier.

12.    Could you highlight a few examples of unique contributions DHL has made in the area of sustainability?