How to Align Customer Value With Green Value - Leading Green - HarvardBusiness.org
Bob Lurie critically addresses two constraining assumptions in questioning whether or not customers will pay a premium for green products:
- They do not have any tangible benefits for customers other than making them feel good about helping the planet.
- They are more expensive to produce than non-green products.
However, for businesses that understand customer insight and innovation, these assumptions are simply not valid. While Bob’s explanations are good and self-explanatory (focusing on performance and cost benefits; lean/sustainable manufacturing and logistics), I have the following to add:
The product innovation and communication thereof needs to be aligned with the unique values for various customer segments. The primary factors are the product/service categories and their positioning, followed by target users’ perception of the products’ use and purpose in their lives.
So while a product may have green/social attributes, their effectiveness in stimulating a purchase will depend on, as mentioned:
- The degree of overall price competitiveness for the category as a whole
- The percentage of green attributes built into the product (substance matters)
- How these attributes improve their lives in terms of:
- Comparative Product Performance
- Emotional/Spiritual Affinity
- Financial Savings
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