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Marcus & Millichap Addresses Real Estate Solutions in Free Webcast

Marcus & Millichap Capital Corp. will host a free webinar on Sept. 17 that provides a comprehensive discussion of financing conditions and specific strategies to address maturing loans or underperforming properties. The 60-minute webcast will take place at 1:30 p.m. ET, including speaker presentations and an interactive Q&A. The event will cover:

  • The real-time status and outlook for financing conditions by property type, including what loans are getting done and which types of lenders are still active. 
  • How to deal with maturing loans or under performing properties, including key strategies for preserving value, the critical variables owners should consider (refinancing, repositioning, equity infusion, sale), loan-modification strategies, and a discussion of what is and is not working.
  • The direction of the economy and the outlook for property fundamentals. 

The webcast will be presented by Marcus & Millchap Managing Directors William Hughes, Hessam Nadji and Alan Pontius.
 
Interested parties can register at https://event.on24.com/eventRegistration/EventLobbyServlet?target=registration.jsp&eventid=158113&sessionid=1&key=186B0494FB371E04008D99203344D6F5&sourcepage=register.

Marcus & Millichap Capital Corp. provides financing solutions for commercial real estate nationwide.

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The Power of Marketing a Green Business, Part II

Editor’s Note: This is the second in a two-part series examining the marketing of environmentally friendly products and services. 
  
In Part 1 of this article we looked at the value of green marketing, its benefits as a marketing tool, and the potential pitfalls. We came to the conclusion that, when done correctly, green marketing was worth integrating into your overriding marketing initiatives. This time, we want to take a more in-depth look at how to implement your own green marketing campaign by examining a series of exercises designed to help you think through the process and steer clear of legal dangers.

You may recall that we introduced the concept of taking a self-inventory of your business to identify where green opportunities exist. We encouraged marketers to put on their “green” glasses and take a hard look at all phases of their company.

In actuality, this isn’t something that should be done by a single individual within the organization but by a group of employees representing a cross-section of your operations. Let’s call them the Green Team.

The goal is to literally have a brainstorming session or series of sessions. Let the ideas fly; feed off of each other’s thoughts. Ideally, you should consider including a couple of customers, suppliers or other stakeholders from outside the company who have an interest or interaction in your business.

Part of the reasoning behind the self-inventory is to avoid missing obvious opportunities that would diminish the value of your new marketing campaign. A self-storage that claims to recycle its water while allowing faucets to drip in the bathroom sends a damaging mixed message. Similarly, claiming to use recycled materials while failing to provide recycling containers is shortsighted and counterintuitive for customers.

The self-inventory also provides a good foundation from which to build a track to run on. As we have learned, green marketing is a widely used term, but it’s difficult to find a single definition because of so many green marketing claims used by marketers keen on expanding their eco-friendly horizons. Thus, creating a site-specific definition for your location and leveraging a green marketing campaign for your business is not necessarily an easy task.

There likely will be two broad categories of results that come out of your brainstorming: areas in which valid claims can be made immediately, and parts of the business that represent opportunities to re-engineer a product or process in order to make a green claim in the future.  

Keep in mind that green opportunities can relate to more than just products and services; they are often related to what goes into those products and services, including a company’s processes, operations, manufacturing, packaging and even building materials. 

Brainstorming

As you brainstorm, ideas will flow simultaneously from both an identification of opportunities to market and how to market it, namely the message, the media, the location of the message, etc. Remember, the most important thing is to keep ideas rolling; everything goes up on the board and nothing should be judged or debated at this point. In the next step, you will come back and apply rules to your marketing ideas to see if they’re valid.

If you have included customers, vendors and other outside stakeholders on your Green Team (and we strongly urge that you do), you will find that the internal and external views of the company will co-mingle, and that’s OK. Good ideas from employees and customers will cross-pollinate to form additional ideas. There’s no need to keep them separate. The goal is to make sure you have examined your green marketing opportunities from an inside point of view, as well as an outside (customer) perspective.

By the end of the brainstorming session, you’ll have created a long list of current and potential opportunities. The second phase of the process is when you judge the list for validity and whittle it down to the most important and relevant claims.

After the initial brainstorming, your green marketing team should be narrowed to employees (and potentially suppliers) because this is when the real work begins, and it can be difficult to accomplish the next tasks with too large of a group. However, when the entire green marketing process is completed, it can be a good idea to reassemble the original brainstorming Green Team to review the results.
 
Executing Strategy

The Green Team is now charged with forming and executing a green strategy. The group should examine the narrowed list of ideas to determine whether each entry is an existing or potential opportunity. If it currently exists, what are the best message and method to communicate it? If it is a potential opportunity, what action steps are needed to make it a reality?

Next is the true marketing phase. At this point, your Green Team needs to develop a marketing plan that ensures all green messaging follows legal guidelines and solid strategies. Let’s start with the legal.

The Federal Trade Commission (FTC) has published a list of rules for green marketing claims (known popularly as the Green Guides) that you can use to cross reference a typical self-storage facility’s products and processes. These include: 

  • Substantiation
  • Specificity
  • General claims, e.g. “eco-friendly”
  • Eco-seals, seals-of-approval and certifications
  • Biodegradable claims
  • Recyclable claims/please recycle claims
  • Recycled content claims
  • Source reduction claims
  • Ozone safe/ozone friendly and no CFCs claims

Legally and ethically, the Green Team is charged with making sure all claims avoid any potential “greenwashing,” which is to make a false or erroneous claim of an environmental benefit. If the group is certain of the facts behind a claim, it still must make sure that the wording of the claim will be clearly understood by the consumer.

Remember, the first rule the FTC uses in judging validity of a green claim is how the marketing message is perceived by the customer. The gap between what consumers take a green message to mean versus the truth behind the claim must be avoided through clarity and specificity. But that alone will not be enough to stay on the right side of the law.
 
The Marketing Message

Once the Green Team has validated a claim using the FTC’s guidelines, it will be ready to craft the marketing message. Of course the FTC has some things to say about that as well. There are a couple of key points to consider under the General Principles section of the Green Guides:

Qualifications and disclosures. “Any qualifications or disclosures ... should be sufficiently clear, prominent and understandable to prevent deception,” the FTC’s guidelines say. “Clarity of language, relative type size and proximity to the claim being qualified, and an absence of contrary claims that could undercut effectiveness, will maximize the likelihood that the qualifications and disclosures are appropriately clear and prominent.”

Overstatement of environmental attribute. “An environmental marketing claim should not be presented in a manner that overstates the environmental attribute or benefit, expressly or by implication,” the FTC advises. “Marketers should avoid implications of significant environmental benefits if the benefit is in fact negligible.”

In layman’s terms, the basis for a claim must be displayed prominently in a legible typeface, as close as possible to the claim. The message needs to be specific and relevant. Most of this is simple common sense. Do not make any broad claims that cannot be substantiated or that might be misleading or irrelevant.

If the legalese and rules feel constraining and stifle creativity as your Green Team begins to formulate its green marketing messages, keep in mind that the guidelines represent a set of checks and balances. Cross-referencing ideas with the FTC guidelines will actually keep your team on track to craft messages that are effective and meet legal criteria.
 
Credibility and Relevancy

Jacquelyn Ottman, a leading expert and consultant in green marketing, outlined some key initiatives in her keynote speech at the Sustainable Brands ’08 Conference. Ottman recommends marketers first focus on primary benefits. Make your message clear and relevant without overstating the environmental benefits. In her speech, she cited a March 2008 Gallup Poll that showed the environment trailing only health care and the economy as being consumers’ top concern.

Her advice is to try to link your green benefits to health issues or how they might positively affect your customer’s pocketbook. Winning messages are those that are relevant to your customers. To be convincing, Ottman also believes in transparency, a topic we have emphasized already.

Credibility and relevancy to your customers are critical factors in effective green marketing. Your green claims or benefits should be in addition to your core marketing messages regarding your products and services. Integrating the two marketing strategies tells customers that your green talking points are simply a part of your overall marketing message and quality of service and practice, not simply a standalone message on which you’re trying to bank.

Another potential source of credibility comes from co-branding opportunities with suppliers. However, be sure you are comfortable with the messaging and claims being made and that they do not counter the FTC guidelines.

As a final confirmation that your Green Team is on the right track, have the group test its messages against TerraChoice Environmental Marketing’s six green marketing sins discussed in part one of this series. This test should help weed out any accidental misstatements and ensure the validity of your claims.

Through brainstorming and message development, your Green Team will create a long list of current and potential claims. Even as you whittle the list down to work on the most important and relevant claims, don’t necessarily throw out the baby with the bathwater.

You may be able to use some of the additional ideas later, such as on a marketing poster in your lobby demonstrating the 101 things you are doing to help the environment. Remember that little things can add up, from selling greeting cards printed on recycled paper to asking customers if they need a receipt before you print it.

Supporting such practices with facts about the bigger picture can round out your messaging. Take receipts as an example. According to The Green Book by Elizabeth Rogers and Thomas M. Kostigen, “ATM receipts are one of the top sources of litter on the planet. If everyone in the United States left their receipts in the machine, it would save a roll of paper more than 2 billion feet long, or enough to circle the equator 15 times.”

That’s the sort of nugget that makes a tiny green idea seem pretty big. It tells the customer that you are doing a lot more than just using recycled products. It shows you’ve thought it through, done your homework and are thoroughly committed to going green. That just might give you a leg up on your competitor.
 
Brad Simonis is a principal with Metro International, a carwash consulting firm and distributor. The company offers expertise in site selection, layout, design, construction, operation and marketing of high-volume carwashes. To reach him, call 866.463.8723; visit www.metro-intl.net.

Related Articles:

The Power of Marketing a Green Business, Part I

Green Building in Self-Storage: Not a Fad. Not a Trend. The Future.

Weighing Risk and Reward in Self-Storage Marketing Messages

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ISS Blog

Demand for Boat/RV Storage Continues to Grow

Thousands of Americans take to the highways and waterways during the summer months in search of R&R. And while the current state of the economy has undoubtedly put a damper on many travelers, others are still packing up and making the most of shorter trips to nearby destinations.

In fact, campgrounds and national parks are reporting excellent turnout for the summer season, according to the National Association of RV Parks and Campgrounds.

While many boat- and RV-storage facilities have experienced a drop in occupancy as more tenants trim their budgets, there is hope on the horizon. A recent news article on MSNBC states despite a drop in RV sales over the past two years, the outlook is promising.

One reason is Americans love to travel—and they love their toys. According to the article, there are more than 8 million RVs crisscrossing America’s roads. Throw in several more million boats, and you’ve got a huge demand for storage.

This week, the ISS staff wrapped up our annual summer supplement highlighting the boat/RV and mobile-storage industry. A common theme for this special issue is marketing. Much like with traditional storage, marketing is a key to filling units. Customer service, a critical component of retaining self-storage renters, plays an even bigger role in this market. Many facilities offer luxurious settings, including clubhouses, free wash services and more. Check Insideselfstorage.com in the coming weeks for more articles on this growing market.

If you’re interested in developing a boat and RV facility, you don’t want to miss the boat/RV seminar at this year’s Inside Self-Storage World Expo, Oct. 5-8, in Washington, D.C. Mako Steel President Caesar Wright will give a detailed overview of this niche storage product, providing insight to trends and an analysis of construction costs. For the full agenda or to register, visit www.insideselfstorageworldexpo.com.

In the meantime, check out these interesting articles from the ISS archives on boat/RV storage. And if you already offer boat and RV storage, tell us how you’re faring this summer by posting a comment below or head over to Self-Storage Talk, the industry's only online forum. We have a special section where boat/RV owners and operators can ask questions and exchange information.

Early-Bird Discount Extended for Inside Self-Storage World Expo

The early-bird discount registration deadline for the Inside Self-Storage World Expo in Washington, D.C., has been extended to Aug. 14. This is attendees’ last chance to save $180 on the Education Package, $25 on the Expo-Hall Package, and more than 30 percent on each of four add-on intensive workshops. The ISS Expo will take place at the Gaylord National Resort & Convention Center, Oct. 5-8.
 
The Education Package includes access to 27 educational seminars, the exhibit hall, and five networking events. Add-on workshops cover the critical areas of self-storage marketing, legal issues, day-to-day facility management, and development. The show’s exhibit hall will feature more than 70 of the self-storage industry’s top suppliers representing a highly diverse range of products and services.
 
Created for self-storage owners, managers, developers, investors and suppliers, the ISS Expo comprises four days of educational seminars, product and service exhibits, and networking opportunities. With a theme of “Today’s Challenges Are Tomorrow’s Profit,” the event focuses on strategies for generating revenue and perfecting business branding in a demanding economic environment. 
 
To learn more and take advantage of early-bird registration rates, visit www.insideselfstorageworldexpo.com.

 

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Littleton Self-Storage Owner Thwarted by Recovery Delays

Several units at the Stor-n-Lock self-storage facility in Littleton, Colo., collapsed during an April snowstorm, and owner Alan Jones is frustrated by delays in getting demolition crews inside the building. He cited paperwork holdups and bureaucracy as the cause.
 
Meanwhile, rain has also poured into the crushed building, making it difficult to assess the damage to tenant belongings. Effected renters have not been allowed to sift through the remains of their goods for fear the building could collapse further.
 
Jones expects his permits from Jefferson County for the demolition and recovery work to be approved this week. The permits were applied for three weeks ago, after Jones’ insurance company finally communicated with the builders about the damage inspection.
 
Source: 9 News Denver, Red tape delays storm damage inspection for months

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New Self-Storage to Be Built in Valparaiso, Ind.

An empty plot of land near Calumet Avenue in Valparaiso, Ind., will soon be home to a Stor-IT-Now self-storage facility, which will contain approximately 50,000 square feet of space. The business is co-owned by Jeffrey Katz and James Lyon, who said most other storage facilities in the area are full.
 
With the exception of a few empty buildings, the plot is currently vacant and is being changed from industrial to commercial. The city planner praised the design of the new project, which the owners hope to open before the end of the year.
 
Source: Gary Post Tribune, Self-storage business moves into empty lot

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Sentry Self-Storage Gets Forest Hill Mangement Contract

Florida-based Sentry Self Storage LLC, which provides management services to independent self-storage owners and investors has been awarded the management contract for Forest Hill Self Storage in West Palm Beach, Fla. The facility has 923 units and 88,627 square feet.

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Man's Ashes Found in Self-Storage After 10 Years

The new owners of a U-Store-It self-storage facility in Middleburg Heights, Ohio, discovered an urn in a back room that had been there for nearly a decade. The cremated remains of Val Torok, who died in 1996, have been returned to his daughter, Diane Christen, after some investigation by local police.
 
The father’s ashes were inadvertently placed in storage 10 years ago when the daughter and her husband lost their home to foreclosure. When they attempted to retrieve their possessions from the facility a year later, they were told their belongings had been mistakenly sold at auction. But the buyer returned the urn to the facility, where it has been in a back-room locker until last week.
 
Source: The Plain Dealer, Middleburg Heights police return man's ashes to his daughter after 10 years

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Portable Storage Gains Popularity on Oahu

Though the island of Oahu has dozens of self-storage facilities, its two mobile-storage businesses have also gained popularity. Portabox Storage Hawaii and the local PODS Inc. franchise have rented more than 1,000 portable-storage units between them.
 
Both companies say business picks up during military deployments and when the real estate market is positive. The average customer rents for six months.
 
Portabox has four employees and has been doing business in Hawaii since 2001. It maintains an inventory of 600 wooden crates that are wrapped in a vinyl covering for weather-proofing. Halona Brooks, branch manager, said approximately 70 percent of its boxes are rented on Oahu.
 
PODS (Portable On Demand Storage), which started doing business in Hawaii in 2007, has approximately 650 of its units rented across the island. The 11-employee company offers three types of units: vinyl-covered plywood, double-thick plastic, and a dense plastic-fiberglass blend. All three have a steel frame that allows them to be stacked at the company’s warehouses. PODS plans to launch limited moving services on Maui next month, said Craig Watson, operations manager.
 
Source: Pacific Business News, Hawaii mobile-storage firms offer alternative to self-storage

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The Power of Marketing a Green Business, Part I

Editor’s Note: This is the first of a two-part series examining the marketing of environmentally friendly products and services.

“Consumers in the United States are expected to double their spending on green products and services in the next year to an estimated $500 billion,” according to an annual consumer survey by Landor Associates. With headlines like these, many in the self-storage industry who are in search of anything to win over customers during these difficult economic times can’t help but ask if green marketing offers the competitive advantage, perfect marketing message, or magic bullet they need.

The perfect storm of plummeting new car sales, slowing retail sales, the housing crisis, a nose-diving stock market and a never-ending media blitz on the state of the economy has resulted in dramatic dips in self-storage occupancies. Can green marketing help?

In consumer products and services, green marketing is already a well-established trend. We see more of it every day, from IBM inundating us with TV ads of a meek, environmentally minded employee winning over the tyrannical corporate boss to the ubiquitous lineup of earth-friendly claims plastered on product labels on retailers’ shelves.

So what is green marketing exactly? Does it matter? Do consumers care? Are we missing the boat if we’re not talking green to our customers? And if so, what is the right way to do it?

Our objective in this first article is to look at other industries, from manufacturing to retail, to see what we can learn from those who have been treading this sometimes slippery slope, and hopefully shorten the learning curve as a result. 

Defining Green Marketing

Green marketing is a broadly used term that can describe any marketing message that touts a company’s use of ecologically safer products or processes, including recyclable and biodegradable packaging, energy-efficient operations, better pollution controls or anything that lessens a company’s environmental or “carbon” footprint (a measure of the impact human activities have on the environment in terms of the amount of greenhouse gases produced, measured in units of carbon dioxide).

It’s a wide-ranging phrase, which is part of the challenge facing successful green marketing efforts. A bigger challenge may be the lack of standards and oversight. Part of this shortcoming is due to the wide variety of companies and industries making environmental claims. How do we oversee truth in advertising as it relates to organically grown chickens versus recycled building materials? By definition, both are “green” claims, but with two completely different bases.

The Federal Trade Commission began issuing green marketing guidelines in 1992 with its Guides for the Use of Environmental Marketing Claims, commonly known as the Green Guides. These guides are designed to help marketers avoid making environmental claims that are unfair or deceptive. The FTC updated these guidelines in 1996 and again in 1998 and is currently reviewing the Green Guides “to ensure that they are appropriately responsive to changes in the marketplace and in consumer perception of environmental claims,” according to its website.

This review is coming more than a year earlier than previously planned as a direct result of the shear volume of green marketing messages.

In the interim, it appears that consumers are dependent on the producer of a claim to validate it, so ultimately the consumer must make decisions as to the soundness of the claim. This gap between what consumers take a green message to mean and the actual truth behind the claim is known as the “green gap.” Conversely, a company’s false or erroneous claim of a green benefit is known as “greenwashing.”

Companies can often make a claim that is technically true but fails to tell the whole story, which, if known, might change the perceived benefit of the product. For example, if a new recycled product takes more non-renewable resources to produce than the product it replaces, a company’s green marketing claim of using recycled materials is technically true, but the process doesn’t result in a net environmental benefit.

According to the 2008 Green Gap Survey conducted by Cone LLC and The Boston College Center for Corporate Citizenship, nearly half of the U.S. population erroneously believes a product marketed as “green” or “environmentally friendly” has a positive or beneficial impact on the environment. Only 22 percent understand these terms more accurately describe products that have less negative environmental impact than previous versions or competing products.

“Most people agree green solutions are better than less green solutions, but how green?” says Frederic Brunel, associate professor of marketing at Boston University, in an interview with The Boston Globe.  “... We need goals and standards.”

Currently, there are many interpretations of green marketing, and every company and industry varies their use of terms and supporting claims. In today’s climate, each company needs to define green marketing for itself, but do so in a manner that makes sense to its customers.

First, though, companies must identify “green” opportunities as they relate to products, packaging, services, operations, processes, manufacturing, building and building materials. Only after a company has taken a thorough inventory of itself and its processes and has made changes that make a difference in its environmental footprint can it begin to market those changes. This is something we will explore in part two of this series.

Do Customers Care?

Before a company jumps head first into developing strategies for its green marketing initiative and the re-engineering that precedes it, perhaps we should first look at whether the efforts will show a return. Just how important is being “green” to your customers? Unfortunately, recent surveys show varying degrees of the importance, effectiveness and return on investment (ROI) for a company’s green marketing efforts, leaving us without a solid conclusion or definitive yes or no answer.

Of course, ROI is a bit of a capitalist’s view on saving the planet. Making your operation green has a lot of returns that won’t show up on the bottom line but may improve branding and customer perception of a particular business or industry. Just how important is green marketing as part of a company’s overall marketing mix, and how important is it in persuading customers to do business with you? Depending on which survey you read, you can build a strong or not-so-strong case as to the effectiveness of green marketing.

Gallup data indicates consumers’ attitudes toward green issues have shifted in the midst of economic hardships. A Gallup survey in January 2000 showed 70 percent of Americans believed the environment should take priority over the economy, but in March 2008 the number of respondents who believed the environment should receive a higher priority fell to 49 percent.

Cone’s Green Gap Survey places the positive impact of a company’s green marketing at 39 percent, reporting that nearly four in 10 Americans preferentially buy products they believe to be “environmentally friendly.”

An Ipsos Reid study conducted last spring came to the opposite conclusion. In that study, four in 10 (44 percent) Americans either “completely agree” (10 percent) or “somewhat agree” (34 percent) that they are not willing to pay more upfront for green-building products, even though they know they’ll be better for the environment and could potentially save them money in the long run.

The same study also revealed that a significant percentage of consumers view the green labeling of a product as little more than a marketing tactic. Ipsos Reid reported that seven in 10 Americans either “strongly agree” (12 percent) or “somewhat agree” (58 percent) that companies that call a product “green” (meaning better for the environment) are doing so just as a marketing tactic.

Men appear more skeptical of green marketing than women. Some 75 percent of men in the Ipsos Reid study believed that labeling a product green is just a marketing tactic, compared to 65 percent of women.

Does this mean a green marketing campaign can have a negative impact on your customers? Not necessarily. Part of the negative turn in the second Gallup survey, for example, may be due to the perception that purchasing environmentally friendly products is more expensive than the alternative. In a bad economy, that could certainly be a factor. The primary danger in presenting a green marketing program, however, is to overstate benefits or be deceptive in messaging, which can truly damage credibility.

Green Marketing Mistakes

A big part of the green marketing challenge is the consistency between a company’s message and the examples it sets in practice (a common problem in all forms of marketing and branding). To claim that you recycle water while a faucet drips in the men’s room is inconsistent with your messaging, for example.

The value of making green claims in chemistry or renewable resources won’t mean much if you are missing much more obvious areas where you could be greener. Are you touting your use of recycled building materials but not offering recycling bins in addition to your trash cans? A consumer with a strong environmental conscience (referred to in marketing circles as a LOHAS, meaning Lifestyles of Health and Sustainability) might take offense at having to throw a glass bottle into your trash can if no recycling bins are offered, then scoff at any green claims you make in your marketing.

“The overwhelming majority of environmental marketing claims in North America are inaccurate, inappropriate or unsubstantiated,” according to a comprehensive survey released by TerraChoice Environmental Marketing. Such pervasive greenwashing, according to TerraChoice, means that “well-intentioned consumers may be misled into purchases that do not deliver on their environmental promise.”

TerraChoice has identified six types of labeling problems that it calls marketing sins. They include claims that have no proof to back up assertions; claims that are so vague their meaning is likely to be misunderstood by consumers; claims that are irrelevant to their respective products; claims that are technically true but distract consumers from a product’s real problems; and claims that misuse or misrepresent certification by an independent authority.

“We are now entering a phase where the consumers have a lot more access to information than they have ever had in the past,” says Scot Case, vice president of TerraChoice, in an interview with Greenbiz.com. “I think the marketing departments haven’t quite realized what strong demand there is for that kind of transparency.”

By conducting an early review of its Green Guides, the Federal Trade Commission (FTC) is clearly backing that position. The FTC hopes to provide more clarity in its guidelines, ensure relevancy and efficacy, and one would assume that the punishment for those failing to heed the new guidelines is sure to get stiffer.

Going forward, green messaging can be a slippery slope for the marketer. The marketing message has to be clear and not subject to interpretation. The FTC looks at all advertising from the consumer’s perspective. In other words, what message does the advertising actually convey to customers? For environmental claims that the Green Guides do not address specifically, the FTC requires substantiation for all reasonable interpretations of an ad. Sometimes it may be necessary to do research to determine how consumers interpret an ad.

To carry weight with consumers, green messaging also needs to be relevant and matter to your customers in relation to what you do as a business. Another way to add credibility to claims is through the use of co-branding. If your message is supported via a marketing piece from a well-known supplier, or even through a local trade association, it may help to validate the message in the minds of consumers.

Most important, there has to be consistency in your message in every phase of customer interaction. Put on your “green” glasses and take a long, hard look at your company from the inside out. What more can you do to lessen your environmental impact? Are you sending any confusing messages to your customers? 

The Halo Effect

Done correctly, green marketing should carry some weight with customers and result in some positives. This type of marketing is still considered fairly new by mainstream or mass-market consumers who likely perceive green messaging much differently than so-called LOHAS consumers and are less likely to scrutinize you as closely.

Like all types of marketing, green messaging will have a stronger impact on certain segments of your customers. The data seem to indicate that no more than 40 percent of customers are currently influenced in their purchase decisions by a green marketing message, and many analysts believe the number is substantially less.

That means green marketing isn’t likely to be the silver bullet for building business at your company. Nevertheless, the perception of your brand is likely to improve with mainstream customers, whether your green efforts are large or small. This halo effect can be seen in how the Prius has affected the perception of Toyota as a whole. One solid green effort by Toyota lifted the entire company’s green attributes above the rest of the automotive industry.

This type of halo effect extends to customers whose personal experience with your brand is reinforced simply by feeling like they have made their own small contribution to the environment by choosing your products or services. Some environmentalists and marketing analysts believe that green marketing is merely a way of tapping into people’s desire to feel like they’re saving the earth, but without having to sacrifice their lifestyle. There may be some truth to that.

The bottom line is the positive impact of green marketing on your business should outweigh the negative, but only if you don’t accidentally damage perceptions due to inconsistent practices and halfhearted efforts that are not thought through. 

Brad Simonis is a principal with Metro International, a carwash consulting firm and distributor. The company offers expertise in site selection, layout, design, construction, operation and marketing of high-volume carwashes. To reach him, call 866.463.8723; visit www.metro-intl.net.

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