Global brands should flaunt eco-credentials in India

Sensemaking / Global brands should flaunt eco-credentials in India

Many brands are shy of plugging their sustainability strategies to India's consumers. It could be an opportunity missed, says Ella Saltmarshe.

05 Apr 2013

Many brands are shy of plugging their sustainability strategies to India's consumers. It could be an opportunity missed, says Ella Saltmarshe.

For most Indians, sustainability is not just a matter of academic debate. Farmers struggle to conserve enough water to survive. Young commuters ride scooters through the worst air pollution in the world. Executives manage businesses amid soaring electricity prices and unreliable supply.

The last thing we Indians voluntarily threw out was the British

And it wasn't so long ago that most Indians had daily habits which were object lessons in the art: returning glass bottles after use, buying unpackaged vegetables from stallholders on the street, and recycling liberally. As consumer behaviour expert Rama Bijapurkar joked in a 2009 interview, "The last thing we Indians voluntarily threw out was the British."

So it's ironic that, while growing numbers of consumers in the West flock to farmers' markets and host 'swishing' parties to swap old clothes, big brands in India are pushing shoppers in the opposite direction: to swap street stalls for supermarkets, soap for highly packaged shower gel, and scooters for sedans. In the last two years, the number of consumers who are choosing to buy second hand goods is down 41%, those opting to repair items rather than buy new is down 16%, and recycling levels are down 20%, according to National Geographic's 2012 Greendex. Could cool marketing help reclaim the old ways?

A handful of brands are trying to do just that: notably, Nokia India's comprehensive phone-recycling campaign, with workshops in 2,500 schools, awareness-raising in 3,000 small mobile stores, and an award-winning viral video campaign showing toasters vibrating, lights with ring tones and washing machines receiving text messages.

Most, though, still fight shy of the S-word. Take green leader Marks and Spencer [M&S]. It has already built two pioneering sustainable stores in India and revolutionised its supply chain, with plans to expand its sourcing of Indian cotton 12-fold over the next three years. But when it comes to point of sale in the country's stores, M&S is surprisingly coy about trumpeting its (considerable) eco-credentials.

Mike Barry, head of its sustainability programme, Plan A, argues that it's important not to confuse consumers when entering a new market. So in India, M&S focuses on a core message of quality and keeps its trailblazing sustainability work backstage. "We were working on Plan A for at least ten years before aggressively positioning it in the UK. In India it's not going to happen this week, or next week, or even in a year's time." Only when the brand has built local trust and the company feels the market is ready will M&S begin a sustainability conversation with Indian consumers, he adds.

Understanding why ethical brands shy away from ethical branding involves understanding the country's consumer landscape. On the one hand there's the 69% of the population that lives on $2 or less per day; on the other, there's the upper and middle classes, numbering between 100 and 200 million (depending on how they're defined) – and growing. With only a few notable exceptions, sustainability is absent from brand communications to each class – albeit for very different reasons.

If I'm struggling to keep my head above water, the last thing I want to be told is my backstroke is not correct

For the poor, argues Agnello Dias, co-founder of Taproot India and one of Asia's top advertising creatives, "Sustainability is obviously going to be low priority. If I'm struggling to keep my head above water, the last thing I want to be told is my backstroke is not correct: I just want to float."

When it comes to the middle class, companies are waiting until the heady rush of newfound consumerism subsides. "India is a young economy," says Piyush Pandey, Executive Chairman of Ogilvy & Mather India. "People seem to be quite satisfied just being able to consume, rather than looking at the higher order benefits."

Yet it seems there is at least one sweet spot that's good for cost-conscious shoppers and the environment. Enter Dr Ajay Mathur, India's Energy Czar, who has recently finished his six-year stint at the helm of the Government's Bureau of Energy Efficiency (BEE). Mathur's challenge was massive: to try to decouple energy consumption from India's booming consumerism. Take air conditioners (ACs): once too expensive for the masses, they now account for 40% of Mumbai's surging electricity use. When Mathur started, manufacturers said that he was on a "wild goose chase". The Indian consumer, they told him, would not pay more for energy-efficient products.

Mathur quickly proved them wrong. He launched an efficiency standard and labelling scheme for household appliances, and within 18 months, 50% of all AC units and 75% of all refrigerators were labelled, despite the scheme being voluntary. Consumers were willing to pay more for an energy-efficient product – provided it recouped the costs within two to three years. BEE teamed up with manufacturers to launch an outreach programme for shop floor sales teams, and even developed the ACSaver app to help the consumer calculate cost savings. By 2011, the average efficiency of AC units sold had increased by 20%. "The vast numbers of appliances in India are bought by people who are first time users [or near enough]", Mathur explains. "So, value effectiveness is an important proposition."

But what about those with cash to blow? Why is there little talk of sustainability aimed at the 5% of Indian households that account for 38% of its total wealth? It's not completely absent: 'green living' figures widely in adverts for swish new housing developments, for example, but often means little more than a view of the park. Could the answer be as simple as conspicuous consumption? Rajiv Mehta, MD India of sportswear retailer PUMA, thinks this could play a part. "Most of the wealth is very recent, so people want to show they have arrived."

This may explain the relatively weak performance of Tata's no frills Nano – the 'one lakh car' (priced initially at INR100,000, hence the name) which would bring motoring within the reach of families reliant on scooters. Prodipto Ghosh, Distinguished Fellow at The Energy and Resources Institute, hails the Nano as an admirable triumph of frugal engineering, which was let down by "a marketing disaster". He explains: "When an Indian family moves up from a scooter to a car, they want to show the world that they are now people to contend with. Tata's mistake was pitching this as the cheapest car in the world. Because if you graduate from a scooter to the cheapest car in the world you're not exactly demonstrating that you've made it large in life."

Rajiv Mehta is nonetheless trying to put sustainability on the upper class agenda. PUMA's new high-profile sustainable store in Bangalore is 100% solar powered, with a geothermal cooling system, bamboo floors and a recycled steel façade. And PUMA is starting to talk the talk, as well as walk the walk. Guests pedal-powered the shop's launch party, generating electricity from stationary bikes. Inside the store, thought bubbles inform shoppers about the importance of fair trade and organic cotton, while consumers take their shoes home in one of PUMA's iconic 'clever little bags'; an award winning eco-alternative to the traditional shoe box. But Mehta is clear this is only the start. "One store is not enough. We need to do it with 20 across India," he asserts. "In fact, developers should take a cue from us, and build a completely sustainable mall."

To which he adds a note of caution: "Consumers feel that if we talk too much about sustainability, it means we are going to charge them more."

Ella Saltmarshe is a writer and communications strategist who splits her time between South Asia and Europe.

Photo: Amit Bhargava/Corbis / Infocus

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