It is 4 am and I am thinking can I really prove it ?
We read everywhere that eco friendly products/services are more expensive. All discussions of green issues focus on the dilemma facing the consumer or the business: that doing good will cost more. This is such a rubbish argument, or at least this is what we believe.
After several decades of existence, the green market has persuaded every single one of us that if you want to do the right thing you have to pay for it. The debate centres around how to persuade business or consumers to be more responsible; how to push them to make the “extra” effort, how their pursuit of profit is killing the planet and they should be ashamed. If I was a writer or politician, I would happily join the debate and try to convince everybody that this is wrong but I am not, therefore we have chosen to demonstrate with actions. It was a good idea because it has given us a good insight into where the problems lie.
First we need to kill a myth (I know it may takes more than one sentence): green products can indeed should, be cheaper than standard products.
I know I am happily mixing green/eco/socially responsible together, I will leave to others to run the debate on this, but the principle is: if you use less resources, if your product travel a shorter distance, the putting together of your product is going to cost you less. OK, if you use slaves rather than employees to put it together you may get some benefit but I would argue that in the long term this is not even an advantage and there are very few products where labour costs are a large part of the consumer price.
Now with this rather simplistic but accurate principle, why are we paying such a hefty price every time we want green? We see only two reasons for that:
This is really the catch 22 that retailer and producer are facing. I am producing millions of product A, if I want to offer an Green alternative to product A, I will initially produce only a fraction of product A, and this will have a cost.
We can see that today in vegetables, John the greener farmer with his little farm cannot compete on price with the large-scale industrial farms, actually getting green was more a justification of the discrepancy for him to start with. Now we all know that mass green farmers can take some dodgy shortcuts, but we should not get rid of benefits because of a handful of fraudsters and we should not condemn mass green production because of some idiots.
Scale matters in consumer goods and green will benefit from it.
2) Cost of change
This not one to ignore, trust me I know, even if your product ticks all the boxes, you still need to convince a bunch of people. Unilever or P&G will happily invest 10s of million in launching a product but they will have to recoup it at some point, and green products with the adding issue above will not escape the general dynamic.
So for these two reasons, it is understandable that the green market started its life as a expensive business… but we are now at least 20 years in!
We decided to ignore both of these issues to prove that green products can be cheaper (I know, it is a bit risky just to prove a point!). We believe that scale and change are no longer problems because consumers are sufficiently aware now, and therefore you can reach the market quickly. This remains to be proved in our case….
So why is there still such a hefty price premium on products that have been around for a long time and are sold in large quantities? This is partly greed but it is also this deep conviction that you need to do make an extra effort to be good: if not your green product will look suspicious.
Maybe the official reason is that these early adopter products will finance the change necessary for the next generation of products (I want to believe that, this is less cynical than greed).
In conclusion, we hope we will be able to demonstrate that Green is cheaper. Please don’t accept any other argument!
We have been developing eco packaging for CDs. The product is primary developed for the end consumer, we are tired of seeing shelf after shelf of plastic boxes (the Jewel Box) coming from China in the shops. I know, who cares? But we know this market well and we believed we could do something about it even if it appears very small.
As you may know if you read other parts of this blog, we have started with the professionals, offering them a green product to wrap up their albums cheaper than the Jewel box. After six months of running around, hundreds of meetings and several samples we are starting to have some success….
By success I mean products out; in terms of feeding our families this is still an utopic dream. But the purpose of tackling the professionals was not to make money, it was to use them to refine the product and to ensure that it was fit for purpose. Now, Paul McCartney is using it (and the funny bit is, he does not know about it, even his management team call the product Digipak on their website), and we hope artists brave enough to ask their label to produce their product in green packaging will turn to MINTpack. Why do they not use it on a larger scale then? Because they are scared of you, the consumers, they are scared of the reaction, they are scared of change.
But at least now the product works we are ready to tackle the shops, so the logical thing to do will be to go to the reception of Currys and ask the lovely receptionist to see the buyer and explain to him “Look I’ve got this packaging that is already in shops because Macca is using it and it is cheaper than the plastic box you are buying (we know we have been buying 100s of million in previous life ourselves) and it is environmentally friendly.
Easy enough no? But what the chances of that happening? Furthermore if or when we have this discussion, we will then have to come to several meetings, do plenty of samples and designs for them and all that for free of course. Did I tell you we are not Uniliver?
But even if we get the nod at some point in time in this hypothetical discussion, somebody will have the clever idea to hike the price to make it premium compare with plastic. Why? Because it is always more expensive when it is green, and you never know, if it does not work out we will recoup some of our costs….
Fortunately the modern world gives us an alternative approach to try to overcome this problem. By selling MINTpack on Amazon we hope to lock the price below the plastic competition, I know the shipment cost is going to kill this argument, but if one day we reach a shop they will not be able to change the price to play with you.
Approximately 400 to 600 millions Jewel Boxes (music and empty boxes) are produced and sold today in Europe, even in quantities of tens of thousands we have a cheaper product than them, so what would it be if we had 5% of the market!
Yes we have overlooked the cost of change but purposely because we do not want to fall in the catch 22 and recover the cost of change in the initital quanitty. Why? It may seem bizarre but if we sell our Green product with a premium like everyone else, we are not sure we would have been courageous enough to drop the price to reflect the true cost. And therefore we would never have proved our point.
Courageous or stupid?
Does it keep me awake at night? Yes.