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LEGAL ISSUES

Green Marketing Heats Up

The CEO of a mail-order company gives advice on marketing 'green' products and using environmental terminology.
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The Federal Trade Commission (FTC) guidelines for "green" marketing, issued last July, are only the latest attempt to limit the use of environmental claims. Earlier, 11 state attorneys general (AGs) issued "Green Report," revised in May 1991, which defined how environmental terms could be used in marketing. And each state has its own laws to protect consumers from misleading advertising claims. Jeff Hollender, CEO of Seventh Generation, a $7.5-million Colchester, Vt., "green" catalog, believes "you have to meet the toughest guidelines if you want to be a national brand." In selecting products, Hollender considers these issues:

What is the specific product benefit? The AGs advise against using such general terms as environmentally friendly, which can mislead consumers. The FTC allows such claims only when accompanied by a "substantiated product attribute." For instance, a product called "eco-safe" might pass muster if it is specified elsewhere that it "contains no ozone-depleting chemicals."

What counts as "recycled?" Most people consider it to be the bottles, cans, and newspapers households recycle. That's called postconsumer waste. But much of what manufacturers call recycled is reclaimed industrial scrap, or preconsumer waste. While the FTC ignores that distinction, the AGs recommend that the term recycled apply only to postconsumer material. Hollender encourages manufacturers to use what consumers have recycled. In fact, Seventh Generation is changing the paper towels it sells to comply with New York standards, which specify that products marketed as recycled contain a high percentage of postconsumer material.

Can I verify my claim? "If I market garbage bags made by a company that claims they're biodegradable, can I take its word for it?" Hollender asks. "Or do I test them myself?" The answer is unclear. New York law might excuse a catalog that reprints a supplier's claim if it makes it clear the claim is unconfirmed. But the revised "Green Report" warns that companies that accept suppliers' test results "do so at their peril." Seventh Generation runs its own tests.

The AGs also discourage life-cycle claims, which are based on cradle-to-grave analysis of a product. A life-cycle analysis of cotton fabric would take into account the fertilizers and defoliants used in cotton production. Under such analysis, a synthetic fabric might prove to be better to the environment than cotton is. Hollender avoids broad claims based on this inexact science. Instead, his catalog's copy for clothing items carefully explains fabric processing. -- Michael P. Cronin

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Last updated: Jan 1, 1993




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