Sustainability is a situation where production and manufacturing companies produce products and design their services in a way that is friendly to the environment and would last longer (United Nations Department of Economic and Social Affairs, 2020). To achieve this goal of a sustainable environment, one has to use natural resources appropriately to ensure it is not depleted and, at the same time producing quality goods and services.
In the modern world, companies have to modify green marketing strategies in production and sales since people are becoming more aware of the environment. The clients are more interested in the value of the purchase rather than making impulse purchases without thinking of future impacts on the environment (Tantram, 2020). If a company has not taken into account the factors mentioned above, then it risks being faced out in the market.
The key points to be noted from assignment 1
Patagonia cloth line
In this paper, we shall use the cloth line industry to discuss the various issues in green marketing with a specific company, which is the Patagonia cloth line. Patagonia is a company that manufactures outdoor clothes, and it is famously known for its environmental sustainability efforts (Buzzo & Abreu, 2019). The company purchases and resells its styles that have been used and further offers clients credits for returning old-fashioned clothes to their store and also for purchasing the used clothes. The sustainability approach mentioned above discourages people from dumping old clothes that may eventually harm the environment.
They are also major supporters of the Go Green Movement, as stated in their mission that the company would produce the best product and cause no unnecessary harm in the environment while inspiring and implementing solutions to solve the environmental crisis. The company has shown its care for the environment by supporting groups and start-ups that have a cause for the environment.
Patagonia also takes steps to minimize the carbon emitted to the atmosphere by offering incentives to workers who use public transport or carpool to work. This step would encourage the employee to reduce the usage of private vehicles and, at the same time, taking care of the environment.
The company has been chosen as an ideal case study since it implements eco-friendly techniques in every aspect of the daily running of the company (Frue, 2020). When it comes to environmental matters, it is in the frontline even when it means partnering with or investing in other companies to make it happen. Below is a detailed analysis of several aspects of the company, which focuses on protecting the environment:
Green Marketing Strategy Critique and Analysis
In this section, Patagonia’s sustainability (green) marketing strategy will be critically analyzed, with the main focus being on the elements of marketing such as product, price, place, promotion, supply chain, and communications. The features will be discussed alongside
Green marketing is a strategy of promoting products or services based on their environmental benefits. The product may either be environmentally friendly, good or produced in an environmentally friendly way without harming the environment in any way (Frue, 2020). One of the theories of green marketing strategy is that consumers will pay more for eco-friendly products, but this is only true when it is done right.
By using recycled products in the production process, they offload the harmful materials that may harm the environment. Patagonia is among the first companies in the clothes industry to come up with an innovative solution to the environmental hazard problem. The organic materials used are friendly to the soil since it will decompose with time when disposed of (Good Trade, 2020). When customers hear of such processes, they become more enthusiastic about purchasing the product since they want to take part in protecting their habitat. This strategy creates a sense of ownership and responsibility to the potential clients, thus encouraging them to purchase the product.
The organic component in the clothes fabric is an incremental product improvement that was not there initially.
The extent which the product promise aligns with actual product sustainability
The extent to which Patagonia products meets the natural step framework is a key determinant on the cause-effect relationship. Since it incorporates economic, environmental and social system in its thinking, it is designed in ensuring the sustainability of these activities. Having participated in numerous environmental planning and sensitization, with well-guided actions in production, all environmental and social aspects are well catered for. Toxicity of these products is negligible since it is derived from environmentally friendly components. Durable products with long service life also reduce the rate of waste disposal. Renewable products could easily be recycled hence reducing pollution.
Patagonia donates a percentage of its revenues to environmental causes and also uses recycled and organic materials in its clothes production. This is a clear indication that the company walks the talk. In the year 2017, Patagonia rolled out an initiative where used Patagonia designs that were in good condition could be returned for exchange with credits (Becker-Leifhold & Iran, 2018). The used merchandise was then cleaned, repaired, and resold on their website, clearly indicating that they were used clothes. This initiative was aimed at reducing the disposals of the equipment. Looking at it from a business perspective, this is a promotional strategy that would instil loyalty in their existing customers and also capture the attention of potential clients (Machine et al. .2017).
The company has also invested in companies that promote and care for the environment. Yerdle is a start-up, one of the companies Patagonia has partnered with, which aims to reduce people’s purchases on new products.
Innovation change and sustainability strategy
Solving of environmental challenges through modifications on the existing products in the markets is among the key sustainability strategy of Patagonia. Modifications of certain market products to meet the needs in the markets are very critical and crucial in targeting profitable customer segments (Blakeman, 2018). Incremental innovations focus on making available products in the market better. Improving the product’s competitive differentiation, its developmental efficiency and production is key is enhancing its sustainability
Patagonia has ensured it is in constant communication with its clients in various ways such as running advertisements and in scripting some sort of messages in their cloth line. In 2013, Patagonia had an advertisement campaign where it warned against some kind of development that threatened to exploit the planet’s resources (Becker-Leifhold & Iran, 2018). This advertisement created awareness of the company and its products, and people would be interested more in the company since the company is also interested in them. This quid pro quo relationship will help to increase the sales margin of the product.
In 2011, the company advertised during the thanksgiving season that read, “Don’t Buy This Jacket.” This advertisement outlined the costs to the environment of one of its products and encouraged consumers to buy used Patagonia products instead of the new ones (Blakeman, 2018). Despite this action, the company’s profits increased by 30% in 2012 and a further 6% in 2013. This communication to their customers helped to scale up their sales margin.
Utilization of full integration of production as a level of sustainable development strategy is critical. Productivity and efficiency of Patagonia products need to be long-lasting to efficiently manage the market demands of the products. With a sound and reliable control over distributors and suppliers of the products, it is easy to efficiently manage competitors. Merging with other interested firms enhances the market supply chain and is also effective in ensuring that new needs arising from the market are adequately managed. Utilizing the available loops in production in line with the buyer’s interests, such as environmentally friendly production processes are very critical in ensuring sustainability in production.
In general, Patagonia products cost slightly higher prices than those of their competitors since they use eco-friendly ways of production with high-quality products. However, the company has a sustainability strategy where the materials used are locally available and eco-friendly. Despite the high prices, people continue to purchase the company’s products all over the world (Hong et al., 2018). It has had an upward trajectory of its products since 2011, and the brand was estimated to have a value of $1 billion in the year 2018.
The reason why people are still loyal to the brand despite the high prices is that the company emphasizes the environment-friendly nature of the products. Consumers will now be interested in the value of the product rather than the price (Hong et al., 2018). They become more aware of the choices they make since by buying Patagonia products, they will be investing in something that would save their money and resources in the future. The sustainability part is an incentive for the customer to take pride in purchasing products from the Patagonia cloth line.
Strategic sustainability recommendations and rationale
So far, the company is doing well on its green marketing strategy, but there is still room for improvement. This section outlines the strategic recommendations for Patagonia to enhance the sustainability characteristics and performance of the brand. The following vital strategic recommendations were drawn from the analysis above;
Patagonia can diversify in its ways of production and the products to increase the quantity and quality of production.
In terms of the methods of production, the company can devise a method of obtaining cheap raw materials by involving the community in the collection of recycled goods used in the production process (Borland, 2015). The company can offer credits or products discount to the customers if they deliver the goods and organic materials that are used in the production of clothes.
The importance of involving the community is that it would reduce the cost of raw materials since the people would be doing it with a motive of protecting the environment rather than the revenue motive (Borland, 2015). They will also feel like part of the finished good and relate more with the products of the company since they were involved in the production. It creates a sense of ownership in the community at large.
The company can also increase the percentage of finished products that are composed of organic materials. This can be done by shifting the resources, human resources, and raw materials inclusive, to the production of organic goods (Buxel, Esenduran, & Griffin, 2015).
The benefit of increasing the percentage of products that contain natural materials is that they would readily decompose when disposed of after use. This is eco-friendly and would not cause any harm to the environment.
Patagonia can partner with or invest in other companies apart from Yedler, which promotes eco-friendly methods of production. The companies can be in the same line of production but, most importantly, those in different lines of output other than the cloth line industry (Naimoli et al., 2015). The company can make a strategic move by partnering with companies that use their products or those that produce the raw materials.
The benefit of this move is that the sustainability effect will be more extensive than the initial one, which would only be covered by Patagonia alone. Another advantage of partnering with those who produce the raw materials is that they can get the materials at subsidized prices, thus reducing the costs of production (Naimoli et al., 2015). Partnering with those who purchase the finished products will promote the brand, thus attracting potential buyers who will eventually buy the products, thus increase the sales. Reduced cost of production and increased sales will consequently increase the profitability of the company (Armstrong et al., 2018).
Advertising and being in constant contact helps customers to know about the products Patagonia is producing and selling. This is important since it will have a long-lasting effect on them.
The benefit of advertising is that it helps to capture the attention of new customers who may not be aware of the company and its products (Clow, 2016). For example, an athlete may need a training gear and is not aware of which one to purchase. Once he sees Patagonia’s cloth line advertisement, then that would be the solution to the client’s problem.
The benefit of being in constant communication with customers is that they would be notified of newly available products, and the loyal customers will definitely come back for more products, especially the latest sportswear by Patagonia cloth line (Dwivedi, Kapoor, & Chen, 2015).
Leveraging prices by encouraging the utilization of economies of scale would reduce the cost of production of Patagonia products (Morgan, 2020). The company can increase the production of environment-friendly clothes and engage in mass production in their industries.
The benefit of this move is reducing the cost of production, which will ultimately lead to reduced prices of the product. When the prices of the goods fall to the current market price, the company will have a competitive advantage over its competitors since the products are environmentally friendly (Notesmatic, 2020). Their eco-friendly part is an incentive for customers to buy their products and leave the other products in the market.
This assessment has been beneficial in the sense that I have learned many aspects of the business world. What appears on the outside, or the success and failure of a company are much more than the products’ prices and profitability of a company. For a company to be successful, it has to think from the customer’s perspective since they are the main determinants of the success or failure of any business, especially which has the motive of maximizing profits.
It is prudent to note that a company invests in its brand at the early stages when the company has just started. At this phase, there is less emphasis on profit but preferably on creating awareness of the product or service to the potential buyer. It is developing a brand. In the case discussed above, Patagonia is a clothing company that invested in branding at its initial stages and now enjoys the advantage of customers’ loyalty. The perspective of lock-in and switching costs can be evident in this scenario since customers continue buying the products of the company even when the prices are higher than those of the competitors. It is because the costs of switching the supplier of their products are higher than that of being locked in. They are loyal to the brand that has been serving them for an extended period.
The experience gained from this experience has been worth it since it has clearly outlined the social responsibility of a company. For any company to feel connected to the community, then it has to address their needs apart from focusing on its business aspect. In this paper, Patagonia has displayed how a company can play a pivotal role in serving the community since their customers are the key drivers of its sustainability. It has invested heavily in protecting the environment by advocating for eco-friendly methods of production and even partnering with firms that are working for the same cause. I think that everyone, no matter how small or big they are, have a social responsibility of protecting the environment. These people play their roles in different aspects, but all their efforts are driven towards a common goal. Customers are leading at the forefront of this great course by buying sustainable goods in the market. By sustainability, it means that they prefer products that are produced in an eco-friendly way and cannot harm the environment in any way in particular.
The learning experience from this assessment can apply in a professional context in the following ways:
The above factors, plus many more, can be applied in a professional context, especially when a company wants to increase its profitability and, at the same time connecting with its customers.
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