Retailers Seek To Boost Sales Of ‘Green’ Products – Part I

Retailers Seek To Boost Sales Of ‘Green’ Products – Part I

Getting into the fray

From giants like Wal*Mart and Home Depot to locally owned hardware stores, retailers and wholesalers all over the US are recognise the growing importance of a consumer segment who purchase green products because of their strong interest in the environment.

The sales aren’t big yet, but they are steadily growing, and these retailers are convinced that being in the frontline will not only increase their sales, but create customer goodwill as well.

Independent hardware stores, lumberyards and home centres are being encouraged in these actions through the leadership of their major wholesalers. The three large dealer-owned companies – Ace Hardware, Do It Best and True Value, together with Orgill, a billion-dollar privately owned wholesaler – are not only providing these products, but are whipping up interest with merchandising and promotional tools as well.

In an innovative move, Ontario, CA based California Hardware (who have a branch in San Francisco) established a division called Plan-It Hardware in November 2006 to focus entirely on ‘green’ products. California residents are more interested in environmental issues than those of any other state, and Plan-It’s efforts are geared towards helping customers better serve those interests.

Growing recognition

‘Buying green’ is not a mass market – yet – since many consumers pay little or no attention to green products. However, there is a growing awareness that it would be smart to make more informed buying decisions about many products.

A growing number of major manufacturers recognise the importance of this movement. Household cleaning products leader Clorox recently introduced a line called Green Works and several paint manufacturers are taking aggressive steps to reformulate their products so as to reduce VOC emissions.

For example, United Gilsonite Laboratories recently introduced Zar Ultra Max wood stains, which resins that result in a VOC-compliant product that has less impact on the environment.

It is estimated that the annual US market in green building products, paints and services alone is worth more than $12 billion. There are also many other products like cleaning supplies, lawn and garden products, and so forth.

One leading retailer in this movement is Seattle based Ecohaus, who operate in Washington and Oregon. Founded in 1991 when they were known as Environmental Home Center & Environmental Building Supplies, they pioneered ‘green’ retailing in the Pacific Northwest at a time when most consumers felt that the movement was simply a fad. In addition to Ecohaus’ retail stores, the company operates as a national distributor of ‘green’ building supplies and household products, using a call centre and an e-commerce site.

The real McCoy

Right now there are an estimated 1,500 to 2,200 products that can honestly be classified as ‘green’ by wholesalers. However, Home Depot increased its number of environmentally preferred products to more than 3,300. This includes building materials not stocked by hardware stores.

Another leading retailer is Virgil’s Hardware in Glendale, CA, who use Plan-It Hardware’s program. At this store, management formed a Green Team of knowledgeable employees to educate consumers on not only the environmental impact of green products, but importantly, the potential cost savings that often result. The store even issues a monthly internal newsletter with green tips for the staff and they have been recycling cardboard, plastic and aluminium for the last 12 years.

With a little imagination, retailers are learning that they sell many other products that promote conservation beyond the so-called ‘green’ ones. For example, aerators conserve water by using less of it, and other products promoting energy efficiency can be promoted as well.

To the credit of U. S. wholesalers, many are reacting to this segment of the market, although some are doing it more aggressively and earlier than others. Plan-It Hardware was one of the first to realise the importance of this movement which is why its buyers developed a hardnosed screening process to set aside genuinely ‘green’ products. They found that consulting various government agencies involved in protecting the environment helped identify merchandise categories in which ‘green’ products could be found.

Plan-It’s executives also realized that they needed to help customers promote and merchandise these products, and began furnishing point-of-sale materials to retailers. They even went so far as to help retailers label and identify ‘green’ products on store shelves. Their ‘Green It Yourself’ campaign makes it easy for independent stores to offer greener, healthier and more energy-efficient products.

Another way in which they are helping retailers is by providing training and training aides for retail employees. An important theme, executives say, carried out in promotional and training materials for store use, is the idea that ‘We care about the environment.’ Most wholesalers supporting this movement are providing POP materials to retailers, especially signing for end caps, where ‘green’ products can be prominently displayed.

End of Part I. To be continued in June 08.