Wayfind

The Truth Behind Greenwashing

What Consumers Told Us and How Brands Should Respond

Issue 55 | Amanda Seevers | Miranda Swaney | CPG | Grocery | Retail

Estimated Read Time: 10 Minutes


So, What's Greenwashing?

Every day, the need to be more environmentally conscious becomes more and more apparent. The fight for a cleaner, more sustainable world has quickly become one of the most collectively discussed social issues by all generations across the globe, and the conversation has certainly made its way into consumer mindset.

Now, more than ever, brands are being challenged by consumer awareness to provide sustainable alternatives to conventional methods and products. Unfortunately, attempts to meet this demand aren't always successful in actually achieving their goal, a prime outcome of this being greenwashing. Greenwashing is the practice of conveying a false impression or providing misleading information about how a company's products are more environmentally sound than they are. Typically, greenwashing is communicated through marketing and PR tactics that are perceived to overamplify or falsify efforts a company is making to inflict positive environmental change to gain favor from consumers, investors, employees, and other stakeholders – think packaging that is green in color, displays nature imagery, and includes ambiguous phrases like eco-friendly, natural, and green. Greenwashing has always been present; the difference now is that consumers are aware of and looking out for it.

Greenwashing is the practice of conveying a false impression or providing misleading information about how a company's products are more environmentally sound than they are.

The Era of the Eco-Consumer

We are in the era of the "conscious consumer" where more than ever before, a wide range of stakeholders care deeply about environmental, social, and governance (ESG) especially following the COVID-19 pandemic. And it's important for brands to understand that these same consumers are utilizing their buying power accordingly. Not only do current day consumers practice eco-friendly purchasing, but according to a survey conducted by pwc, 83% also believe that companies should actively shape ESG practices1.

It is important to note that the value placed in ESG is not generationally isolated. According to a survey by Futerra2 in partnership with the Consumer Goods Forum, regardless of generation, most people have a high degree of expectation that retailers and brands will act in a sustainable way. What it means to actually act in a sustainable way, however, does seem to vary. Millennials, Gen Xers, and Baby Boomers agree that sustainability means "products made from recycled, sustainable and naturally-harvested fibers and materials," whereas almost 50% of Gen Z believes that sustainability is not only defined by what a product is comprised of, but also how it is manufactured.

Regardless of generation, most people have a high degree of expectation that retailers and brands will act in a sustainable way.

Despite some differences in sustainability definitions, there is one thing all generations agree upon–sustainable packaging. Across generations, 73% combined feel that sustainable packaging is very or somewhat important today, compared to only 58% in 2019. Additionally, 71% of all respondents believe that online shipments contain an excess of packaging and over 75% prefer eco-friendly packaging.

We asked 1,000 people to respond to a survey to gather additional consumer understandings of and attitudes toward greenwashing. Here's what we found across all generations surveyed:

Collectively, we found that 56% of respondents are more likely to buy a product advertised as environmentally friendly and only 16% of respondents are not concerned by greenwashing.

It's apparent that an increasing number of consumers of all generations are paying serious attention to greenwashing. However, the problem remains that people have a hard time spotting greenwashing in action – 39% of respondents claim to only be "somewhat confident" in identifying greenwashing practices – making building awareness of legitimate green practices a crucial component to long-term brand success. As businesses seek sustainable growth, it's important to be abundantly clear in the credibility of environmental and sustainability claims to build consumer confidence in your brand. Not only will this ultimately increase brands reach to the eco-consumer, but it will also result in an overall larger reach in brand credibility and trust.

How Can You Avoid Greenwashing and Claim Your Eco-Credibility?

It's obvious that avoiding greenwashing is advantageous for brands, consumers, and the overall longevity of our world. The question is, how? As consumers, avoiding greenwashing is a matter of educating yourself on claims being made versus the reality of the claim. As for brands, there's a bit more work to be done.

Currently, consumer trust in eco-friendly claims is low. It has been shown that consumers are more than willing to engage with conscious purchasing, but to tap into this market, brands must make trust and certainty easy to attain. Brands that are embarking on a sustainability transformation must ensure their marketing approach is aligned, transparent, truthful, and clearly presented to the consumer as such.

Brands that are embarking on a sustainability transformation must ensure their marketing approach is aligned, transparent, truthful, and clearly presented to the consumer as such.

There are a few ways brands can do this:

Determine your shade of green. Understanding the shade of green of your customers is key. There is a lack of common ground when it comes to what exactly ESG should look like, so evaluating your consumers level of understanding will help you meet them in the middle. In the same way you'd usually assess the market, evaluate the consumer ideology but this time through a green lens. Survey your audience to understand their outlook on sustainability. Evaluate the pain points in your eco-consumers integration with your product, then consider how to ease their experience journey.

Today's consumer is all about convenience and transparency, so how do you create a seamless experience that leaves zero room for questioning your brand's intent? It's also important to give your consumers insights to your efforts with ease, as 39% of our respondents said being presented with easy access to company claims along with actions taken would increase trust.

Consider questions like:

How am I creating trust in our sustainability claims?
How are these claims then being advertised?
What informational resources am I providing my eco-consumer?
Is my brand truly deemed sustainable? What about the packaging? Building operations?
What are the pain points? How do logistics come into play when rethinking how we do this?
Who are the experts that can help us answer these questions?

Aramark, an American food service, facilities, uniform services provider, and longtime partner of WD, has answered these questions and rolled out a successful sustainability plan based upon those answers. The "Be Well. Do Well." commitment drives sustainability through eight priorities, aligned with the Sustainable Development Goals set out by the United Nations in 2015. These claims are accompanied by public annual impact reports that are also directly communicated to key stakeholders.

Get everyone on the same sustainability page. You will need to align your brand standards with your sustainability claims. Create a panel of key internal and external stakeholders in your business to open the sustainability conversation and create accountability where the gaps lie. If you are honestly serious about your sustainable transformation, conversations and accountability should be held at the executive and board levels as these are where many resources are allocated. However, don't stop the conversation here! Engage with your investors on these conversations, gather commitments, create a space for sustainability reporting, and tie these impacts directly to your financials. There's strength, and power, in numbers. Approach others in the industry to partner in a meaningful way on sustainability initiatives. We're all in this together, after all.

The Body Shop took this strategic discussion a step further by hosting a Boardroom 2030 activation3, where it invited a group of young people and activists from Extinction Rebellion, a global environmental movement, to speak with its team and rethink its approach. "What's new is that you have to dig hard with sustainability and R&D teams to identify proof points and tangible benefits that make sense to consumers," said Philippe Armand, chief marketing and experience officer at Michelin.

Don't try to be the expert. We can't all be experts in everything, which is why we surround ourselves with people and organizations that are. 35% of respondents we surveyed agreed that participation with official ESG organizations would increase the likelihood of claim believability.

For example, Athleta began a partnership with Fair Trade USA, an organization that promotes fair labor practices and wages for farmers and workers, an especially important sustainability pilar for Gen Z. With Fair Trade, Athleta introduced its first Fair Trade Certified collection, which now spans a total of 270 products. By partnering with Fair Trade, Athleta has successfully supported their mission to empower women while still giving back to the people who make their products. Simultaneously, Athleta has created consumer trust in the brand through this partnership.

In addition to bringing experts in, encourage your brand stakeholders to become advocates. Activism is key to change, and it also gives your business the opportunity to interact with consumer values directly. For example, in early 2022, UK clothing brand, Finisterre, hosted an ocean activist training camp and invited experts to share their insight on why ocean protection is important to sustainability and how to become better engaged in ocean protection. To start advocating within your brand, work with your team of stakeholders to define what activism looks like to your business and then create activism support policies for those who engage in activism efforts.

Labels leave no room for questions. Proper and legitimate labeling that the consumer knows and understands is one of the most black-and-white ways to bring credibility to your brand's sustainability efforts. Ranking the highest in creating trust between brands and eco-consumers, 56% of survey respondents found official eco-label certification to be the most helpful in true eco-product identification.

There are several certified eco-friendly labels that credible products and services can attain, many of which depend on your line of business and sustainability claims. For example, a common certification type relating to clean energy and sustainable products and services is the Green-e certification. You can find this certification on many household products from brands like Arm & Hammer, Herbal Essences, and many more. If you're looking to inform consumers that you are against animal cruelty, The Leaping Bunny certification promotes that the company has not tested their products on animals during the development process. This certification label can be found on cosmetics, personal care, household and cleaning products. The least industry specific certification, also considered the gold standard for sustainable brands, is the B Corp certification, which is obtained by measuring a company's social and environmental performance.

The list goes on and on. To evaluate labels that best align with your sustainability efforts, visit Sustainable America's Ultimate Guide to Sustainability Certifications.

The Best Time to Start is Now

Consumers know what they want – brands that authentically care about, promote, and execute sustainability initiatives. Unfortunately, issues like greenwashing promote mistrust and suspicion so that consumers don't always know how to spot the companies that are truly tackling their sustainability goals. Brands need to put in the work to understand their customer better, enlist the help of experts to build a plan, get everybody on board to execute that plan, and disseminate the information to consumers through accurate, credible labeling and transparent information. As the saying goes the best time to get start was yesterday, but the next best time is now.


Amanda Seevers
Amanda Seevers
Sr. Director, Strategy & Insights
WD Partners
Miranda Swaney
Miranda Swaney
Manager, Strategy & Insights
WD Partners


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