Circular Economy and Marketing Strategy

Introduction to Circular Economy

How can we implement circular economy principles in our marketing strategy?

First let’s see the definitions of the linear economy, circular economy. A linear economy is the one where we take from nature and make products which then result in waste produced. But in the circular economy, we add one more step which is designing out the waste and pollution.

“A Circular Economy is the one that is restorative and regenerative by design”

-Ellen MacArthur Foundation

Ellen MacArthur Foundation gives the best possible explanation of this and you can get everything about the circular economy on their website. The circular economy includes redefining growth and focusing on the overall benefits of society. The 3 principles of circular economy as per Ellen MacArthur Foundation are:

  1. Design out waste and pollution
  2. Keep products and materials in use
  3. Regenerate natural systems

Keeping these principles in mind while creating marketing strategy will not only help us make our marketing practices sustainable but also create an added advantage for our business/ brand. According to Nielsen’s report (2015), 66 per cent consumers and 73 per cent millennials in the world are willing to pay more for sustainable products. Hence, practices which make your business/ brand environment-friendly require more efforts but will pay back in the long run.

So here we will see a few examples where brands have kept the sustainability principles in mind while designing and implementing their marketing strategies. We will also discuss new ideas and their feasibility.

Liva Seed Tags for Livaeco

This was an initiative of Liva where they designed out one of the waste products of marketing which is garment tags. Liva Seed tags were made of seed paper, which is made from biodegradable fibre and plant seeds. One can sow the tag and grow a tree. All the products made of Livaeco fabric used these tags. Garment tags are there on every garment we buy and are destined to reach the garbage landfill. Hence this was a great initiative to stop the tags from going to the landfill and creating awareness among consumers about environmental sustainability and the importance of growing plants. Such initiatives have twofold benefits as manufacturing these tags requires less water consumption and leads to less greenhouse gas emission. Therefore, they have a less environmental impact both pre and post-production.

Cartacrusca by Barilla and Favini

Another example is of pasta manufacturer Barilla in association with paper manufacturer Favini. They collaborated to create a range of paper called Cartacrusca which was made of the waste barn produced while manufacturing pasta. Barilla also used this paper to create packaging for a few of its products.

Alternative Business Model

We can create products and services, keeping in mind the sustainability factor. A lot of electronic companies today stop manufacturing parts of older appliances; hence the whole product needs to be trashed. We can launch products with guaranteed lifetime service. This will allow them to stay in use for a longer time. Today instead of buying we can rent products which we want to use. Especially products which are required for a shorter duration of time. These business models are helping us reduce consumption and hence optimize production. Companies like Mutterfly, Furlenco, Zoomcar are based on this business model.

Mutterfly, a startup from Mumbai provides Electronic products like Camera, Video games etc. on rent at just 1% of their MRP. We normally require a camera when we are travelling so one can rent it for that time duration and then return it. Similarly, Furlenco is for renting furniture and Zoomcar is for renting cars.

Marketing Communication Optimization

The materials used in marketing campaigns have a certain carbon footprint. As marketers when we are planning a campaign, we must calculate this and try to minimize it as much as possible. I have written about waste produced in marketing communication activities in a previous blog.

We as marketers have a major concern of getting a proper ROI on our marketing spends. Spending marketing budget on materials which have a short life in the system is a bad idea. ATL and BTL activities mostly involve the use of such materials. Today, in this fast-paced world we communicate something new every quarter or after every few months. Hence more material getting into the system for a shorter duration.

In the past few years, we have seen that LED screens have replaced flex, posters and banners at many places and in many ways. It’s a good way to eliminate materials which have a short life and end up in the landfills. We can always think of innovative ways to communicate our campaign, where we can also minimize our wastage and carbon footprint.

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Palka Kejriwal

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