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For Philips Lighting, it pays to be green

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Challenge: Five years ago, Philips Lighting Co. was hiding its (green) light under a basket. “[Philips was] on the forefront of green activity, with five year plans to reduce waste and toxins, but we were doing it internally and not making a big deal of it,” said Steve Goldmacher, director of corporate communications. “And we realized a lot of companies were making a green wash of it. We weren’t getting credit for some of the things we were already doing.”

Solution: Philips launched numerous green campaigns, specifically targeting its b-to-b clients. One such spot featured the Eiffel Tower in lit splendor, touting the tower’s 7,300 tons of steel, 2.5 million rivets, and 18,038 pieces of iron and 986-foot height— with one massive lighting bill. But, the ad pointed out, Philips Lighting's technology helped reduce the tower's lighting bill by 30%.

Smart, said Darrin Duber-Smith, president of Green Marketing. “For the consumer market, there’s a PR advantage to simply being green,” he said. “But does it pay off in the b-to-b world? Does your b-to-b partner really care about that?”

Marketers who assume that sentiment alone is enough to drive buyers to green products are wrong, says Duber-Smith. That’s not enough. “What [businesses] care about is quality, convenience, capacity, credibility, transparency.”

Goldmacher agreed, saying that Philips targeted exactly those concerns. “We go into an operation and tell them that we have the longest life product with the lowest mercury—and it’s an easier sell than some other companies might have—it’s a benefit to maintenance and toxicity problems.”

Goldmacher also pointed out that with energy efficiency built in Philips’ products touch all three bases that an office manager needs—efficiency, longevity and eco-friendliness. It’s a decision “well within a CFO’s comfort zone,” he said.

As an example, he pointed to a bulb that Philips called “Earth Light.” When sales were bad, and the company did testing to find out where its buyer’s concerns lay, they company renamed the bulb “Marathon.” Only about 20% of respondents were willing to change products to benefit the environment—but for increased efficiency—well, that’s worth the extra money.

Result: Philips Lighting was recognized this month by the Environmental Protection Agency as the first company in the U.S. to launch a company-wide effort toward meeting the EPA’s National Partnership for Environmental Priorities waste minimization standards.

“Philips is now in a position to leverage what they’re doing in the b-to-b world,” Duber-Smith said, noting that outside recognition will fuel the company’s branding and marketing efforts.

Goldmacher said the honor has demonstrated that the company is walking the walk. For the environment, the company’s efforts will have long term effects. However, what consumers will notice, says Goldmacher, “is that that their light bulbs are lasting longer and providing them with energy-efficient savings.” So for Philips, the efforts translate to high b-to-b sales.

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