Feelings are facts

Understanding customers need and demand is crucial for a successful environmental product differentiating. An example of the opposite was when StarKist in 1990 introduced “dolphin-safe” tuna captured in regions where the tuna doesn’t swim below the dolphins and making the dolphins unintentionally victims for the basketlike nets dropped in the sea to reach the tuna. StarKist failed on three conditions necessary for a successful differentiating. First they over estimated the customers will to pay more for the “dolphin-safe” tuna. Second, for each saved dolphin a dozen of sharks, turtles and other marine animals fell victims for the nets, leaving them and the environmentally advantages dead. And the final condition where StarKist failed where that they had no protection against imitators leaving StarKist without return on the environmental investment. So depending upon market situation (push or pull) this leads to three conditions which need to be fulfilled in order to return investment for an environmental product differentiating

• Identify customer or market willing to pay extra for an environmentally friendly product
• The environmental advantages must be able to communicate to customer
• The protection against imitators is good enough to profit the investment

Some kind of failure mode analysis of the risks with such a product differentiating could be difficult to perform since it touches many intangibles but is helpful both in identifying potential customer and when comparing competitors. Some of those intangibles could be customer loyalty and what that is worth and the employee morale. Hard to put numbers on such parameters but feelings are probably facts.