Marketing to Conserving Customers: A Guide to Operating Green with a Triple Bottom Line

Marketing to Conserving Customers

A Guide to Operating Green with a Triple Bottom Line

Marketing to Conserving Customers

A Guide to Operating Green with a Triple Bottom Line

NRA Restaurant ShowMay 19, 2008

Lisa Kivirist & John Ivankoco-authors of ECOpreneuring and Rural Renaissance

Inn Serendipity Bed & Breakfast

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MENU FOR PROSPERITYIn An Emerging “Green Economy”

Climate for Change- Changing perspective- Definitions- Trends

Green Guide to Operating Sustainably- Ingredients for restaurant sustainability- Ecopreneurial restaurant profiles

Action Plan- Selected resources

PERSPECTIVEPeak Oil

Global production of crude oil peaking

• Raw material for gas, diesel fuel, plastics, pesticides in agriculture

• End of abundant, easy to reach, cheap oil

Source: peakoil.org, energybulletin.net, richardheinberg.com

PERSPECTIVERising Cost of Energy

Wealth = Energy

• Energy impacts all aspects of restaurant industry– Operations & customers

• 600%-plus increase in oil over 10 years– $12/barrel in 1998– $86/barrel in 2008

• Upward spiral of natural gas & electricity costs– Electricity rates going up 6 - 8% in many parts of country

PERSPECTIVEInflationary Times

• Wholesale restaurant food prices rose 7.4%– Largest increase in 3 decades– Source: National Restaurant Assn.

• Present conventional food system unsustainable– For every calorie of vegetables, more than 10 calories of

hydrocarbons (oil) are needed– For every calorie of beef, more than 50 calories of energy needed– 29 calories of transport energy for 1 calorie of Chilean asparagus– Source: Omnivore’s Dilemma, Confronting Consumption

World appetite for oil & grain resulting in higher food prices (and energy)

PERSPECTIVEEcological Decline

• Every ecological system is in decline– Habitat destruction & poor land use

decisions– Air & water pollution– Over fishing or harvesting

• Rapid loss of biodiversity– 90% of food supply from 15 food crops

& 8 species of livestock

Source: The Ecology of Commerce, State of the World

Earth’s life support systems failing

PERSPECTIVEClimate Change

Buildup of carbon dioxide in atmosphere

Source: Intergovernmental Panel on Climate Change, ipcc.ch

• Extreme weather events– Increasing variability and unpredictability

• Likely cap-and-trade schemes legislated to mitigate climate change– Even higher cost for energy (coal, oil-based

energy)

PERSPECTIVEPrecious Water

Water likely to become the next oil

Source: EPA, Food & Water Watch

• Water pumped from aquafers faster than replenished

• Bottled water waste– 60 million water bottles disposed every day in US– Only 12% recycled– Producing bottles requires 1.5 million

barrels of oil– Transport adds to carbon dioxide emissions

PERSPECTIVERestorative Opportunities

From Scarcity…- Running out- More is better- Externalizing costs- Work harder = more customers

Source: ECOpreneuring, ecopreneuring.biz

…To Abundance- Quality, not quantity- Filling “ecological”

niches- Adaptable, resilient- Internalizing costs- Greater self-

sufficiency- Re-localization

DEFINITIONSSustainability

The practice of sustainability is about creating new ways to live and prosper while ensuring an equitable, healthy future for all people and the planet.

Source: The Natural Step, naturalstep.org

DEFINITIONSSustainability

Transformation of economy …from life-depleting to life-restoring

Source: The Natural Step, naturalstep.org

DEFINITIONSTriple Bottom Line

Multiple bottom lines:

• Planet (environment)– Enhancing, restoring and conserving nature

• People (social)– Customers, workers, vendors, investors

• Profit (economy)– Reinvesting for the future?

Source: Angry Trout, ECOpreneuring, ecopreneuring.biz

TRENDSFood Related: Organic

• Organic food industry growing

at 10%-20% per year

- Source: Organic Trade Association

• 7 in 10 Americans express some concern about pesticides,

hormones, antibiotics and other chemicals in food- Source: Roper Public Affairs

• Households with incomes LESS than $50,000 spend more

money, per capita, on organic food than higher income

households Source: Hartman Group and Nielsen Homescan

TRENDSFood Related: Local

• The avg. meal travels 1,500 miles

- In local food system, food travels avg. 45 miles

- Source: Environmental Commons

• Between 1994 and 2004, the number of farmers’ markets

in the U.S. more than doubled, adding almost 2,000

markets- Source: USDA Agricultural Marketing Service

• Local food linked to health benefits, environmental

preservation, exceptional flavor, local economy benefits- Source: Midwest Organic & Sustainable Education Service

TRENDSFood Related: Fair Trade

• Fair trade is exchange that seeks to create greater

equity and partnership through paying fair wages,

supporting participatory workplaces, ensuring

environmental responsibility, respecting cultural identity,

building direct and long-term relationships, educating

customers- Source: Fair Trade Federation, fairtradefederation.org

• Small but rapidly growing market segment

- In 2006, global fair trade cocoa grew 93%, coffee 53%, tea 41%

bananas 31% Source: Fair Trade Federation, transfairusa.org (listing)

TRENDSFood Related: Restaurants

• More restaurant customers prefer “sustainable”

businesses

- 62% of patrons chose restaurants based on commitment to

environment

- Source: National Restaurant Association, 2008

• 5 of the top 10 “hot trends” according to national

chefs

- Local produce, organic produce, artisan/microbrew beer,

sustainable seafood, grass-fed items

- Source: National Restaurant Association, American Culinary Federation, 2008

TRENDSFood Related: Travel

• Tourism is big business for tableservice

restaurants- About 40% of revenues at

fine-dining restaurants

- National Restaurant Assn., 2008

• Ecotourism increasing at annual rate of 10-20%, versus overalltourism 4% annual rate- Source: World Resources Institute

• Geotourism- Travel that enhances “sense of place” & features cuisine- National Geographic/Travel Industry Assoc. of America

TRENDSFood Related: General

• Thrive in “Experience Economy”– Seek emotional experiences,

even transformational ones– But not transactions

• Joseph Pine/James Gilmore, Experience Economy

• Emergence of the “Creative Class”– “Place is becoming the central

organizing unit of our economy and society.”

• Richard Florida, Rise of the Creative Class

GREEN GUIDEIngredients for Restaurant

SustainabilityDiversity of ingredients

• Plenty of room for creativity, innovation

• Start in the back of the house…– Replace energy inefficient appliances– Immediate return on investment

• Then move to front of the house

• Boldly state your values


Sustainability1. Energy Efficiency & Conservation

– Nearly 1 million restaurants consume more electricity than any other retail outlet (National Rest. Assn.)

– Compact fluorescent, linear fluorescent, or LED?– Energy Star-certified appliances

2. Water Efficiency & Conservation– Avg. restaurant uses 300,000 gallons of water/year (Green Restaurant Assn.)– Low flow toilets, waterless urinals– Eliminate bottled waters– Provide tap/filtered water upon request


Sustainability3. Recycling & Composting

– Avg. restaurant generates 50,000 pounds of garbage/year (Green Restaurant Assn.)– Seek to eliminate the concept of waste– Select disposable cups, plates, cutlery that can be composted– Re-useable carry out containers (even with deposit)– Turn waste fryer oil into biodiesel

4. Sustainable Food– Local– Organic– Grass fed, Pastured– Seasonal menus– Do you feature your farmers or producers?– Signature items that showcase community


Sustainability5. Pollution Prevention

– Eliminating polystyrene foam (Styrofoam)– Purchasing carbon “off-sets” for operations– Chlorine-free paper products

6. Recycled, Tree-Free, Biodegradable & Organic Products– Natural soaps in bathrooms– Cloth napkins from organic cotton– 100% recycled, post-consumer waste paper for menus– Sustainable furnishings


Sustainability7. Non-Toxic Cleaning & Chemical Products

– Buy from companies you trust (and disclose ingredients)

– Terms like biodegradable, non-toxic, organic are

unregulated

8. Renewable Energy – Participate in “green energy” programs offered by large utilities

– Generate your own with photovoltaics or if site permits,

wind turbine

– Use the sun to heat water with solar thermal system

– Heat with renewable wood, corn or geothermal system


Sustainability9. Green Building & Construction

– No Volatile Organic Compounds (VOC) in caulks, paints

– Forest Stewardship Council (FSC) certified wood

– Natural buildling materials: cork, bamboo

– Daylighting, passive solar design

– Use of reclaimed building materials, recycled materials

– Secure Leadership in Energy and Environmetal Design (LEED) certification offered by U.S. Green Building Council (usgbc.org)

10. Stakeholders– Employees paid “living wage”– Training address environmental issues– How can your customers pitch in?– Giving back to community

GREEN GUIDECertification in the USA

• Green Restaurant Association– dinegreen.org– Certification based on recycling, elimination

of Styrofoam, 4 steps/yr. for environment

• Co-op America Business Network– coopamerica.org– members based on social & environmental

criteria (restaurants as well as other business sectors)

• Travel Green Wisconsin– travelgreenwisconsin.com– state sponsored, voluntary certification

program that includes restaurants– Certification based on extensive list

addressing all aspects of operations

GREEN GUIDEVoluntary Review: Green Routes

Source: Green Routes, greenroutes.org

• Find one-of-a-kind places to eat, play, shop, sleep and learn

• Web-delivered content

• Innovative networking of restaurants and other rural enterprises

Key elements in review:

• Ecological responsibility• Contribution to local economic vitality• Cultural sensitivity• Experiential richness

GREEN GUIDEVoluntary Review: Green Routes

This is a program by Renewing the Countryside in Minnesota, greenroutes.org

MARKETING TO CONSERVING CUSTOMERS

Serving conserving customers, not “consumers”


• Awareness building about human impacts on the planet

• Changing how we live, work, eat and play

• Change in consciousness that influences our lifestyle and spending habits


• 50 million Americans– About 1/4 of US population

• Strongly aware/deeply concerned about issues facing planet– Taking action to address them

• Focus on health, well-being

• Wiser consumption

Source: Cultural Creatives, by Paul Ray/Sherry Anderson, culturalcreatives.org

Cultural Creatives, creating a new culture, worldview


Lifestyles of Health and Sustainability (LOHAS)

Source: LOHAS, lohas.com

• Integrate social, political and economic values with their actions in the marketplace

• Roughly 1 in every 3 people in U.S.– 58 million adults

• Authenticity and transparency key – Avoid “greenwashing” – Walk the talk


5 key LOHAS market segments

Source: LOHAS, lohas.com

(1) Healthy lifestyles: organic & natural foods

(2) Ecological lifestyles: ecotourism, eco-products

& natural building/green design

(3) Sustainable economy: self-sufficient, eco-friendly

(4)Alternative healthcare

(5) Personal development: yoga & spas


• Communicate responsibility & legacy story– Avoid focus on “environment”

• Offer authentic EXPERIENCES

• Selective approach to media– Public radio, partner with non-profits,

menu tastings & tours

• Celebrate the local community– Focus on unique sense of place

– Network with like-minded lodging, attractions, events (packaged tours)


“7 Ps” of marketing, not 4

(1)Product- How do you treat nature,

vendors, employees?

- Eliminate waste

(2)Price- The premium goes to nature,

employees, or community

- Based on values, not simply a “good value”



“7 Ps” of marketing

(3) Place (distribution)- How can you showcase your community?

(4) Promotion (PR and advertising)- Tell YOUR unique story

- Let your customers be your ad/PR agency

(5) People- Go beyond “transactions”

- Create experiences

- Follow the “80-20 rule”Source: ECOpreneuring, ecopreneuring.biz


“7 Ps” of marketing

(6) Partnerships- Networking (non-profits)

- Cause-related marketing

(7) Purpose- Celebrate your passion

and purpose

- Sell steak, not sizzle


Ecopreneurial ProfileAngry Trout Cafe

• Sustainable,

local ingredients– Customers care about the fishermen,

farmers & brewers, want to hear their stories

– Local maple syrup, produce, microbrews

• “Place-based” cuisine– Featuring local varieties of wild rice

– Feature only fish from the region in season


• Reduce waste with reusable items– Reusable take-out food trays

– Refillable pens

– Organic cotton little napkins

6-inch x 11-inch- half material- half the water, energy, detergent to clean them


• Living wage– Lowest $8.50/hr.

and kitchen staff, $12.50/hr.

– Share the wealth

• Community connections– Buying from neighbors;

selling to neighbors

– Furniture, dishware, décor, tilework, metalwork

– Supporting the local economy

Ecopreneurial ProfileHook, Washington DC

• Sustainable seafood leader– Highest quality product

– Direct interactions with suppliers

• On site visits to Caribbean/West Africa by chef/owner, Barton Seaver & staff

• Menu reflects seasonal focus– Exclusively sourced local produce

– Humane meat & dairy products

• Linking food & environment– Partnership with EarthEcho

Ecopreneurial ProfileHabana Outpost, New York

• First solar powered restaurant in New York– Patrons can recharge cell

phones & computers

• “Bike blender” pedaled by patrons to make fruit drinks

• Local organic ingredients

• Dishes, flatware, cups made from corn/sugar cane fiber

Ecopreneurial ProfileHabana Outpost, New York

#1 Photovoltaic system

#2 Reused truck is kitchen

#3 Kids corner (garden)

#5 Rain water collection (for toilets, irrigation)

#8 Recycled aluminum table

#12 Reclaimed doors

Ecopreneurial ProfileChipotle Mexican Grill

• “Food with integrity”- Foods, design of restaurants, treatment of employees

• Featured pasture-raised pork from Polyface Farm (Virginia only)– Vegetarian and vegan options

• Return on Investment & Return on Environment– Publicly traded stock up 100% since May, 06

Ecopreneurial ProfileKavarna Vegetarian Coffeehouse, Green Bay, WI

• Purchase “green energy” from local utility– Offer free beverage to customers who also

participate

in green energy program

• Vegetarian cuisine– Reducing ecological footprint

– Tapping growing trend

• Innovative use of Internet– Blog website format

– Social networking

Ecopreneurial ProfileAmerican Flatbread

Bakery & Restaurant, Los Alamos, CA

• Artisan, handmade pizzas– Made in woodfired oven

• All locally grown ingredients– Pizza with a “sense of place”

– All within 300 miles

• Feature farmers by name– “Windrose Farm Baby Lettuce

Salad…”

– “Strauss Family Organic Vanilla Bean Ice Cream”

Ecopreneurial ProfileAmerican Flatbread

Bakery & Restaurant, Los Alamos, CA

• Support fair trade movement– Locally-roasted, certified Fair Trade,

organic coffees

• Seasonal & fresh menus– Reducing ecological footprint

– Bar appetizer: fresh pea pods

• Frozen certified organic pizza– Restaurant open on

weekends only

Ecopreneurial ProfileInn Serendipity Bed & Breakfast, Browntown, WI

• Two room B&B, near Monroe, Wisconsin

- Niche lodging-place food service

• Organic and vegetarian

• Fresh, from garden to plate

• Seasonal cuisine– Offers variety for returning guests

• Fair Trade, Organic coffee/tea– Only earth-friendly vendors

Ecopreneurial ProfileInn Serendipity Bed & Breakfast

Renewable Energy Systems• Net Producer of Electricity on Annual Basis

• Reduce Ecological Footprint

Ecopreneurial Profile Inn Serendipity Bed & Breakfast

Solar Thermal System for Hot Water

• 3 collectors• Capture heat from

sunlight to heat waterfor domestic use

• Estimated payback of less than 5 years

Ecopreneurial Profile Inn Serendipity Bed & Breakfast

Off-Grid Photovoltaic System & all-electric Car

.5 kW PV system for charging:

– All-electric CitiCar

– Back-up electricity for greenhouse– Recharging electric mower

SELECTED RESOURCESSources for Sustainable Ingredients

• Local Harvest- Locate sustainably-raised foods in your area; localharvest.org

• Community Supported Agriculture (CSA)- Purchase “shares” of farm’s products;

www.wilson.edu/csasearch/search.asp

• Eat Well Guide- eatwellguide.org

• HappyCow vegetarian restaurants- happycow.net


• Chefs Collaborative– Farmer-Chef Connection provides a good source for farmer and

restaurant collaboration

– Guide to Good Eating to help diners locate Chefs in their network

– chefscollaborative.org

• Pastured Products Directory– eatwild.com

• Slow Food USA– slowfoodusa.org

SELECTED RESOURCESSources for Sustainable Seafood

• Marine Stewardship Council– Certification of seafood

– msc.org

• Monterey Bay Aquarium

Seafood Watch Card– montereybayaquarium.org

• Blue Oceans Institute– Cell-phone text messaging service

– blueocean.org

SELECTED RESOURCESOrganizations

• Database of State Incentives for Renewable Energy– Funding for energy conservation and renewable

energy

– www.dsireusa.org

• Midwest Renewable Energy Association– Educational resources and connections to

professional installers

– www.the-mrea.org


• GreenOptions– From their Eat.Drink.Better. portal to their Ecopreneurist and

Sustainablog, this dynamic and upbeat blog site receives over 300,000 unique visitors per month and serves as a bridge to operating greener

– www.greenoptions.com

• Consortium for Energy Efficiency (education)– Promotes energy efficient products, technologies and

services

– www.cee1.org


• Energy Star (EPA)– Listing of Energy Star certified appliances &

equipment that will save your business money, reduce impacts on environment

– Resources, management tools & numerous examples

– www.energystar.gov

• National Restaurant Association’s “Conserve”– To be launched on Earth Day, 2008

SELECTED RESOURCES

• Angry Trout Café Notebook– by George Wilkes

• The Ecology of Commerce– by Paul Hawken

• Omnivore’s Dilemma- by Michael Pollan

www.ecopreneuring.biz www.ruralrenaissance.org

Books by Lisa Kivirist & John Ivanko

• ECOpreneuringPragmatic how-to guide to launching or greening your enterprise.

• Rural RenaissancePractical guide to greening operations.

• Edible EarthSimple vegetarian cookbook.

SELECTED RESOURCES

Marketing to Conserving Customers: A Guide to Operating Green with a Triple Bottom Line

Business

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