GREEN MARKETING

July, 2011 Symbiosis Institute of Telecom Management Pune Assignment by: SYNDICATE X MBA(TM-I) Systems and Finance

Tarun Chaturvedi Arun Koshy Thomas Udit Wadhwa Utsab Basak Vidit Kataria Vishal Srivastava Monika Bharti Vidhu Mahana

11020541064 11020541065 11020541066 11020541067 11020541068 11020541069 11020541070 11020541071

Under the guidance of

PROF. Sujata Joshi

ACKNOWLEDGEMENT
We extend our profound thanks to our internal guide Prof. Sujata Joshi, whose duly help, support and advice made this assignment a very success.

ii

SYNOPSIS
The world of business is being affected and influenced of different major changes in the external environment which affects the buying perspective and behavior of the customers. Environmental issues have gained importance in business as well as in public life throughout the world. It is not like that a few leaders of different countries or few big renowned business houses are concerned about the day to day deterioration of oxygen level in our atmosphere but every common citizen of our country and the world is concerned about this common threat of global warming. As of now, consumers are becoming continuously associated themselves with the social responsibility, particular about what they can do in order to protect the environment and prevent any dangerous impact of global warming or climate change to the world. This enables businesses and industries in the world to focus on one of the most challenging factors towards their marketing process, the emergence of green marketing. So in this scenario of global concern, corporate houses has taken green-marketing as a part of their strategy to promote products by employing environmental claims either about their attributes or about the systems, policies and processes of the firms that manufacture or sell them. Clearly green marketing is part and parcel of overall corporate strategy. Therefore, marketing plays a very crucial role in the well-being of the society and it is important for different companies to have very serious social responsibilities. As a result, green marketing is being considered as one of the major development and changes in the modern world of business.

iii

TABLE OF CONTENTS

CHAPTER NO

TITLE
ACKNOWLEDGEMENT SYNOPSIS

PAGE NO.
ii iii

1.

Introduction to Green Marketing

1.1 Abstract 1.2 Evolution of environmental concern 1.3 Green products and its characteristics 2. Need for Green Marketing in the telecom industry 5

3. 4. 5. 6. 7. 8.

Benefits of Green Marketing Adoption of Green Marketing Challenges and Opportunities Present scenario in the telecom industry Green Options ahead An investigation on green marketing: Study of Nokia and Samsung

7 8 10 13 16 21

9. 10.

Overview of Telecom Service Providers Green Activities 30 Future prospects of Green Marketing Conclusion References 34 36 37

11.

iv

CHAPTER 1 Introduction to Green Marketing

EXECUTIVE SUMMARY Faced with growing evidence that their lifestyle choices are tightly intertwined with environmental consequences, many consumers are going greenand they are willing to pay to do so. These environmentally savvy consumers enjoy aboveaverage income and exhibit strong brand loyalty, but their choices are limited when it comes to green products and services in the telecom sector. The trend toward green is starting to influence the industry, but strategies and services are still nascent. Telecom players that can position themselves to take advantage of this demandthrough their choice of components, adjustments in the carbon footprint of their operations, or establishment of a full green proposition including devices and the 4Pswill be able to create compelling differentiators that drive consumer purchasing. GREEN MARKETING WHAT IS IT? Green marketing began in Europe in the early 1980s when certain products were found to be harmful to the earth's atmosphere. Consequently new types of products were created, called "green" products, which would cause less damage to the environment. The movement quickly caught on in the United States and has been growing steadily ever since. The development of ecologically safer products, recyclable and biodegradable packaging, energy-efficient operations, and better pollution controls are all aspects of green marketing. Green marketing is the marketing of products that are presumed to be environmentally safe. Green marketing has been around for longer than one might suspect in fact, a workshop on ecological marketing was held by the American Marketing Association in 1975. Since then, the definition has been refined and segmented into 3 main buckets:

Retailing Definition: The marketing of products that are presumed to be environmentally safe. Social Marketing Definition: The development and marketing of products designed to minimize negative effects on the physical environment or to improve its quality. Environmental Definition: The efforts by organizations to produce, promote, package, and reclaim products in a manner that is sensitive or responsive to ecological concerns. All three of these definitions speak to the fact that green marketing involves informing consumers about initiatives youve undertaken that will benefit the environment, with the overall goal of improving sales or reducing costs. Thus green marketing incorporates a broad range of activities, including product modification, changes to the production process, packaging changes, as well as modifying advertising. The development of green marketing has opened the door of opportunity for companies to co-brand their products into separate line, lauding the green-friendliness of some while ignoring that of others. Such marketing techniques will target the minds of the consumer market. As a result of this businesses have increased their rate of targeting consumers who are concerned about the environment. These same consumers through their concern are interested in integrating environmental issues into their purchasing decisions through their incorporation into the process and content of the marketing strategy for whatever product may be required. Marketers and consumers are becoming increasingly sensitive to the need for switch in to green products and services. While the shift to "green" may appear to be expensive in the short term, it will definitely prove to be indispensable and advantageous, cost-wise too, in the long run. EVOLUTION OF GREEN MARKETING The green marketing has evolved over a period of time. According to Peattie (2001), the evolution of green marketing has three phases. First phase was termed as "Ecological" green marketing, and during this period all marketing activities were concerned to help environment problems and provide remedies for environmental problems. Second phase was "Environmental" green marketing and the focus shifted on clean technology that involved designing of innovative new products, 2

which take care of pollution and waste issues. Third phase was "Sustainable" green marketing. It came into prominence in the late 1990s and early 2000.

GREEN MARKETING IN TELECOM INDUSTRY The telecom industry is in the early phase of defining what going green means wherein the possibilities of greening ranges from handset recycling programs, reducing hazardous materials within the handset and using energyefficient equipment to evangelizing the environmental benefits of telecommuting and teleconferencing. The problem lies in the development of the kind of scale that makes entire green product lines economically viable enough. The marketing stories of each 3

company had been their marketing stories, embedded on green corporate practices. As more telecom companies consider the marketing angle, they are trying to out-green each other. For example, the claim energy efficient gets stretched to the breaking point and the dangers of rendering the message will cause large cost ramifications when proven untrue. The meaningful impact then on telecom companies is evident on the firms competitive position. Sony Ericsson is lauded for marketing proof-of-concept green products in 2008 whereas Nokia presented various green initiatives. GREEN PRODUCTS AND ITS CHARACTERISTICS The products those are manufactured through green technology and that caused no environmental hazards are called green products. Promotion of green technology and green products is necessary for conservation of natural resources and sustainable development. We can define green products by following measures: Products those are originally grown Products those are recyclable, reusable and biodegradable Products with natural ingredients Products containing recycled contents, non-toxic chemical Products contents under approved chemical Products that do not harm or pollute the environment Products that will not be tested on animals Products that have eco-friendly packaging i.e. reusable, refillable containers etc.

CHAPTER 2 Need for Green Marketing in Telecom Industry

As resources are limited and human needs are unlimited, it is important for the marketers to utilize the resources efficiently without waste as well as to achieve the organization's objective. So green marketing is inevitable. There is growing interest among the consumers all over the world regarding protection of environment. One of the most important factors to consider is the issues regarding the environment, particularly regarding the global warming or climate change. Worldwide evidence indicates people are concerned about the environment and are changing their behavior. As a result of this, green marketing has emerged which speaks for growing market for sustainable and socially responsible products and services. Climate change or global warming is being characterized by extreme scale and urgency and hence our industries aim to improve energy efficiency and reduce carbon dioxide emissions throughout their business. It is estimated that during the last 30 years the CO2 emissions have gone up by 73%. India is ranked 5th amongst the countries in the list of global GHG emission. There are some other concerns also which increase the requirement of green marketing: Base stations are very power intensive Diesel generators need regular maintenance Price of petroleum products is increasing Energy consumption from telecom networks is the contributor to GHG emissions Telecom Industry is the second largest diesel consumer in India Providing electricity to the expanding networks is a big challenge Power requirement for BTS varies from 1300-2500 watts.

The factors that are leading to enhanced action on greening are as follows: Need to reduce the cost of operations of the telecom network by reducing energy cost. Need to expand network into rural areas where power availability is poor. Renewable energy technology becoming available at increasingly reducing cost. Confluence of socio-political trends towards environmental responsibility, pressure groups against global warming. Creating sustainable businesses has become important where the objective is not only to create products and services through ethical means but also minimize environmental impact and improve communities. International treaties like Kyoto Protocol.

CHAPTER 3

Benefits of Green Marketing

Green marketing offers business bottom line incentives and top line growth possibilities. While modification of business or production processes may involve start-up costs, it will save money in the long term. For example the cost of installing solar energy is an investment in future energy cost savings. Companies that develop new and improved products and services with environmental impacts in mind give themselves access to new markets, substantially increase profits and enjoy competitive advantages over those marketing non-environmentally responsible alternatives. Developing green or eco-friendly products would mean a reduction in Carbon Footprint (total set of greenhouse gas emissions), environmental impurities like Arsenic and Mercury, PVC cables and more and more use of eco-friendly products like recyclable plastic, bromine free circuit boards, biodegradable packaging etc. Recycling of unused materials allows elimination of toxic non-biodegradable waste products which reduces the pollution in our environment. Huge monetary investment is required for BTS & other infrastructure depending on the location of the infrastructure .But with use of solar/wind energy for power supply & green power grid towers capex can be reduced even for remote locations. Power load in rural sectors can be reduced by using telecom towers running on the renewable /green energy with 40% load factor. For example RCOM deployed bio-fuel plants to run its rural telecom networks. Significant power savings can be achieved because operators are deploying energy efficient equipment for network systems called POTP. 7

CHAPTER 4

Adoption of Green Marketing

Green marketing has been widely adopted by the firms worldwide and the following are the possible reasons cited for this wide adoption: 1. OPPORTUNITIES As demands change, many firms see these changes as an opportunity to be exploited and have a competitive advantage over firms marketing non environmentally responsible alternatives. In an endeavor towards energy efficiency and cost reduction, Bharti Infratel has set an initial target of deploying 2,000 renewable energy sites. This initiative, which is the first of its scale for an Indian Passive Telecom Infrastructure provider (tower sharing), would result in estimated savings of $16.67 million per year. The project would also result in an estimated reduction of 58,170 tonnes of CO2 emissions per year, thus helping in the mitigation of global warming potential. 2. SOCIAL RESPONSIBILITY Many firms are beginning to realize that they are members of the wider community and therefore must behave in an environmentally responsible fashion thus resulting in environmental issues being integrated into the firms corporate culture. An example of a firm Alcatel-Lucent has reduced its facility-based CO2 emissions by nearly 112,000 tons from 2007 to 2009, exceeding its goal of cutting annual CO2 emissions by 10 percent from the 2007 level by the end of 2010, according to the companys 2009 Corporate Social Responsibility (CSR) report. The company has set a goal to reduce its carbon footprint from all sources 50 percent by 2020. 3. GOVERNMENT PRESSURE The government is not leaving any stone unturned to take up with social responsibility and the latest released recommendations of TRAI on the approach and 'green telecom' practices speak volumes about the gravity of the matter. As per its recommendations on 'Approach Towards Green Telecommunications', a telecom service provider should declare the carbon footprint of their network 8

operations in the prescribed format. This declaration should be undertaken after adopting the prescribed formula and procedures. The declaration of the carbon footprints should be done twice in a year, which is after every 6 months. Who is not able to make their carbon foot print to the minimize standard will be charged with penalty. Not only this, government also initiate the award for Green Mobile from this year ,Bharti-Infratel bagged the 2011 Green Mobile Award at the GSMA Mobile World Congress at Barcelona and was also awarded the 2010 innovative infrastructure company of the year award, at the CNBC Infrastructure Awards, for this ground breaking initiative. 4. COMPETITIVE PRESSURE Another major force in the green marketing area has been firms desire to maintain their competitive position. In many cases firms observe competitors promoting their environmental behaviors and attempt to emulate this behavior. In some instances this competitive pressure has caused an entire industry to modify and thus reduce its detrimental environmental behaviour. A shift in power sourcing to renewable technologies, such as solar photovoltaic, will result in a close to 300 per cent reduction in total costs (CAPEX + OPEX) for telecom operators, in comparison to a diesel generator (DG) based tower over ten years. 5. COST OR PROFIT ISSUES Firms may also use green marketing in an attempt to address cost or profit related issues. In minimizing wastes firms often develop a more effective production process that reduces the need for some raw materials thus serving as a double cost savings. In other cases firms attempt to find end-of-pipe solutions, instead of minimizing waste by trying to find markets or uses for their waste materials, where one firms waste becomes another firms input of production.

CHAPTER 5

Challenges, Opportunities & Threats

CHALLENGES
1. NEED FOR STANDARDIZATION It is found that only 5% of the marketing messages from Green campaigns are entirely true and there is a lack of standardization to authenticate these claims. There is no standardization to authenticate these claims. There is no standardization currently in place to certify a product as organic. Unless some regulatory bodies are involved in providing the certifications there will not be any verifiable means. A standard quality control board needs to be in place for such labelling and licensing. 2. NEW CONCEPT Indian literate and urban consumer is getting more aware about the merits of Green products. But it is still a new concept for the masses. The consumer needs to be educated and made aware of the environmental threats. The new green movements need to reach the masses and that will take a lot of time and effort. 3. PATIENCE AND PERSEVERANCE The investors and corporate need to view the environment as a major long-term investment opportunity, the marketers need to look at the long-term benefits from this new green movement. It will require a lot of patience and no immediate results. Since it is a new concept and idea, it will have its own acceptance period. 4. AVOIDING GREEN MYOPIA The first rule of green marketing is focusing on customer benefits i.e. the primary reason why consumers buy certain products in the first place. Do this right, and motivate consumers to switch brands or even pay a premium for the greener alternative. It is not going to help if a product is developed which is absolutely green in various aspects but does not pass the customer satisfaction criteria. This 10

will lead to green myopia. Also if the green products are priced very high then again it will lose its market acceptability.

OPPORTUNITIES
1. The service providers can take a number of steps to reduce their carbon footprints. For example:

Proper radio planning to reduce number of BTSs Sharing of passive and active infrastructure Sharing of backhaul Adoption of green shelters Replacing air-conditioners with forced air cooling, HFC free cooling systems. Precision air-conditioning Intelligent remote air-conditioning control Installing outdoor base-stations using energy efficient technology and renewable energy sources. Mobile device life cycle emission could be reduced through recycling. USOF may also be given to projects that use alternative sources of energy for tower and related equipment. Spectrum charges may also be linked with carbon credits earned by various operators. Public funding and support in the form of tax benefit may be considered for various projects in the green space. There is also need to monitor and report on the carbon footprint of different segments in telecommunications industry.

2. Indias current renewable energy base is 13,250 MW (7.7% of total Installed base). Indian Wind Energy Association has estimated the 'onshore' potential for utilisation of wind energy for electricity generation is of the order of 65,000 MW. In wind power, Indias total installed capacity is planned to at least double by 2022 and the nation is emerging as an important manufacturing base for the global wind industry. In July 2009, India unveiled a $19 billion plan, Jawaharlal Nehru National Solar Mission, to produce 20,000 MW of solar power by 2020. Indias National Solar Mission aims to see solar energy achieve grid parity with the cheapest coal fired capacity by 2030 and establish the country as a global leader in the field. 11

THREATS
1. INITIAL CAPITAL COST Organizations and the consumers will have to bear the initial cost incurred in setting up and implementing this new concept. Telecom industry will have to undergo a complete change in setting up a greener network and also greener equipment. Many companies have come up with some greener concepts such as green tower but are struggling hard to find market for their concept. 2. LONG TERM PROFITS Industry should remain patient for a while until they start gathering profit. These profits will be substantial but will take time due to heavy investment made and lesser revenue initially. Break -even point can be expected after few years. With telecom industry already going through a rough patch of lesser profit margin, profit will be real concern in telecom before implementation of green marketing. 3. RESEARCH AND DEVELOPMENT COST Due investments in this segment will be high as to innovate different techniques and strategies of green marketing. The major role of this segment will encompass development of greener products, making consumers aware of these products, use of less and environmental friendly resources to produce these products, recycling techniques etc. 4. SUPPORT OF THE GOVERNMENT AND OTHER REGULATORY BODIES Support of Government bodies such as TRAI and DOT will play a crucial role in spreading this concept among the people. Subsidy and relaxation given by the government will cut down the cost incurred in implementing this technique and hence will facilitate the manufacture and sale of more and more green product. But the telecom industry should look beyond these threats and companies should start working on setting up goals and plans to take initial advantage in this highly competitive market as sooner or later this concept will become a necessity for the people. 12

CHAPTER 6

Present Scenario in Telecom Industry

Being a major consumer of energy, the telecom sector needs uninterrupted power supply for operating efficiently. But the low availability of power in the country and its poor quality significantly increase the capex and opex of telecom installations, and result in unsatisfactory service quality. The problem of poor power supply is experienced at telecom operators installations as well as in customer premises. At the telecom installations, the issue is addressed by using DG sets. But operating these DG sets necessitates transportation and storage of diesel, which is a major problem in rural and remote areas. At the customer premises, battery inverters or DC-DC converters are used to tackle the issue. However, the battery remains only partially charged if the power supply is unreliable. Decentralised distributed generation technologies based on renewable energy sources such as solar photovoltaic (PV) and wind turbine generators (WTGs) address these issues at the operators end to a large extent, and are, therefore, considered as the emerging alternative power solutions for telecom networks. The distribution of solar radiation varies from 4.5 kWh per square metre per annum to 6.5 kWh per square metre per annum. This implies that solar solutions are viable across the country. However, wind energy can be adopted as a solution only if the geographical location is appropriate in terms of wind speed.

The telecom sector is the third largest consumer of diesel in India after defence and the railways. The demand for the fuel is set to escalate with an increase in the number of telecom towers in the country from 500,000600,000 in the near future. According to the Cellular Operators Association of India, a shared site consumes 3,000 litres of diesel per annum. The situation is likely to worsen with rural areas expected to drive sector growth because almost all rural sites use DG sets for 10-16 hours daily, and at least 40 per cent of villages have no access to grid power.

13

Besides helping operators to expand their reach to these areas, tower sites in the hinterland facilitate power supply to un-electrified villages. Following the rural expansion ventures of the telecom companies, community power is emerging as an important concept. It explores the possibility of renewable energy (RE)-powered mobile sites acting as an anchor for demand and a revenue stream for stand-alone off-grid power stations. These power stations can cater to the requirements of the site and surrounding communities. This concept can be a win-win solution for both the telecom operator as well as the village. The model works best when implemented by a professional third-party energy service company.

CURRENT STATISTICS OF POWER CONSUMPTION IN TELECOM

Telecom Network Energy Consumption Energy Consumption By The Tower Sites Energy Consumption By The Core Network Total Number Of Telecom Towers In India Annual Diesel Consumption By Mobile Towers Annual Co2 Emissions By Mobile Towers Annual Co2 Emissions Due To Diesel Consumption Annual Co2 Emissions Due To Power Grid Power Sharing By Mobile Towers Total Power Consumption Power Provided By Renewable Energy Resources

86% 65% 21% 3,10,000 2 Billion Litres 5.3 Million Litres 5 Million Tons 8 Million Tons 1. 40% By Grid Electricity 2. 60% By Diesel Generators 1,67,077.36 Mw 16,786.98 Mw Or 7.7 %

14

POWER AVAILABILITY DISTRIBUTION AT CELL SITES THROUGHOUT THE COUNTRY

CELL SITES

EB AVAILABILITY

DESCRIPTION

10%

>20 HOURS

20%

16-20 HOURS

30% 25% 15%

12-16 HOURS 8-12 HOURS <8 HOURS

Mainly Metro Cities Of Mumbai, Kolkata, Chennai, Some Cities Of Gujarat, Chattisgarh & Punjab. Covers Most Other Major Towns &Cities In The Country. All Semi-Urban & Small Towns. Mostly Rural Areas Mostly Parts Of JK,Bihar & Parts Of Ne States, Up, Assam

15

CHAPTER 7

Green Options Ahead

1. ADOPTION OF ENERGY EFFICIENT EQUIPMENT AND INNOVATIVE TECHNOLOGIES Telecom service providers and others in the ICT industry can bring into play an expansive array of technologies and services that will substantially improve the environmental footprint of commercial enterprises as well as that of consumers. It is important to understand that the technologies underlying a green communication initiative are largely currently available. Energy costs account for more than half of a mobile operators operating expenses and about 65% of this is for the tower site equipment. Therefore, radio network solutions that improve energy efficiency are not only good for the environment; they also make commercial sense for operators and support sustainable, profitable business. A way to compare energy efficiency of products is to assess annual CO2 emission during the life time operation of products. 2. USE OF RENEWABLE SOURCES OF ENERGY Many telecom companies are now exploring multiple sources of renewable energy, like Solar, wind, bio-fuels, etc. Renewable energy is energy generated from natural resources such as water, sunlight, wind, rain, tides, fuel cells and biomass sources as energy crops. Renewable energy sources are energy sources that are continually and naturally replenished in a short period of time. Renewable Energy Technologies (RETs) are those that utilize energy sources in ways that do not deplete the Earths natural resources and are as environmentally benign as possible. By exploiting these energy sources, RETs have great potential to meet the energy needs of rural societies in a sustainable way, albeit most likely in tandem with conventional systems. . It is estimated that 118,000 renewable energy base stations could save up to 2.5 billion litres of diesel a year and cut annual carbon emissions by up to 6.3 million tons. The following approaches have been considered singly or in combination: Solar energy Wind energy Ocean/Tidal energy 16

Pico hydro energy Biomass energy Fuel cell energy

Base stations powered by such solutions offer economically viable alternatives since they lower both operating and maintenance expenditures. 3. INFRASTRUCTURE SHARING Passive site sharing involves components such as the tower, ground based or rooftop, cables, physical site or rooftop, shelter cabinets, power supply, airconditioning, alarm systems, etc. In addition, active sharing of network infrastructure, which involves the sharing of the antennae systems, backhaul transmission systems and the base station equipment itself, will allow operators to save an additional 40% on top of available savings from passive infrastructure sharing. Active sharing could save mobile operators globally about US$60 billion over the next five years.

4. IMPROVEMENT OF GRID SUPPLY The total installed power capacity (as on 30-11-2010) is 1,67,077.36 MW out of which power from renewable energy sources is 16,786.98 MW or 7.7 %.With the increase in availability of grid power in rural and remote areas consumption of diesel for telecom tower sites would reduce resulting in reduction of carbon footprint. As more and more energy comes from renewable sources, the footprint would reduce further. 5. WASTE MANAGEMENT Rapid industrial development has led to the generation of huge quantities of hazardous wastes, which have further aggravated the environmental problems in the country by depleting and polluting natural resources. Therefore, rational and sustainable utilization of natural resources and its protection from toxic releases is vital for sustainable socio-economic development. The lack of technical and financial resources and the regulatory control for the management of hazardous wastes in the past had led to the unscientific disposal of hazardous wastes which posed serious risks to human, animal and plant life. The hazardous waste generated in the country per annum is estimated to be around 4.4 million tonne. Out of this, 38.3% is recyclable, 4.3% is Incinerable and the remaining 57.4% is disposable in secured landfills. 17

Nevertheless, considering the fragile ecosystem that India has even this low quantum of hazardous wastes can cause considerable damage to natural resources if untreated before releases. Mobile phone recycling is reducing the environmental impact of the telecom industry not only by reducing CO2 emissions, but also by limiting the release of toxic elements into the environment. With more than 3 billion mobile phone users globally, it is estimated that over 500 million tons of mobile phones have been retired worldwide so far. These devices contain numerous toxic elements, like arsenic, beryllium and lead, which risk being disposed of in landfills. 6. BETTER NETWORK PLANNING Network planners can help reduce the carbon footprint in a number of ways. New network design methodologies, radio techniques and site technologies have been developed to reduce energy consumption across the board: from radio equipment, through climate and power systems to radio access networks with a focus on improving both new network roll-out, as well as the operation of existing networks. Energy consumption can be reduced if network solutions and services can be designed to use fewer sites and to reduce energy consumption. When equipment, like base stations, operate they dissipate some power as heat which raises the ambient temperature of the equipment. If the equipment is not cooled, by bringing the ambient temperature within the operational range, then the equipment may malfunction or breakdown. Backhaul may be designed for sharing using adaptive Ethernet transmission rate switching depending on traffic load. There are techniques like MIMO (Multiple Input Multiple Output), HARQ (Hybrid Automatic Repeat Request), beam forming, wireless mess networks, distributed equipment that would be more energy efficient. Innovative methods like using telecom towers as wind towers and solar panels as shelter roofs can also deliver some benefits. Software based power management systems can be used by telecom service providers to do a real-time monitoring and management of energy consumption in their facilities. Properly planned systems can save those 15% to 35% on energy costs. 7. STANDARDIZATION OF EQUIPMENT, TEST AND CERTIFICATION There are some existing global standards for green telecom that telecom equipment should conform to e.g. ISO 14001:2004, OHSAS 18001:1999 and EuP. The EuP is a new regulation that sets eco-design requirements for energy-using 18

products. The international standards WRI/WBCSD GHG Protocol and the ISO 14067 standard Carbon Footprint of Products are moving closer to completion. Furthermore, significant developments are taking place in different countries that will shape the practical implementation of product carbon foot printing in the future. International standards stimulate large production of standard equipment and help vendors to exploit economies of scale. Standards if adopted internationally can help larger adoption of green technologies. Universal mobile phone charger and a common base station for dual technology should be considered for use. A common base station for dual technology can also be considered. Use of smarter equipment that may lead to less number of towers. 8. MANUFACTURING PROCESS A green product development initiative is often about responding to market interest in environmentally friendly products. For telecom equipment manufacturers the case is no different. The value of a green product for these companies isn't just about environmental goodwill. The following list highlights a number of key means whereby opportunities exist to address direct or indirect CO2 emissions: Increasing energy efficiency in the handset Increasing energy efficiency of the charger Seeking to utilize solar-power handsets or solar-powered chargers Reducing transport emissions Ensuring that handsets are manufactured using materials sourced companies with green credentials Reducing packaging Encouraging hand recycling

from

9. MONITORING AND REPORTING It is important to devise mechanisms for telecom industry to have a good monitoring system for the carbon emission and ensuring carbon footprint reduction. Carbon footprint of all the activities needs to be measured and documented. Compliance to international standards and domestic regulations must be continuously verified.

19

10. GOVERNMENT SUPPORT SUBSIDIES, TAXES & LEVIES Adoption of green telecom has its own costs and offsets. R&D of energy efficient equipment or those that work on alternate sources of energy requires funds. There is a general feeling that the alternate sources of energy are more expensive as compared to the grid electricity or even that obtained through diesel gensets. When incentive schemes are considered necessary, there could be a number of ways in which they could be worked out: Incentives can be given for equipment working on the principle of energy conservation. Energy requirement for equipment or a part of the network can be worked out as a function of traffic or based on cooling requirements, ability to function in all weather conditions or on sleep mode functionality. The equipment that outperforms the threshold set may be given incentive. Equipment that uses renewable energy sources may be given subsidy. Equipment that is spectrum efficient and is able to provide more data rate with minimum bandwidth and equipment which is able. To provide radiations of more signal strength with less power consumption can be given incentive. The operators who utilize non-hazardous materials in telecom as per Kyoto Protocol be given incentives. The telecom industry having adequate arrangement for the hazardous waste reduction should be considered for incentives. There could be incentive plans for operators who implement equipment recycling program. There could be non-financial incentives to operators/tower companies in the form of technical assistance provided by experts of bodies like GSMA, specifically for feasibility studies.

20

CHAPTER 8 Study of Nokia and Samsung

ABSTRACT Day by day, mobile phones are turning into more of necessity then a luxury. The benefits of the mobile phone are far too many. Ease of communication, the anywhere, anytime contact - with friends, relations, colleagues and in theory at least the efficiency brought to busy lives. The entire global business industry is facing different challenges from the external environment including the concern to the environment which influence the behaviour and perspective of the customers in availing or buying particular product or service. As a result, it is important for different companies to focus on the said changes or development in customer behaviour and focus on different marketing activities and strategies that will enable them to establish good relationship with the customers, which will lead to loyalty and long-time connection. By focusing on the growing Importance of green consumerism and green marketing, it can help companies to come up with strategies which will enable them to create a brand that focus on social responsibility. Furthermore, it could help companies to know the different aspects of the company that are needed to be associated or connected to the process of green marketing. The study will focus on the strategies being applied by 2 mobile phone brands and how it affects their relationship with the company. SIGNIFICANCE OF THE STUDY Climate change or global warming is being characterized by extreme scale and urgency. This is because of the fact that it has negative impact to the lives of each and every individual in the world. On the side of the business industry, regarding the supply side, it is vital for companies to drastically reduce its impact in manufacturing, distribution, raw materials, energy use and other aspects that are related to marketing process. Therefore, the issue of green consumerism and green marketing is vital for the organization because it influence the process of manufacturing or creating the product due to the supply chain, at the same time on the process of selling the product to the market via branding and image. Therefore, it is important to study the use and application of green marketing in two of the most popular mobile phone brands in the world. This will help to focus 21

on the different strategies and other activities inside the organization which enables them to properly and successfully implement green marketing and connect with their green consumer. OBJECTIVES OF STUDY This study focused on the investigation of green marketing in in-depth manner by using and comparing cases of Nokia and Samsung. It pertained on the green marketing strategies. In addition, the study aimed to draw conclusions about which between Nokia and Samsung is more committed in green marketing and the reason behind it. With this, the specific objectives of the study are. To determine how Nokia and Samsung reaches its consumers through its green marketing strategies. To examine how consumer requirements are integrated in marketing green products. To analyze how green marketing builds consumer awareness of environmental characteristics of the products.

GREEN MARKETING STRATEGIES NOKIA 1. PLANET Nokia aims to be a leading company in environmental performance. Achieving environmental leadership means minimizing own environmental footprint. With the expansion of mobile communications, this is all the more important. Nokia strive to reduce the environmental impact of their products, solutions, and operations. 2. PRODUCT Nokia take a proactive approach when considering how their activities might impact the environment. The product creation is guided by life cycle thinking, minimizing the environmental impacts across the lifecycle of a product. A life cycle assessment helps to identify and focus the activities on where they can best contribute to environment. 22

In the product creation, focus is on energy efficiency, sustainable use of materials, smart packaging and creating environmental services that engage people to more sustainable lifestyles. All the materials in the products are selected with environment in mind. They have improved the energy efficiency of the products, and the devices remind user to unplug the charger when the battery is full. With over a billion people using Nokia phones around the world, small steps like these make a big difference. By providing eco applications and services, they increase awareness of environmental choices and promote sustainable actions, like offsetting CO2 emissions caused by flying. Effective end-of-life practices close the lifecycle loop, putting energy and valuable materials back into circulation. They currently offer take-back schemes in 85 countries.

Environmental efforts focus on four issues:

Substance management Nokia work closely with their suppliers and require full declaration of the substances we use in our devices. Their work is based on the precautionary principle and aim at continuously reducing the amount of substances of concern. In addition, they explore the opportunities for using new, more environmentally friendly materials, such as bio plastics or recycled metals and plastics.

Energy efficiency They work to reduce the energy consumption of their operations, and agree on energy efficiency targets with the key suppliers.

23

3. PROMOTION Take back and recycling The first pilot campaign, Planet Ke Rakhwaale was launched in 4 cities Bangalore, Delhi, Gurgaon, and Ludhiana. During the pilot, Nokia encouraged mobile phone users to recycle their old handsets and accessories, regardless of the brand, and promised to plant a tree for every phone dropped during the campaign period in these cities. As a result, over 68000 pieces weighing over 3 tons of old phones and accessories were collected in 45 days of the campaign period from these 4 cities. The Planet Ke Rakhwaale take-back and recycling campaign extended to 28 cities across India. The campaign aimed to inspire young minds to spread the recycling message. For every handset, regardless of the brand, dropped in the recycle bin, Nokia promised to plant a tree for every mobile phone recycled and also offered a surprise gift made of recycled material. In the second phase Nokia extended the engagement through a Corporate Engagement Program. Nokia partnered with over fifty corporations from across sectors to do campaigns in their offices. This campaign has been done in over three hundred offices to date. The Phase II ended with over 500,000 pieces of phones and accessories weighing over 16 tons were collected. 4. PEOPLE Each year an independent market research company helps them to research trade customers views on Nokia through our Listening to Trade Customer (LTC ) survey. A sample of executive and operational contacts from the companies that make up about 80% of Nokia revenues are invited to take part. Feedback from the survey is used to drive action planning at the local and global levels. At a local level, Nokia account managers discuss the survey findings with their customers and take relevant actions. The consolidated feedback is used to understand where systematic improvements are needed. Customer participants receive a response letter from Nokias CEO highlighting the surveys overall findings and the key improvement actions taken.

SAMSUNG
1. PLANET It planned ESH (ENVIRONMENTAL SAFETY & HEALTH) PROGRAM to maintain specific environmental standards at its various locations. It 24

launched recycling policy to determine how to recycle the products & which toxic chemicals to be removed from them to make them ecofriendly. 2. PROMOTION To make customers more aware about the environmental concerns Samsung decided to launch various green community programs at various cities & education for school children. 3. PEOPLE As Samsung believed that employees are the faces of the company & employee-customer interface is very important to promote revenues hence it devised employee education program about environmental awareness. 4. PRODUCT Samsung wanted to recycle its own products hence to make customers aware of various recycling schemes, techniques & its advantages it established recycling centres throughout the different countries. For further marketing Samsung developed an Eco-design assessment system. This system manages products compliance with environmental criteria developed based on resource efficiency, energy efficiency and eco-friendly materials. They further upgraded their Eco-Design management system, introducing the eco-rating system for all developed products. This assigns each newly developed product an eco-rating (Eco-Product, Good Eco-Product, or Premium Eco-Product) based on strict evaluation criteria. It actually helped the customers to identify & purchase the green products. 5. PLACE Samsung wanted to promote its eco-products, hence it started labelling & certifying them with energy labels & eco labels so that they can become visible to the customers & customers can become aware of the companys green initiatives.

25

INTEGRATION OF CONSUMER REQUIREMENTS

NOKIA Eco-content and Services: Eco-minded wallpapers, eco tips in tutorial, maps for route optimization and pedestrian navigation. More eco content and services available at Ovi. Energy Efficiency: Power Save mode, ambient light sensor, unplug charger reminder, High Efficiency Charger AC-10. Materials: Free of PVC, free of nickel on the product surface, free of brominated compounds, chlorinated flame retardants and antimony trioxide as defined in Nokia Substance List. Recycling: All materials of the device can be recovered as materials and energy. Device is up to 80% recyclable. Packaging: up to 60% recycled material. 100% recyclable. Reduced compact package size. Material and Substances: free of PVC, free of brominated & chlorinated compounds and free of antimony trioxide as defined in Nokia Substance List, bio-based materials in inner parts of the product User Guide: Interactive user helps in device and online, only Quick Guide in the box, eco tips on Green Page.

SAMSUNG Sprint announced the latest addition to its Android line-up, the Samsung Replenish. Billed as an eco-friendly smartphone, the Replenish is constructed of recycled and recyclable materials. It will also be the first Android-powered smartphone from Sprint that will not require the companys $10 premium monthly data charge since the carrier made the new fee a requirement. Spec highlights include Android 2.2 (Froyo), a 2.8-inch QVGA touchscreen display, a QWERTY keyboard and a 2-megapixel camera. All the Samsung mobile phone EPS comply with California's Amended Appliance Efficiency Regulations effective, 100% of mobile phone power supplies are ENERGY STAR compliant.

26

MAKING CONSUMERS AWARE OF THE GREEN INITIATIVES:

NOKIA a) Promoting sustainability through services and software Nokia have developed eco services for their phones to help people to make sustainable choices and consider the environment in their everyday lives. A variety of eco services are freely downloadable to Nokia devices via Ovi store. b) Taking part in creating best practices Nokia supports the concept of individual producer responsibility. In order to carry out their own responsibilities they need others in the value chain, like consumers and retailers, to commit to bring back obsolete mobile devices for responsible recycling. Such co-operation eventually leads to a situation where significant drivers for environmentally optimized product design enabling easier recycling would become commonplace, bringing further benefits for consumers, producers and the environment. Theyve been running take-back campaigns since the late 1990s and regularly work with environmental organizations or non-governmental organizations such as WWF to increase consumer awareness in different markets around the world. c) Spreading the word about recycling There are some of the barriers to recycling phones, like worrying about losing the numbers or photos youve got stored on your phone. These barriers mean that return rates from most of Nokias collection schemes are currently very low; they get back just 3 percent of redundant phones. Nearly half of these are sitting unused in peoples drawers. As part of their we recycle program, theyre helping consumers, retailers and their service network bring those phones back for recycling.Nokia has set up close to 5000 Nokia recycling points globally, each taking back mobile devices and accessories. In India, Nokia has laid out a robust recycling infrastructure across the country with over1300 recycling bins installed at Nokia Care Centers, Nokia Priority Dealers and Nokia Concept Stores.

27

SAMSUNG a) Green community programs Employees at all production sites of Samsung Electronics are engaged in local environment protection activities, teaming up with NGOs and communities as part of the companys commitment to social contribution. b) PlanetFirst Campaign PlanetFirst is a commitment, a mind-set, and a fundamental approach that Samsung believes is critically important as consumers seek to balance their desire for cutting edge technology while pursuing a greener way of life. Samsung is committed to providing a better green experience through ecofriendly products, solutions and technologies that benefit the customers lives, affirm shared values, and respect the planet. CUSTOMER SATISFACTION By not compromising with the QOS & QOE even after making the products eco-friendly, biodegradable & recyclable as customer is mainly concerned with the services provided & not with the quality of material used in the products. Though there is a possibility of increase in product prices due to use of green materials still the vendors or operators should ensure value proposition or value for money.

ROLE OF GREEN PROMOTIONS IN INCREASING SALES The labelling of products helps in making the customers aware of their environmental benefits & also tells them about the non-toxic material usage. The old unwanted electronics products can be recycled through different recycling programs & retail outlets. It motivates customers to go for green products. The various green campaigns & community programs conducted throughout the year help in making consumer environment friendly & more conscious about the importance of biodegradable materials & control on GHG emissions. 28

PACKAGING & LABELLING: NOKIA Nokia works to minimize the environmental impact of its packaging by selecting sustainable materials, reducing the packaging size, reducing the volume of material we use, and considering what happens to the package when it is no longer needed. Nokias packaging contains no hazardous or restricted substances, and is fully compliant with the EU directive 94/62/EC. Packaging materials have been marked where practically possible. Plastic parts are marked in accordance with ISO 11469 and ISO 1043-1 to -4 standards. SAMSUNG a. Eco Labels Many countries have voluntary eco-label programs to encourage businesses to market environment-friendly products and help consumers, both private and public buyers, identify eco-friendly products easily on the market. Samsung Electronics products have been recognized for their eco-friendly design and technology, achieving eco-labels in many markets around the world. Below are some examples of Samsungs eco-labelled products. Samsung Electronics provides the Product Eco-Declaration (PED) of all products to stakeholders upon request. The PED contains environmental information on products regarding specifications, energy and discarded product recycling activities. b. Energy Labels The US Environmental Protection Agency developed the Energy Star program to identify and promote energy-efficient products that reduce greenhouse gas emissions. Many Samsung Electronics products are Energy Star certified.

CONCLUSION
Although Both Companies follows the similar kind of initiatives and strategies to reach out to people and sell their products, Nokia seems to be more committed in green marketing in terms of its environmental strategy, environmental management systems and substance and material management. 29

CHAPTER 9 Overview of Telecom Service Providers Green Initiatives

1. Idea Cellular It partnered with Ericsson and GSMA's Development Fund to develop biofuels as a power source for wireless networks in rural India. In a pilot project, such fuels were used to power mobile base stations in Latur, Maharashtra, where grid power is highly unreliable. Presently, Idea Cellular is experimenting with hybrid solar solutions. It has begun with 20 sites at present and intends to take it to 500 eventually. Another initiative from Idea is to have a higher number of outdoor base transceiver stations (BTSs) as they consume relatively lesser energy compared to indoor BTS. Idea Cellular launched the Use Mobile Save Paper campaign. The main rationale behind it was World over, millions of tonnes of trees get cut every day to produce paper, leading to alarming rates of deforestation. One simple idea to save paper is to efficiently use the mobile phone for large number of day to day communication. The new IDEA campaign showcases how the mobile phone can be used as an efficient tool to read daily newspapers generate e-bills, make payments and transactions, issue e-tickets and boarding passes; thereby saving tonnes of paper every day.

2. Reliance Communications Reliance Communications (RCOM) has installed windmills on its towers at Kunustara and Murugathal in West Bengal. Moreover, the operator also approached Pune-based solar panel manufacturer Machino craft, for powering cell sites using solar power. It is currently exploring the feasibility of using solar energy in areas where an electric connection is not available. RCOM has also deployed bio-fuel plants to run its rural telecom networks in several areas.

30

Save Paper. Switch to E Bill This campaign was started by RCom. Their Social endeavor was to promote E-bill. This program was designed to offer our most valued customer, an environment friendly billing service. Together they started a step towards reducing the usage of paper, conserving our natural resources and lowering our carbon footprints. They also launched the Go Green campaign.

3. Airtel: Bharti Airtel, which was the second largest buyer of diesel after Indian Railways till 2007, when it spun off its cellular towers into a separate entity (Indus Towers), has already conducted trials using wind power for sites in coastal areas of Andhra Pradesh, Orissa and Bengal. It has also conducted some pilot projects on solar power and bio-fuels. Bharti Infratel has already installed 500 solar sites on ground and is planning to take this to 2,000 soon. By end 2010-11, 30 per cent of its sites are likely to be using alternative fuels. Bharti Infratel Limited was awarded the Green Mobile Award for Best Green Product / Service or Performance category for its pioneering P7 Green Towers project initiative. Infratel's Green Towers P7 initiative is a comprehensive energy management programme and is a combination of 7 energy efficiency sub-projects. This path-breaking initiative aims to reduce dependence on conventional sources of energy by adopting cleaner technologies for power generation and energy efficiency to mitigate greenhouse gas emissions, while providing connectivity uptime service to telecom operators' tower sites. Bharti remains the first company in the world to introduce the practice of sharing of passive infrastructure by collaborating with our competition to share mobile towers and to reduce the collective carbon footprint of the industry. Within Bharti Airtel, a number of initiatives have been launched last year aiming to reduce energy consumption in lighting and air conditioning areas. The company has installed Solar Hot Water Generator at its main campus in Gurgaon for fulfilling the hot water requirement in the cafeteria. Majority of its facilities across NCR region are now installed with LES (Lighting Energy 31

Savers), which have reduced energy consumption in the lighting system to the tune of 10-25%. Variable Frequency Drives installed in AHU (Air Handling Unit) at its Campus have helped in enhancing the efficiency of cooling system by 10%. These measures have resulted in a saving of 8.5 lakh units of electricity per year. 4. Aircel It built a green field data centre called National Technology Centre in Gurgaon. The data centre uses many eco-friendly initiatives such as motionsensor lighting, use of LED lights and CFLs, adaptive cooling, geothermal heat exchange and earth air tunnel for reducing load on chillers, solar water heating, and rain water harvesting. The benefits obtained from the initiative were: Staying green. Reduced power and cooling needs. Power Usage Effectiveness of 1.8. Reduced carbon footprint by over 400 tons.

5. Uninor Uninor has been appreciated for its contribution towards environment and climate and it has been awarded with prestigious Green Globe Award at the TERI organized Delhi Sustainable Development Summit 2011. Uninor was awarded the prestigious Green Globe Foundation Award 2011 for Best Contribution by a Corporate/Business Enterprise Private Sector. Uninor got awarded for its The Green Initiative Opex Model. The model includes green initiatives like implementation of free cooling units, fuel catalysts and solar power equipment at Uninor tower sites. Due to unreliable power supply to many telecom towers in India, a majority of towers are today heavily depending on diesel. GSM operator Uninor has received accolades for its continuous CSR initiatives in the field of dependent on diesel generators for uninterrupted service. Uninors pilot project showed not only a reduction in carbon footprint, but also savings of up to 30% on the operating cost.

32

6. BSNL BSNL has taken up pilot projects for 10KW solar plants at 14 sites and wind power project at 6 USO funded sites in Rajasthan, Gujarat, Tamil Nadu, Karnataka and Maharashtra

Tabular Representation:

PARAMETERS

AIRTEL

IDEA CELLULAR

AIRCEL

RCOM

UNINOR

BSNL

Green Campaign

Awards & Recognition

Paperless Service

Adoption Of Renewable Energy Resources. GHG Emissions Control

Areas of activity per operator.

33

CHAPTER 10 Future Prospects of Green Marketing

FUTURE INITIATIVES THAT CAN BE TAKEN BY THE GOVERNMENT The government is also likely to make it mandatory for mobile phone towers to be powered by solar energy. The Ministry of New and Renewable Energy is undertaking a test project on the adoption of solar power panels on 600 towers. The trials are to be completed by mid-2011, post which the project will be implemented nationally. A funding scheme for the same is being worked out.

FUTURE INITIATIVES BY THE TELECOM OPERATORS Undertaking research and development activities for producing bio-fuels from renewable energy sources, such as agricultural waste and residues, to power existing diesel based mobile towers. Adoption of fuel cell systems. Fuel cell is a generic term encompassing a wide range of technologies that typically work by transforming the chemical energy of a fuel (usually hydrogen) directly into electrical energy. Fuel cells can generate power ranging from 1 watt (cell phone) to several megawatts (small factories). Hydrogen itself can be extracted in many different ways from different sources.

Solar powering of mobile towers. Solar has so far emerged as the most preferred of renewable technologies on offer primarily because of the availability of abundant sunlight across the country.

Adoption of solar-wind hybrid solutions consisting of both wind turbines & solar cells which help lower fossil fuel consumptions by up to 80 per cent. Base stations powered by such solutions offer economically viable alternatives since they lower both operating and maintenance expenditures.

34

Installation of bio-fuel plants. This can be helpful for rural telecom towers where bio-wastes are abundant.

FUTURE INITIATIVES BY VENDORS Recycling of unused old handsets by allowing more & more customers to go for recycled versions of their handsets. This can be achieved through recycling centres.

Vendors have been increasingly flooding the market with renewable energy solutions. For instance, Moser Baer offers customised solar energy solutions to minimise operational complexity and maximise financial benefits. It also provides customised hybrid systems with other resources like wind to use potential windy sites to optimise costs. Such systems are definitely going to be more popular in near future to replace diesel consumption.

Leading equipment makers such as Ericsson and Nokia Siemens Networks (NSN) have also installed hundreds of base-stations powered by solar panels, wind turbines or bio-fuels, mostly in parts of the developing world where there is no electricity grid. NSN is currently offering operators autonomous sites, which can be configured with solar and wind systems to suit the local environmental conditions. Recently, NSN has also entered into a global collaboration with ACME Tele Power, whereby the two companies will work together to offer efficient operation, maintenance and energy management solutions to telecom operators in India. ACME Tele Power is focusing on eco-friendly technologies such as green shelters, nano cooled shelters and battery coolers.

35

CHAPTER 11 Conclusion
Now this is the right time to select Green Marketing globally. It will come with drastic change in the world of business if all nations will make strict roles because green marketing is essential to save world from pollution. From the business point of view because a clever marketer is one who not only convinces the consumer, but also involves the consumer in marketing his product. Green marketing should not be considered as just one more approach to marketing, but has to be pursued with much greater vigour, as it has an environmental and social dimension to it. With the threat of global warming looming large, it is extremely important that green marketing becomes the norm rather than an exception or just a fad. Recycling of paper, metals, plastics, etc., in a safe and environmentally harmless manner should become much more systematized and universal. Marketers also have the responsibility to make the consumers understand the need for and benefits of green products as compared to non-green ones. In green marketing, consumers are willing to pay more to maintain a cleaner and greener environment. Finally, consumers, industrial buyers and suppliers need to pressurize effects on minimize the negative effects on the environment-friendly. Green marketing assumes even more importance and relevance in developing countries like India.

36

References
Business Strategy and The Environment, Bus.Strat.Env.II, pg 285-297. Ottoman, J.A. et al, "Avoiding Green Marketing Myopia", Environment, Vol48, June-2006 www.greenmarketing.net/stratergic.html www.greenpeace.org/international www.google.com

TRAI Consultation Paper on Green Telecommunications http://en.wikipedia.org/wiki/Green_marketing

www.coai.com

Marketing Mastermind, June 2011

www.greentelecomlive.com www.tele.net.in www.voicendata.com

37