When bigs make big moves: Wal-Mart and the green labels

I found this article by Stephanie Rosenbloom published on the New York Times online edition on July 15, 2009.

It basically discusses about Wal-Mart mission to create an index system to label all the items sold in their stores according to the environmental and social impact (meaning children labour, etc..) of each single product. It would be like a sort of nutrition label but containing all the environmental and sustainability information regarding the product.
This alone it’s astonishing because it revolutionizes the way people carry out their purchases. Without messing with all the marketing engineering stuff we can assume that a customer –a consumer- is basically driven by two macro factors when roaming supermarkets: the price and the marketing pressure taken as a whole, comprising advertising, packaging, etc… What Wal-Mart wants is to add a third macro factor to the purchasing process. If Wal-Mart is successful consumers will be able to introduce environmental sustainability to their decision making process. You must consider that in the last 20 years or so “green” has become a powerful concept which, differently from other ones, influences almost all the social layers. This said, it’s quite possible that the introduction of this “mirror of the products' soul” will heavily impact the whole production and supply chain, eventually reaching the western world consumers values.
With such a great objective is more than natural to be skeptic about the effectiveness and the feasibility of what Wal-Mart is doing.

For what concerns the effectiveness we already know that where green labels are applied they work like a check valve for the consumers. Let’s just take the A-G consumption class labels applied to electric appliances in the EU. The vast majority of EU consumers wouldn’t choose anything which ranges from B to F, sticking to appliances labelled with the first two letters. About this point we must also keep in mind the selling environment which in this case plays a fundamental role. From the ‘80s the big supermarket chains have gained more and more predominance as distributor players and the process is still ongoing. By selecting products, reserving spaces on their shelves, and proposing the customers their own branded products, the supermarket chains have leverages that can effectively shape the mass production quality. Coming back again to the example I just made, if you enter whatever retailer store selling electric appliances you can see how the majority of the fridges, ovens or air conditioners, are labelled class A or B while only a few are classified C or less.
The feasibility though it’s something completely different. For this project Wal-Mart is involving different actors each of them playing a role in creating what they want to be a standard ready to be exported to distribution chains all over the world. Suppliers, scholars and environmental associations were summoned by Wal-Mart to build a system whose complexity can easily become its biggest liability. Speaking of suppliers, they will surely complain using the typical equation which states that producing in a more careful social and environment way equals to producing at a higher cost. To this “counter attack” Wal-Mart will respond in two ways. At first by demonstrating how this equation is easily falsifiable –i.e. by reducing packaging you reduce costs-, and secondly by using their leading position in the market to compel manufacturers to “try harder”. By quoting Rosenbloom article, Wal-Mart said that suppliers who refuse to participate to their “green labelling” mission won’t be penalised but become less important to them.
There’s one last benefit generated by Wal-Mart project, which is less evident but equally important. Left aside the exaggerations and fanaticism, it’s obvious that a more sustainable way of life is only driven by logic. Spare resources and recycling those whose purpose has expired can hardly be defined but a progress. In the same way it’s also clear that the western world culture has developed around the concept of consume which self explain itself.
Generally speaking consuming can only lead to depletion at least until we find a way to produce more energy than the amount we spend to generate it. Until that time the only sensible thing to do is trying to adopt a smarter way to keep the most of our lifestyle without depleting the resources at the rate we're used to do.
Wal-Mart is trying to do its part.
Should you happen to be interested in Wal-Mart sustainability program just check the relevant section of their website here.

Wal-Mart logo is Copyright of Wal-Mart Inc. Picture is by Andrew Dunn, 30 December 2004. All the above are here reproduced under the terms of the Fair Use.