Product innovation: eco-efficient value creation
The double objective
The way towards sustainability requires a double aim in product innovation:
– lower eco-costs and at the same time
– higher value (a higher market price).
We call this: eco-efficient value creation. See Fig. 4.4a.
The reason we need value creation for eco-efficient products is threefold:
1. the higher price prevents the rebound effect (see page “design alternatives“)
2. the higher price in the market is required to cover the higher production cost of green products (note that a higher price is only accepted by the consumer when the perceived value is higher, otherwise the consumer will not buy the product)
3 . lowering the EVR appears the key to a sustainable development at the level of countries (see FAQs, question 3.1)
In the following text, three examples are shown:
The first example is from the building industry:
Figure 4.4a The required double objective in design: lower eco-costs plus higher value
replacing a concrete slab floor by a wooden floor.
See Fig. 4.4b
The wooden floor has lower eco-costs, but is more expensive. So the wooden floor must have a higher perceived value. This can be achieved by marketing: the feel-good factor of wood must be emphasized (wood is “warm” and reminds you of mother nature).
The second example is the introduction of Senseo, Fig. 4.4c, by Saralee-DE and Philips, a decade ago. This is an perfect example of
- the concept of the EVR
- consumer expenditures
- design alternatives
- product innovation
- product portfolio strategy
- green marketing
Figure 4.4b Replacing a concrete floor by a wooden floor