Selling Small, Thinking Big: P&G's Sustainable Innovations

Add to iTunes
GreenBiz Radio RSS

• 

  Your Email: *

  Your Name: *

  Send To: *

  Enter multiple addresses on separate lines or separate them with commas.

  You are going to email the following: Selling Small, Thinking Big: P&G's Sustainable Innovations

  Message Subject: (Your Name) has forwarded a page to you from GreenBiz.com®

  Message Body: (Your Name) thought you would like to see this page from GreenBiz.com®.

  Your Personal Message: *
  
• 
• 
• 

If you work for a company that makes laundry soaps, then the resources used in your own operations are only a small part of your overall footprint. This is especially true if your company works on the global scale of Procter & Gamble.

When looking at the energy use of its products from manufacture to disposal, P&G found that far and way the biggest source of energy use came from customers washing their laundry in warm or hot water As a result, the company began to develop new products designed to not only to be washed in cold water -- using less energy -- but has begun developing a whole range of products it calls "sustainable innovation products."

I spoke with Peter White recently to find out what makes a P&G product sustainable, how the company incorporates social responsibility into its goals, and how to make every job a green job.

Matthew Wheeland: Peter, thanks so much for taking the time to talk today. I wanted to talk briefly about Procter & Gamble's overall goal for green products.

At our Greener by Design conference a few weeks ago, you mentioned that the company has set a goal to sell $20 billion in total sales of what you call "sustainable innovation products." Tell me a little bit about what kinds of products those are.

Peter White: Well, what we call sustainable innovation products and, as you say, we've set a goal that by 2012 we're going to develop and market at least $20 billion worth in cumulative sales. Sustainable innovation products are products with a significantly reduced environmental footprint versus previous alternative products.

So the environmental improvements are going to be significant and they're gonna be obvious and when we said that, we've actually defined what we mean by a significant improvement.

We looked across the whole lifecycle of the product and there has to be at least a 10 percent improvement, whether it's in energy use, whether it's in water, packaging, waste or transport, but as I said, over the whole lifecycle. And 10 percent may not sound a lot, but over the whole -- a 10 percent saving over the whole lifecycle is a significant improvement and a significant hurdle to meet.

As far as the products we're talking about, products in the laundry area, of course, low-temperature products like Tide Cold Water or in Europe we have the equivalent, which is Ariel Cool Clean. The significance there is that if you look over the whole lifecycle of washing clothes, by far the biggest energy consumption and therefore CO2 emission comes from the heating of the water for actually washing the clothes.

P&Gs energy usage across all products' lifecycles. The tall red bar represents customer energy use for laundry products, i.e. washing laundry in warm water.

So if you can actually get people to wash at low temperature then clearly there's a huge energy and CO2 savings. In the U.S., it's very significant. If we could get everybody in the U.S. to wash at low temperature in cold water it would save around 3 percent of the total domestic energy consumption and would actually save somewhere around 6 percent of the country's greenhouse gas Kyoto commitment.

That's low temperature detergent, compacted products; you've seen across North America we've compacted our liquid laundry detergent within the product. We have other products for low-income consumers, for example, Downy One Rinse, which is for hand-washing in many developing countries. That reduces by around two-thirds the amount of water needed to actually do the washing.

Then, other sorts of products, our Braun shavers, for example, we've just got a new smart battery charger for the Braun razors and so that these shavers use around 60 percent less energy compared to the alternative product.

These are the sorts of things where there's a significant and obvious environmental improvement.

MW: And one huge element of this is how do you get customers to use these in the way they're intended, the cold water laundry detergents particularly, but before we get to that, how does Procter & Gamble go about developing and designing these products? Is it looking at what's already on your list of products on the shelves and figuring out ways to improve them or is it coming up with entirely new products?

PW: Well, I think, as in most things, it's both/and, and I think what is key here is to get sustainability into the innovation process, so we've sort of embedded it into the innovation process that our research and development folks use so that for some time they've been using tools like lifecycle assessment that actually look at the overall environmental impacts of a product throughout the total life.

As they assess new products, it's getting these sorts of assessment tools into the R&D process so that people early on can actually determine what the sustainability profile of their products are. Just to get back to that one example I gave earlier around Tide Cold Water, the whole idea of that came from an assessment of the energy consumption of the company. We did a lifecycle assessment essentially of Procter & Gamble.

We looked at all of our product categories and all the lifecycles of those products to see where, you know, our energy footprint lay and that gave us, I mean, quite a surprise at the time that, you know, there was this huge peak in laundry in the use phase and that actually led us to develop a low temperature detergent because, obviously, in that case there are benefits all around.

We tout the environmental benefit of low-temperature washing, but, you know, there's a clear -- the consumer benefit is the consumer saves energy and therefore saves money. It also at lower temperature is better for fabrics, so it's better for fabrics.

It's a benefit for the consumer. It saves the consumer money and it's better for the environment, so it's a win all around, so we're not asking the consumer to make a tradeoff here. We're actually providing benefits all around.

MW: You touched on the energy use idea, which I want to come back to again in a moment. Part of the design process you mentioned at the conference entails a shift from what you call green by design to products that are green by design. Can you explain the difference between those two ideas?

PW: Well, essentially at the conference I was just making the distinction. I mean the role of design in green products, that's obviously the whole design process you could say, but it's green by design. It's the design piece that makes the difference.

The other point there is, you know, that you make it green by design, i.e. intentional and that's something, you know, that we have taken onboard, but if you're going to make green products you have to be very intentional and actually build it into the fabric of the company.

And it's not just about going out there and having green advertising. You have to have the R&D in place to actually design these products that have these significant and obvious environmental benefits. You obviously then have to have the communication to the consumer so the consumer understands what the benefits are and knows how to actually realize those benefits, but it goes much further than that.