What does Toyota's travails mean to green marketing?
That question seems ripe these days, as the leading Japanese auto maker gets a comeuppance for its allegedly serious safety defects — and the more than 8 million cars it has recalled worldwide as a result. Toyota, after all, had become a darling of the eco-minded, a case study in the green halo that can inure to old-line companies that bring environmental innovation to mainstream audiences. Toyota seemed to have done it the right way: with products that weren't just greener, but better — in this case, high-aesthetic, high-performance, affordable cars.
In some regards, Toyota's Prius gas-electric hybrid represented the green consumer ideal: no tradeoffs — a product that pushed all the right buttons. It came from a trusted brand, didn't require consumers to change habits, performed well, looked great, and provided an environmental benefit. It made a public statement about the owner's green cred. It offered consumers, as I've dubbed it, "Change without changing." There haven't been many other consumer products from major brands, save for a handful of household cleaners, that have fired on all those cylinders.
But now that ideal has experienced a crash-course in reality, a collision of technological snafus and a corporate culture that shunned transparency for expediency — and may have committed criminal neglect. The result, as everyone knows, is a massive global regulatory undertaking, media-fanned anxiety on the part of Toyota vehicle owners — and more than a little handwringing on the part of environmentalists, who aren't sure what to think of a company that had come to be seen as a corporate hero.
One evidence of that hero status comes from the Green Confidence Index co-produced by my team at GreenBiz.com. Every month we ask 2,500 Americans — a demographically representative sampling of the adult online population — a simple but profound question: "What company, if any, do you think of as being 'green'?" It's an unaided question, meaning that no list of companies is provided. Respondents simply name companies that are top of mind. For the past six months, Toyota has remained among the top 8 companies named. (Walmart and Clorox have consistently been the top two, while 64% of Americans aren't able to name any company they consider to be green — a story for another day.)
It will be interesting to see how the troubles will tarnish Toyota's green sheen, especially since the company's recalls have been so widely and persistently reported; this isn't some scandal limited to the blogosphere or the green world. The Green Confidence Index will be following this closely over the coming months.
So, what does the recall mean to the world of green? There are several potential scenarios:
1. The recalls will severely damage Toyota's credibility, making room for other car companies to emerge as green leaders, especially as a new wave of hybrids, diesels, and electric vehicles rolls out over the next 18 months: Nissan's Leaf, GM's Chevy Volt, Ford's Focus, Volkswagen's Touareg, higher-end cars from BMW, Porsche, and Infinity — in addition to cars, vans, electric bikes, and other alt-fueled vehicles made by countless smaller firms, from Aptera to Zap. Plus, the high-profile (and high-priced) Tesla Roadster and Fisker Karma. In an era in which nearly everyone has one or more green vehicles to promote, the Prius may take a back seat.
2. Toyota's brand leadership and reputation for quality and environmental leadership will survive intact. So indelible is its reputation, the scenario goes, and so loyal are its customers — especially diehard Prius owners — that the public will see Toyota through. This scenario, of course, hinges in large part on whether and how the company digs itself out of its reputational hole in the coming weeks: how it executes on its recalls, how it survives upcoming U.S. congressional hearings (and their counterparts in other countries), and what evidence of corporate malfeasance arises. It also depends on things outside of the company's control. For example, every serious accident involving a Toyota vehicle could become fodder for local (or national) news media to burnish a Toyota-as-death-trap reputation that could take years to undo.
3. Toyota's plight will be a setback for green products in general and green vehicles in particular. The Prius — the darling of environmentally minded consumers — has now been tarnished as unsafe, thanks to its occasional loss of braking. (So, too, have the upscale Lexus hybrid and the Toyota Sai compact, another hybrid sold only in Japan.) For skeptics, climate deniers, and green grumps of all stripes, this "proves" that green marketing is a scam, simply another means to separate consumers from their wallets. When all is said and done, the Prius will have mowed down a host of promising products with environmental attributes — and not just cars. At minimum, it will give solace to those who already had been looking for reasons not to purchase fuel-efficient cars, energy-efficient appliances, organic foods, and other greener goods.
4. The Prius recall will prove that greener cars are just like any other, in that they come from real companies with real problems. As such, it will help to socialize the new crop of green vehicles, and maybe other green products, helping people to see them as part of the "regular" marketplace. This will reduce the negative stigma some people hold against green products. And while Toyota's products may take a while to regain favor, their woes won't impede other companies' success.
Which of these scenarios pans out is anyone's guess. And it's not a zero-sum game. Toyota could win this battle (Scenario 2) while green products lose the war (Scenario 3). It will be interesting to watch — another speed bump in the long and winding road toward the mainstreaming of green.
The Toyota story is a powerful reminder that green products must also be in compliance with social, environmental and safety standards. Even if the Prius traveled 300 miles to the gallon of gasoline, it has to be safe and reliable. An electronic device could use virtually no energy and be made out of 100% recycled materials, but if it is made in a sweatshop, it does not represent a green product. Beyond compliance does not mean compliance no longer matters, the better term might be compliance plus.
Posted by: Bruce Klafter | February 16, 2010 at 01:38 PM
With the new recall of Corollas today, I gave up and sold all of our Toyota stock. I'm betting that there is more pain to come before recovery sets in.
Posted by: Tom Eggert | February 17, 2010 at 12:26 PM
"When all is said and done, the Prius will have mowed down a host of promising products with environmental attributes — and not just cars."
I do not meet many people who are legitimately on the fence about green products. In my experience, the majority of the climate skeptics and green marketing conspiracy theorists simply hold a more present tense view of practicality and cost effectiveness. They make after the fact philosophical stands based on what is congruent with their very practical, day to day, decisions.
The organic bananas that cost more but taste very similar to normal bananas do not make any sense to this person. Paying extra for a car that is smaller, has less horsepower, and doesn't actually save any money on fuel/maintenance because you have to change out the batteries at some point, makes exactly zero sense to him/her.
I do not think that this incident will turn many people on or off to green products. Those who make decisions based on practicality will not buy these products until the day to day benefits of green products match those of traditional products in a simple and intuitive way.
Posted by: Jeff Sabins | February 19, 2010 at 09:23 AM
Bruce, I have to disagree with your post. "but if it is made in a sweatshop, it does not represent a green product." I think this is incorrect. The words "green" and "safe" and "ethically manufactured" all exist because they have different meanings. Totally different, non-overlapping, topics.
By broadening the "Green" revolution to include all kinds of other value based, moral, and ethical issues, the odds that any positive change towards preserving the environment under the banner of "going green" goes to zero. Keep green for the environment, use the other terms where they apply.
Posted by: Jeffrey Sabins | February 19, 2010 at 11:17 AM
I agree that safety should be the primary factor for choosing a car. It would be great if the car could be safe and ecological too! In any case, let us remember to weigh out all important factors in choosing a car.
Posted by: Saar | February 22, 2010 at 12:57 AM
Toyota's problem isn't going to have a big effect on the green movement. The biggest problem with the Green movement is that sometimes people implement dreams before they're ready. Like Jeff said, if something "green" tastes the same, works the same, and COSTS the same as a current product, it's hard to sell it to most people. A green product has to become economically practical in order to catch on.
Posted by: Connie L. | February 24, 2010 at 11:55 AM
I agree with Connie that this will not have a huge effect on the green movement. It just shows that even a company like Toyota is not the most reliable car manufacturer either. No car company can produce that reliable cars. That is the just the way it is in the mechanics world as far as I know.
Posted by: Fabian Pattberg | March 03, 2010 at 01:17 PM
I believe that safety should be the primary concern of all auto manufacturers. They should also focus on creating a vehicle that helps the environment and not to destroy it. This recall should teach them a lesson.
Ruzzel Walsh
Posted by: Claremont auto glass | March 07, 2010 at 10:49 PM