Green branding is a challenge, even for the baking industry. For credible green brand management, bakeries must take comprehensive and holistic measures in all areas of the company.
By Prof. Dr. Ralf T. Kreutzer, Professor Emeritus, Berlin School of Economics and Law
1. Green branding labeling
Green branding, also known as green brand management, refers to the process of making a corporate or product brand sustainable and positioning it as sustainable in the market. A successful (re)alignment of brand management and marketing as a whole requires numerous processes within the company to be geared towards sustainability. Green branding must therefore not start with marketing alone. Building a ‘green brand’ requires comprehensive measures in all areas of the company and is based on sustainable corporate management.
All of the goals and measures then lead to green brand management. Advertising and promotional measures then serve to communicate the sustainability initiatives internally and externally. Green marketing and green branding are therefore the icing on the cake of sustainability-oriented corporate management (see Fig. 1). Otherwise, there is a risk that the company’s measures will come across as greenwashing.
The question for every company is how it can implement the requirements of the triple bottom line concept (see Fig. 2; in more detail Kreutzer 2023, p. 3-6). This concept aims to simultaneously strive for ecological sustainability (planet), social sustainability (people) and economic sustainability (profit).
Achieving these goals requires companies to align their entire business model with sustainability.
2. Fields of action for green branding in the baking industry
The successful implementation of green branding in the baking industry requires a comprehensive and integrated concept. Every decision and every process within the company must be geared towards sustainability in order to establish a credible green brand. Here are the most important steps and fields of action that need to be considered.
2.1 Sustainable procurement and production
A key aspect of green branding in the baking industry is sustainable procurement and production. Bakeries can place a strong focus on regional and organic ingredients when selecting their raw materials. By giving preference to local suppliers, transport routes can be minimized and the local economy supported. At the same time, certified organic raw materials and fair trade products help to reduce the environmental impact of conventional agriculture and provide a better life for people in the supply chain
In the production process itself, the main focus should be on energy and resource efficiency. The use of modern, energy-efficient machines and technologies can significantly reduce energy consumption in the baking process. It can also be examined whether the CO2 footprint can be reduced by switching to renewable energy sources such as solar or wind power. Photovoltaic systems on your own building can also contribute to this.
In addition, water conservation and reuse systems should be used to reduce water consumption. Effective waste management is also important. By minimizing production waste and implementing recycling and composting programs, bakeries can further reduce their environmental impact. Consequently, the following questions, among others, need to be answered:
+ Which raw materials are currently used and how sustainably are they obtained?
+ Are recycled materials used in products and packaging to reduce the consumption of primary raw materials?
+ Have resources already been saved and harmful emissions reduced in the manufacturing process?
+ How quickly can further optimization potential be exploited in production?
+ Are employees along the entire supply chain paid fairly?
+ Do the suppliers act responsibly?
+ Have resources already been saved in logistics and what potential still needs to be leveraged?
+ Can packaging be disposed of sustainably after use?
+ Is energy and water management efficient?
+ Is effective waste management in place?
The answers to these and other questions provide the informational basis for green branding.
2.2 Sustainability in the product portfolio
Sustainability must also be clearly visible in a bakery’s product portfolio. This starts with product development. Here, for example, environmentally friendly packaging can be used. Recyclable or compostable packaging materials are a good choice to reduce waste and protect the environment. In addition, recipes should be based on natural and sustainable ingredients in order to offer customers healthy and environmentally friendly products. Transparency also plays an important role. The bakery should clearly label the origin and sustainability of its products to increase customer confidence. Transparent product information allows customers to understand what steps the company has taken to ensure sustainability.
These are important measures on the way to green branding.
Another important step towards sustainability is not wanting to keep as many products as possible in stock until closing time. Surely, a customer can’t be expected to accept that certain baked goods are no longer available shortly before closing time. One argument would be that not so many goods would then have to be destroyed or given to food banks that distribute this food to people in need.
The following questions, among others, must therefore be answered here:
+ Is environmentally friendly packaging used?
+ To what extent are natural, possibly sustainably produced
ingredients used?
+ Are sustainable elements reported transparently?
+ Are remaining stocks of perishable goods consistently
avoided?
+ Is there cooperation with food banks?
+ Are perishable goods – before they expire – still being put to use?
2.3 Sustainability in the operating process
Another important aspect of building a green brand is the commitment of your own employees. Regular training in sustainable practices and environmental awareness can help to ensure that all employees are pulling in the same direction. In this way, employees can be involved in initiatives to develop sustainable corporate management. This allows employees to contribute their own ideas to the process and promotes a culture of sustainability throughout the company.
The following questions, among others, must therefore be answered here:
+ How comprehensively are employees involved in the journey towards sustainability?
+ Which ideas from employees can be integrated into the process?
+ How regularly are employees informed about the results achieved?
2.4 Sustainability in logistics and distribution
Sustainable practices can also be implemented in logistics and distribution. Optimizing supply chains can help to shorten transport routes and reduce CO2 emissions. It makes sense to work with logistics companies that also use sustainable practices to further minimize the environmental impact. If local markets are preferred for distribution, the ecological footprint can be further reduced.
The following questions, among others, must therefore be answered here:
+ Are the journeys regularly route-optimized?
+ Can journeys be avoided?
+ Do you use vehicles that use renewable energy?
+ Is recyclable shipping packaging used?
+ Is there a focus on the local market?
2.5 Integration of customers and partnerships
Customers can be involved in the sustainability strategy through informative campaigns and hands-on activities. This may even increase customer loyalty to the company. ‘Nudging’ is an effective method of motivating customers to make more sustainable purchases or adopt healthier behavior (see Thaler and Sunstein, 2010; Grunwald and Schwill 2022, pp. 92-95).
Nudging should be understood as ‘guiding’. It is an attempt to encourage customers to change their behavior without exerting coercion, imposing bans, or providing economic incentives. The people addressed therefore still have freedom of choice because they do not have to react to the nudges. Prohibitions or commands and the use of economic incentives are therefore not part of nudging.
Nudges are only intended to ‘guide’ individuals to make a ‘better’ decision – as defined from a certain perspective. Only the provision of further information should contribute to a change in behavior.
Ideally, pleasure-oriented ‘green’ communication that conveys a desire for sustainability is successful – e.g. through the ‘good feeling’ of having purchased a sustainable product. When companies enter into partnerships with environmental organizations and other sustainable brands, their own credibility can be increased and common goals can be achieved more easily. Through such collaboration, bakeries can benefit from the experience and knowledge of others and further improve their own sustainability practices.
The following questions, among others, must therefore be answered here:
+ Is nudging used to motivate customers to make more sustainable purchases?
+ Which nudges are particularly successful?
+ Can a collaboration with environmental organizations enhance your own sustainability journey?
+ What can be learned from other sustainable brands?
3. Legal framework for green marketing and green branding
A credible green brand requires authentic and transparent communication. It is important to avoid misleading statements and greenwashing. In greenwashing, companies claim that their products or business models are more sustainable than they actually are. This is a form of misleading advertising, which is already prohibited under Section 5 of the Unfair Competition Act. This misleading advertising attempts to create a green image and distract from the actual consequences of the company’s own business activities. All companies should therefore refrain from the following forms of greenwashing today (see also Grimm and Malschinger, 2021):
Partially green services
An offer is positioned as ‘green’ even though only individual features are environmentally friendly. Because of these partially green services, the entire offer or even the entire company is assumed to be ‘green’ by association.
Sustainability is not documented
Here, statements about sustainability are made in communication that are not substantiated. Motto: ‘Boldly asserted is half proven!’
“Why should the bakery industry start thinking about these regulations today? Anyone placing orders in the next few months to print brochures or bags that could be used until 2026 should know exactly which statements will no longer be permitted in the future – so that these printed products do not have to be destroyed later. ”
Prof. Dr. Ralf T. Kreutzer
Vague statements
Unclear terms such as ‘fair’, ‘sustainable’, ‘regional’ and ‘climate-neutral’ are used in communication, some of which are not legally protected and/or only pretend to be sustainable without providing any evidence.
Empty labels
Some companies use self-designed labels that suggest sustainability without being backed up by concrete measures or third-party audits.
Irrelevant statements
Statements are made here that are true, but have no substance in terms of sustainability. Example: ‘controlled contract farming’ on the packaging of Bahlsen cookies.
Untruths
Here, statements are made in communication that are simply false and must therefore be described as lies. The need to refrain from such measures continues to result from the European Empowering Consumers Directive, which has been in force since March 26, 2024 – but is widely unknown. This regulation must be implemented by the EU member states by the first quarter of 2026. This directive prohibits the following practices:
+ General environmental claims (such as ‘environmentally friendly’, ‘green’, ‘climate-friendly’, ‘bio-based’) without any concrete, verifiable content
+ Generally product/service-related advertising with compensation projects
+ Advertising future environmental performance without a detailed and realistic implementation plan that is regularly reviewed by an independent external expert
+ Sustainability labels with environmental and/or social characteristics that are not based on a certification system or have not been established by a government agency
The Green Claims Directive, which is currently (as of June 2024) still being discussed in the European legislative process, is intended to regulate the following:
+ Justification based on a list of criteria
+ Communication of ecolabels and specified environmental claims – which must be available offline or online
Both contents must be certified in advance by an accredited independent body or certification system. Corresponding violations are to be punished by the authorities as a matter of priority.
Why should the bakery industry start thinking about these regulations today? Anyone placing orders in the next few months to print brochures or bags that could be used until 2026 should know exactly which statements will no longer be permitted in the future – so that these printed products do not have to be destroyed later.
In addition, it makes sense today to check your own presence – both online and offline – for statements that will no longer be permissible (without evidence) in the future. This approach is more effective than rushing into action shortly before the deadline. After all, control mechanisms and sanctions for infringements can then be expected in order to effectively combat greenwashing.
4. Outlook
In order to credibly implement green branding in the baking industry, bakeries must take comprehensive and holistic measures in all areas of the company, from sustainable procurement and production to resource-efficient operating processes, environmentally friendly logistics and authentic communication. Every decision and every process should be geared towards sustainability. This is the only way bakeries can build a genuine green brand, gain the trust of their customers and retain customers in the long term.
Author
Prof. Dr. Ralf T. Kreutzer is professor emeritus at the Berlin School of Economics and Law, Berlin. Research areas include:
marketing, international/strategic marketing, dialog and online marketing, digital Darwinism, digital transformation, artificial intelligence, sustainable corporate management
References
– Gebhardt, J./Leiendecker, J./Lienke, G./Meier, F., Proposal of the EU Commission for a Green Claims Directive, in: ESG – Zeitschrift für nachhaltige Unternehmensführung, 5/2023, pp. 130-134
– Grunwald, G./Schwill, J., Sustainability Marketing. Stuttgart: Schäffer Poeschel, 2022
– Grimm, A./Malschinger, A. (2021). Green Marketing 4.0. A Marketing Guide for Green Davids and Greening Goliaths. Wiesbaden: Springer Gabler
– Kreutzer, R., The path to sustainable corporate management, Wiesbaden: Springer Gabler, 2023
