Clorox Goes Green

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Sumi Cate, R&D group manager, Clorox: "The natural and sustainability trends are really starting to gain momentum within the chemical industry. I think that nature can teach us a lot. It's an area I've always had a lot of passion for." | photo by Jason Madara

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Carl Pope, executive director, the Sierra Club: Clorox's Knauss says of Pope, "Both Carl and I start with one foundational belief: Corporate America and environmental groups must start working together. We really do have the best interests of the consumer and the planet at heart." | photo by Jason Madara

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For Clorox, it's nothing but upside. For the Sierra Club, it's risking -- if not undermining -- its most valuable asset: its independent reputation. In exchange for the use of its name, the Sierra Club applied precious little leverage. For example, it made no demands for Clorox to offer recycled packaging or change the environmental profile of other products. Not only did the club withhold financial information, but it also agreed not to lend its name to any other natural cleaning products, even if they're 100% organic and packaged in a coconut shell. Adviser Makower, who originally encouraged Clorox to reach out to nonprofits, is dismayed by the deal the Sierra Club struck: "To be tied directly to sales and not reveal [the details], and to be flacking the products, is, in any world, borderline unethical," he says. "It soils the living room for everybody."

The take-home message for the Sierra Club and other nonprofits may be that they need to draw a careful distinction between two types of nonprofit/for-profit relationships: cause-related marketing and endorsements. Historically, in cause-related marketing campaigns, a group such as the Sierra Club would collect proceeds from the sale of a non-mission-related product, such as a calendar. There are no special environmental claims being made about the calendar itself -- the organization's name is simply a sign of support. "It's like the Easter Seal," Pope says. "You're getting money from a candy. It isn't that the candy is better for polio."

In endorsement relationships, on the other hand, a group such as the Forest Stewardship Council or the Sustainable Fishery Advocates puts its seal of approval on a product that claims some mission-related benefits. No money should be involved, or that seal isn't going to be worth much.

In the Green Works situation, the distinction seems to have collapsed, which Pope himself admits. He says the Sierra Club has started a task force to reexamine its corporate policies in the wake of the experience. "Because we insist that these products meet our mission standards, the distinction for us between cause-related marketing and product endorsement is a little fuzzy. It's pretty clear that we're having a hard time keeping the distinction clear in our minds, so how can we possibly expect the consumer to keep it clear?"

Consumers, of course, may not care either way, and ultimately, Pope, as the leader of a grassroots organization, must strike a balance between keeping the club members happy and reaching a much broader audience. The club is facing challenges recruiting younger enviros, who increasingly choose to engage online rather than become lifetime contributing members, even as the activist volunteer core ages and shrinks. Of the 1.3 million Sierra Club contributors, only 800,000 have made the commitment to become members. Being exposed to millions of shoppers at Wal-Mart, Target, and elsewhere has to be a plus. "Many more people are buying Clorox Green Works than know what the Sierra Club is. It's like getting an advertisement on the back of the Clorox bottle," says Adam Werbach, a former president of the Sierra Club who is now a sustainability consultant with Saatchi & Saatchi S, working for Wal-Mart. "That's much more valuable than whatever dollars they got paid for it."

In the meantime, the unlikely partnership continues to grow despite its fraught beginnings. Green Works sales forecasts have already been boosted six times, and each product now leads its category within the natural-products universe -- and not through cannibalization. Green Works has actually grown the overall size of the naturals market by 300% in the categories it competes in, and more products are in the pipeline, all stamped with the Sierra Club seal. What's more, both Pope and Knauss say they're talking about a new effort to promote a green rebranding of Clorox's Brita water filters as an environmentally friendly alternative to bottled water. "When I got on board 21 months ago, the question was, How quickly can we sell this thing?" Knauss says of the Brita business. "In the last 9 to 12 months, as people have been educated about the sustainability issue, Brita has seen its strongest growth in over a decade."

Sounds like a win-win for everybody. What could go wrong?