The greatest market failure

The greatest market failure the world has ever seen, a situation in which the market does not efficiently allocate resources to achieve the greatest possible customer satisfaction: climate change.

As Sir Nicholas Stern observed many years ago, climate change is the latest and most tragic confirmation of Garrett Hardin’s tragedy-of-the-commons theory. It’s a fascinating challenge for marketing professionals, a world championship for the best of the best: after getting everybody to buy Coke Zero and Apple, how about using social marketing to get 100% of the world’s population to adopt a behaviour change that, simply put, will allow our civilization to survive.

Market research has shown that 50% of people consider climate change to be the single greatest threat facing humanity – and one which will significantly impact future generations. But not even 10% of people think that they can personally make any difference: the public continues to externalise climate change to other people, places and times.

Climate change has faced various marketing difficulties:

-          Horrible naming: ‘Global warming’ sounds downright appealing and highly unlikely to prompt new behaviours. ‘Warming’ sounds about as dangerous as a sheep or an eiderdown comforter.

-          Education and information never get people to change their behaviour – whether it’s eating more fruit or using condoms – and they certainly won’t get a majority to renounce acts of consumption. So let’s forget the pamphlet approach.

-          Climate change is practically imperceptible. It’s sort of like getting people to accept that the earth is round and that it revolves around the sun: people’s physical senses and their understanding of the environment conflict with the message.

-          We must segment the market by means of useful analyses – such as Defra’s – that use variables such as willingness and ability to act.

We don’t have much time: a frog in a pot doesn’t die until the water boils, but he does become less willing and able as the temperature rises.  If marketing can’t solve this, we’ll have no choice but to go the 12 Monkeys route.

What marketing strategy would you use to address climate change?

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