LG, Samsung see energy efficiency marketing pay off

LG, Samsung see energy efficiency marketing pay off

When EnergyStar began pilot testing its “Most Efficient” label in 2011, some companies and trade associations were concerned that having an additional top tier designation would take away from the existing Energy Star Gold label. Initially, only a few companies were onboard with the program, and only a handful of products met the criteria for the label.

Meant to provide some incentive for manufacturers to continuously improve efficiency, the Most Efficient label sets a high bar and so far only applies to televisions, refrigerators, washers, and heating and cooling equipment. The Most Efficient standards for refrigerator/freezers require them to be about 30 percent more efficient than standard models. TV requirements call for 80 percent more efficiency than common products on the market.

As it closes its second pilot year, all concerns have been erased and the program’s success is solid. According to the EPA, the washer and TV categories have exploded in 2012: At the beginning of the year, there were 24 clothes washers and 63 televisions that were eligible for Most Efficient status. Currently, there are 66 Most Efficient clothes washers and 455 Most Efficient televisions.

For companies, of course, it’s not just about getting a gold star for energy efficiency but about how energy efficient products sell, and so far that’s a success story as well. LG announced last week a 75 percent increase in sales of Energy Star Most Efficient products. Part of that increase is due to an increase in the number of Most Efficient-designated products in the company’s line: LG had only eight televisions and five washing machines eligible for the label when the program launched in 2011. Now, it has more than 60 Most Efficient products available, across all four product categories (refrigerators, televisions, washers, and heating and cooling).

Graphic of two women standing next to refrigerator provided by sparkstudio/Shutterstock

The bump is also due to LG’s promotional efforts around the Most Efficient designation. In EPA’s early reports on the Most Efficient pilot it describes the label as a way to target “early adopters and environmentally conscious shoppers,” but LG’s marketing campaign is not targeting just a niche audience.

“LG often highlights the energy efficiency of its products in marketing materials and events and works to educate consumers about the benefits of energy efficient products,” says Alyssa Goldfarb, a spokesperson for the company.

Goldfarb cites a recent Times Square electronic billboard highlighting Most Efficient products, as well as a sales training handout focused on the products as recent examples. In a recent presentation on the company’s success at the Energy Star Partners’ Meeting, LG Electronics USA’s Public Affairs Vice President John Taylor highlighted aggressive consumer promotions, PR efforts, unique advertising campaigns and robust sales training as contributing to the company’s sales increases.

“We do a lot of consumer research and for consumers looking for a new fridge or washing machine, energy efficiency is always one of the top considerations,” Taylor says. “It’s growing as a concern when they’re purchasing TVs as well—it used to be way down on the list in that realm, but it’s becoming more important.”

In a recent LG survey of 3,622 consumers, consumers rated energy efficiency as the third most important attribute when selecting an appliance (reliable brand and good value for money were the top two attributes).

In addition to increasing sales of Most Efficient-designated products, LG increased sales of Energy Star-qualified products overall by 30 percent in 2011 from the previous year. “LG continues to gain market share in core product categories in the United States and the percentage increase in sales of Energy Star products is higher than average,” Goldfarb says.

LG isn’t the only company having Energy Star success. EPA lists Samsung, Kenmore and LG as the top three companies with qualifying products. With more than 70 TVs qualifying, Samsung has by far the largest number of Most Efficient products on the market. The company has also found creative ways to bring super-efficient products to the masses, and to sell the benefits of energy efficiency to more than just a dark-green audience.

Last month, for National Energy Awareness Month, Samsung introduced Energy Star to Samsung Nation, its corporate website which uses game principles and rewards visitors for taking sustainable actions. Since its launch in 2011, the site has enrolled 1.2 million new Samsung Nation members and boasts four million visitors a month.

In October, the company encouraged Samsung Nation members to take the Energy Star Pledge in order to be automatically entered for a chance to win an Energy Star-certified Samsung 32” LED Full HD TV. The pledge asks consumers to take simple steps toward energy efficiency, including purchasing Energy Star products and keeping their homes well insulated. Samsung also joined LG in Times Square last month, with a billboard encouraging consumers to take the Energy Star pledge for National Energy Awareness Month.

In addition to reaching out to consumers, companies are increasingly targeting the building industry with Most Efficient products. LG recently showcased its Most Efficient duct-free air conditioning systems at the American Institute of Architects national convention and design expo in D.C., and is doing the same at this week’s U.S. Green Building Council’s Greenbuild 2012 in San Francisco.

As the Most Efficient label moves into full implementation, EPA expects manufacturers to continue promoting the program. “Partners mentioned that Energy Star has high brand recognition and gives added value to their product promotions,” the agency wrote in its early summary of the Most Efficient pilot. “They expressed that Most Efficient helped them differentiate products through a brand that consumers were already aware of and comfortable with.”