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Big Three take high road on environmental front - Wal-Mart Stores Inc., K Mart Corp. K Mart Stores, Dayton-Hudson Corp. Target Stores - Retailing & The Environment

Discount Store News, March 18, 1991 by Richard Halverson

Big Three Take High Road On Environmental Front

Wal-Mart earned goodwill among environmentalists when it was the first major retailer to speak out in favor of the environment in 1989.

Today, the Bentonville, Ark.-based discounter still enjoys that goodwill, despite carping by some that the move was a marketing ploy, rather than based on sincere beliefs.

Regardless of motives, the environmental lead Wal-Mart grabbed gives it a marketing edge that it continues to hone as Kmart and Target tackle the issue, each in its own way.

The Big Three of discounting are taking high-profile, active roles on the environmental front, each in ways that reflect their differing styles and philosophies.

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In August 1989, Wal-Mart took the environmental lead with ads in The Wall Street Journal calling on manufacturers to make their products less harmful to the environment, including the way they packaged them.

When vendors presented claims that they had improved products in various ways, such as by switching to recycled paper, Wal-Mart began promoting the products, without question, with "green" shelf tags. At one point, Wal-Mart was promoting about 300 products with green tags but the number has declined to about 200, mostly for household chemicals and paper products, including disposable diapers.

The green tags remain for about six months until customers learn about the improvements, said Paul Higham, vice president, marketing and sales. Higham, who spearheads Wal-Mart's environmental efforts, has been on the speaking circuit for several months, talking about the chain's earth programs.

Higham has refuted criticism from some environmentalists that Wal-Mart's stand on the environment was a marketing gimmick because it makes no attempt to verify vendor claims that they've improved their products.

"Ours is not a marketing ploy. We don't see this as a marketing issue. We see this as the sort of thing we need to do as good citizens of our country and this planet," said Higham in a published report.

"Wal-Mart's stance is that any improvement that our customers, our vendors or ourselves makes is a positive improvement," he said at a recent environmental conference sponsored by the International Furnishings and Design Association, New York.

"We don't know enough about any product to tell our suppliers what they have to do to improve," he said. "But, we've found that they know and are willing to improve."

A $1.3 million environmental donation Wal-Mart gave last October to celebrate its 28th anniversary, illustrates how the chain approaches the issue from its traditional grassroots approach.

Wal-Mart divided the money 1,627 ways, an $800 share for each store, Sam's Club, hypermarket and distribution center, and let store associates donate the money in their names to local environmental projects of their choice, for example, tree planting or park improvements.

In a contrast in style, Kmart gave four environmental donations, total value undisclosed, last year, all to national environmental groups: Keep America Beautiful, National Audubon Society, National Parks and Conservation Association and FishAmerica.

For its environmental philanthropy, Target gives about $1 million a year to sponsor a club called Kids for Saving Earth that gets children involved in environmental projects, such as park clean-up and community recycling, said environmental program manager Ann Aronson. Aronson reports to George Hite, vice president for public affairs, and the catalyst behind Target's sponsorship of the program.

After its first year, KSE has formed 3,000 chapters and has recruited 85,000 youngsters, she said. By next year, the number of KSE chapters is expected to double to about 6,000, she said.

With recycling the hottest environmental issue, Wal-Mart captured the high ground last year by rolling out a program that lets customers drop off waste materials for recycling at each store. In contrast, Kmart and Target are declining to use their stores as recycling centers, except on a spot basis.

Last year, Wal-Mart successfully tested store site recycling centers in Denver by stationing 22-foot long containers in store parking lots and inviting customers to drop off newspapers, aluminum cans, cardboard and plastic bottles.

With more than 600 store recycling programs already in operation, Wal-Mart expects to complete the rollout to all 1,600 stores by year-end.

Wal-Mart has pledged all recycling profits to The United Way. It pays Browning Ferris Industries, Houston, and Waste Management, Oakbrook, Ill., to collect the materials customers drop off and find buyers for the waste. The waste haulers pass Wal-Mart all proceeds from the sales.

"The program has been so successful that Wal-Mart has gone way over budget" for collection fees, said John Kenny, a coordinator for BFI. "They're spending millions" for pickup fees that range from $75 to $275 depending on distances and markets.

In a move to reduce costs, Wal-Mart invites vendors such as Coca-Cola, Rubbermaid, GNB Batteries and Procter & Gamble to become partners by sponsoring a collection container.

Retail Industry

Big Three take high road on environmental front - Wal-Mart Stores Inc., K Mart Corp. K Mart Stores, Dayton-Hudson Corp. Target Stores - Retailing & The Environment

Discount Store News, March 18, 1991 by Richard Halverson

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