110 5 Result of Analysis and Interpretations
“And another added value is that, since our products are developed for the biological
cycle, the chemistry used in the production is suitable for the biological cycle (...)
products contain only natural material” (see Appendix: German Quote 64).
Further differentiation from competitors is achieved if organizations are theonly ones within their industry offering circular products. This unique selling
proposition might be the deciding influence for customers when deciding on the
purchase. Cases, such as Gamma and Delta have realized this benefit, as they are
the only ones offering circular products within their industry. Interviewee of case
Gamma states in this context: “Yes of course the motivation is also that it is the only
product on the parquet market which has this feature [which is circulatable]” (see
Appendix: German Quote 65). The company representative of case Delta sees this as
a clear characteristic to differentiate themselves from the rest of their competitors:
“We replaced the polyester we are using with the new developed polymer, which is
biodegradable; this is our unique selling proposition” (see Appendix: German Quote 66).
Most notably for organizations operating in the highly competitive textileindustry, differentiation from competitors is as an important point. Closed loop
production is an innovation to differentiate from competitors from low-wage coun-
tries. For case Beta, a textile manufacturer who exclusively operates in Germany,
the CEO sees innovation as an obligation to stay competitive: “It is important for
me as German manufacturer to be the first to offer Cradle-to-Cradle products before
any competitor from China offers such products” (see Appendix: German Quote 7).
For the purpose of this research competitive advantage is grouped into thenon-monetary impacts. However, this could be argued because according to Por-
ter’s definition it contains the monetary advantage of cost leadership. The reason
why competitive advantage has been grouped as non-monetary in this thesis is
that the competitive advantage per se has no financial aspect. The consequence
of a competitive advantage might be a financial one but the advantage per se isn’t.
5.2.2.2 Non-Monetary Impact: Reputation
The second non-monetary effect of the circular economy implementation identified
in the data is the creation of positive reputation. Enticing customers to buy a product
requires more than simply physical attributes and functions. Already in the early
1950s, researchers indicated that brand image is an important concept (Dobni and
Zinkhan 1990). In their article from 1955, Gardner and Levy describe brand image
as an enduring motivation to purchase products that have a social, psychological,
and physical nature. Furthermore, products convey a set of feelings, ideas, and
attributes about brands, which influence the customer in their purchasing decision
(Gardner and Levy 1955). Generally it can be said that brand image helps to define
a product or a brand for customers and differentiates it from competitive offerings.