ECONOMICS ASSIGNMENT
Name: Aminesh Nayan Gogoi
UID: SM0120004
Subject: Economics (major)
Faculty: Nishibrata Hazarika
National Law University and Judicial Academy, Assam
CONSUMER BEHAVIOR FOR GREEN
PRODUCTS
Abstract— There has been a rapid growth in economy with the increase in
the consumption across the world. This over consumption has resulted in
the deterioration of the environment. The consequences of this
environmental degradation has resulted in pollution, global warming etc
which has become a cause of public concern which in turn lead to the
green movement for the preservation of environment. The purpose of this
paper was to understand the variables affecting the consumer buying
behavior of green products. The study revealed the demographic factors
don’t influence the purchasing behavior of green products. A consumer’s
purchase behavior depends on the consumer’s level of satisfaction
towards the product. Purchasing behavior and customer satisfaction is
mostly influenced by the attributes of the green products.
INTRODUCTION:
What is a green product? A green product is a sustainable product
designed to minimize its environmental impacts during its whole life-cycle
and even after it’s of no use.
Green products are usually identified by having two basic goals – reducing
waste and maximizing resource efficiency. They are manufactured using
toxic-free ingredients and environmentally-friendly procedures and are
certified by recognized organizations like Energy star, Forest Stewardship
Council, etc.
Consumers, we everyone know, one that consumes, especially one that
acquires goods or services for direct use or ownership rather than for
resale or use in production and manufacturing.
Green consumers, “one who avoids products that are likely to endanger the
health of the consumer or others; cause significant damage to the
environment during manufactory, use or disposal; consumer a
disproportionate amount of energy; cause unnecessary waste; use material
derived from threatened species or environment; involve unnecessary use
of, or cruelty to animal.
With the increase in the technologies there has been an increase in the
industrial activities which has affected the environment adversely. The
environment has been exploited extensively; this over exploitation of
environment has resulted in climate change, global warming, pollution,
depletion of the ozone layer etc. These issues have raised concerns to
protect our environment which has led to the concept of going green.
Government has introduced policies to save the environment from further
degradation and so has the corporations opted for environmentally friendly
practices. One of the earliest steps that were taken regarding this
environmental concern was to introduce products that were supposed to
environmental friendly and had utilitarian status for consumers. 1 These
products have positive effects on the environment as they are less toxic,
biodegradable, recyclable, energy efficient, renewable due to which they
are termed as “Green Products”. Because of the negative effects on
environment, green marketing activities have been a major tool that is
utilized by various organizations, which have brought about a change in
buyers' purchasing approach towards green items. 2 Green behavior is the
choice made by the consumers whether to buy an eco- friendly product o
not. A consumers concern towards a safe environment has been frequently
increasing. Nowadays the market contains a wide variety of products that
are environmentally safe. The purchase behavior of the consumers
depends on the beliefs and the consciousness of the consumer towards
environmental concerns. If a consumer opts for a green product it not only
has personal benefits for the consumer but also many long term
environmental benefits. The decision to purchase these products depends
on the behavior which the consumer might adopt towards these
products.
1
D’Souza, C.; Taghian, M., & Lamb, P. (2006). “An empirical study on the influence of
environmental labels on consumers”. Corporate Communications: An International Journal.
2
Cohen, M. R. (1973). Environmental information versus environmental attitudes.
However, it is likely that many customers, who are environmentally
conscious, are not routinely making these eco friendly purchases as the
result of what has been called the “value-action gap”.3 The value action gap
is the disparity between the knowledge of consumer about the environment
and the behavior he adopts towards such products. A study was conducted
in 2004 in Canada which showed that there is gap between acceptance
and adoption of green products. 4 The process of selling products and/or
services based on their environmental benefits is called Green marketing.
A lot of companies promote their products by enhancing the consciousness
of the consumers towards the environmental issues which makes a
consumer move from a convectional product to a green product. 5 This
helps the firms to not only market their products but also increase the
awareness of the consumers. Green lifestyle has become common in
green marketing and strategies for the development of green products to
save the environment and to gain long term profits. Nowadays, we have lot
of green products in the market e.g. CFL bulbs, Electric home appliances,
jute bags, rechargeable batteries, solar chargers.
LITERATURE REVIEW:
Green marketing is nowadays considered to be one of the fast growing
trends in business. It involves activities taken by the organizations related
to environmental problems by providing services and products which are
eco-friendly and do not degrade the environment in any way. Now both
marketers and consumers are opting for the products that are green.
3
Blake, J. (1999). Overcoming the 'value-action gap' in environmental policy: Tensions
between national policy and local experience, Local Environment.
4
Kennedy, E., Beckley, T., McFarlane, B., & Nadeau, S. (2009). Why We Don’t “Walk the
Talk”: Understanding the Environmental Values/Behavior Gap in Canada, Human Ecology
Review
5
Golkonda, S. B. (2013). Bioproducts: Consumers' perception and buying behavior.
Environmental Awareness:
The awareness about the issues of the environment can determine the
behavior of the individuals towards environment. The awareness and
attitude have a positive effect on the purchasing behavior of the
consumers.6 The more the individual is aware about the environmental
concerns, it could the create favorable behavior towards the same. The
increased knowledge about the environmental issues creates positive
attitudes.7 The knowledge about the environment is correlated with the
attitude and behavior towards the environment. 8Proper knowledge about
environmental problems can make individual more responsible towards the
environment.9 Consumers who are more aware and conscious about the
environment make more green choices. An individual’s positive
environmental behavior doesn’t not necessarily guarantee his involvement
or participation towards the environment. The individual involvement is
very important, and the strength of motivation on the processing of
information depends on one’s degree of involvement. 10 Based on these
findings it can be assumed that the consumers who have knowledge and
6
Roberts, J. A. (1996). Green consumers in the 1990s: profile and implications for advertising.
Journal of Business Research.
7
Arcury, T. A. (1990). Environmental attitude and environmental knowledge. Human Organization.
8
Laroche, M., Bergeron, J., & Barbaro-Forleo, G. (2001). Targeting consumers who are willing
to pay more for environmentally friendly products. Journal of Consumer Marketing
14
Schahn, J., & Holzer, E. (1990). Studies of individual environmental concern. Environment
and Behavior.
are aware about the environmental issues are more likely to go for green
purchases.
Purchase behavior:
Behavioral intentions can indicate the actual future behaviors of
individuals.11Intentions can change over a period of time. The longer the
time interval the less accurate will be the predicted behavior from
intentions. There can be a number of events and consequences which can
alter the intentions of an individual. Alwitt, L.F. & Berger, I.E. (1993)
examined the structure of attitude strength and its relationship with
purchase intentions. It revealed that the general attitude towards
environment of a consumer does affect his purchase behavior but the
attitude towards the product affects the purchase intentions of a consumer.
Willingness to pay:
Many consumers are concerned about environmental safety and some are
concerned about their health and also about cost. Cost is a crucial factor
when the willingness to pay a premium for green products is concerned
and there is a lesser brand awareness of eco-friendly. 12Thus, the intentions
of a consumer to purchase green products can be dependent on certain
factors like price of the product and availability of the product. The
intentions to purchase green products can also change if the consumer
realizes that the green advertising done for the product has been
10
Petty, R. E., & Cacioppo, J. T. (1990). Involvement and persuasion: Tradition versus
integration. Psychological Bulletin
11
Ajzen, I., & Fishbein, M. (1980). Understanding attitudes and predicting social behavior
12
Shukla, S., Shah, D., Mehra, P., Muralikrishna & Gupta, A.K. (1998), “Consumer Response to
Green Market Opportunities”, Proceedings of the National Workshop on Marketing Organic
Food products, Indian Institute of Management
misleading or vague or false claims have been made about the product
been green. It has also been found that those customers, who are
concerned about ecological problems, are also willing to pay more to be
eco-responsible but companies need to enhance the performance of their
products and make them more environment friendly, even if they need to
increase the price of their products. Thus the quality and performance of a
green product can also be considered as a factor which affects the
intentions of consumers to purchase a particular green product.
Customer Satisfaction:
As the quality and the performance of the product are the major reasons for
the customer to be satisfied with the product. A customer’s satisfaction
towards the particular product will influence the future purchase decisions
of consumers and form customer loyalty but also spread a positive word of
mouth about the product. Satisfaction is usually interpreted as a means of
predicting customer's future purchase. 13A satisfied consumer is going to
repeat his purchase in future. A satisfied consumer is more likely to
recommend the preferred product to others.14
GREEN MARKETING:
Green can be defined and indicated in many different meanings. Green
defined by Prem and Daleen (1993) as environmental and ecological
awareness or consciousness, corporate social responsibility (CSR),
sustainable development, environmental protection or conservation, and
new consumerism.
Polonsky (1994) stated that “green or environmental marketing consists of
all activities designed to generate and facilitate any exchanges intended to
13
Oliver RL (1999). Whence consumer loyalty?
14
Reynolds K, Arnold M (2000). Customer loyalty to the salesperson and the store: examining
relationship customers in an upscale retail context.
satisfy human needs or wants, such that the satisfaction of these needs
and wants occurs with minimal detrimental impact on the natural
environment”. In other words, green marketing was a path for companies to
introduce and promote environmental friendly or green products to
customers in order to satisfy its customers’ needs and wants. Generally,
companies or organizations that penetrated in green marketing will
vigorously promote its environmental friendly policies and achievements to
its target customers as well as potential target customers. It means that
companies or organizations need to advertise and promote its products or
services that composite with environmental or green characteristics like
organic, environmental friendly and recycle that applied in producing
consumer products or goods. Besides, the difference between conventional
marketing and green marketing lead to a variety of activities needed in
green marketing which includes modification on the products, changes in
the productions process, change in the products distribution, new style and
decoration in products packaging, and change in the way of marketing
communications.15
According to the Dagnoli (1991), there were a growing number of people
that prefer to purchase environmental friendly products will lead to
increasingly in the number of green customers. In other words, consumers
now are more concern to business that play more environmental efforts
and they will support companies that excellent in and master with their
green marketing.
CONCLUSION:
This paper was mainly focused to study the purchasing approach of
consumers towards green products. It is evident that the purchase
behavior and customer satisfaction towards green products is not
influenced by age, gender, income or educational qualifications of the
consumers. Purchasing behavior of consumers depends on their level of
satisfaction towards the products. The concern for environment has
15
Prem & Daleen (1993). Consumer Awareness towards Green Marketing, 2011.
been found to be more among the young consumers. Consumers
regard the features of the green products to be most important while
purchasing them. They are even willing to pay more for the green products
to protect their environment. Consumers are motivated to buy green
products not only because of their concern for the environment but
also because they believe these can be healthier option for them.
Thus organizations need to focus more on improving the quality of green
products and also need to provide high quality green products at genuine
prices. As the high price and low quality of the green products are the two
most important factors that prevent and demotivate the consumers while
thinking about purchasing such products.
