ZENITH

International Journal of Multidisciplinary Research

Vol.1 Issue 5, September 2011, ISSN 2231 5780



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ECO-FRIENDLY PRODUCTS AND CONSUMER PERCEPTION

SUDHIR SACHDEV*

*Assistant Professor, Manav Rachna College of Engineering,
Sector 43, Aravlli Hills, Delhi Surajkund Road,
Faridabad, Haryana -121004.

ABSTRACT

As resources are limited and scarce while human wants are unlimited, it is important for the
marketers to utilize the resources effectively and efficiently without wastage as well as to
achieve the organization's objective. Green marketing is inevitable for the attainment of long-
term mission and vision of an organization. There has been rising awareness among the
consumers all over the world concerning protection of the environment. People do desire to
bequeath an uncontaminated earth to their offspring. This research paper covers various forms of
environmentally concerned consumer behavior and their determinants. The understanding of
environmentally concerned consumer behavior is of importance to consumers, business, market
place, educationists, public policy makers, thinkers and academicians.

The last decades have seen a progressive increase in environmental consciousness worldwide as
the environment moved from a fringe to a mainstream issue and consumers became more
concerned about it. However, despite positive forecasts, demand for environmentally friendly
products didnt grow as expected and both attitude-behavior and intention-behavior gaps
emerged. Thus, this study endeavors to explore why people do not buy environmentally friendly
products by finding out which are the main constraints impeding them to translate their green
intentions into actual purchase behavior. Needless to say, paramount significance is going to be
attached to eco-friendly products as they shall come to occupy the centre stage in coming years.
Commensurate with that, there will be a shift in consumer perception albeit at a low pace in
coming years.

KEYWORDS: Green Marketing, green consumer behavior, environmentally friendly products.


INTRODUCTION
Beginning in the 1970s, a significant amount of research has been conducted on consumer
behavior for environmentally friendly products. Many variables were shown to drive consumer
choice in regards to purchasing environmentally friendly products. The growing social and
regulatory concerns for the environment lead an increasing number of companies to consider
green issues as a major source of strategic change. For years, there have been warnings about the
dangers of climate change, excessive natural resource consumption, and ever-increasing waste
generation. Consumer Businesses are significant users of natural resources - water, energy, fuel,
agricultural resources, forest and marine resources. Outputs from Consumer Business operations,
including packaging waste, solid waste, emissions, and waste-water, also have significant
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International Journal of Multidisciplinary Research
Vol.1 Issue 5, September 2011, ISSN 2231 5780



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environmental impact, both directly and indirectly through consumer usage and disposal
behaviors. Media headlines consistently focus on stories predicting dire consequences associated
with the environment. Ascertaining fact from fiction and prioritizing true risks can be a daunting
task.

Since society becomes more anxious with the natural environment, businesses have started to
adjust their behavior in an attempt to address society's "new" concerns. Some businesses have
been quick to accept concepts like environmental management systems and waste minimization,
and have integrated environmental issues into all organizational activities. People are conscious
about the less environment friendly product due to their own welfare that is why this issue is
very modern topics for India. This paper tries to unearth consumer attitudes and perceptions
towards eco- friendly products in FMCG sector and their willingness to pay on green products.

WHAT IS GREEN MARKETING?

Green marketing is inevitable for any type of organization. According to the American
Marketing Association (AMA) green marketing is the marketing of products that are presumed
to be environmentally safe. It incorporates a broad range of activities, including product
modification, changes to the production process, packaging changes, as well as modifying
advertising. Defining green marketing is not a simple task where several meanings intersect and
contradict each other. Other similar terms used are Environmental Marketing, Sustainable
Marketing and Ecological Marketing.

As per Brundtland Commission (1987), Development that meets the needs of the present
without compromising the ability of future gene rations to meet their own needs (Rowell, 1996).

Another definition is Green or Environmental Marketing consists of all activities designed to
generate and facilitate any exchanges intended to satisfy human needs or wants, such that the
satisfaction of these needs and wants occurs, with minimal detrimental impact on the natural
environment. (Polonsky 1994b).

It is the voluntary pursuit of any activity that encompasses concern for energy efficiency,
environment, water, conservation and the use of recycled/recycled products & renewable energy
(Confederation of Indian Industry) Industry

Peattie (2001) described evolution of green marketing in three phases. First phase is termed as
"Ecological" green marketing, and during this period all marketing activities were concerned to
help environment problems and provide remedies for environmental problems. Second phase is
"Environmental" green marketing and the focus shifted on clean technology that involved
designing of innovative new products, which take care of pollution and waste issues. Third phase
was "Sustainable" green marketing came into prominence in the late 1990s and early 2000.




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International Journal of Multidisciplinary Research
Vol.1 Issue 5, September 2011, ISSN 2231 5780



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METHODOLOGY

In this section we briefly explain the research methods used in the data collection. The
authors employed questionnaire method for data collection to explore consumers purchasing
behavior and reasoning for this behavior. The survey was completed in Faridabad (Haryana) and
the sample size was 45. People belonging to SEC A and SEC B (socio-economic classification A
and B) were interviewed. The purpose of selecting respondents from this group was to generate
data from people who are well educated and have a decent purchasing power. This number of
interviews enabled us to achieve theoretical saturation in our target group. Our recruitment
strategy was to encompassing a range of green consumers from different age groups, genders and
socio-economic groups. The secondary data were collected from relevant journals, books and
other published data.
The Main objective of the study is, to investigate the consumer attractiveness towards eco-
friendly products in FMCG sector and their impact of purchasing decision.
THE GREEN CONSUMER

There is growing interest among the consumers all over the world for protection of the
environment. The green consumers are the main motivating force behind the green marketing
process. It is their concern for environment and their own well being that drives demand for eco-
friendly products, which in turn encourages improvements in the environmental performance of
many products and companies. Thus, for a marketer it is important to identify the types of green
consumers. Although no consumer product has a zero impact on the environment, in business,
the terms green product and environmental product are used commonly to describe those
products that strive to protect or enhance the natural environment by conserving energy and/or
resources and reducing or eliminating use of toxic agents, pollution, and waste. Worldwide
evidence indicates people are concerned about the environment and are changing their behavior
and there is growing awareness among the consumers all over the world regarding protection of
the environment where they live. People do want to bequeath a clean earth to their offspring.
Various studies by environmentalists indicate that people are concerned about the environment
and are changing their behavior pattern so as to be less hostile towards it. Research reveals that
increasing number of the consumers, both individual and industrial, are asking for environment-
friendly products. Most of them feel that environment-friendly products are safe to use. As a
result, green marketing has emerged, which aims at marketing sustainable and socially-
responsible products and services profitably but without having any adverse effect on the
environment. Now is the era of recyclable, non-toxic and environment friendly goods. This has
become the new mantra for marketers to satisfy the needs of consumers and earn better profits in
a greener way. It includes a broad range of activities like product modification, changing the
production process, modified advertising, change in packaging, etc., aimed at reducing the
detrimental impact of products and their consumption and disposal on the environment.
Companies all over the world are striving to reduce the impact of products and services on the
climate and other environmental parameters. Marketers are taking the cue and are going green.
Green marketer can attract customers on the basis of performance, money savings, health and
convenience, or just plain environmental friendliness, so as to target a wide range of green
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consumers. The green consumers are the driving forces behind the green marketing process. It is
they who drive consumer demand, which in turn encourages improvements in the environmental
performance of many products and companies. Thus, for a marketer it is important to identify the
types of green consumers.

Demographically, green customer, our study reveals, are diversely spread along all income
ranges, age brackets, education levels and various household sizes. On average green shoppers
are a little older, tend to have higher income, and more education, but you will find substantial
numbers of green shoppers can be found distributed across the consumer population.

CONSUMER ATTITUDES IN EMERGING MARKETS

According to various research reports, shoppers are thinking green, but not always buying that
way
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. (Mainieri, Barnett, Valdero, Unipan, and Oskamp 1997). We surveyed young business
professionals about sustainable consumption in India. These young business people also
represented young Indian consumers, mainly from the middle and upper socio-economic groups.
Our research revealed that awareness and understanding of sustainable consumption among
consumers was low; the majority of Indian consumers still buy small, unpackaged goods from
low-cost, family-run shops. Even to wealthier Indian consumers, sustainable consumption was
felt to imply only consuming less; the concept of consuming differently is a significant but
missing factor. In addition to this, variety of barriers were identified, such as availability,
affordability, convenience, product performance, conflicting priorities, skepticism and force of
habit which prevent people from buying eco-friendly products. (McCarty and Shrum 1994)

THE RISE OF CONSUMER POWER AND CONSUMER SKEPTICISM

Many of the early products designed to be environmentally responsible, such as electric cars and
recycled paper, did not meet the basic expectations of consumers. Rightly or wrongly, these early
disappointments have made it tougher to convince todays consumers that green products work
as well as those that they are intended to replace, or are worth higher prices. In their search for
guidance on consumption choices, people trust each other more than any other source of
information.

At the same time, our research indicates that consumers are less trusting of brands than in the
past, and increasingly believe that they have the power to significantly influence how responsibly
a company behaves. A trusted source of peer-generated information: 61% of consumers now
consider blogs a reliable source of information, and more than half trust consumer-generated
media. In addition to the traditional marketing criteria, customers want to judge the following
environmental elements too:
How environmentally friendly is the product?
Are the manufacturing, packaging and promotion of green products sustainable?
How green is the business overall?
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International Journal of Multidisciplinary Research
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Is the marketing credible or just greenwash (environmental claims that could be
considered false, unsubstantiated and/or unethical)?
However, during this study authors found that
Neither customers nor manufacturers clearly state environmental benefits on product
packaging.
It is not clear to the general people that what kinds of benefits to expect in a given
environmental friendly product.
There is no legal authority that can certify environmental claims made by the
manufacturers.
Green Marketing here was only concerned with promotional activity with modest or no
attempt being made in product development in the context of green product.
Extremely modest promotional activities have been taken by the government authorities
or Chambers of Commerce and the related authority as well.
Sustainability considerations either drive or influence the buying decisions of more than half the
shoppers interviewed in our study. However, for most green shoppers, sustainability
considerations are an important purchase driver, but secondary to other dominant purchase
drivers. For most shoppers sustainable considerations become a tie-breaker only when other
factors are in relative parity. However, once a more sustainable product has captured the
shoppers commitment it tends to create brand stickiness by retaining the shoppers loyalty
through repurchase. We theorize that when a shopper makes a conscious selection of a green
product that they are making a personal contract that implies social responsibility
and they are less likely to change products in the future.

This study found that although interest in buying green extended across all age, income and
education levels, with 90 percent of respondents open to considering sustainable products, less
than 25 percent of shoppers actively consider them when buying. Yet only 47 percent of those
who consider buying eco friendly products actually found green products on retail shelves and
just 22 percent actually purchased them.

LACK OF UNDERSTANDING/CONFUSION ON-PACK CLAIMS AND LABELS

More than 50 percent consumers remain suspicious of greenwash i.e. environmental claims
that could be considered false, unsubstantiated and/or unethical (Ottman 1995). The products
available in todays supermarkets carry a wide range of labels, on-pack claims and elements of
design that are meant to inform and reassure consumers on health, safety, environmental or
social concerns. Several brands, including grocery retailers, have developed their own labels;
other brands use endorsements from non-certifying (but trusted) third parties, or on-pack claims
(such as natural) to convey sustainability attributes. Many consumers remain confused about
which products are better for society and the environment. In regards to eco-labeling, many
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experts have suggested that consumers are confused due to inappropriate labeling. Research has
shown that consumers do not always understand environmentally friendly labels attached to
products (Kangun and Polonsky 1995). Eco-labels such as biodegradable, sustainable, fair
wage/fair trade, environmentally friendly, and recyclable are usually unfamiliar and/or
unknown to consumers. Nevertheless, labels can play an important role in fostering sustainable
consumption when used as part of a package of measures. Confusion remains among consumers
about the differences between fair-trade, ethical, organic and other types of products. Further,
there is an unrealistic expectation of consumers, who are not usually willing to spend time
understanding these issues and are rarely prepared to pay more for sustainable products In the
absence of green certifications, eco-labels, and other indications of a products environmental
performance, the final decision frequently comes down to corporate reputation.

A little more than half of our intentional green purchasers surveyed indicated that they would
pay more for green products. We also believe that in general our top two percent will pay more
than 20 percent for many green products. The majority of shoppers are looking for parity in
pricing related to more sustainable products. In the shoppers mind, using fewer resources is not
usually more expensive.

Our green shoppers tested as slightly more responsive to advertising and slightly less sensitive to
promotions. Our interpretation of the statistics is that shoppers need more information related to
green products and in general respond more favorably to an Every Day Low Price strategy than
cyclical promotional strategies. This closely aligns with the strong evidence of a loyalty effect
connected with sustainable characteristics.

Consumer businesses are missing a substantial opportunity to market and provide greener
products. Ninety percent of shoppers surveyed indicated they are ready and willing to consider
more sustainable products, but green products were only purchased only in less than 20 percent
of the shopping trips. There are substantial gaps between the markets readiness for sustainable
products and the delivery of those products to the shoppers market basket.

Many shoppers want green products, but retailers and brand marketers are losing green sales at
several key points along the path to a purchase. The largest opportunities to capture shoppers
interested in green products involve building awareness, educating shoppers, making green
products easier to find and recognize, enhancing in-store communications and inspiring shoppers
at the store shelf. Shoppers are becoming turned off about purchasing green at the last step.
Although 47 percent of shoppers surveyed looked for and found green products, only 22 percent
of the shoppers surveyed actually purchased one.

Retailers and manufacturers are losing potential green sales from a quarter of shoppers at the
store shelf. Inspiration and information will yield better conversion at the shelf level decision.
For some shoppers, credibility and concerns about product performance enter into the equation.
Green products are getting lost in the store. Surveyed shoppers often couldnt find the green
products they wanted in the store. It is very possible for green products to become lost in the
assortment. A good sustainable product strategy provides clear visibility and selling cues to the
shopper to highlight green products in the assortment. Retailers and manufacturers need to work
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together to determine the appropriate assortment of green products, minimize out-of-stocks, and
clearly identify green products in the store. Utilizing shopper marketing programs and leveraging
vehicles to draw attention to green products will help increase the green conversion rates.

One-third of shoppers surveyed who would buy green products indicated that they are not yet
inspired to look for them. Awareness and education move people along their green learning
curve. Shoppers do not always understand the social and environmental benefits of products and
are often confused by the messages in the media. Many are unaware of what makes a product
sustainable versus merely good for you. A large number of shoppers remain unsure
of what is green, and some are still unsure of the whole green movement.

In-store communication strongly influences green purchasing. Some shoppers remain unsure of
product performance or product quality; they assume sustainable products would not perform as
well. Shoppers at this stage are questioning the product, so communicating brand and product
attributes via in store signage and product packaging drives shoppers to purchase. The top three
means of identifying a product as green for shoppers surveyed were through packaging/labeling,
in-store signage and brand advertising. Retailers and manufacturers can leverage these vehicles
to address quality and performance questions and motivate shoppers to become purchasers.

To address these issues, retailers and manufacturers need to provide more coordinated
communication and education about sustainability. They need to make the business case for
buying green to the shopper. Education on product benefits, social and environmental benefits,
and actions that shoppers and consumers can take are needed from both retailers and
manufacturers. Consistent, aligned messaging in stores, online, in advertising and involving
other touch points is a critical step to driving shoppers from interested to purchasers.

THE ROLE OF BUSINESS: Participants felt that sustainability should be embedded into
corporate strategies, including the responsible investment of company assets and the
encouragement of social entrepreneurship.

Significant opportunities exist in the development of new sustainable markets, such as for eco-
products, nonpetroleum-based products, sustainable buildings and public transport.

THE ROLE OF GOVERNMENT: Support from government is essential, since some
businesses will always seek to place profit before cost, even if the majority behaves responsibly:
One of the most important aspects is to work closely with government setting the law,
regulations and tax framework.

KEY ISSUES FOR BUSINESS

Green marketing must satisfy two objectives: improved environmental quality and customer
satisfaction. The vast majority of consumers, however, will ask, If I use green products,
whats in it for me? the top reasons consumers do not buy green products included beliefs that
they require sacrificesinconvenience, higher costs, lower performancewithout significant
environmental benefits. In practice, green appeals are not likely to attract mainstream consumers
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unless they also offer a desirable benefit, such as cost-savings or improved product performance.
To avoid green marketing myopia, marketers must fulfill consumer needs and interests beyond
what is good for the environment.

How do you create a green strategy that is pitch perfect and tuned for long-term success? Why
should people believe a companys claim? To be effective, companys strategy and messages
need to be convincing. This means that they must be backed by facts and figures. Companies
need to make environmental friendly products easily available and affordable and without
compromising on performance and at no extra costs for the consumer to make informed
purchasing decisions, as they increasingly report a willingness to do so. In order to have a
credible, sustainable brand, companies must have operational integrity and their communications
have to strike the right balance between visibility and transparency

An integrated marketing communications approach and/or a holistic approach, using eco-labels,
may better educate consumers on the social and environmental impacts of their consumer
purchasing decisions. What companies must remember, however, is that environmental labeling
schemes are only a supplement to not a substitute for general environmental awareness and
educational efforts (Thogersen 2000). In addition, studies have shown that, in making purchasing
decisions, consumers use labels only when he/she trusts the message conveyed; therefore, labels
should be promoted in a way that conveys trust.

The purchase of many everyday products has a habitual character. It is performed in a stable
context, often executed with high frequency and without much reflection. A familiar brand label
or product look may serve as a cue initiating an automatic response or habit. During recent years
consumers have been asked to show environmental concern. The automatic process should
compete with a new behavioral intention: to make an environmentally benign choice. A frequent
and successful implementation of this new intention will, it is hoped, result in a new habit that
replaces the old one.

REFERENCES

Arbuthnot, J. (1977), The roles of attitudinal and personality variables in the prediction of
environmental behavior and knowledge, Environment and Behavior, 9, 217 232.

Kangun, N. and M.J. Polonsky (1995), Regulation of Environmental Marketing Claims: A
Comparative Perspective, International Journal of Advertising, 14, 1 24.

Mainieri, Tina; Barnett, Elaine G. (1997), Green buying: The influence of environmental
concern on consumer behavior, Journal of Social Psychology, Vol. 137, Iss.2, pp. 189 205.

McCarty, J.A. and Shrum, L.J. (1994), The recycling of solid wastes: personal values, value
orientations, and attitudes about recycling as antecedents of recycling behavior, Journal of
Business Research, Vol. 30, No. 1, pp. 53 62.

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International Journal of Multidisciplinary Research
Vol.1 Issue 5, September 2011, ISSN 2231 5780



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Ottman, Jacquelyn. (1995), Todays consumers turning lean and green, Marketing News, Vol.
29, Iss. 23, pp. 12 14.

Peattie, Ken. (2001), Towards Sustainability: The Third Age of Green Marketing, The
Marketing Review, Vol. 2 Iss. 2, pp.129 146.

Polonsky, Michael Jay. 1994a. "Green Marketing Regulation in the US and Australia: The
Australian Checklist." Greener Management International 5: 44-53.

Thogersen, John. (2000), Psychological Determinations of Paying Attention to Eco-labels in
purchase decisions, Journal of Consumer Policy, Vol. 23, Iss. 3, pp. 285 315.