Customers’ Attitude and Purchase
Decision towards Green Products at Chennai - An Analytical Approach
Abstract
The present study is to identify the attitude and purchase decision of customers
towards green products at Chennai. The
study includes six factors that influences the customers to take decision on
purchase of green products. The research design was
descriptive and analytical in nature. Data was collected using structured interview
schedule method. Convenient sampling
technique was used to collect data from
300 respondents. Statistical
tools like descriptive statistics, chi-square, correlation and regression
analysis was done to establish the relationship between socio-economic factors,
awareness of customers
towards green marketing, attitude of customers towards green marketing and
purchase decision of customers towards green products. Based on the findings, it is found that majority of
the customers are aware of green marketing and they have further decision to
purchase green products. Further there is a significant positive relationship between customers’ awareness towards green
marketing and attitude and purchase decision of customers towards green
products.
Key words: Green
Marketing, Attitude, Purchase Decision, Green Products.
Introduction
In
the modern era of globalization, it is the responsibility for each and every
industry to protect our environment from pollution and energy depletion,
global warming, hazardous waste disposal and water pollution. In most of the countries government
is concerned about the environmental problems and insisting the industries to
produce environmental friendly products to
keep the customers as well as customers in fold and even keep our natural
environment safe. Thus green marketing is one of
the strategies a firm can adopt to product eco-friendly products namely using recycled
materials in product production, using green energy (such as wind and geothermal), reducing production waste (in both energy
and materials), including sustainable and organic agriculture, buy/sell locally, reducing transportation
energy, reduce
product packaging and making
products reusable and recyclable. Adopting such practices may or may not be perceived
as “green” depending upon customer perceptions of other aspects of the
business. However, these actions can still be positioned as the company “doing
its part” promoting positive reactions toward the company. Green
marketing is a tool used by many companies in various industries to follow this
trend. It is a phenomenon which has
developed particular important in the modern market and has emerged as an
important concept in India as in other parts of the developing and developed
world, and is seen as an important strategy of facilitating sustainable
development. It becomes
a part of the new marketing approaches which do not just refocus, adjust or
enhance existing marketing thinking and practice, but seek to challenge those
approaches and provide a substantially different perspective. Today, customers
are also aware of the environmental issues like; global warming and the impact
of environmental pollution. They are aware that their individual consumption behavior
affects the environment and these customers are more conscious of the
seriousness of environmental degradation. Thus, customers are increasingly
engaging in environmentally friendly behavior and are interested in supporting
businesses that are engaging in green strategies. Green purchasing behavior can
help achieve a sustainable environment. Thus the present study has been
undertaken to identify the awareness of customers towards green marketing and
its eco-friendly concept. The study includes six factors that influences the
customers to take decision on purchase of green products namely knowledge of the customers, effectiveness of
green advertising, product attributes, product quality, brand image and eco-labeling
and certification. It also finds out the impact of green marketing on purchase
decision of customers towards green products at Chennai city.
Literature Review - Green
Marketing
According to Polonsky (1994), 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. Green
marketing comprise of green products, green packaging, green prices; green
communication and green distribution called as green marketing mix (Khan and Khan, 2012). A green product
refers to a product that is typically nontoxic, originally grown,
recycle/reusable, not tested on animals, not polluting the environment and
minimally packaged; and contains natural ingredients, recycled content and
approved chemicals (Ottman 1998; Pavan
2010).
Customer
Awareness towards Green Marketing
A customer whose purchasing behaviour is persuaded
by environmental concerns is known as a green customer (Shrum et al. 1995). Customers are less likely to
purchase green products if they are unfamiliar with the brand (Glegg et al. 2005). Price is the attribute that customers
reflect on when making a green-purchasing decision. Customers are less likely
to purchase green products if they are more expensive (Blend and van Ravenswaay 1999; D'Souza et al. 2006).
Customer
Attitude towards Green Products
Rashid
(2009) has identified that when customers are aware of eco
labels they react more positively towards knowledge of green marketing and the
purchase of green products. The research by Kuhn (1999) also adds value to his research by identifying that the
promotion of eco-friendly product manufacturing will definitely help improving
a company's market share due to the ability of the company to present
sustainable marketing strategies. The creation of a customer value and
the subsequent translation into purchase of products is strongly identified by
the impact of environmental advertisements (Baldwin,
1993).
Customers’ Purchase Decision of Green
Products
According
to the Theory of Planned Behavior by Ajzen
(1991), the combination of attitudes towards the behavior, subjective
norms, and perceived behavioral control guide the formation of a decision, and
thus, decision is assumed to be the predecessor of the actual behavior. Roberts and Bacon (1997) have developed
a conceptual model to explore the relationships between customers’
environmental concern and ecologically conscious customer behavior in the USA.
Their study conceptualized the customer behavior variable in six-dimensional
criteria with 30 measuring items. They ranged from the use of recycled products
to customers green purchase behavior. In a similar study on customer behavior, (Chan, 2001) developed a conceptualized
model that investigated the influence of various cultural and psychological
factors on green purchase behavior among Chinese customers. The green purchase decision
in the study was conceptualized as a single dimension variable and was measured
by three items.
However, D’Souza et al. (2006)
have developed a conceptualized model that consisted of seven variables in
their study, which investigated the influences of multiple factors on green
products for green purchase decision among customers in Australia. The green
purchase decision in the study was conceptualized as two-dimension variables,
with price and quality as the measurement for green purchase decision. Whereas
the study by Nik Abdul et al. (2009) referred green purchase decision as the probability
and willingness of a person to give preference to products having eco-friendly
features over other conventional products in their purchase considerations.
Likewise, Chen and Chang (2012)
defined green purchase decision as the likelihood that a customer would buy a
particular product resulting from his or her environmental needs.
Objectives of the Study
·
To study the socio-demographic factors
of the respondents.
·
To determine the factors affecting customers
attitude and purchase decision of green products.
·
To identify the awareness of customers
towards green marketing.
·
To find out the relationship between customer
awareness and their attitude and purchase decision of green products.
·
To offer suggestions to enhance the
effectiveness of green marketing with strategic promotional tools.
Theoretical Framework
Based on the preliminary data collection and review of literature,
the independent variables namely customer awareness towards green marketing,
attitude of customers towards green marketing and factors affecting customer
purchase decision of green products such as namely knowledge of the customers, effectiveness of green advertising,
product attributes, product quality, brand image and eco-labeling and
certification have been identified. The study finds
out whether these independent variables have an effect on dependent variable
namely customers’ purchase decision of green products at Chennai. The following
diagram depicts the framework of the study.
Research Methodology
This
study scrutinized the customers’ attitude and purchase decision of green
products at Chennai. The study is descriptive and analytical in nature. The
target population of this study consists of customer of green products at Chennai
city. The sample size was 300 customers. Convenient sampling technique has been
used to collect data from the customers. The data was collected by using
primary data source. The questionnaire consisted with four dimensions namely
socio-demographic factors of the customers, customers’ awareness towards green
marketing, attitude and purchase decision of customers towards green products.
The questionnaire was developed by using a five point Likert scale. The
secondary data used in the study have been collected from related articles,
journals, thesis, books, newspapers and internet, etc. In this study, the
statistical measures namely reliability, descriptive statistics, correlation,
chi-square and regression were used.
Hypotheses
On the basis
of theoretical perspective and objectives of the study, the following hypotheses
are developed for the study:
H1: There is an association between
socio-demographic factors and customers’ attitude towards
green marketing.
H2: There is a significant relationship
between customers’ awareness, attitude and purchase decision
of green products.
H3: There is a significant impact of
customers’ awareness, attitude and purchase decision of green
products.
Data
Analysis
a. Reliability Test
Cronbach’s Alpha Reliability test used to
examine the internal consistency of variables in the construct. It states that
reliability less than 0.60 are considered to be poor, while those in the 0.70
range are acceptable and those over 0.80 are considered good (George and Mallery, 2003 and Kline, 2000).
Table-1
|
Sl. No.
|
Scale
|
No. of Items
|
Cronbach’s Alpha (α)
|
|
I
|
Customers’
Awareness towards Green Marketing
|
10
|
0.851
|
|
II
|
Customers’
Attitude towards Green Marketing
|
10
|
0.962
|
|
III
|
Customers’ Purchase Decision towards Green
Products
|
||
|
1
|
Knowledge
of the Customers towards green products
|
8
|
0.940
|
|
2
|
Effectiveness
of Green Advertising
|
6
|
0.900
|
|
3
|
Product Attributes
|
6
|
0.874
|
|
4
|
Product
Quality
|
6
|
0.828
|
|
5
|
Brand Image
|
8
|
0.880
|
|
6
|
Eco-Labeling
and Certification
|
10
|
0.955
|
From the above table, it is learnt that Cronbach’s Alpha reliability for all the
factors was above 80 per cent which means that the variables produce consistent
results if measurements are made repeatedly.
Descriptive Statistics
Table-2
|
Sl. No.
|
Scale
|
Mean
|
Standard Deviation
|
|
I
|
Customers’
Awareness towards Green Marketing
|
3.01
|
1.09
|
|
II
|
Customers’
Attitude towards Green Marketing
|
2.97
|
1.33
|
|
III
|
Customers’
Purchase Decision towards Green Products
|
||
|
1
|
Knowledge
of the Customers towards Green Products
|
3.13
|
1.03
|
|
2
|
Effectiveness
of Green Advertising
|
3.16
|
1.08
|
|
3
|
Product
Attributes
|
3.18
|
1.20
|
|
4
|
Product
Quality
|
3.12
|
1.00
|
|
5
|
Brand Image
|
2.99
|
1.11
|
|
6
|
Eco-Labeling
and Certification
|
3.08
|
1.25
|
From the above table, based
on mean value Product Attributes (3.18) is considered as a most significant
factor which immensely affects the purchase decision of green products,
followed by effectiveness of green advertising (3.16), knowledge of the
customers towards green products (3.13), product quality (3.12), eco-labeling and
certification (3.08) and brand image (2.99). It is also found that the mean values
for all the statements are nearer to 3.00; which means that the customers were
aware of green marketing and their attitude towards green marketing is said to
be positive. As a result it is visibly revealed that they are taking precise
decision towards purchase of green products.
b.
Chi-Square
This test is administered to ascertain the association between the socio-demographic
factors and attitude of customers towards green marketing.
H0: There is
no association between socio-demographic factors and customers’ attitude
towards green marketing.
H1: There is
an association between socio-demographic factors and customers’ attitude
towards green marketing.
Table-3: Socio-Demographic
Factors and Customers’ Attitude towards
Green Marketing
|
Socio-Demographic
Factors
|
Chi-Square Value
|
P value
|
Conclusion
|
|
Gender
|
8.670
|
0.040*
|
Accepted
|
|
Age
|
22.063
|
0.005**
|
Accepted
|
|
Educational qualification
|
10.674
|
0.016*
|
Accepted
|
|
Occupation
|
15.828
|
0.008**
|
Accepted
|
|
Income
|
17.674
|
0.008**
|
Accepted
|
|
Marital status
|
6.802
|
0.270
|
Rejected
|
** Significant
at 1per cent level * Significant at
5 per cent level
Since the P value is less than 0.01, the alternate hypothesis is
accepted at 1 per cent level of significance. Hence it is concluded that there
is an association between age, occupation and income with customers’ attitude
towards green marketing. Since P value is less than 0.05, the alternate
hypothesis is accepted at 5 per cent level of significance. Hence it is
concluded that there is an association between gender and educational
qualification with customers’ attitude towards green marketing. Since P value is
greater than 0.05, the alternate hypothesis is rejected at 5 per cent level of
significance. Hence it is concluded that there is no association between marital
status and customers’ attitude towards green marketing.
c.
Correlation
In
order to find the significant relationship between customers’ awareness,
attitude and purchase decision of green products, correlation is used.
H02: There is
no significant relationship between customers’ awareness, attitude and purchase
decision of green products.
H12: There is
an association between customers’ awareness, attitude and purchase decision of
green products.
Table-4: Customers’
Awareness, Attitude and Purchase Decision of Green Products
|
Variables
|
Customers’ Awareness towards Green Marketing
|
Customers’ Attitude towards Green Marketing
|
Customers’ Purchase Decision towards Green
Products
|
|
Customers’ Awareness towards Green Marketing
|
1
|
|
|
|
Customers’ Attitude towards Green Marketing
|
0.974**
|
1
|
|
|
Customers’ Purchase Decision towards Green Products
|
0.905**
|
0.945**
|
1
|
** Significant at 1 per
cent level
Since the P value is less than 0.01, the null hypothesis is rejected at
1 per cent level of significance. Hence it is concluded that the independent
factors namely customers’ awareness and customers’ attitude towards green
marketing have a positive and strong relationship with customers’ purchase
decision towards green products. This implies that as the level of awareness
and positive attitude towards green marketing increases, the level of purchase
decision of customers towards green products also increases. It is also clear
from the above table that maximum correlation exists between customers’
attitude towards green marketing and customers’ purchase decision towards green
products (0.945), followed by customers’ awareness towards green marketing and purchase
decision of customers towards green products (0.905). From the above table, it
is also evident that customers’ awareness and customers’ attitude towards green
marketing are pair wise positively significant at 1 percent level.
d.
Regression
In
order to find the impact of customers’ awareness, attitude and purchase
decision of green products, regression is used.
Table-5: Predictor Variables of
Multiple Regression Analysis
|
Multiple R
value
|
R Square value
|
Adjusted R2
value
|
F value
|
Standard
Error
|
P value
|
|
0.913
|
0.834
|
0.831
|
316.872
|
1.846
|
0.001**
|
** Significant at 1per cent level
Table-6: Co-efficient
between Customers’ Awareness, Attitude and
Purchase Decision of
Green Products
|
Variables
|
USC
|
SE
|
SC
|
t value
|
P value
|
|
(Constant)
|
0.040
|
0.482
|
|
0.083
|
0.936
|
|
Customers’
Awareness towards Green Marketing
|
0.484
|
0.042
|
0.481
|
11.420
|
0.001**
|
|
Customers’
Awareness towards Green Marketing
|
0.268
|
0.051
|
0.211
|
5.279
|
0.001**
|
**
Significant at 1per cent level
Dependent variable (Y)
= Customers’ Purchase Decision towards Green Products
Independent/predictor variable = Customers’ Awareness towards Green
Marketing (X1) and Customers’ Awareness
towards Green Marketing (X2)
The
above table revealed that purchase decision of customers towards green products
can be predicted at R2 = 0.913. In this model, the value of R2
denotes that 83.1 per cent of the observed variability in purchase decision of
customers towards green products can be significantly explained by their awareness
and attitude towards green marketing. The remaining 16.9 per cent is not
explained which means that the rest 16.9 per cent of the variation of purchase
decision of customers towards green products is related to other variables
which are not depicted in this model. Since the p value is less than 0.01, the
null hypothesis is rejected at 1 per cent level of significance. Hence the
linear combination of customers’ awareness and attitude towards green marketing
is significantly related to purchase decision of customers towards green
products (F = 316.872 and P = < 0.001**).
The Ordinary Least
Squares (OLS) equation for predicting purchase decision of customers towards
green products is:
Purchase decision of customers towards green
products (Y) = 0.484X1+0.268X2
The
co-efficient of X1 is 0.484 which represents the direct relationship between customers’
awareness towards green marketing and purchase decision of customers towards
green products. The estimated positive sign indicates that for each additional
unit of customers’ awareness towards green marketing, there is a 0.484 unit increase
in the purchase decision of customers towards green products and it is
significant at 1per cent level.
The
co-efficient of X2 is 0.268 which represents the direct relationship between customers’
attitude towards green marketing and purchase decision of customers towards
green products. The estimated positive sign indicates that for each additional
unit of customers’ attitude towards green marketing, there is a 0.268 unit increase
in purchase decision of customers towards green products and it is significant
at 1 per cent level.
Findings
The
study found that, from the mean and standard deviation, customers’ are aware of
green marketing and they have positive attitude towards it. There is a positive
and significant relationship between customers’ awareness and attitude towards
green marketing with purchase decision of customers towards green products. Further
that the socio-economic factors except marital status have an association with customers’
attitude towards green marketing and it is significant at 1 per cent and 5 per
cent level. It is vibrant that customers’ awareness and attitude towards green
marketing have a positive impact on purchase decision of customers towards
green products.
Suggestions
Today,
new type of customers have emerged due to environmental concerns which
indicates the importance of environment in decision making to buy green
products. Concerning the results of testing research hypotheses, the customers
were having positive attitude towards green marketing. Therefore if the
companies take extra effort in providing effective marketing strategies, the
attitude and perception of the customers towards green marketing may increase.
It is also found that, based on mean value advertisement have great impact on
purchase intention of customers towards green products. Therefore it is advised
to make effective advertisement to increase the sale of green products. It is
also recommended to the companies to modify the product attributes to
differentiate it from other products which in turn aids in enhancing positive
attitude and strong purchase decision towards green products.
Conclusion
Since
customers are more interested today in environmental issues and their
environmental awareness is remarkably grown, one can observe incremental
changes in their consuming behaviors. This study explains regarding the factors
and variables do impact on consumers’ purchase decision towards green products.
The study found that there is a positive impact of customers’ awareness and
attitude towards green marketing on purchase decision towards green products.
Therefore, it is mandatory for the organizations to focus on green marketing to
increase the knowledge of customers towards green products which in turn
enhances the sale of green products. It is also noted that advertising, product
attributes, product quality and brand image also have positive impact on purchase
decision of green products.
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