You are on page 1of 13

Green Marketing and its impact on consumer behavior- A Research Paper.

Author- SYEDA SHAZIA BUKHARI Lecturer, College of Management, SMVD University, Katra, INDIA, 182301 Email- shaziabukharia@rediffmail.com

Green Marketing and its impact on consumer behavior- A Research Paper. Abstract- Environment friendly, so called green marketing has become a discussed subject and
companies are constantly trying to find the best ways to reach the customers with their green message. Customers are becoming more demanding and they have started to pay more attention to the environment. What is important with brands is how customers perceive them, what the image of the brand is. The aim of this study is to find out how cosumer behaviour is influenced by Green Marketing by Companies. The research study took place in Udhampur district in Jammu & Kashmir, during the spring 2011. A questionnaire was designed in order to find out how people perceive Green marketing and how aware they are of the environmental contribution that is being made by the companies. The question we wanted to find a respond to where Whether the purchasing behaviour of consumers is affected if companies go green? The results from this illustrates that companies need to increase their communication with the customers on going green, and that attributes like price and quality are more important than environmental responsibility. Key Words- Green Marketing, Consumer Behaviour , Marketing Mix.

Introduction
According to the American Marketing Association, green marketing is the marketing of products that are presumed to be environmentally safe.[1] Thus green marketing incorporates a broad range of activities, including product modification, changes to the production process, packaging changes, as well as modifying advertising. Yet defining green marketing is not a simple task where several meanings intersect and contradict each other; an example of this will be the existence of varying social, environmental and retail definitions attached to this term.[1]Other similar terms used are Environmental Marketing and Ecological Marketing. Green marketing refers to the process of selling products and/or services based on their environmental benefits. Such a product or service may be environmentally friendly in it or produced and/or packaged in an environmentally friendly way.

The obvious assumption of green marketing is that potential consumers will view a product or service's "greenness" as a benefit and base their buying decision accordingly. The not-so-obvious assumption of green marketing is that consumers will be willing to pay more for green products than they would for a less-green comparable alternative product - an assumption that, in my opinion, has not been proven conclusively. While green marketing is growing greatly as increasing numbers of consumers are willing to back their environmental consciousnesses with their rupees, it can be dangerous. The public tends to be skeptical of green claims to begin with and companies can seriously damage their brands and their sales if a green claim is discovered to be false or contradicted by a company's other products or practices. Presenting a product or service as green when it's not is called green washing. 1.Three keys to successful green marketing Show potential customers that you follow green business practices and you could reap more green on your bottom line. Green Marketing isn't just a catchphrase; it's a marketing strategy that can help you get more customers and make more money. But only if you do it right. For green marketing to be effective, you have to do three things; be genuine, educate your customers, and give them the opportunity to participate. 1.1) Being genuine means that a) that you are actually doing what you claim to be doing in your green marketing campaign and b) that the rest of your business policies are consistent with whatever you are doing that's environmentally friendly. Both these conditions have to be met for your business to establish the kind of environmental credentials that will allow a green marketing campaign to succeed. 1.2) Educating your customers isn't just a matter of letting people know you're doing whatever you're doing to protect the environment, but also a matter of letting them know why it matters. Otherwise, for a significant portion of your target market, it's a case of "So what?" and your green marketing campaign goes nowhere.

1.3) Giving your customers an opportunity to participate means personalizing the benefits of your environmentally friendly actions, normally through letting the customer take part in positive environmental action. Evolution of Green Marketing The green marketing has evolved over a period of time. According to Peattie (2001), the evolution of green marketing has three phases. First phase was 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 was "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. It came into prominence in the late 1990s and early 2000. Why Green Marketing? As resources are limited and human wants are unlimited, it is important for the marketers to utilize the resources efficiently without waste as well as to achieve the organization's objective. So green marketing is inevitable. There is growing interest among the consumers all over the world regarding protection of environment. Worldwide evidence indicates people are concerned about the environment and are changing their behavior. As a result of this, green marketing has emerged which speaks for growing market for sustainable and socially responsible products and services. Benefits of Green Marketing Companies that develop new and improved products and services with environment inputs in mind give themselves access to new markets, increase their profit sustainability, and enjoy a competitive advantage over the companies which are not concerned for the environment. Adoption of Green Marketing There are basically five reasons for which a marketer should go for the adoption of green marketing. They are -

Opportunities or competitive advantage Corporate social responsibilities (CSR) Government pressure Competitive pressure Cost or profit issues

2.Objectives2.1. To establish a relationship between consumer purchasing decision and green marketing. 2.2. To develope a green marketing mix for consumers. 2.3. To highlight the challenges being faced by companies pursuing green marketing.

Research MethodologyData Sources- Primary data was collected through questionnaires. Research Tools- The data accumulated from the various authentic sources (primary ) was subjected to various statistical tools for verification and interpretations, such as, Descriptive Statistics(Mean, Standard Deviation and Percentile) were used to have a understanding on the basis of the respondents group. The data once collected was analysed by using the Statistical package for Social Sciences (SPSS).The tests used for analysis were independent t-test, multiple regression analysis and binary logistic regression analysis. Sample Size- A Random sampling strategy was carried out. A survey of about 50 consumers belonging to Udhampur district of Jammu region was done .

3.Statistics obtained from data analysis-

3.1The customers were asked if they would like to pay more for green products, the response was 60% not ready to pay more and 40% were ready as is clear from the Bar chart. See Bar Chart 1. 3.2.When it came to ranking ,the customers gave least preference to environment friendly attribute of a product ,giving it a rank of 5 on a scale of 1-5 ,1 being highest and 5 being lowest rank. See Bar Chart No.2. 3.3.It was seen that purchase behavior of buyers was not much influenced by green marketing as equal no. of buyers agreed and disagreed with the influence as is clear from the pie chart no.3.

Green Marketing Mix


Every company has its own favorite marketing mix. Some have 4 P's and some have 7 P's of marketing mix. The 4 P's of green marketing are that of a conventional marketing but the challenge before marketers is to use 4 P's in an innovative manner. Product The ecological objectives in planning products are to reduce resource consumption and pollution and to increase conservation of scarce resources (Keller man, 1978). Price Price is a critical and important factor of green marketing mix. Most consumers will only be prepared to pay additional value if there is a perception of extra product value. This value may be improved performance, function, design, visual appeal, or taste. Green marketing should take all these facts into consideration while charging a premium price. Promotion There are three types of green advertising: a) Ads that address a relationship between a product/service and the biophysical environment

b) Those that promote a green lifestyle by highlighting a product or service c) Place The choice of where and when to make a product available will have significant impact on the customers. Very few customers will go out of their way to buy green products. Ads that present a corporate image of environmental responsibility

Strategies
The marketing strategies for green marketing include: Marketing Audit (including internal and external situation analysis) Develop a marketing plan outlining strategies with regard to 4 P's Implement marketing strategies Plan results evaluation

4.Challenges Ahead
4.1. 4.2. 4.3. 4.4. 4.5. Green products require renewable and recyclable material, which is costly Requires a technology, which requires huge investment in R & D Water treatment technology, which is too costly Majority of the people are not aware of green products and their uses Majority of the consumers are not willing to pay a premium for green products

Some Cases

a. b.

McDonald's restaurant's napkins, bags are made of recycled paper. Coca-Cola pumped syrup directly from tank instead of plastic which saved 68 million

pound/year. c. Badarpur Thermal Power station of NTPC in Delhi is devising ways to utilize coal-ash that

has been a major source of air and water pollution. d. Barauni refinery of IOC is taken steps for restricting air and water pollutants.

Conclusion
Green marketing should not neglect the economic aspect of marketing. Marketers need to understand the implications of green marketing. If you think customers are not concerned about environmental issues or will not pay a premium for products that are more eco-responsible, think again. You must find an opportunity to enhance you product's performance and strengthen your customer's loyalty and command a higher price. Green marketing is still in its infancy and a lot of research is to be done on green marketing to fully explore its potential.

Questionnaire
1. Do you know something regarding Green marketing: a) Well Understood b) Moderately understood c) Little understood d) Not at all

2. By the definition of Green marketing you mean:

a) Environment friendly products and services. b) Recycled Products. d) Using herbal ingredients e) All the above.

3. What are the Green marketing activities you think that the organisations should be involved in : a) Developing environmental friendly products. b) Causing lesser pollution c) Preserving the natural environment d) All the above

4. Your purchase behavior is influenced by the Green Marketing practices of the firm: a) Strongly Agree c) Neutral b) Agree d) Disagree e) Strongly Disagree

5. Your repurchase behavior is influenced by the Green Marketing practices of the firm: a) Strongly Agree c) Neutral b) Agree d) Disagree e) Strongly Disagree

6. Your purchase decision is most affected by :

a) Price of the product c) Quantity

b) Quality d) Brand e) Product being environment friendly

7. Would you pay extra for a green product: a)Yes b)No

8. Companies usually take care of the natural environment: a) Strongly Agree c) Neutral b) Agree d) Disagree e) Strongly Disagree

9. Companies contribute to the upkeep of the natural environment a) Strongly Agree c) Neutral b) Agree d) Disagree e) Strongly Disagree

10. Companies should have waste minimization and recycling programs : a) Strongly Agree c) Neutral b) Agree d) Disagree e) Strongly Disagree

11. The Company should abide with various environmental laws: a) Strongly Agree c) Neutral b) Agree d) Disagree e) Strongly Disagree

12. It is desirable to buy eco friendly products: a) Strongly Agree c) Neutral b) Agree d) Disagree e) Strongly Disagree

13. Polluting the environment should not be considered while purchasing the product : a) Strongly Agree c) Neutral b) Agree d) Disagree e) Strongly Disagree

14. Which of the Companies you believe are best in Green Marketing Practices: a) Ayur herbals c) Maruti Udyog Ltd. b) Tata Motors d) Dabur Ltd.

References1. Elam Rehbar and Nabsiah Al Wahid (2011), Investigation of green marketing tools effect ion consumers purchase behavior, Business strategies series,vol;12,Issue-2 2. Karl E., Henion; Thomas C. Kinnear (January 1976). "Ecological Marketing". Ecological Marketing. American Marketing Association. pp. 168 . 3. Ken Peatlle and Andrew Crane (2005),Green Marketing: Legend, Myth or Prophesy? Qualitative research: An International Journal, Vol: 8, Issue-4 4. McDaniel, Stephen W.; David H. Rylander (1993). "Strategic green marketing". Journal of Consumer Marketing (MCB UP Ltd) 10 (3): 410.

5. Mendleson, Nicola; Michael Jay Polonsky (1995). "Using strategic alliances to develop credible green marketing". Journal of Consumer Marketing (MCB UP Ltd) 12 (2): 418. 6 .Thomas L. Friedman (April 15, 2007). "The Power of Green". The New York Times 7. Vasanthakumar N . Bhatt (1993), Green marketing begins with green designs, Journal of Business and industrial marketing, Vol;8.Issue 4

Buyer Readiness to pay more for green products


70% 60% 50% 40% 30% 20% 10% 0% % of Customers responding yes % of Customers responding No Column2

BAR CHART 1

rank order
Environment friendly product brand quantity quality price 0 1 2 3 4 5 rank order

BAR CHART 2

PIE CHART 3

Purchase decision and Green Mktg


Relationship between purchase decision and green marketing strongly agree

agree

neutral