CHAPTER-II

REVIEW OF LITERATURE

Green purchase behaviour refers to the consumption of products that are

benevolent or beneficial to the environment , recyclable or conservable and
sensitive or responsive to ecological concerns .

Clem (2008) reveals that going green reflects a social consciousness around
saving and advancing the Earth’s natural resource , preserving and protecting
them for the sake of civilization .Consumers are becoming more and more
aware of environmental issues and this has increased the demand for
ecological products . If consumers have a favourable attitude toward greening
environment , they are more inclined to purchase green products . The
continuous awareness of environmental problems may in turn change
consumers’ attitudes and purchase intentions as well.

Consumer purchase intention has been an important concept in marketing

literature . Previous studies have exposed that consumer with intention to buy
products exhibit higher actual buying rates than those customers who
demonstrate that they have no intention of buying (Brown, 2003).
Blackwell et al (2001) also support this by indicating that purchase intentions
represent what consumers think they will buy . Furthermore , behaviour
towards a particular object is approximated by an intention to perform that
behaviour (Malhotra and Mccort 2001) . Thus , purchase intention positively
affects the probability of a customer decision that he will buy green products .
Environmental concerns play an important role on consumers ‘ intention to
purchase green products . Thus , environmental concerns are not the only
factor for the consumers to purchase environmentally friendly products . There
are other factors that lead to the purchases.
Green consumers have been willing to pay a higher price for environmentally
friendly products (Laroche et al , 2001;Peattie, 2001). A higher price of green
products is an indicator of environmental performance , because less polluting
products are more costly to produce (Mahenc , 2008). A study conducted by
D’Souza et al . , (2006) contrary reported that generally , perception of green
products is negatively associated with customer’s intention to purchase them if
they are of higher price and low quality in comparison to traditional products .
A lower price caused by cost saving will encourage consumers to buy
Environment-friendly products. When the demand for a product is price
responsive, a lower price will be a more successful strategy for the company.
When the price is held at the same level, positive properties of the product
about the environment can be used as a competitive advantage element. In
case the price of the product is higher, importance should be given to
promotion of differentiated green product and also there should be consumers
ready to overpay for the product. In this case, important thing is level of price
(Emgin and Turk, 2004).

A specific dimension of traditional marketing, green marketing contains the

same ingredients of traditional marketing: product, price, promotion and
place. It has become important for companies to create and sustain a
relationship with all who they interact with: its suppliers, market
intermediaries, the public and most importantly their customers (Ravald &
Grönroos, 1996). Many companies today openly commit themselves to
carrying out their business in accordance with environmental principles. New
green behaviour has emerged. It increases environmental awareness among
law makers, environmental groups, consumers, financial institution, insurers,
and the company’s own employees and, most of all, the customers. This also
increases the number of national and international environmental schemes,
laws and regulations that have been to gain a competitive advantage in the
changing world, firms are established. Following the demand trend of
customers and make improvements of this development over time. On the
other hand, marketing and marketers have come to understand the
importance of valuing and maintain a long term relationships with
stakeholders who are rejoining reciprocal trust and loyalty (Landua, 2008).

On the other hand, environmental management as a strategic tool not only

improves control and reduces environmental impact but also develops
business opportunities for company managers. The green marketing concept
could be operationalised by using the following marketing-mix actions:

(1) Designing of green products;

(2) Distribution with green criteria;

(3) Pricing of green products;

(4) Green publicity

The presented operationalization also includes green product design. The

literature recognizes that managers should be aware of that green marketing
begins with green design (Vasantha kumar, 1993) and that product design
constitutes an active interface between demands (consumers) and supply
(manufacturers) (Baumann 2002).

Green distribution is commonly included because product distribution

systems can constrain green design solutions since they must guarantee the
tangible “ecological nature” of the products on the market (Imballagio, 2002).
Additionally, distribution concerns often increases the environmental impact
of products, and is constantly regulated for environmental compliance. Green
products pricing is considered because green industrial differentiation works
efficiently only when green products reduce clients costs - (Wohlgemuth
1999). Every organization has values. Based on the values which the
organization has, it can then establish a vision of what it would like to
become. Without a clear vision a company will not have a clear idea about
which path to travel down and will find strategic planning as a pointless
exercise (Welford, 2000).

Green awareness is discussed in three sections:

 Consumers' environmental concern
 Awareness of green product and price
 Brand image.
Green product ‘s quality is also a concerned factor for most consumers . Green
consumers generally trust on these brand and are not ready to compromise on
quality . As there is an expectation on the part of customers that all products
offered should be environmentally safe without a need to sacrifice quality ,
businesses must enhance green product quality as well as focus on
environmental benefits of a product , and share these aspects with customers
in order to achieve the recognition in the market (D’Souza et al , 2006).Hence ,
these reveal that traditional product characteristic such as brand name , its
price and quality are still the most important ones that consumers considered
when making purchasing decision (Gan et al , 2008)
Consumers' Environmental Concerns
Consumers' environmental concerns are related to the interest towards the
biophysical environment and its problems related to the consumer and the
surroundings. It has been noted by foregoing research that women were more
concerned about the environment than men (Murphy 1978). It has also been
stated that consumers express environmental concerns based on product
characteristics, accuracy of green product claims, information provided on the
products and its benefits (Forkink 2010; Luchs 2010). (Barr and Gilg 2006)
found that committed individuals or mainstream environmentalists skewed
and put forward a higher importance on environmental issues where they
develop a high level of concern and express a personal responsibility and moral
obligation to play their role to help the environment. By clearly communicating
the benefits of a product on the packaging or in advertising, negative
perceptions towards an environmentally friendly product's effectiveness i.e.,
their environmental concerns can be surmounted (Luchs 2010).
Green Product and Price Awareness
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). Price is the attribute that
consumers reflect on when making a green-purchasing decision. Consumers
are less likely to purchase green products if they are more expensive (Blend
and van Ravenswaay 1999; D'Souza 2006). However, there were a group of
environmentally conscious consumers, i.e., more than 80 percent of Thai,
Malaysian and Korean consumers from the emerging markets in the region,
who are willing to pay premium price to purchase environmental products
(Dunlap and Scarce 1991; Lung 2010). (D'Souza 2006) noted that all products
offered should be environmentally safe without a need to trade off quality
and/or pay premium prices for them.
Brand Image Awareness
Brand image is related to a consumer's perception on the image of the
products with green labels or images. A brand image common to a consumer's
eye can help companies to introduce new brands and improve sales of existing
brands (Markwick and Fill 1997). Consumers are less likely to purchase green
products if they are unfamiliar with the brand (Glegg 2005). Companies that
create ads that are more focused on green, eco-friendly image will influence
their customers' purchasing decisions. Users like to associate themselves with
companies that have a brand image associated with the environment.
Consumers changed their buying behaviour and purchase products they
considered green (Ottman 1993). This is because related marketing campaigns
on green products can help companies in increasing brand awareness and
building positive corporate image in the minds of the customers (Adkins 2004;
Varadarajan and Menon 1988).
Other studies have indicated that many consumers are unwilling to forgo
essential product benefits during their purchase decision . So therefore, green
products must also perform competitively not only according to environmental
aspects , but also on the basis of other important product characteristic for
instance convenience or durability (Diamantopoulos et al 2003)
Consumers’ choice for green products can be heavily influenced by the
packaging too. Packaging attributes can persuade consumers to purchase the
product . According to Dantas et al .,(2004), packages and labels have only a
few seconds to make an impact on consumer’s mind ; during that time , it must
catch the consumer’s eye , and convince the shopper that it is the optimum
option on shelf (Rowan , 2000)