Examine The Effects Of Green Packaging On Consumers Green Purchase Intentions And Actual Purchase Behaviour

Project and Seminar Material for Business Administration and Management BAM

Abstract

Packaging was introduced to consumers as a way to protect goods, as well as to help ease handling and clearly communicate the contents of items being purchased (lindh et al., 2016). however today, one of the most common forms of packaging, plastic, has become a threat to environmental health by contributing greatly to waste (ellen macarthur foundation, 2019; world commission on environment and development (wced), 1987; wasteminz, 2020). some consumers are turning to reduced-packaging options such as package-free shampoo bars, and are stating a preference for sustainable packaging (business wire, 2019). but are consumers concerned enough about the consequences of plastic packaging to change their grocery shopping habits? this research sought to examine the effects of green packaging on consumer’s green purchase intentions and actual purchase behaviour.

Data were collected through structured questionnaires administered to 182 respondents that consist of students of Ebonyi state university. The collected data were analyzed using Regression analysis. The results showed that the Purchase Value and the purchase intent rates were not very high. These results may be due to the fact that the packaging characteristics might be perceived as very poor. Statistical analysis using ANVOA and regression analysis was then conducted to analyse the findings. The overall result was that there was no significant relationship found between the introduction of sustainable packaging information labels and the corresponding selection of the product with the most sustainable packaging. Therefore, the manipulation of the packaging may be key for the perception of the consumer. However, Due to limited time and resources, the research is only conducted within Ebonyi state university. Therefore, the results of this survey may not be generalized to the whole population of the world.

Chapter One

Introduction

1.1 Background of the Study

As the world’s economy is rapidly developing, the global environment is increasingly deteriorating. Protecting environment, creating a harmonious living environment has become one of the most important concerns of consumers. In Nigeria, people’s ecological consciousness and environmental protection consciousness also have obviously improved. More and more people tend to choose green consumption. Driven by the green consumption, enterprises begin to take customer as the guide of the green marketing strategy. In the marketing process, they pay attention to the balance and coordination between enterprise and the consumer, social and environmental, as well as the sustainable development of the enterprises.

From the point of view of the enterprise, obtaining the corresponding green certification, printing the green label on the products and packaging, make it become an important clue for consumer to cognize green product attributes. It becomes a basic symbol to differ green products from the non-green products, which is a very effective green marketing strategy. (Kim and Choi, 2005:592), the use of the label of environmental protection is helpful for the enterprise products to make differentiation, to win competitive advantages in the market. At the same time, it helps enterprise to improve its corporate image and product image, so as to win the trust and favour of customers. From the consumer’s point of view, the green label is a kind of strong signal, conveying some invisible characteristics of the products to consumers, such as the quality of the products and the intrinsic value. In addition, it provides convenience to consumers in the purchase discrimination on green products, reducing unnecessary trouble.

Packaging in modern terms can be defined as the designing and producing containers and wrappers for a product (Keller, 2009:187). Packaging is so important that most of the marketers believe it is the fifth P of marketing mix with other four Ps of product, price, promotion and place and it is considered to be an important element in product strategy (Philip Kotler, 2008:13). In today’s market it consists of three functions which include logistics, commercial and environmental functions (Rundh, 2013:1547) Linking Packaging to Marketing: how packaging is influencing the marketing strategy. Packaging is also an important factor of brand recognition as well as an important factor in creating positive brand associations (Keller, 2009:187). In a competitive market, packaging as a marketing tool could be an effective way to achieve marketing objectives and at the same time it satisfies the desires of consumers through its aesthetics elements which include package’s size, shape, text, colour, material and graphics and its functional elements as well (Rundh, 2013:1547). Packaging as an element of product strategy has become so important that when there seems to be a minute difference in the brands, innovative packaging may provide a competitive advantage (Keller, 2009:187). Packaging has developed itself from time to time and the factors that affected it include changing needs and demographics, changing needs of storing and transporting a product and technological advancement (Calver, 2007:32).

Due to the crowded marketplace of today’s world packaging has evolved as an affective communicator to get consumers attention and convince them at the point-of-purchase when compared with other traditional marketing mediums such as mass media advertising (Robert L. Underwood, 2008:207). Packaging conveys the meaning of a brand in non-durables and becomes a point of difference when other products of similar category just portray the functional benefits, thus eventually establishing a relationship between a consumer and a brand (Robert L. Underwood, 2008:207). Packaging is an important factor of brand recognition and creating positive brand associations (Keller, 2009:187). Packaging has now many functions from protecting the product, to transporting the product to the end consumer safely preserving quality and to persuade the consumer to buy the product by getting consumer attention while at the same time creating a positive impact at retail stores in a highly competitive environment The multi-faceted dimension of packaging marketing logistic or marketing tool?, (Rundh, 2005:670). Research has shown that consumers positively evaluate product’s packaging if it consistently and coherently conveys the meaning of that product through its packaging elements (Hannele Kauppinen-Raisanen, 2010:287). Therefore, the innovation of this paper is from the perspective of enterprise marketing, emphatically analyzing consumers’ psychological cognitive process of the green packaging, and how the green packaging affects the buying behaviour of consumers on different perception stages, so as to formulate effective marketing.

1.2 Statement of the Problem

Nigerian as a nation is challenged by the following issues which have been addressed as research problems in this study. They are inadequate green knowledge, lack of environmental consciousness, lack of government control, high price of green and distrust towards green products.

As a result of the globalization, every day a huge number of consumers stand in front of the well-stocked store shelves of supermarket and find themselves exposed to hundreds of different product of different brands and labels from many countries and regions with different packaging’s (Glass- bottles, PET bottles, Tetra packs, Bag-in-box, etc), different volumes and prices. One might think that this concentration of similar products at the same point of sale is due to the circumstances caused by the state monopoly of the beverages. According to recent research there were around ten thousand different brands only in the Nigeria market with three thousand of them competing on the shelves of the supermarkets (Sherman & Tuten 2011:21). Unless the consumer already knows what to purchase, they will go through a selection process. It is based on this premises that the researcher wants to examine the Effects of Green Packaging on Consumers Green Purchase Intentions and Actual Purchase Behavior.

1.3 Purpose of the Study

The main purpose for this study is to examine the Effects of Green Packaging on Consumers Green Purchase Intentions and Actual Purchase Behaviour.

1.4 Objectives of the Study

The following are the specific objectives of the study:

To ascertain what effect Sustainable Packaging will have pn a higher impact on Purchase Intent, than Non Sustainable;
To assess that Perceived Value will positively impact Purchase Intent of consumers;
Sustainable Packaging will have a higher impact on Perceived Value, than Non Sustainable;
To observe that Perceived Value will positively impact willingness to pay;
To assess that Sustainable Packaging will create a higher willingness to pay, than Non-Sustainable
To assess that willingness to pay positively affects Purchase Intent of consumers;

1.4 Research Questions

What is Sustainable Packaging definition?
What is the impact of Sustainable Packaging in the Purchase Intent of the consumer?
What is the Perceived Value of consumers about Sustainable Packaging?
What is the influence of Perceived Value in the Purchase behaviour of consumers?

1.5 Research Hypotheses

H1: Sustainable Packaging will have a higher impact on Purchase Intent, than Non Sustainable;
H2: Perceived Value will positively impact Purchase Intent of consumers;
H3: Sustainable Packaging will have a higher impact on Perceived Value, than Non Sustainable;
H4: Perceived Value will positively impact willingness to pay;
H5: Sustainable Packaging will create a higher willingness to pay, than Non-Sustainable;
H6: willingness to pay positively affects Purchase Intent of consumers;

1.6 Scope of the Study

The scope of this study although very wide if it has been carried out in the entire population. For this reason, it is necessary to have a concentrated area of study which was restricted to the evaluation of the Effects of Green Packaging on Consumers Green Purchase Intentions and Actual Purchase Behaviour” using students of Ebonyi state university living within Ishieke campus as case study.

1.7 Limitations of the Study:

Due to limited time and resources, the research is only conducted within Ishieke Campus, Ebonyi state University. It only covers the educational area of Ebonyi state University. Therefore the results of this survey may not be generalized to the whole population of the world.

Other limitation is that, this research only undertakes the younger generation for survey. People from other age groups such as middle age, senior citizens might be interested to purchase green products.

1.8 Significance of the Study

This project work will contribute to academia by providing experimental evidence to the area of green marketing. More specifically, the authors do this by transferring traditional methods used in conventional marketing, to the area of green marketing. Moreover, the authors expand the understanding of how to communicate with green marketing effectively, to influence consumer behaviour efficiently.

Further, this study contributes with a deeper understanding of what motivates consumer behaviour in terms of ecology. Finally, the study contributes to Companies understanding of how to communicate ecology via green marketing, as a means to strengthen the image of their private eco-brand.

On the current stage, the amount of researches about the green consumer behaviour based on the view of enterprise is relatively small, and the number of study about the specific marketing strategy on the influence of green consumption behaviour is also small. Therefore, the innovation of this paper is from the perspective of enterprise marketing, emphatically analyzing consumers’ psychological cognitive process of the green labels, and how the green labels affect the buying behaviour of consumers on different perception stages, so as to formulate effective marketing.

By investigating people’s perceptions about the role of packaging on consumer buying behaviour this study will help marketers to realize in which way the packaging influences perceptions of consumers while buying a certain product.

1.9 Definitions of Terms

Green:

The term “green”, implies an underlying concern for preservation of the environment and a non-invasive lifestyle Kim and Choi, (2005:592).

Packaging:

Packaging includes design and production of container or wrapper for a product. Packaging is the container for a product Hueber, (2000:6)

Green Packaging:

Green marketing of products is offering a competitive advantage in the form of giving an alternative of products that can be less harmful to the environment. Kohl, (1991).

Green Purchase:

Green purchase as a specific kind of eco-friendly behaviour that consumers perform to express their concern to environment, (Reitman’s, 1992:18)

Consumer Behaviour:

The process by which individuals search for, s elect, purchase, use, and dispose of goods and services, in satisfaction of their needs and wants. (Chase and Smith, 1992:2).

Chapter Five

Summary, Conclusion and Recommendation

5.1 Summary

This section goes through the Research Questions presented in the beginning of the Introduction chapter, highlighting the main findings for each one.

RQ1: What is Sustainable Packaging definition?

The outcome of the investigation was the following definition: green packaging is a package that can be recycled and reutilized. The concept of recycling is already present these days in the majority of the products sold in the supermarket. Paper, plastic and glass can be recycled and a big fraction has the recycling symbol on the package. For this reason the decision to take into consideration the second characteristic most voted was carried on. Therefore the concept of Reutilization was included.

One way to reduce the amount of pollution and garbage would be by reutilizing the packaging. So for companies to offer a sustainable option they would need to think in packages that can be recycled but reutilized as well.

RQ2: What is the impact of Sustainable Packaging in the Purchase Intent of the consumer?

The answer to this research question was based on the quantitative analysis. the outcome of the analysis says there is no impact. the fact is that being sustainable or not does not impact the intention to purchase of the consumer.
This conclusion answers to the purpose of the research – if a sustainable option affects the purchase intent of the customer – and it is No. Given all recent events about environmental concerns, it would be expected that the result would be positive, so the sustainable option would make a difference in the consumer intention. However the data clearly shows that the population studied is not aligned with that idea.

The fact that the sample size was small and mainly answered by Portuguese people may have influenced the results. Portuguese usually do not like the idea to pay for a product that is more expensive just because it is sustainable. Perhaps companies should offer the sustainable option and at the same time keep consumers satisfied.

RQ3: What is the Perceived Value of consumers about Sustainable Packaging?

The perceived value was assessed in a way that respondents rated from negative purchase intention (0) to positive purchase intention (7) some sentences about the product showed. The average rate of PV for the green packaging was 4,2500, which was above the global average (4,1580) and higher than the normal (4,0659). The rate allows concluding the PV is good, because it is above 3,5.

The results suggest that the PV of green packaging is higher than the NP. However the hypothesis that the type of packaging may influence the PV was not validated. Therefore it is fair to say that the PV of green packaging is good (4,2500), but it is not possible to conclude that the packaging type influences the PV of consumers.

Rq4: what is the influence of perceived value in the willingness to pay of consumers?

Perceived quality of the packing may influence the value that the consumer is willing to pay for the product. Some authors defend the better the perceived quality the higher the willingness to pay. As also mentioned in that section in this dissertation it is assumed that perceived quality is comparable to PV.

The relationship between PV and willingness to pay was validated, so PV positively influences the willingness to pay of consumers. The results show that, in global terms, these two variables are positively and slightly correlated, and by increasing one unit of PV the willingness to pay will increase by 3,80 units.

Therefore the answer to the Research Question is that PV positively influences the willingness to pay by 3,80 units per 1 unit increase.

This study was very relevant because it analysis a situation that is pertinent nowadays and not only it impacts current decisions that companies are making, but also addresses to purchase intents and concepts that were not yet defined and completely clear in the existent literature.

In terms of managerial implications, the sustainable concept is trendy these days. Daily news about product launches with environmental friendly packaging come out and companies are adapting their strategy to the current world’s situation. People are also starting to engage more often in the sustainable options. Therefore the theme of this dissertation is very actual and may be relevant to the current strategic decisions for the companies. If this study was done in greater scale and country Green Packagingecific the outcomes would be extremely interesting and valuable for the companies.

Regarding the academic implications this dissertation covers literature gaps that were not addressed before, such as the green packaging definition. As this is a current theme the outcome information is recent and relevant to real discussions. It can be also used as base for deeper studies around the theme that can fill the gaps of this thesis. Finally it explains how the whole model works and the relationships between the variables that are part of it, which was not analysed yet on its full scope.

5.2 Conclusion and Recommendation

It may be time to reframe the argument/discussion and look at achieving the end goal of waste reduction from another perspective. The individual consumer does hold positive sustainable attitudes, as seen in this and other studies, however, these positive attitudes are not translating into purchase intent. This is possibly because of the other competing product attributes such as price, quality and taste. Future research could look at the inclusion of a sustainability element in the brand story of a product and be part of what makes a brand relevant to today’s consumer. Maybe it is the collective we, where the purchase decision is changed by government regulation or business practices in the supply chain that lower prices or make such sustainable options more widely and readily accessible to the market. This study hints that the issue of sustainability and the reduction of waste, in particular, is not going to be solved via an easy solution of putting an eco-label on a product. The issue of consumer uptake of sustainable packaging has many layers and complexities, and as researchers, marketers and policy makers, we need to think laterally and innovatively on how we create a supermarket full of sustainable packaged goods by not entirely relying on the individual consumer purchase decision.

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