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Mahdi Mesbahi GM04701 Masoud Moghadas GM04443 Mark Liew Han Loong GM04130Product attributes to motivateconsumers, and consumer attitudes inEnvironmentally Friendly Products(EFP) purchasing. Consumer Behavior| GSM5230
Table of Content1. Introduction2. Literature and Review3. Methodology4. Data Analysis and Results5. Discussion6. Conclusion& Recommendations
IntroductionThe Environmentally Friendly Product(EFP) is defined as a product whichhas no damage to the environmentduring manufacturing, use, ordisposal.
Introduction• Enacted roles and regulations by government are restrictions that enforce producer to produce such products• Consumers demand that might be consequence of more contribution towards the environmental protection, are persuading them to produce green products
Introduction• The final decision maker is consumer• Without understanding the motives behind consumer’s behaviour, this issue can’t deal with only by governmental rules and regulations nor by promotion strategies adopted by marketers• Previous studies mainly focused on different angles of consumer behavior in purchasing EFP, and attitudinal factors as predictors of intention, and effects of psychological and situational factors. The gap is missing factors which is clarification of dynamics and motives behind purchasing of EFP.
Introduction• What product attributes do consumers consider as motivation for purchasing environmentally friendly products?• Determine consumer attitudes toward intention to purchase environmentally friendly products.
Literature ReviewYear Name Findings Schwepker and Policymakers may benefit more from informing the public of the solid1991 Cornwell waste disposal problem. The social factors and personal factors are main Important factors in decision making for purchasing of EFP. Policymakers need to educate consumers regarding more alternatives2010 Kim & Kim of green behavior and persuade them to accept the purchase of an EFP. Social connectedness, self-esteem and perceived seriousness of2012 Ahn&Koo environmental issue are important factors to motivate consumer for pro-environmental purchasing behavior. Theogersen&Sand Green consumers do not spend more time and effort than2012 ager conventional consumers. Consumer understand the challenges of environment, but their Arminda and2010 Mario concerns aren’t always translated into purchase of environmentally friendly products.
Methodology• exploratory study to understand consumer behavior towards the purchasing of environmentally friendly products.• questionnaire were developed quantitatively• 3 key constructs ie. – What are the important factors which consumers use to determine how they chose EFP in their everyday purchases, – preference and choice of their EFP purchases in relation to the availability of an EFP option, and – ranking of the factors which affects the purchase of a EFP. – There was also 5 demographical questions to understand the spread of demographics within the sample taken for this survey.
Methodology• responses to the first EFP related questions were made using a five-point Likert-type scale (Not Important to Moderately Important to Extremely Important)• second question was also using a five-point Likert-type scale (Not Agree to Moderately Agree to Extremely Agree)• third question was based on a ranking of 1-5, 1 is the most effective factor and 5 is the least effective one.• demographic questions were fixed choice answer options.• 118 graduate students from GSM UPM were surveyed Wrong data: 13 Number of final observations: 105
Data Analysis and Results General Characteristics of SamplesAge Frequency Percentage Cumulative percentage20-25 37 35% 35%25-30 32 30% 66%30-35 17 16% 82%35-40 10 10% 91%40-45 7 7% 98%More than 45 2 2% 100%Race Frequency Percentage Cumulative percentageMalay 50 48% 48%Indian 14 13% 61%Chinese 31 30% 90%Other 10 10% 100%
Data Analysis and Results General Characteristics of SamplesSex Frequency Percentage Cumulative percentageMale 36 34% 34%Female 69 66% 100%Study Status Frequency Percentage Cumulative percentageFull-time 68 65% 65%Part-time 37 35% 100%Work experience Frequency Percentage Cumulative percentage0-2 46 44% 44%2-5 24 23% 67%5-10 14 13% 80%More than 10 21 20% 100%
Data Analysis and Results Intention 6 R2=0.52 =0.74 5 Obs=105 Obs=90 4Intention’s score 3 2 1 0 0 1 2 3 4 5 6 Average of 5 factors’ scores
Data Analysis and Results Standard Regression Statistics Coefficients t Stat ErrorMultiple R 0.86 Intercept cte 0.65 0.20 3.24R Square 0.74 Price Pr 0.10 0.04 2.66 Availability Av 0.18 0.04 4.52Adjusted R Square 0.73 Awareness Aw 0.22 0.04 4.98Standard Error 0.26 Information In 0.12 0.04 2.92Observations 105 Attitude At 0.19 0.03 5.79 Average Scores which were assigned to FactorsPrice Availability Awareness Information Attitude 1:Not important 4.1 4.0 3.8 3.7 3.8 5:Extremely important
Data Analysis and Results Rank Price Availability Awareness Information Attitude 1 57% 9% 6% 11% 18% 2 13% 51% 12% 17% 6% 3 11% 18% 34% 18% 19% 4 9% 13% 32% 28% 18% 5 11% 9% 15% 27% 39%1. Price of EFP2. Availability of EFP3. Awareness of consequences of EFP purchasing4. Getting information about EFP through social networks5. Consumer’s attitude about EFP
Discussion• Price and availabilities are two important factors that motivate consumer to purchase EFP. It means that consumer may not spend more money and time to purchase them.
Discussion• The more information regarding EFPs and the more awareness of the consequences having consumers, the more motivation towards purchasing them.
Discussion• It is support the findings of Schwepker &Cornwell(1991) as information is a basis to purchase pro-environmental products.• It is also support findings of Ahn& Koo (2012) regarding the role of ‘social connectedness’ and ‘perceived seriousness of environmental issues’ as important motives for environmentally friendly behavior.
Discussion• “Separation of recyclable waste” is moderately important for respondents, meaning that their concern towards environmental issues is not high.• It makes more clear their attitudes towards ‘price’ and ‘availability’ as extremely important factors for decision making to purchase EFP.• It highlights the role of education and perception regarding environmental issues.• It is also supporting the findings of Kim&Kim(2010) in which policymakers need to educate and persuade consumers towards pro-environmentally friendly behavior.
Discussion• The results of part C show that the most important factor on decision making to purchase EFP is firstly ‘price’ and secondly ‘availability’.• It means that to motivate consumer for purchasing EFP, the price of these products should not be higher than the normal products and also they should be well distributed in market so that being easy accessible.• It is also support the findings of Thogersen and Jorgensen(2012) that green consumers do not spend more time and effort than conventional consumers.
Discussion• The least important factor on decision making to purchase EFP is ‘attitude’.• Again it shows that the role of information, education and also promotion could be very important in intention of consumer towards purchasing EFP.• It shows that the strategy of attitude change is necessary to follow by producers and policy makers.
Conclusion &Recommendations• To encourage consumers to purchase EFP, marketers and policymakers should be simultaneously active.• Marketers should focus on competitive price, extensive distribution system and increasing awareness and information through social networking and also promotion.• Policymakers should be firstly focused on increasing awareness of consumers towards environmental issues and persuade them to behave pro-environmentally, and then enacting related rules and regulations.• As a theoretical points of view, they both should try to using ‘strategy of attitude change’ by changing the knowledge function as one of the basic motivational function.