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CONSUMER BUYING BEHAVIOR AND ATTITUDES TOWARDS ECO-FRIENDLY FAST MOVING CONSUMER GOODS

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Companies today, move towards green as the consumers are concerned about the natural surroundings. Natural environmental influence our day-today lives in many ways, yet only few academics have discussed green issues in Sri Lankan context. Hence, this paper is an attempt to investigate the consumers purchasing behavior and attitudes towards eco-friendly fast moving consumer goods (FMCG) with special reference to cosmetics &personal care products.

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CONSUMER BUYING BEHAVIOR AND ATTITUDES TOWARDS ECO-FRIENDLY FAST MOVING CONSUMER GOODS

  1. 1. 2015 Cambridge Business & Economics Conference ISBN : 9780974211428 July 1-2, 2015 Cambridge, UK 1 CONSUMER BUYING BEHAVIOR AND ATTITUDES TOWARDS ECO- FRIENDLY FAST MOVING CONSUMER GOODS – COSMETICS & PERSONAL CARE PRODUCTS Pradeep Randiwela1 Faculty of Management and Finance, University of Colombo Sri Lanka p_randiwela@mkt.cmb.ac.lk P.M.N.Mihirani Institute of Human Resource Advancement University of Colombo Sri Lanka nimanthi_mihirani@yahoo.com 1 Winner of Best Professor in Marketing, awarded by Asia's Best B-School' at Singapore CMO Asia 2010, former Dean/Faculty of Management and Finance, University of Colombo.
  2. 2. 2015 Cambridge Business & Economics Conference ISBN : 9780974211428 July 1-2, 2015 Cambridge, UK 2 CONSUMER BUYING BEHAVIOR & ATTITUDES TOWARDS ECO-FRIENDLY FAST MOVING CONSUMER GOODS: COSMETICS & PERSONAL CARE PRODUCTS ABSTRACT: Many manufacturing companies today, move towards green as the consumers are concerned about the natural surroundings. Natural environmental influence our day-today lives in many ways, yet only few academics have discussed green issues in Sri Lankan context. Hence, this paper is an attempt to investigate the consumers purchasing behavior and attitudes towards eco- friendly fast moving consumer goods (FMCG) with special reference to cosmetics &personal care products. The research was conducted in the Western Province of Sri Lanka employing a conceptual framework that identified four major factors that affect consumer green purchasing behavior such as; individual belief, environmental factors, socio economic characteristics, awareness &knowledge. Data collected from 153 respondents with the use of a questionnaires and this was done by way of judgmental sampling. Both descriptive and inferential statistical were used to analyze data. The “Lifestyles of Health and Sustainability” (LOHAS) model was utilized to measure the purchasing behavior. This study assessed the magnitude of LOHAS categories exists in the Western Province for environment friendly cosmetics and personal care products market along with an examination of the factors affecting purchasing behavior. The results reveal that the majority of the respondents were environment unconcerned where as the miniature portion were in reality the active environment stewards. Results of the regression analysis reveal that among the variety of socio-economic factors considered, only gender, marital status and income level were significantly affecting the purchasing behavior. Key words: Green Marketing , FMCG, LOHAS, Cosmetics & Personal Care, Purchasing Behavior INTRODUCTION
  3. 3. 2015 Cambridge Business & Economics Conference ISBN : 9780974211428 July 1-2, 2015 Cambridge, UK 3 Communities all over the world are identifying the need of environmental safety where the “Green Marketing “as a concept which business organizations concerned to satisfy customer needs in an environmentally friendly approach. As a result of alarming rates of environmental lethal issues and emerging community pressure on protecting the environment, a variety of business entities globally have moved beyond simply adhering to environmental regulations. Many internationally reputed enterprises continue innovations and introducing environment friendly solutions as alternatives to traditional products. Moreover, business processes allied to product life cycles (i.e. from raw material acquisition to disposal of waste after consumer usage) have been re-engineered in order to reduce environment impacts. Fast Moving Consumer Goods (FMCG) sector is a considerably large sector in Sri Lankan economy which the stakeholders have to open their eyes on eco-friendliness as it is one of growing industries which has focused on green marketing strategies all over the world. Since urban societies become more complex and prone to increasing problems due to environmental pollution and unethical business practices, there is a significant attention been drawn by both consumers and business organizations on natural environment. Consequently, some businesses have begun reform their behavior in an attempt to address this society’s “new” concerns. Nonetheless, at present lack of utilizing biologically degradable materials is a major observable issue in Sri Lanka which has already leaded to accumulation of solid waste. As well, materials such as polythene and plastics are still used as major packing and hauling materials of many FMCG products. Though some alternatives are in use, these may not be the best solutions for the prevailing environmental issues. Moreover, Western Province, Sri Lanka which consists of Colombo, Gampaha and Kalutara districts has eventually become the most populated area both residentially and industrially. Consequently, problems allied with natural resources such as
  4. 4. 2015 Cambridge Business & Economics Conference ISBN : 9780974211428 July 1-2, 2015 Cambridge, UK 4 higher consumption levels of water, electricity, fuel and wood by both firms and general public are becoming a major issue with increasing population density in the above region. Thus innovations are of a great need where consumer inputs are needed to be incorporated. On the other hand, most of the marketing practitioners globally are using green elements as powerful marketing tools so that firms in Sri Lanka as well would have a greater potential to improve. RESEARCH PROBLEM AND OBJECTIVE Although environmental issues affect most of the activities in day-today lives, there were only few academic disciplines which have discussed green issues in Sri Lankan context. Since green marketing is an emerging field in Asian countries like Sri Lanka, consumer behavior towards this society’s new concern is still in the understanding level. It has been proven by the findings of Jain and Kaur, (2004)where the results demonstrated that the majority of the consumers still lack ‘green knowledge’ and due to such low awareness on green products, many organizations are neither yet motivated in pushing their businesses towards developing more green products nor are working hard on green packaging. Further it is also mentioned that a considerable number of consumers have an ideal concept of being environmentally responsible but may not necessarily implement this concept. Consequently, taking no efforts to move towards a lifestyle which is green was identified as a major issue. Unlike the organic food market, being one of the major segments in FMCG sector, cosmetics and personal care products manufacturing and marketing firms may find difficult to develop new strategies since consumer behavior towards green products is still unknown. In line with the literature, though Sri Lankan consumer’s interests for green products are gradually rising, the availability and awareness created by the marketers may be very less compared to the European countries. This knowledge gap alone with lack of information regarding consumer
  5. 5. 2015 Cambridge Business & Economics Conference ISBN : 9780974211428 July 1-2, 2015 Cambridge, UK 5 behavior which has contributed to lack of green movement in Sri Lanka can be bridged by means of understanding green consumers and their characteristics. Therefore, overall, it is a major requirement to identify the consumer viewpoints in terms of attitudes, perception, environmental knowledge and socio economic factors in order anticipate different consumer needs so that firms would use these facts to modify their strategies accordingly through developing novel approaches to meet those needs. As well, it is important to identify doubts and misperceptions of consumers and thereby to suggest key areas which knowledge and awareness must be conferred in developing an appropriate green consumer mind set towards sustainable development of the country. The Main objective of the study is,  To examine whether the consumers are concerned about green environment when they buy FMCG and Personal Care products  To understand consumers awareness about green products and environmental knowledge  To evaluate consumer perception, attitude and purchasing behavior towards existing eco-friendly cosmetics and personal care products. Green Marketing The negative impacts on the environment due to companies’ and human activities have directed companies to develop eco-friendly products. The consumption of eco-friendly products and consumers’ attitudes towards these products has led to the expansion of the green marketing mix “that preserves environmental resources and in the meantime deliver value added products and services” (Datta and Ishaswini, 2011).
  6. 6. 2015 Cambridge Business & Economics Conference ISBN : 9780974211428 July 1-2, 2015 Cambridge, UK 6 Green Marketing concept appeared at the end of the 1980’sand it has been defined by many researchers. According to the Ghosh (2010) Green Marketing is defined as the marketing activities that facilitate exchanges to satisfy consumer needs and wants by minimizing the impact of these activities on the physical environment. Green Purchasing Behavior Green Purchasing Behavior (GPB) is conceptualized as the probability and willingness of a person to provide preference to products having eco-friendly features over other traditional products in their purchase considerations. According to Beckford et al., (2010) and Chan (2001) research findings, green purchase intention is a significant predictor of green purchase behavior, which means that purchase intention is positively affecting the probability of a customer decision that he/she will buy green products. Purchasing Behavior of Green Cosmetics & Personal Care Products These two products have not been considered together in previous research papers, but current study attempt to search the behavior intention of those two categories together, by identifying the significant of those product categories in FMCG sector. Two studies have examined green marketing strategies for eco friendly personal care products and later on discussed the research papers of cosmetic products. One focused on the product development of green cosmetics and toiletries in the context of the United Kingdom (Prothero&McDonagh, 1992), and the other focused on promotional advertisements of U.S. companies offering natural personal care products (i.e., Burt’s Bees, Tom’s of Maine, and The Body Shop) (Todd, 2004). Both studies revealed that consumers’ ecological awareness has had a major impact on the cosmetics industry and suggested that personal care companies consider the protection of ecology as their business philosophy to satisfy consumer needs.
  7. 7. 2015 Cambridge Business & Economics Conference ISBN : 9780974211428 July 1-2, 2015 Cambridge, UK 7 Attitudes towards Green Purchase It has been believed that the actions of individuals can be predicted by their attitudes. Numbers of studies have been made towards improving the ability to predict an individual’s actions. Mainieri et al. (1997) revealed that the consumers’ attitude is associated with the knowledge and personal experience they possess. However inconsistencies were observed among the relationship between consumers’ attitude and their behavior when it comes to green consumerism. Mainieri et al. (1997) found low correlation between consumers’ attitude and green purchasing behavior. In order to predict specific behaviors, the measurement criteria of attitudes should be directed at a specific environmental issue like purchasing of green products (Mainieri et al. 1997). CONCEPTUALIZATION By over viewing the investigations related to green behavior and purchasing intentions, it is identified that researchers with specific goals and perspectives have presented different models in this regard. After reviewing many researches in green purchasing and green intentions, the authors suggested following conceptual framework which is a modification of Hessami, et al., 2013 conceptual framework. (Figure 1). As it can be seen in the Figure1, there are four main indicators that are influencing the consumer attitudes and green purchasing intentions, namely, Individual’s ecological beliefs, Environmental factors, Socio economic characteristics, consumer awareness on green products. Each of these variables is subdivided into various factors built upon the literature review. These factors play significant role in green purchasing decision and intentions and they have sufficient influence.
  8. 8. 2015 Cambridge Business & Economics Conference ISBN : 9780974211428 July 1-2, 2015 Cambridge, UK 8 Figure 1.Concep Figure 1. Conceptual Framework of the current research Green Consumer Market (LOHAS Model) The major conceptual model used in this study to measure the green consumer purchasing behavior was “Lifestyles of Health and Sustainability (LOHAS)”. This is commonly used to refer the green consumer and represents the marketplace for the goods and services sought by these consumers (Mobium,2007). Individual’s Beliefs Environmental Factors Socio Economic characteristics Company/governme nt role/support Social influence Age, Gender Income Residence Education Level Religion Occupation Material Status Awareness & knowledge Marketing Information Green Product, Price, place, promotion Attitudes towards green purchase Green purchase intention Perception on green companies Perceived Environmental Responsibility Environmental concerns Perception on green concept
  9. 9. 2015 Cambridge Business & Economics Conference ISBN : 9780974211428 July 1-2, 2015 Cambridge, UK 9 The Natural Marketing Institute (NMI) has identified five segments which categorize the greenness of the adult population based on attitudes and behavioral traits toward health, wellness and sustainability, rather than demographic characteristics. Revised and updated over time, NMI’s current green consumer segments include (1) Active LOHAS, (2) Naturalites, (3) Drifters, (4) Conventionals, and (5) Green unconcerned. Consumers of the Active LOHAS market segment, purchase only eco-friendly products and play an active and loyal role in protecting the environment (Mobium,2007). This segment regularly consumes organic and natural products, particularly those in the food and beverage category. Naturalites are not, however, dedicated to the green movement or large consumers of environmentally friendly durable goods (e.g. hybrid vehicles, energy efficient appliances), rather they are focused more on personal health issues, such as holistic living (Mobium, 2007). Drifters are trend sensitive and more worried about image than actual execution, as well as eager to be seen in trendy eco-supermarkets such as Whole Foods, partly because it is a fashionable place to be. This segment is also fairly price sensitive (Mobium, 2007). Conventional consumer group does not have a green outlook but does practice some practical green behaviour, such as recycling and energy conservation. They want to conserve resources (i.e. energy and water etc.) because it is economical and sensible (Mobium, 2007). Unconcerned group does not practice environmental responsibility. This segment is therefore not a key target market for the LOHAS industry (Mobium, 2007). Sample: Sample was collected in Western Province of Sri Lanka covering Colombo, Gampaha and Kalutara districts which has become the most populated area both residentially and industrially. Since the number of individuals that possesses the trait of interest in Green marketing is limited whereas relevant information was obtained from a very specific group of people, Judgmental
  10. 10. 2015 Cambridge Business & Economics Conference ISBN : 9780974211428 July 1-2, 2015 Cambridge, UK 10 sampling which is a non probability sampling technique was used for the study where the units were sampled based on their knowledge and professional judgment. Two hundred consumers were selected for this study. Data Collection: The study was mainly based on primary which data was gathered through a structured questionnaire based interviews. This phase was consisted of questionnaire design, verification, pilot survey and real survey. Pilot survey: In order to validate the questionnaire in terms of clarity, adequacy and accuracy, a pilot survey was carried out as the first step of fact finding by conducting interviews among ten businesses in the designated region, involved in some form of green business practices (convenient sample). Additionally, the questionnaire was administered to several academics in the field of business management and to a statistical expert. Along with feedback gathered from the pilot survey, adjustments were made in selected areas. For instance, increasing the number of categories in the fields such as education level and monthly income are among the significant adjustments that are useful in identifying relationships with purchasing behaviors. As well, sequence and flow of questions were changed in order to minimize errors (i.e. influential feedback, avoidance and biasness). Consequently, the continuous feedback was used in adjusting an accurate, adequate and reliable questionnaire to be used to gather information on identified research problems. Real Survey:
  11. 11. 2015 Cambridge Business & Economics Conference ISBN : 9780974211428 July 1-2, 2015 Cambridge, UK 11 The real survey was carried out as the second step during April and May 2014 by conducting a structured questionnaire based interviews and discussions among 200 consumers in Western province Sri Lanka according to a Judgmental sampling technique. From this sample, a total of 153 usable responses were received from interviewees in Colombo, Kalutara, and in Gampaha Districts. Analysis of Data: Both descriptive and inferential statistical methods were used to analyze data. Major software packages used for the analysis were “Statistical Package for the Social Sciences (SPSS)” (Version 17), “MINITAB” (Version 12) and “Microsoft Excel” (Version 2007). In addition to the assortment of illustration methods used in descriptive statistics, the major inferential statistical concepts used were weighted likert scales, Chi- square analysis and regression analysis. Descriptive analysis was used in this study to simplify both qualitative and quantitative data so that it would be easy to understand and measureable. Both categorical and continuous data types were used so as to simplify demonstrations and to facilitate further analysis. These methods are further discussed in sections below. Classification of Customers based on LOHAS: 12 statements were used to evaluate the purchasing behavior of customers. These statements were developed based on the unique characteristics identified in the LOHAS model .
  12. 12. 2015 Cambridge Business & Economics Conference ISBN : 9780974211428 July 1-2, 2015 Cambridge, UK 12 Valuation Criteria of LOHAS Model: Each statement was given a defined score where the sum can be used to determine the segment which customers are belonged to. The scores were determined by considering the unique and common characteristics of different LOHAS groups (Table 1). Table1. Valuation Criteria of LOHAS Model Factor Description Statements Score 01. Unique characteristics of Active LOHAS 3,5,6,7,8 100 02. Unique characteristics of Naturalities 9 80 03. Common characteristics of Active LOHAS and Naturalities 2,3 75 04. Unique characteristics to Drifters 4 50 05. Unique characteristics of Conventionals 10 10 06. Unique characteristics of Drifters, Conventionals and Unconcerned 11 05 07. Unique characteristics to Unconcerned 1,12 –500 Source:Mohan, G. & Denis, W. (2013) Assessing the Factors Affecting Purchasing Behavior: Purchasing Behaviour is a function of (depends on) socio economic factors. Purchasing Behaviour = ƒ ∑ (Socioeconomic factors) Purchasing Behavior = ß0 + ß1 (AGE) + ß2 (GEN) + ß3 (RES) + ß4 (EDL) + ß5 (REL) + ß6(OCP) + ß7 (MAS) + ß8(INC) + e Where, AGE1 = Age; Dummy/ discrete variable (<20=1, 21–30=2, 31–40=3, 41–50=4, >50=5) GEN2 = Gender; Dummy/ discrete variable (Female =1, else 2) RES3 = Residence (Region1=1, Region2=2, Region3=3 etc.) EDL4 = Education level (Ordinary; levels from 1 to 5) REL5 = Religion (Buddhist =1, Catholic = 2 etc. or Buddhist =1, Non Buddhist =2) OCP6 = Nature of occupation (Govt.= 1, Private =2, Self business =3, Daily wages=4, Unemployed =5, Other= 6) MAS7 = Marital status (Married =1, Unmarried =2, Other =3 or Married =1, else =0) INC8 = Gross monthly income (Rs., K=thousands) (<10K = 1, 10-20K = 2, 20-30K = 3, 30-40K = 4, 40-50K = 5, Over 50K = 6)
  13. 13. 2015 Cambridge Business & Economics Conference ISBN : 9780974211428 July 1-2, 2015 Cambridge, UK 13 ß0-ß8 = Coefficients e = Disturbance term Analysis of variance (ANOVA) tables were obtained through the regression analysis in order to interpret the significance of relationships between purchasing behavior and socio economic factors. Further the significance and the reliability of the module used in the study were evaluated through goodness of fit measurements. RESULTS & DISCUSSION: The results of the character evaluation of green consumerism reveal that the majority of the cosmetics and personal care products consumers in the sample were belonged to “Unconcerned” category (64%) where the second and third largest segments were “Drifters” and “Naturalites” with percentages 39 and 23 respectively (Figure 2). Figure 2. Distribution of LOHAS Segments among the Sample The most important consumer segment which is “Active LOHAS” was conspicuously diminutive (12%) when compared to the largest segment. The results illustrates that the consumers are notably less focused on environment conservation in accordance with the LO 18, (12%) NA 23, (15%) DR 39, (25%) CO 9, (6%) UN 64, (42%) LO : Active LOHAS NA : Naturalites DR : Drifters CO : Conventionals UN : Unconcerned
  14. 14. 2015 Cambridge Business & Economics Conference ISBN : 9780974211428 July 1-2, 2015 Cambridge, UK 14 evaluation criteria where merely 12% of the respondents is presumed to have a responsibility on the environment and social well being. Regrettably, a percentage constitute for a total of 73% which represents the majority of consumers do not exactly purchase green products as their first choice. Residence: Data collection was done in western province Sri Lanka which comprised of three main districts of Colombo, Kalutara & Gampaha. The results of the survey further reveal that the majority of “Active LOHAS” and “Naturalites” as important green consumer segments (15% collectively) were in the Colombo district where Gampaha and Kalutara districts had the third importance. Therefore, in general consumers in Colombo district are more adoptive towards green consumption when compared to other two regions. However, the outcome of Chi-square analysis demonstrates that there is no significant difference among the magnitude of LOHAS segments among three districts (Table 2). Table 2. Chi-square statistics for Socio Economic Characteristics with magnitude of LOHAS segments Variable C-Sq P-value Residence 0.250 Gender 0.046* Age 0.129 Education Level 0.129 Nature of Occupation 0.29 Level of Income 0.04* Note: C-Sq – Chi Square Statistics,*Significant at 0.05 level Gender: The outcome of the Chi-square analysis discloses that the purchasing behavior significantly differs among the gender (Table 2).
  15. 15. 2015 Cambridge Business & Economics Conference ISBN : 9780974211428 July 1-2, 2015 Cambridge, UK 15 Age of Respondents: The results of the Chi-square test reveal that the purchasing behavior and the adoption among LOHAS categories do not significantly differ among age groups (Table 2). However, the majority of “Active LOHAS” and “Naturalites” were found from consumer groups among the ages of 21-30 (Table 2). Education Level: Results of the Chi-square analysis further demonstrate that the LOHAS categories do not vary among education level of consumers (Table 2). This proves that education do not make any effect on green consumption and life style. Nature of Occupation: Moreover, results of Chi-square analysis demonstrates that magnitude of LOHAS segmentation does not significantly vary on nature of occupation of consumers (Table 2). Level of Income: Further, the results of Chi-square analysis demonstrate that there is a significant difference between income levels and LOHAS segment distribution (Table 2). The statistical proof exemplifies that at least one group of consumers in a particular income category differs from others in adapting to a different behavior of LOHAS. Environment Responsibility The results reveal that the respondents had an average likert value of 3.99 (nearly 4.00) for environment responsibility (Table 3). This proves that in general, the respondents were willing
  16. 16. 2015 Cambridge Business & Economics Conference ISBN : 9780974211428 July 1-2, 2015 Cambridge, UK 16 to take environment related responsibilities in order to contribute to the society if better green movements are available. Table 3. ALV for variables considering under Individual Belief Variable ALV Environmental Responsibility 3.99 Perception on Green Concept 3.94 Perception on Green Companies 3.08 Environment Concern 4.20 Note: Average Likert Value The Chi-square statistics obtained for the above evaluation further demonstrates that the average likert values significantly differ among LOHAS segments (Table 4). Though all segments reached a likert value score over the average amount of 3.0, Active LOHAS consumers and Conventional possessed the most positive view on environment responsibility. The least average value was notably reached by the unconcerned group. Table 4. ALV on Environment Responsibility among LOHAS Categories LOHAS Category C-Sq LO NA DR CO UN Coefficient P-Value 4.35 4.21 4.19 4.29 3.76 39.93 0.000* Note: C-Sq – Chi Square Statistics, F Fisher’s Exact Test Coefficient, *Significant at 0.05 level Perception on Green Concept: It is evident that perception of green concept was slightly elevated and beyond the average level (Table 3). This demonstrates that the group of customers considers that the green concept as a vital notion for a country while a very few number of respondents considered that green marketing is merely an idea where it has no true consideration about environment protection. Results of the Chi-square analysis reveal that the ALV for perception on green concept significantly differ among LOHAS categories (Table 5). Notably, the Active LOHAS group
  17. 17. 2015 Cambridge Business & Economics Conference ISBN : 9780974211428 July 1-2, 2015 Cambridge, UK 17 possessed the most positive perception regarding the concept, whereas the unconcerned group showed the least positive figure. Table 5.ALV on Perception on Green Concept among LOHAS Categories LOHAS Category C-Sq LO NA DR CO UN Coefficient P-Value 4.32 4.33 4.07 4.31 3.74 38.96 0.000* Note: C-Sq – Chi Square Statistics, F Fisher’s Exact Test Coefficient, *Significant at 0.05 level Perception on Green Companies: The perception of consumers on green companies was roughly consistent with the average level (Table 3). This demonstrates that the group of consumers considers that the function of a company for green is considered on average among people. These average level figures may lead to suspect that this group had a negative image on existing companies and their green behavior. Results of the Chi-square analysis reveal that the ALV for perception on green companies significantly differ among LOHAS categories (Table 6) where the figures demonstrates that the “Unconcerned” group had the worst perception on green companies. Table 6.ALV on Perception on Green Companies among LOHAS Categories LOHAS Category C-Sq LO NA DR CO UN Coefficient P-Value 3.29 3.21 3.14 3.33 2.98 29.52 0.00* Note: C-Sq – Chi Square Statistics, F Fisher’s Exact Test Coefficient, *Significant at 0.05 level Environment Concern: The Likert values derived from consumer focus on environment disclose that the group of respondents had concerned on the environment beyond an average consumer (Table 3). This demonstrates that though the majority of respondent were belonged to the group of
  18. 18. 2015 Cambridge Business & Economics Conference ISBN : 9780974211428 July 1-2, 2015 Cambridge, UK 18 “unconcerned” in the actual purchasing behavior, as consumers they had a good level of focus on the environment. Results of the Chi-square analysis reveal that the ALV for Environment concern significantly differ among LOHAS categories (Table 7), where the highest figure was derived from the “Conventional” group followed by “Active LOHAS” group. Table 7. ALV on Environment Concern among LOHAS Categories LOHAS Category C-Sq LO NA DR CO UN Coefficient P-Value 4.56 4.28 4.39 4.61 4.03 44.48 0.00* Note: C-Sq – Chi Square Statistics, F Fisher’s Exact Test Coefficient, *Significant at 0.05 level Company and Government Support: Results of the survey demonstrates that consumers of cosmetics and personal care products had an averagely fine impression that companies and the government take actions and supports towards environment conservation (Table 8). However, it was notable that the ALV figure was considerably low when compared to other factors. Moreover, results of the Chi-square analysis reveal that the ALV computed for views of consumers on company and government support were significantly differed among LOHAS categories (Table 9). Table 8. ALV for variables considering under environment Factors Variable ALV Company & Government Support 3.37 Social Influence 3.63 Note: Average Likert Value
  19. 19. 2015 Cambridge Business & Economics Conference ISBN : 9780974211428 July 1-2, 2015 Cambridge, UK 19 Social Influence: The Likert values derived regarding external influences on purchasing decision making disclose that the group of respondents had a social pressure and a positive influence beyond average, though actual buying behavior was distinct with a majority of unconcerned consumers (Table 8). Table 9. ALV on Company and Government Support among LOHAS categories LOHAS Category C-Sq LO NA DR CO UN Coefficient P-Value 3.73 3.38 3.54 4.00 3.26 35.67 0.00* Note: C-Sq – Chi Square Statistics, F Fisher’s Exact Test Coefficient, *Significant at 0.05 level Further, results of the Chi-square analysis reveal that the ALV computed for consumers on Social influence were significantly differed among LOHAS categories (Table 10). According to the results, Active LOHAS consumers had a significantly higher influence for environment concerns and lifestyle which had lead them toward practicing green consumer behavior. Table 10. ALV on Social Influence among LOHAS categories LOHAS Category C-Sq LO NA DR CO UN Coefficient P-Value 4.06 3.78 3.91 3.97 3.48 37.78 0.00* Note: C-Sq – Chi Square Statistics, F Fisher’s Exact Test Coefficient, *Significant at 0.05 level Awareness and Knowledge on Green Products, Price, Place & Promotion: The results reveal that the consumers also had a beyond average knowledge and awareness on green products (Figure 3). The most noticeable limitation among the majority of consumers was that they are either unaware or had no idea about the clues given in the product package/
  20. 20. 2015 Cambridge Business & Economics Conference ISBN : 9780974211428 July 1-2, 2015 Cambridge, UK 20 Figure 3. Awareness and Knowledge on Green Products labels to identify possible environment or health hazards. Further, the majority had stated that they had no clear understanding of all information given in the package material. Figure 4. Awareness and Knowledge on Price, Place and Promotion Results of the survey further illustrates that consumers had some dilemma on selections as they had doubts and misconceptions regarding the features of the marketing mix. In case of place and promotion, the consumers had limited awareness and knowledge on place and promotion 125 79 56 108 140 28 74 97 45 13 125 79 56 45 140 81.70% 51.63% 36.60% 29.41 91.50% 0 20 40 60 80 100 120 140 160 1 2 3 4 5 Numberofrespondents/Percentage Statement Yes No Correct Correct Percentage 50 26 130 67 55 30 143 86 110 23 86 97 122 10 50 26 130 67 55 30 143 32.68% 16.99% 84.97% 43.79% 35.95% 19.61% 93.46% 0 20 40 60 80 100 120 140 160 1 2 3 4 5 6 7 Numberofrespondents/Percentage Statement Yes No Correct Correct Percentage
  21. 21. 2015 Cambridge Business & Economics Conference ISBN : 9780974211428 July 1-2, 2015 Cambridge, UK 21 (Figure 4) where it can be suspected that the decision process could be affected. Results further reveal that the consumers’ view associated to distribution and communication was somewhat uncertain. Figure 5. Information Sources Used by Consumers Sources of Information: The survey outcome reveals that the majority of the respondents (73.8%) were exposed to information through media including television, radio and news papers. Internet in the modern society is an exceptional tool to reach information from the market place. Nearly 34% of the respondents have identified these resources as useful information stream (Figure 5). Moreover, Personal experiences, retail shop/ super market displays, family members and friends were also considered as information sources which consumers can acquire valuable information on green marketing, products and companies. In addition to those streams,. 0 53 11 23 39 45 45 52 15 113 0.00 34.64 7.19 15.03 25.49 29.41 29.41 33.99 9.80 73.86 0 10 20 30 40 50 60 70 80 90 100 110 120 Other Sources Internet based Sources Magazines Promotional Activities of Companies Friends Family Members Retail Shop/ Supermarket Displays Personal Experience Company Representatives Media (TV, Radio, News papers) Frequency/ Percentage InformationSource Percentage Frequency
  22. 22. 2015 Cambridge Business & Economics Conference ISBN : 9780974211428 July 1-2, 2015 Cambridge, UK 22 Figure 6. Consumer Rating on Most Available Information Source consumers of cosmetics and personal care products have also recognized promotional activities of companies, company representatives and different magazines as supplementary information sources Availability of Information: The results reveal that the most available information source to consumers was the Media (Figure 6). Nearly 40% of consumers reach information on cosmetics and personal care products through television (TV), radio and news papers. The second major information source is the internet and World Wide Web where the availability of useful information was 0.00 34.64 0.00 3.27 3.27 3.92 11.11 3.27 0.65 39.87 0 53 0 5 5 6 17 5 1 61 0 5 10 15 20 25 30 35 40 45 50 55 60 65 Other Sources Internet based Sources Magazines Promotional Activities of Companies Friends Family Members Retail Shop/ Supermarket Displays Personal Experience Company Representatives Media (TV, Radio, News papers) Frequency/ Percentage InformationSource Frequency Percentage
  23. 23. 2015 Cambridge Business & Economics Conference ISBN : 9780974211428 July 1-2, 2015 Cambridge, UK 23 Figure 7. Consumer Rating on Most Reliable Information Source rated as 35%. In addition to the third most available information source of retail/ supermarket displays (11%), less than 10% of consumers rated the other streams as the most available information sources. Reliability of Information The majority of respondents (42%) stated that personal experience is the best reliable source of information, while as the second rating another group (27%) stated that promotional activities of companies are mostly reliable. The other major reliable information sources were family members, company representatives, friends and internet based sources where the percentages were 23%, 19%, 18% and 13% respectively. 0 13 0 27 18 23 4 42 19 6 0.00 8.55 0.00 17.76 11.84 15.13 2.63 27.63 12.50 3.95 0 10 20 30 40 50 Other Sources Internet based Sources Magazines Promotional Activities of Companies Friends Family Members Retail Shop/ Supermarket Displays Personal Experience Company Representatives Media (TV, Radio, News papers) Frequency/ Percentage InformationSource Frequency Percentage
  24. 24. 2015 Cambridge Business & Economics Conference ISBN : 9780974211428 July 1-2, 2015 Cambridge, UK 24 Table 11. Parameter Estimates of Multiple Ordinal Regression Model Factor Description Estimate Std. Error Wald df Sig. 95% Confidence Interval Lower Bound Upper Bound [Age=1] 20 or Below -1.557 2.802 .309 1 .578 -7.049 3.934 [Age=2] 21 – 30 -1.888 2.377 .631 1 .427 -6.547 2.771 [Age=3] 31 – 40 -1.459 2.267 .414 1 .520 -5.903 2.985 [Age=4] 41 – 50 -.828 2.302 .129 1 .719 -5.339 3.683 [Age=5] 51 – 60 .272 2.455 .012 1 .912 -4.540 5.084 [Age=6] Over 60 0a . . 0 . . . [Gender=1] Male 1.269 .492 6.664 1 .010 .306 2.233 [Gender=2] Female 0a . . 0 . . . [Marital status=1] Single .142 .583 .059 1 .807 -1.001 1.285 [Marital status=2] Married 1.565 .756 4.280 1 .039 .082 3.047 [Marital status=3] Separated 0a . . 0 . . . [Education level=4] Secondary level 1 -2.112 1.890 1.249 1 .264 -5.816 1.592 [Education level=5] Secondary level 2 20.637 .000 . 1 . 20.637 20.637 [Education level=6] Tertiary level 1 1.190 .810 2.155 1 .142 -.399 2.778 [Education level=7] Tertiary level 2 .499 .730 .467 1 .494 -.932 1.930 [Education level=8] Tertiary level 3 .856 .585 2.141 1 .143 -.290 2.001 [Education level=9] Tertiary level 4 0a . . 0 . . . [Religion=1] Buddhism .097 .845 .013 1 .908 -1.558 1.753 [Religion=2] Christian .033 1.095 .001 1 .976 -2.113 2.179 [Religion=3] Catholic .896 .876 1.045 1 .307 -.822 2.613 [Religion=4] Muslim .488 1.171 .174 1 .677 -1.807 2.783 [Religion=5] Hindu 0a . . 0 . . . [Occupation=1] Government 5.333 2.940 3.290 1 .070 -.430 11.096 [Occupation=2] Semi-gov. 5.206 3.034 2.944 1 .086 -.741 11.153 [Occupation=3] Private 5.533 3.070 3.249 1 .071 -.483 11.550 [Occupation=4] Self-employed 6.459 3.289 3.857 1 .050 .013 12.905 [Occupation=5] N.G.O. 4.613 3.332 1.916 1 .166 -1.918 11.144 [Occupation=6] Temporary Work 4.734 3.100 2.331 1 .127 -1.343 10.810 [Occupation=7] Daily Wages -17.628 .000 . 1 . -17.628 -17.628 [Occupation=8] Unemployed 4.811 3.158 2.322 1 .128 -1.378 11.000 [Occupation=9] Student 3.573 3.423 1.089 1 .297 -3.136 10.281 [Occupation=10] Other 0a . . 0 . . . [Income level=1] Below 10 K -6.303 2.250 7.849 1 .005 1.893 10.712 [Income level=2] 10 – 20 K 3.397 1.743 3.800 1 .051 -.018 6.813 [Income level=3] 20 – 30 K 2.540 1.449 3.074 1 .080 -.299 5.379 [Income level=4] 30 – 40 K 1.928 1.364 1.997 1 .158 -.746 4.603 [Income level=5] 40 – 50 K 1.370 1.302 1.107 1 .293 -1.182 3.922 [Income level=6] 50 – 60 K 3.176 1.446 4.821 1 .028 .341 6.011 [Income level=7] 60 – 70 K .080 1.678 .002 1 .962 -3.209 3.369 [Income level=8] 70 – 80 K 3.220 1.640 3.854 1 .050 .005 6.434 [Income level=9] 80 – 90 K .213 1.553 .019 1 .891 -2.830 3.257 [Income level=10] 90 – 100 K .142 1.660 .007 1 .932 -3.112 3.396 [Income level=11] Over 100 K 0a . . 0 . . . [Relation to Env=1] None .538 .837 .414 1 .520 -1.102 2.179 [Relation to Env=2] Society Member -.365 1.157 .099 1 .753 -2.633 1.904 [Relation to Env=3] Employee of GC -1.486 .961 2.392 1 .122 -3.369 .397 [Relation to Env=4] Env. Journalist -23.568 .000 . 1 . -23.568 -23.568 [Relation to Env=5] Env. Researcher -1.232 1.206 1.044 1 .307 -3.595 1.131 [Relation to Env=7] Env. Scientist 0a . . 0 . . . Note: a-compared factor; GC – green company; *Significant at 0.05 level
  25. 25. 2015 Cambridge Business & Economics Conference ISBN : 9780974211428 July 1-2, 2015 Cambridge, UK 25 Importantly, though consumers stated that Media and retail shop displays are mostly available information streams, they were considered as least reliable sources. Magazines were not considered by consumers as a reliable information sources (Figure 7). Effect of Socio-economic Factors: Results of the regression analysis reveal that among the variety of socio-economic factors considered, only gender, marital status and income level were significantly affecting the purchasing behavior (Table 11). In fact, these factors were the ones which make the difference between LOHAS categories where different mind-sets are focused on distinct purchasing behaviors. Table 12. Model Fitting Information Model -2 Log Likelihood Chi-Square df P-Value Intercept 420.671 Final Model 321.627 99.043* 41 0.001* Note: *Significant at 0.05 level; **larger the value higher the fit According to the statistical outcome of the analysis, male when compared to female were more focused on green consumer behavior whereas respondents those who were married are also oriented positively towards green consumerism. Further, Income levels 1, 6 and 8 were significant in purchasing behavior. Table 13. Model Goodness-of-Fit Measurements Parameter Coefficient/ Value df P-Value Pearson Chi-Square Statistics 536.830** 471 .019* Cox and Snell Adjusted R-Square 73.06** 471 -- Note: *Significant at 0.05 level; **larger the value higher the fit This exhibits that the respondents with an income level of 6 and 8 were keen in green consumer behavior when compared to those who had an income level of 11. As well, those who belonged
  26. 26. 2015 Cambridge Business & Economics Conference ISBN : 9780974211428 July 1-2, 2015 Cambridge, UK 26 to the level 1 were deviated from green behavior. Table 12 and 13 confirm the model fit indices; Pearson Chi Square Statistics; Cox and Snell R-Square for the regression model. The value indicated the reasonable model fit where it is fitted well in explaining the variation Socio economic characteristics in adopting LOHAS categories. CONCLUSION: Green marketing is an important concept for both companies and customers where environment protection is a major concern. Many manufacturing companies today, moves towards green as the consumers are becoming more conscious about the natural surroundings. Green marketing is the marketing of products that are supposed to be both environmentally and individually beneficial. This practice adds in a broad range of activities in the marketing mix, including product modification, production process changes, sustainable packaging, distributing and communication etc. Linking with the marketing concept it do not just re-focus, adjust or enhance existing marketing philosophy and practice, but also seeks to confront those approaches and reach substantially in different outlook. Green marketing consists of a cluster of approaches which strive to tackle the lack of fit among conventional marketing and the ecological and social realities of the wider marketing context. LOHAS classification, which a model used internationally, is useful to identify the magnitude to which consumers are focused on natural environment and its conservation. This study assessed the magnitude of LOHAS categories exists in the Colombo district for environment friendly cosmetics and personal care products market along with an examination of the factors affecting purchasing behavior.
  27. 27. 2015 Cambridge Business & Economics Conference ISBN : 9780974211428 July 1-2, 2015 Cambridge, UK 27 The majority of the respondents can be considered as environment unconcerned where as the miniature portion are in reality the active environment stewards. Though the results reveal that consumers possess a considerable level of positive perception for green marketing concept, products and for companies, practically, the purchasing behavior differ due to a variety of reasons. It can be supposed that the consumers are all potential include “Suspects” who evaluate those features in the buying decision process, “Prospects” who may attracted to the concept and haven’t buy and finally “Customers” who are the actual buyers. In this scenario, loyal customers are “Active LOHAS” and “Naturalites”. Though Drifters and “Conventionals” as well can be good customers for green products the majority of them deviate from the interest during the buyer decision making process. One major reason for the above deviation, as revealed in the survey is that the inability of consumers to trace information about products, where a considerable number of consumers had no idea about the information given in the product. On the other hand the perception of respondents on green companies was roughly hovering around the average level. Thus consumers may have a negative image on companies regarding green marketing. Thus, companies may provide necessary information via better promotions in order to educate consumers to create a want by demonstrating the difference of their products. The majority of respondents were in the ages between 21 and 30 years where among those a major portion is environment unconcerned consumers. This is an indicator that the younger generation as the future of a nation does not concern about the environmental issues allied with cosmetics and personal care products. However, this may be merely for the context of cosmetics and may be different for another kind of market.
  28. 28. 2015 Cambridge Business & Economics Conference ISBN : 9780974211428 July 1-2, 2015 Cambridge, UK 28 Considering the education levels, it was revealed that though the majority over 70% had reached their tertiary education, according to the statistical analysis, there was no significant relationship among education level and the adopting in LOHAS categories. Thus education may lead to change the mindset of those respondents in a way that they could make a sense to create a burning need to protect the environment. Moreover, the consumers who had attended an environment related education program were found making proper decision making in purchasing. Therefore, it is recommended to include environment education and green consumerism to the education system where younger generation can gain knowledge and apply practically in their lives in decision making. Importantly, unlike formal school or college education, these education programs can be used to educate adults in the society who are not engaged in an environmentally and socially responsible consumer behavior at present. However, these like education programs must be promoted by the government and non-government organizations in order to increase the literature and environmental knowledge of consumers so that they can actively participate in valuable decision making allied to environment protection while improving the quality of their lives. As per the “marketing concept and philosophy” today, consumers too could engaged in marketing as participant of creating value, where society will benefit ultimately. The consumers are less satisfied regarding the support given by companies and by the government. Thus the interest can be given where people would be motivated towards green consumption, if proper governmental programs are implemented with the support of the private sector. Since statistics reveals that the contentment on the prop-up of government and non government organizations is low, it can be concluded that the consumers may be expecting more institutional support for a green movement. Currently, the support and influence, subsidy
  29. 29. 2015 Cambridge Business & Economics Conference ISBN : 9780974211428 July 1-2, 2015 Cambridge, UK 29 schemes, loan facilities which may be required by companies are lacking in the country. Thus, a proper research on companies to evaluate this need and to arouse the need of a green movement must be managed trough a well establish national policy. Importantly, these set-ups must assure that all organizations, society and the environment can be benefitted according to the triple bottom-line concept. On the other hand, attracting customers through managing a proper blend of the marketing mix is important. Pricing is as decisive in green marketing as in conventional marketing. Most customers will only be prepared to pay a premium if they recognize supplementary value such as improved performance, functionality or usability. Environmental benefits alone may not be a validation for elevated prices for all LOHAS categories. Thus, product aspects which give a valuable outcome together with a realistic price are essential to attract and to convert “Conventionals” and “Drifters” to effective LOHAS consumers. Proper marketing promotions as communication may be used to draw attention of the “Unconcerned” group where perception and attitudes can be challenged to be altered through providing awareness and knowledge. However, there is a national need for communicating the potential benefits hidden savings in green products. Though these there might be a need to promote aggressively with relatively higher prices, environmentally responsible products may be comparatively less expensive when whole life costs are taken into consideration. In terms of cosmetics and personal care, the overall health benefits and environmental benefits must be communicated to the society. In addition to the pricing and promotional difficulties, there many negative aspects allied to green marketing where one of such worse phenomenon is “green washing”. In modern society, corporations are ever more recognizing the benefits of green marketing “Green washing” refers
  30. 30. 2015 Cambridge Business & Economics Conference ISBN : 9780974211428 July 1-2, 2015 Cambridge, UK 30 to businesses that espouse outwardly green acts with an underlying intention to amplify profits through misleading consumers. In conclusion, the study suggests a need of a national policy towards green marketing with green consumerism and green production where regulation, education and awareness, subsidies and aids are crucial elements for the betterment of cosmetics and personal care products consumers in Sri Lanka. Further, involvement of both government and private sector where consumers can be value creators may lead the society towards economic and environment sustainability.
  31. 31. 2015 Cambridge Business & Economics Conference ISBN : 9780974211428 July 1-2, 2015 Cambridge, UK 31 REFERENCES: Beckford, C. L., Jacobs, C., Williams, N. and Nahdee, R. (2010). Aboriginal Environmental Wisdom, Stewardship, and Sustainability: Lessons from the Walpole Island First Nations, Ontario, Canada. The journal of environmental education, 41( 4), 239–248. Chan, R. Y. K. (2001). Determinants of Chinese consumers’ green purchase behavior. Psychology & Marketing, 18 (4), 389-413. Datta, S. K. and Ishaswini, (2011). Pro-environmenatal Concern Influencing Green Buying: A Study on Indian Consumers. International Journal of Business and management, 6 (6), 124-133. Ghosh, M. (2010). Green Marketing – A changing concept in changing time. BVIMR Management Edge,4(1),82-92. Hessami, H. Z., Yousefi.P and Goudarzi, G. (2013). The Conceptual Model of Effective Factors on Consumers, Green Purchasing Intentions. International Journal of Engineering and Innovative Technology (IJEIT),2 (7). Jain, S. K., and Kaur, G. (2004). Green marketing: An Indian perspective. Decision, 31(2),18- 31. Mainiery, T., Barnett, E. G., Valdera, T. R., Unipan, J. B. and Oskamp, S. (1997). Green Buying: The Influence of Environmental Concern on Consumer Behavior. Journal of Social Psychology, 137(2), 189-204. Mobium. (2007). Living LOHAS: Lifestyles of Health and Sustainability in Australia Consumer Trends Report, Mobium Group, August. Mohan, G. and Denis, W. (2013) Behavior modeling of green consumerism using LOHAS classification: A Concept article. Social & Environment Marketing Research Quarterly.20-23.
  32. 32. 2015 Cambridge Business & Economics Conference ISBN : 9780974211428 July 1-2, 2015 Cambridge, UK 32 Prothero, A. and McDonagh, P. (1992). Producing environmentally acceptable cosmetics? The impact of environmentalism on the United Kingdom cosmetics and toiletries industry. Journal of Marketing Management, 8, 147-166. Todd, J. T. (2004), The visual perception of 3D shape. TRENDS in Cognitive Science, 8(3), 115-121. ABBREVIATION FMCG: Fast Moving Consumer Goods LOHAS: Lifestyles of Health and Sustainability ALV:Average Likert Value GAL: Grand Average Likert Value SPSS:Statistical Package for the Social Sciences NMI: Natural Marketing Institute E&SR: Environment and Social Responsibility

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