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Abstract

Common marketing strategies include emphasizing products' "green" or environmentally friendly attributes and characteristics to appeal to a growing market of environmentally conscious consumers. While previous studies have used product labels such as "eco-friendly," "environmentally friendly," and "sustainable" to investigate consumer preferences, relatively little is known about how consumer perceptions as a pre-decision mechanism impact their preferences and choice behaviors. Using data collected through an online survey of U.S. and Canadian consumers, we investigate systematic differences in individuals' perceptions of the terms "eco-friendly" and "sustainable." Marketing implications for the food and green (i.e., greenhouse/nursery producers, suppliers, and retailers) industries are discussed. Copyright 2015 Northeastern Agricultural and Resource Economics Association.
Agricultural and Resource Economics Review 44/1 (April 2015) 21–34
Copyright 2015 Northeastern Agricultural and Resource Economics Association
Consumer Perceptions of Eco-friendly
and Sustainable Terms
Benjamin Campbell, Hayk Khachatryan, Bridget Behe,
Jennifer Dennis, and Charles Hall
Common marketing strategies include emphasizing products’ “green or
environmentally friendly attributes and characteristics to appeal to a growing
market of environmentally conscious consumers. While previous studies have used
product labels such as “eco-friendly,“environmentally friendly,” and “sustainable”
to investigate consumer preferences, relatively little is known about how consumer
perceptions as a pre-decision mechanism impact their preferences and choice
behaviors. Using data collected through an online survey of U.S. and Canadian
consumers, we investigate systematic differences in individuals’ perceptions of
the terms “eco-friendly” and “sustainable.” Marketing implications for the food and
green (i.e., greenhouse/nursery producers, suppliers, and retailers) industries are
discussed.
Key Words: choice behavior, environmental attributes, labels, perceptions, survey
Increasingly, consumer products are advertised by promoting their “green” or
environmentally friendly attributes and characteristics to appeal to a larger
consumer base or to gain a premium for the product. As noted by Truffer,
Markard, and Wustenhagen (2001), this can be thought of as eco-labeling.
Numerous terms fall within this eco-labeling context, but two, “eco-friendly” and
“sustainable,” are applied to a wide variety of products and are at the forefront
of the green movement. As noted by Merriam-Webster (2013), the term “eco-
friendly” originated in 1989 while “sustainable” has been around since 1727.
Further, Greenbiz (2009) noted that 1,570 products claiming to be sustainable,
eco-friendly, or “environmentally friendly” were launched in 2009, tripling the
number launched three years earlier. Given the terms’ longevity and increasing
usage in the marketplace to inform and inluence consumer decision-making,
there is a growing need to understand how consumers perceive these terms.
Merriam-Webster (2013, web page) deines eco-friendly as “not environmentally
harmful” and sustainable as “involving methods that do not completely use
Benjamin Campbell is an assistant professor and extension economist in the Department of
Agricultural and Resource Economics at University of Connecticut. Hayk Khachatryan is an
assistant professor in the Department of Food and Resource Economics at Mid-Florida Research
and Education Center, University of Florida. Bridget Behe is a professor in the Department of
Horticulture at Michigan State University. Jennifer Dennis is an associate professor in horticulture
and agricultural economics in the Department of Horticulture and Landscape Architecture and the
Department of Agricultural Economics at Purdue University. Charles Hall is the Ellison Professor
and chair in international loriculture in the Department of Horticultural Sciences at Texas
A&M University. Correspondence: Benjamin Campbell University of Connecticut Department
of Agricultural and Resource Economics 1376 Storrs Road, Unit 4021 Storrs, CT 06269 Phone
860.486.1925 Email ben.campbell@uconn.edu.
We gratefully acknowledge funding from the U.S. Department of Agriculture Federal and State
Marketing Improvement Program that was instrumental in conducting this research. We also
thank Vineland Research and Innovation Centre (Vineland Station, Ontario) and the Zwick Center
for Food and Resource Policy for their support in conducting this research. The views expressed
are the authors’ and do not necessarily represent the policies or views of the sponsoring agencies.
22 April 2015 Agricultural and Resource Economics Review
up or destroy natural resources.” Perhaps from a more consumer-oriented
perspective, the American Hotel and Lodging Association (2014, web page)
deines the term eco-friendly as “a loose term often used in marketing to
inform consumers about an attribute of a product or service that has an
environmental beneit. This term does not necessarily indicate all attributes of
a product or service are environmentally benign.” The association deines the
term sustainable as “meeting the needs of the present without compromising
the ability of future generations to meet their needs.” Thus, deinitions of eco-
friendly and sustainable vary and, unlike for organic labeling, there are no
federal or state certiications to align deinitions across products.
Consequently, terms such as eco-friendly and sustainable, hereafter referred
to as EFS, have the potential to suffer from “greenwashing.” As deined by
EnviroMedia Social Marketing (2013, web page), “greenwashing is when a
company or organization spends more time and money claiming to be ‘green’
through advertising and marketing than actually implementing business
practices that minimize environmental impact.” EnviroMedia Social Marketing
(2013) goes on to note that greenwashing is a problem because it can cause
confusion among consumers (e.g., they purchase a product that is perceived
to be something it is not). Through such misinformation and false claims,
consumers may have inaccurate information about terms associated with
environmentally friendly products and may in some cases come to believe that
environmental labeling is nothing more than a sales gimmick.
In regard to environmental labeling, the studies completed so far have focused
mostly on understanding perceptions of the terms “organic” and “local”;
only a few have examined EFS terms even though their use is widespread.
Of the studies that have examined preferences and/or willingness to pay for
EFS labels (Thompson and Kidwell 1998, Blend and Van Ravenswaay 1999,
Wessels, Johnson, and Holger 1999, Moon et al. 2002, Mueller and Remaud
2010, Sirieix and Remaud 2010, Han, Hsu, and Lee 2009, Jhawar et al. 2012,
Marette, Messéan, and Millet 2012), none investigated the role of consumers’
perceptions of the terms in choice decision-making. However, as noted by Lusk
et al. (2004), Pope and Jones (1990), and Cameron and Englin (1997), the way
in which individuals perceive or intrinsically deine concepts such as EFS may
inluence their choices.
Despite the rising use of EFS terms on product labels, little is known about the
underlying perceptions and deinitions associated with them. As with the terms
local and organic (Ipsos Reid 2006, Campbell, Mhlanga, and Lesschaeve 2013),
we hypothesize that consumers’ perceptions and associations regarding EFS
vary and can be both positive and negative (H1). We irst compare perceptions
of EFS of respondents who were already familiar with the terms to respondents
who were not. Within this context, we examine how demographic, purchase-
behavior, and other consumer characteristics affect whether consumers
are familiar with EFS. We then focus on whether there is overlap between
perceptions of EFS terms and other terms such as local and organic that have
well-established deinitions. We hypothesize that the meaning of EFS terms has
begun to overlap the meaning associated with the certiied term organic (H2),
especially among individuals who have purchased increasing quantities of local
and organic products. Finally, we identify demographic, purchase-behavior, and
other consumer characteristics that play a role in respondents’ perceptions
of EFS terms as sales gimmicks and/or as associated with expensive products
(H3). We then discuss the primary economic and marketing implications of
Consumer Perceptions of Eco-friendly and Sustainable Terms 23Campbell et al.
the study with an emphasis on cases in which the unregulated EFS terms are
perceived as similar to the heavily regulated term organic.
Methods
Data
To better understand consumer perceptions, associations, and deinitions of
EFS terms, we initiated an online survey in spring of 2011. Using a database
from Global Marketing Insite, Inc. (GMI), we surveyed consumers on a variety of
purchase behaviors, environmental attitudes, demographic characteristics, and
their perceptions of EFS terms. Potential survey respondents were contacted
by GMI and invited to participate, and interested consumers were directed to
follow a link to the survey online. Of the 2,700 consumers contacted, 2,511
completed the survey; 68 percent were from the United States and 32 percent
were from Canada. Each of the 48 contiguous U.S. states and all of the Canadian
provinces were represented in the survey1 with states and provinces that had
larger populations sampled at a higher rate.
We endeavored to obtain a representative sample (based on 2010 census
estimates) relecting overall mean demographics for the United States and
Canada. Our U.S. sample had an average age of 35.8 (compared to the U.S.
census estimate of 37.2) and was 78.1 percent Caucasian (U.S. census average
was 78.1 percent). Our U.S. sample differed statistically from the census in
terms of average household income ($65,273 vs. $52,762 in the census) and
gender (males were 58.3 percent vs. 49.2 percent in the census). With regards
to our Canadian sample, the average age (42.7 vs. 39.7 in the census), average
household income ($66,747 vs. $69,860 in the census), and gender proportion
(49.6 percent vs. 48.6 percent in the census) in our sample were statistically
equivalent to averages for the Canadian population. The terms used in our
ethnicity question (in line with the U.S. census methodology) are not directly
comparable to the terms used in the Canadian census and how responses
were calculated; however, our rough calculations indicate that the Canadian
population is about 80 percent Caucasian, which is less than our sample
average of 86 percent.
The survey asked questions related to demographics (i.e., household income
and characteristics, education, marital status, age, gender, and ethnicity),
purchase behaviors (i.e., identity of the primary shopper in the household,
the types of stores generally shopped in, and purchases of local and organic
produce), and recycling habits (i.e., frequency of recycling a number of
materials). With regard to the questions of interest, we irst asked respondents
whether they had heard of the EFS terms (irst eco-friendly and then
sustainable). This question allows us to directly address H1: consumers who
are familiar with the EFS terms have different proiles than consumers who are
not. We tested our second and third hypotheses (H2: perceptions of the terms
local, organic, sustainable, and eco-friendly overlap; H3: consumers who view
EFS terms as gimmicks will have a different proile from consumers who do not)
by asking respondents to mark all of the characteristics provided in a list that
they perceived as representing EFS (Table 1). The list presented in the survey
1 Hawaii and Alaska were not included since perceptions in those states could be different than
the typical U.S./Canadian consumer given differences such as transporting product to those areas.
24 April 2015 Agricultural and Resource Economics Review
was inalized after discussions with experts in the horticultural (comprising
both food and nonfood products) industry and a review of the literature. Given
the increasing use of the EFS terms, we did not ask consumers to consider the
terms in the context of a speciic product or product type. Rather, we asked
for their perceptions in a general context so we could better understand the
overall connotation associated with them. The list included an entry for “some
other characteristic not listed” to capture any omitted characteristics.
We acknowledge two aspects of the survey that could potentially affect
interpretation of our results. First, the question on the term sustainable was
always presented after the question on the term eco-friendly, which could
bias the answers regarding sustainable. However, as shown in Table 1, there is
little overlap of responses to those questions. Second, respondents were asked
about their current perceptions of EFS terms. Consumers might have instead
described what they thought the terms should mean, which could weaken some
of the conclusions. However, we believe that the majority of the respondents
provided current perceptions and our discussion proceeds accordingly.
Analysis
To determine whether there are differences in respondents who had and had not
heard of the EFS terms, we compared the mean for each group using a t-test. We
wanted to understand the relationship between respondents’ demographic and
purchase-behavior characteristics and (i) whether they had heard of a term and
(ii) their perceptions of the term. Using a binary logit model and corresponding
marginal effects, we can examine the impact of the explanatory variables (e.g.,
demographics and purchase behaviors) on the question of interest.
We address eco-friendly irst. We assigned a value of 1 to respondents who
indicated that they had heard of the term and a value of 0 to respondents who
indicated that they had not. Once coding was completed, we used a binary logit
model such that the binary logit probability could be modeled as
(1) Pi = 1 / (1 + ex'
iβ)
where Pi is the probability of the ith respondent choosing the characteristic, xi
is a set of explanatory variables (e.g., demographic characteristics, purchase
behaviors, recycling behaviors, and beliefs about environmental terms), and β
represents the coeficients to be estimated. After obtaining the log-odds from
the binary logit model, we determined the corresponding marginal effects.2 We
then modeled the question regarding the term sustainable in the same manner.
Both models used the entire sample of U.S. and Canadian respondents. The
variables for each model were chosen based on a review of previous studies,
notably studies about the terms organic and local. We included recycling
behaviors and beliefs about the terms local and organic as proxy variables to
better understand the environmental mindset of the respondents; those results
are provided in an appendix available from the authors.3
2 Marginal effects for continuous explanatory variables can be interpreted as the percent
change given a one-unit increase from the mean. For a dummy explanatory variable, the marginal
effect is the percent change given a move from the base category to the category of interest.
3 Full tables are available in an appendix; contact the author or see http://public.homepages.
uconn.edu/~bec12003.
Consumer Perceptions of Eco-friendly and Sustainable Terms 25Campbell et al.
Table 1. Percentage of Survey Participants from the United States and Canada Associating Various Characteristics with
Sustainable and Eco-friendly
Eco-friendly Perception Sustainable Perception
Canada United States Canada United States
Have Not
Heard
Have
Heard Diff.
Have Not
Heard
Have
Heard Diff.
Have Not
Heard
Have
Heard Diff.
Have Not
Heard
Have
Heard Diff.
Have heard of eco-friendly (sustainable)? 5 95 8 92 23 77 26 74
Attributes
Green 43 78 *** 34 78 *** 24 52 *** 25 49 ***
Locally produced or sourced 18 33 ** 10 28 *** 14 26 *** 7 22 ***
Organic 35 53 ** 23 53 *** 14 28 *** 19 28 ***
Reduced greenhouse gases 20 68 *** 13 61 *** 14 38 *** 10 32 ***
Expensive or pricey 5 28 *** 9 27 *** 11 16 12 15
Socially responsible 20 56 *** 11 53 *** 24 62 *** 18 48 ***
Global warming 15 44 *** 17 41 *** 13 22 *** 9 21 ***
Energy savings, eficient, conservation 25 77 *** 24 75 *** 28 54 *** 20 51 ***
Lower carbon footprint 15 68 *** 16 62 *** 13 42 ** 9 36 ***
Sales or marketing gimmick 0 16 *** 8 17 *** 12 9 5 11 ***
Certiied or certiication 8 25 *** 10 17 ** 13 16 *** 8 15 ***
Best management practices 5 25 *** 8 20 *** 20 47 *** 12 37 ***
Biodegradable 33 71 *** 17 68 *** 16 36 *** 15 37 ***
Recycling 30 76 *** 33 75 *** 22 37 *** 18 38 ***
Some other characteristic not listed 8 1 *** 4 1 *** 6 3 ** 9 3 ***
Note: *, **, and *** represent the statistical difference between those who have and have not heard of the terms by country at a 0.1, 0.05, and 0.01 signiicance level respectively. For
instance, of consumers who had heard of eco-friendly, 33 percent perceived it to be locally produced, which is signiicantly more than the 18 percent who perceived it to be locally
produced but had not heard of eco-friendly.
26 April 2015 Agricultural and Resource Economics Review
The inal step in the analysis examined links between purchase behavior
and respondents’ demographic characteristics. Following the model set-up
in equation 1, we used the dependent variable to represent the selected
characteristic. We started with eco-friendly, coding a characteristic of eco-
friendly (e.g., a respondent perceived “green” as a characteristic of eco-friendly)
as 1 and all nonselected characteristics as 0. The same was done for sustainable.
Once coding was completed, we modeled the eco-friendly and sustainable
characteristics separately using a binary logit model such that the binary logit
probability could be modeled as in equation 1 and again used the entire sample
of U.S. and Canadian respondents.
Results
Heard of Term
Given how commonly EFS terms are used in the marketplace, it is important
to understand the types of consumers who have and have not heard of those
terms. As noted in Table 1, we ind that 5 percent of the Canadian respondents
and 8 percent of the U.S. respondents were not familiar with the term eco-
friendly and that 23 percent of the Canadian respondents and 26 percent of
the U.S. respondents were not familiar with the term sustainable. We then
examined differences in perceptions of the characteristics that make up the
terms between people who were familiar with them and people who were not,
and signiicant differences are readily apparent for most of the characteristics.
Among the Canadian respondents, for instance, 43 percent of those who had
not heard of the term eco-friendly characterized it as green while 78 percent of
those familiar with the term perceived it as green. Among U.S. respondents, only
25 percent of those who had not heard of sustainable perceived it as green while
49 percent of those who were familiar with the term viewed it as green. We see
the same pattern emerge for all of the environmental characteristics (reduced
greenhouse gases, energy saving, lower carbon footprint). Respondents who
had heard of the EFS terms were signiicantly more likely to perceive an
environmental characteristic as an attribute of eco-friendly and sustainable
than respondents who had not heard of the EFS terms.
Terms that have stricter deinitions due to federal and state legislation (i.e.,
locally produced, organic, and certiied) also are more often associated with
EFS terms in both Canada and the United States. For instance, 53 percent of
respondents in the United States and 53 percent of respondents in Canada who
had heard of the term eco-friendly perceived organic as one of its characteristics.
And although only 28 percent of Canadian and 28 percent of U.S. respondents
perceived organic as a characteristic of sustainable, that was still signiicantly
higher than the percentage for respondents who had not heard of the term.
Further, we see that “sales or marketing gimmick” was associated with EFS
for a relatively small percentage of the respondents; eco-friendly was viewed
as a gimmick by 8 percent of U.S. respondents who had not heard of the term
previously and by 16 percent of Canadian respondents and 17 percent of U.S.
respondents who had heard of the term.
Viewing these results in context, we ind that products marketed as eco-
friendly and/or sustainable are likely to have both an advantage and a
disadvantage relative to other products. The advantage is that irms still
have opportunities to more concretely deine the terms for consumers (more
Consumer Perceptions of Eco-friendly and Sustainable Terms 27Campbell et al.
so for sustainable) given the overall lack of familiarity with them. Firms
potentially have a particular advantage over local and organic producers since
a large subset of respondents equated local and organic with eco-friendly
and sustainable. Given current regulations for organic products and limits on
labeling a product as locally produced, irms offering products labeled as eco-
friendly and/or sustainable could potentially operate in a less strictly regulated
environment. The disadvantage lies in the consumers who perceive EFS labels
as a sales gimmick or as applied to products that are overly expensive.
Though these results provide important information to marketers, they
are not speciic enough to allow for inferences about how consumers would
respond to products labeled with these terms. Notably, two questions arise: (i)
What respondent characteristics correlate with a person who has not heard
of the term? (ii) Could some respondent characteristics allow irms to better
understand consumer perceptions?
Marginal Effects: Heard of Term
One of our primary goals is to understand how speciic respondent characteristics
inluence whether a consumer has heard of EFS terms. Thus, we focus speciically
on demographic characteristics and purchase behaviors with the results reported
in Table 2. Other factors (e.g., the importance of buying local and organic) and
actions (e.g., recycling) could inluence whether a respondent has heard of the
EFS terms so we include them in the model but exclude them from Table 2.
An evaluation of the results shown in Table 2 provides some interesting
insights. We irst examine the demographic characteristics. We ind that for
every child in the household above the mean there is a 0.9 percent decrease in
the probability that a respondent has heard of eco-friendly and a 3.8 percent
decrease in the probability that a respondent has heard of sustainable.
Educational attainment played a role only for sustainable—a respondent who
had a high school diploma, some college, or a bachelor’s degree was less likely
to have heard of sustainable than a respondent who had not graduated from
high school. Caucasian consumers were 2.2 percent more likely to be familiar
with eco-friendly and 6.4 percent more likely to be familiar with sustainable
than non-Caucasian consumers. We also ind that income has a positive
impact on familiarity with sustainable but has no impact on familiarity with
eco-friendly.
Of particular interest is the result that consumers who purchase more local
produce are more likely to have heard of both eco-friendly (1.4 percent) and
sustainable (3.3 percent). Further, respondents who purchase more organic
produce are more likely to have heard of sustainable. These results do not
indicate whether respondents use the term to make their purchase decisions
but do indicate that there is a link between having heard of the terms and
purchasing local and organic products. When viewed in conjunction with
the other demographic results, this inding provides insight into the types of
consumers who have heard of the terms, which irms can use to determine how
to increase awareness about a particular term.
Marginal Effects: By Perception
Table 3 reports the results of the binary logit model for perceptions of certiied,
locally produced, and organic as characteristics of the EFS terms for demographic
28 April 2015 Agricultural and Resource Economics Review
Table 2. Marginal Effects from the Binary Logit Model Associated with
Having Heard of Eco-friendly and Sustainable
Have Heard of Eco-friendly
Have Heard of
Sustainable
Coeficient p-Value Coeficient p-Value
Country (United States = 1) –0.006 0.436 –0.0003 0.988
Age 0.000 0.989 –0.0010 0.156
Number of adults in household 0.002 0.448 –0.0100 0.186
Number of children in household –0.009 0.002 –0.0380 0.000
Incomea 0.000 0.627 0.0045 0.064
Gender (male = 1) –0.021 0.001 0.0494 0.008
Household area: suburban 0.000 0.993 0.0220 0.309
Household area: rural –0.003 0.734 0.0299 0.233
Educ: high school to some college –0.015 0.189 –0.1488 0.000
Educ: bachelor’s degree –0.002 0.797 –0.0829 0.001
Educ: greater than bachelor’s degree –0.008 0.517 –0.0179 0.622
Race (Caucasian = 1) 0.022 0.030 0.0636 0.011
Purchased plants during last year 0.000 0.978 0.0493 0.018
How often purchased local produce 0.014 0.000 0.0328 0.007
when local was available
How often purchased organic 0.004 0.390 0.0404 0.001
produce when organic was available
Log pseudo-likelihood –513.3 –1,304.1
Wald chi-square 222.3 237.2
Prob > chi-square 0.000 0.000
Pseudo R-square 0.203 0.103
a Coeficient represents a $10,000 change from the mean income.
factors. Values shown in bold represent statistically signiicant coeficients
at the 0.10 level. First, it is apparent that U.S. and Canadian consumers view
the terms differently. For instance, relative to Canadian respondents, U.S.
respondents were 6.4 percent less likely to perceive certiied as a characteristic
of eco-friendly. For sustainable, U.S. respondents were 3.8 percent less likely
to associate certiied and 3.3 percent less likely to associate locally produced
with sustainable. These results are most likely the result of a variation in
environmental awareness between U.S. and Canadian consumers caused by
different environmental regulations in the two countries.
In terms of gender, we see that men were less likely to perceive locally
produced or organic as eco-friendly while gender has no impact on perceptions
of sustainable. This result is potentially troublesome for organic and local
producers. Firms that market their products as organic or local are subject
to various regulations associated with those terms that do not apply to eco-
friendly. Given that women tend to do more of the household shopping than
Consumer Perceptions of Eco-friendly and Sustainable Terms 29Campbell et al.
Table 3. Marginal Effects from the Binary Logit Model Associated with the Perception that an Attribute is Eco-friendly or Sustainable
Eco-friendly Perception Sustainable Perception
Certiied Locally Produced Organic Certiied Locally Produced Organic
Variable Coeff. p-Value Coeff. p-Value Coeff. p-Value Coeff. p-Value Coeff. p-Value Coeff. p-Value
Country (United States = 1) –0.064 0.001 –0.035 0.109 0.002 0.949 –0.038 0.026 –0.033 0.085 0.000 0.992
Age –0.002 0.002 –0.001 0.188 –0.002 0.065 –0.001 0.010 –0.001 0.362 –0.000 0.525
Number of adults in household –0.007 0.276 –0.010 0.232 –0.005 0.581 0.010 0.043 –0.009 0.196 0.011 0.136
Number of children in household –0.007 0.395 0.001 0.937 0.005 0.654 0.008 0.204 0.003 0.681 0.014 0.107
Incomea 0.002 0.306 –0.004 0.154 –0.005 0.084 0.002 0.216 –0.003 0.184 –0.001 0.623
Gender (male = 1) –0.002 0.918 –0.051 0.006 –0.046 0.039 0.009 0.482 –0.018 0.255 0.021 0.259
Household area: suburban –0.007 0.720 0.030 0.170 –0.030 0.249 –0.007 0.649 0.007 0.685 0.010 0.642
Household area: rural 0.022 0.382 0.043 0.146 0.034 0.299 0.017 0.430 0.020 0.413 0.004 0.895
Educ: high school to some college –0.030 0.165 0.005 0.873 0.073 0.023 0.013 0.563 –0.040 0.062 0.025 0.375
Educ: bachelor’s degree –0.009 0.624 0.024 0.285 0.059 0.027 0.027 0.108 0.003 0.858 0.038 0.096
Educ: greater than bachelor’s degree 0.006 0.812 0.023 0.496 0.039 0.300 0.011 0.656 –0.009 0.718 0.003 0.915
Race (Caucasian = 1) –0.002 0.930 0.014 0.570 0.013 0.636 –0.004 0.806 –0.007 0.745 –0.007 0.783
Purchased plants during last year 0.031 0.076 0.006 0.795 0.044 0.077 0.017 0.259 0.014 0.451 0.025 0.232
Heard of term eco-friendly (1 = yes) 0.068 0.025 0.103 0.006 0.172 0.000 0.022 0.436 0.050 0.163 –0.004 0.929
Heard of term sustainable (1 = yes) 0.060 0.001 0.093 0.000 0.065 0.014 0.044 0.002 0.108 0.000 0.084 0.000
How often purchased local prod.b –0.003 0.780 0.026 0.047 0.012 0.411 –0.008 0.417 –0.005 0.617 0.018 0.165
How often purchased organic prod.b 0.009 0.337 0.012 0.322 0.037 0.008 0.019 0.020 0.027 0.010 0.041 0.001
Log pseudo-likelihood 1,151.7 1,364.1 629.7 –902.2 –1,090.6 –1,271.3
Wald chi-square 124.9 208.5 182.9 105.2 160.2 157.3
Prob > chi-square 0.000 0.000 0.000 0.000 0.000 0.000
Pseudo R-square 0.054 0.084 0.063 0.0609 0.089 0.073
a Coeficient represents a $10,000 change from the mean income.
b Scale is a 1–5 Likert scale with 1 = never and 5 = always.
Notes: Base categories are Canada, urban household, less than high school diploma, other race, did not purchase plants, have not heard of eco-friendly, have not heard of sustainable.
30 April 2015 Agricultural and Resource Economics Review
men (Zepeda 2009, Flagg et al. 2013, Wolfe 2013), the fact that women are more
likely to associate local and organic with eco-friendly offers irms opportunities
to take business from local and organic producers while not having to obtain
certiications. Local and organic producers have made environmental concerns
their hallmark, but in doing so, they have opened a door to eco-friendly
potentially being used to some extent as a proxy for organic.
Further examination of Table 3 indicates that respondents who had a
bachelor’s degree were 5.9 percent more likely to associate organic with eco-
friendly and 3.8 percent more likely to associate organic with sustainable. This
result is interesting since respondents with bachelor’s degrees were less likely
to have heard of sustainable. One potential explanation is that relatively highly
educated respondents are more aware of organic messaging that says that
organic products are environmentally friendly, thereby making a link between
environmental terms and organic. Results of a recent paper by Campbell et al.
(2014) support this interpretation; they found that relatively highly educated
consumers related environmental beneits such as reductions in carbon
footprints and greenhouse gas emissions to organic. An alternate explanation
is that relatively highly educated consumers answer the question in terms of
what sustainable should be and not how they currently view it. However, since
we do not see education playing a role in whether a respondent had heard of
eco-friendly, we believe respondents answered the question in terms of how
they currently viewed it. Assuming that respondents answered the question as
asked (provided their current view of the term), our results raise the possibility
that respondents with more education may see an eco-friendly label and
incorrectly assume that the product is organic.
Local and Organic Competition
As shown in Table 1, most consumers perceive eco-friendly and sustainable
as indicating some type of environmental measure, notably a positive
environmental circumstance. This was not unexpected since marketing
generally uses the terms in that manner (Yue et al. 2011, Hall et al. 2010).
However, the more interesting question is how consumers who purchase local
and organic products perceive these terms, especially given the considerable
resources being invested by “buy local” and “buy organic” groups. For this
reason, we include the marginal effects from the binary logit for environmental
perceptions in an appendix while focusing our attention on the marginal effects
that are directly related to the local and organic terms.
Table 3 shows that several demographic characteristics and purchase
behaviors have a signiicant effect on the probability of a consumer perceiving
a characteristic as part of the EFS terms. For instance, U.S. consumers were
6.4 percent less likely to perceive certiied as a characteristic of eco-friendly
and 3.8 percent less likely to perceive it as a characteristic of sustainable than
Canadian consumers. In addition, they were 3.3 percent less likely to perceive
locally produced as a characteristic of sustainable.
Of particular interest are the demographic characteristics and purchase
behaviors that are linked to higher levels of purchases of local and organic
products. For instance, consumers who purchase local produce more frequently
are 2.6 percent more likely than other consumers to perceive the term locally
produced as a characteristic of eco-friendly. With respect to the term organic,
we see the potential for producers to use eco-friendly and sustainable as
Consumer Perceptions of Eco-friendly and Sustainable Terms 31Campbell et al.
alternatives to organic, especially when marketing to consumers who purchase
organic products. For example, consumers who purchase organic products
more frequently are 3.7 percent more likely than other consumers to perceive
organic as a characteristic of eco-friendly and 4.1 percent more likely to
perceive organic as a characteristic of sustainable. These results do not imply
that a consumer will purchase a product labeled as eco-friendly or sustainable
over a product labeled local or organic; rather, it indicates that eco-friendly and
sustainable could be used as alternative terms either to differentiate a product
or to avoid local or organic labeling laws that stipulate speciic boundaries or
production practices.
Note also that younger consumers who had heard of the EFS terms were
more likely to associate them with certiication. Since certiication is a hallmark
of organic products, this association among younger consumers between
certiication and other environmental types of messages should be a concern
for organic producers. Producers using EFS labeling not only do not have to pay
for certiication but could easily impact organic brands if the environmental
claims are not the same as those made by organic producers.
Sales Gimmick and Expensive
As more and more environmental terms enter the marketplace, some terms
may be diluted because consumers come to perceive the messages as gimmicky
and negative. Such skepticism is often referred to as a loss in authenticity
(Behe et al. 2010). As shown in Table 1, 9–17 percent of the respondents in
our sample who had heard of the terms perceived them as sales gimmicks and
15–28 percent perceived them as indicating that the products were expensive.
We present the results of this analysis in Table 4, where values in bold represent
statistical signiicance at the 0.10 level. The marginal effects presented in Table
4 show that younger consumers are more likely than older consumers to
perceive eco-friendly as denoting expensive and to perceive both eco-friendly
and sustainable as sales gimmicks. We also see that familiarity with the term
eco-friendly increases the likelihood of perceiving both terms as denoting
expensive and gimmicky. For instance, familiarity with eco-friendly increased
the probability of associating eco-friendly with expensive by 16.1 percent
and of associating eco-friendly with a sales gimmick by 6.9 percent (Table 4).
This inding indicates that some consumers are becoming skeptical of new
terminologies, leading to negative connotations for them. Also of interest is the
inding that rural consumers are 4.6 percent more likely than urban consumers
to perceive eco-friendly as a sales gimmick.
Conclusions
Our goal was to better understand consumer perceptions of the frequently
used terms eco-friendly and sustainable. We hypothesized that consumers’
perceptions would be inluenced by whether they were already familiar with
the terms (H1), that the terms are beginning to be associated with local and
organic products (H2), and that a deinable subset of consumers has a negative
association with the terms as being sales gimmicks or denoting expensive
products (H3).
Using an online survey of U.S. and Canadian consumers, we ind that several
consumer characteristics are associated with whether a person has heard of
32 April 2015 Agricultural and Resource Economics Review
Table 4. Marginal Effects from the Binary Logit Model Associated with the Perception that an Attribute is Eco-friendly or Sustainable
Eco-friendly Perception Sustainable Perception
Expensive Sales Gimmick Expensive Sales Gimmick
Variable Coeff. p-Value Coeff. p-Value Coeff. p-Value Coeff. p-Value
Country (United States = 1) –0.029 0.186 –0.009 0.586 –0.049 0.009 –0.007 0.621
Age –0.002 0.026 –0.002 0.001 0.000 0.486 –0.001 0.008
Number of adults in household 0.009 0.227 –0.005 0.411 0.003 0.564 0.006 0.170
Number of children in household 0.006 0.558 –0.005 0.533 –0.005 0.483 –0.001 0.818
Incomea –0.003 0.279 0.002 0.145 0.002 0.263 0.000 0.790
Gender (male = 1) –0.017 0.359 0.037 0.008 0.018 0.223 0.011 0.353
Household area: suburban –0.008 0.697 –0.008 0.659 –0.001 0.948 0.006 0.664
Household area: rural 0.004 0.878 0.046 0.054 0.015 0.504 0.038 0.067
Education: high school to some college –0.010 0.699 –0.029 0.130 0.011 0.610 0.001 0.955
Education: bachelor’s degree 0.027 0.218 0.001 0.970 –0.009 0.574 0.009 0.486
Education: greater than bachelor’s degree 0.030 0.363 –0.012 0.582 0.012 0.643 0.016 0.461
Race (Caucasian = 1) 0.030 0.197 0.003 0.877 0.006 0.735 –0.009 0.547
Purchased plants during last year 0.050 0.011 0.003 0.839 0.010 0.506 0.023 0.056
Heard of term eco-friendly (1 = yes) 0.161 0.000 0.089 0.000 –0.003 0.930 0.004 0.874
Heard of term sustainable (1 = yes) 0.069 0.001 0.073 0.000 0.031 0.056 0.017 0.208
How often purchased local produceb –0.010 0.423 –0.007 0.461 0.006 0.518 0.003 0.706
How often purchased organic produceb –0.013 0.235 0.000 0.971 –0.001 0.873 0.012 0.095
Log pseudo-likelihood 324.4 96.8 –945.5 –716.9
Wald chi-square 184.9 156.8 75.1 78.2
Prob > chi-square 0.000 0.000 0.000 0.000
Pseudo R-square 0.0773 0.0775 0.0396 0.0528
a Coeficient represents a $10,000 change from the mean income.
b Scale is a 1–5 Likert scale with 1 = never and 5 = always.
Note: Base categories are Canada, urban household, less than high school diploma, other race, did not purchase plants, have not heard of eco-friendly, have not heard of sustainable.
Consumer Perceptions of Eco-friendly and Sustainable Terms 33Campbell et al.
the terms: number of children in the household, gender, race, and purchases of
local and organic produce. With this in mind, irms that market their products
using eco-friendly and/or sustainable terms will want to consider the consumer
segments most likely to value such terms as well as opportunities to educate
consumers about the terms’ meanings. Consumers who are already familiar
with the terms may not accurately understand them.
Since eco-friendly and sustainable are not regulated, there is potential for
greenwashing by irms to take advantage of consumers who misconstrue them.
For instance, eco-friendly and sustainable tend to be familiar to consumers
who purchase local and organic produce. As consumers purchase increasing
amounts of local and organic produce, they are more likely to associate organic
and locally produced with eco-friendly and sustainable. This could potentially
directly impact local and organic labeling strategies for producers. For instance,
a irm could forgo organic labeling (and associated certiication costs) if its
consumer base accepts sustainable as organic. Perhaps just as likely is a irm
using eco-friendly and/or sustainable labels to differentiate its products and
compete directly with organic and/or local producers. In either case, the local
and organic brands could be eroded, allowing irms to “stretch” the deinition
of the terms to capture consumers interested in local and organic products.
As a whole, the results have important implications for marketing of food and
the green industry (greenhouse and nursery producers, suppliers, and retailers).
As the presence of various product claims and especially environmental
claims continues to grow, irms will have to be proactive to insure that their
messages do not get lost in the crowd or fall victim to incorrect perceptions.
Firms marketing products using terms that are subject to regulation (e.g.,
certiied, organic, and local) must be cognizant of how other environmental
terms impact their messaging and marketing. Because many irms lack the
resources and capability to conduct such research, this study provides useful
insights regarding eco-friendly consumers that irms can incorporate into their
marketing strategies.
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