Explaining effective factors on consumers’ willingness to pay more for buying green products based on the Value-Belief-Norm theory Alireza Ziaei-Bideh.

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Presentation transcript:

Explaining effective factors on consumers’ willingness to pay more for buying green products based on the Value-Belief-Norm theory Alireza Ziaei-Bideh MSc of Business Management, Persian Gulf University Mahsa Namakshenas-Jahromi MSc student of Industrial Management, Yazd University

Introduction  Green Consumers or Environmental-Friendly Consumers are those who consider the impact of manufacturing process and consumption of environmental resources while making purchase or participating in other market related activities; and make their decisions accordingly.

 Similarly, in Iran, according to evidence, the public concern about environmental issues has increased among consumers, and green segments have emerged in markets. Introduction..  Researchers have come to the conclusion that attitudes towards environmental issues and environmental-friendly behaviors and factors that encourage consumers to purchase green products are not the same in all cultures.

 The term 'green' has nothing to do with color, but the choice of name is appropriate because green is a color that is often associated with nature.  Green products are considered kinder to the environment than non- green goods, in one way or another. Energy efficient, durable and often have low maintenance requirements. Free of Ozone depleting chemicals, toxic compounds and don’t produce toxic by-products. Often made of recycled materials or content or from renewable and sustainable sources. Obtained from local manufacturers or resources. Biodegradable or easily reused either in part or as a whole.  Green products are:

What is the effective factors on consumers’ willingness to buy green products that have a premium price compared with similar products in market? Research Question

Value-Belief-Norm Theory  The VBN theory of pro-environmental behavior developed by Stern (2000) is an extension of the Norm Activation Theory (NAT) of Schwartz’s (1977).  The VBN theory assumes a hierarchical model where individual value orientations directly influence beliefs, and thereby attitudes and finally behavior.

Conceptual Model

Methodology  The target population of this research is consumers in Yazd province  A convenience sampling method was used to select the respondents.  A total of 300 initial responses have been received. After eliminating the confounding questionnaires, the number of final sample analyzed was 252, resulting in a response rate of 84%.  A questionnaire was used to collect the required data. All measures have been adopted from previous studies.  Structural Equation Modeling (SEM) has been used to test the conceptual model.

Results  Initial model results:

Results..  Final model results:

Results..  Final model fit:

Results..  Path coefficients and hypothesis testing:

Conclusion  VBN theory can explain effective factors on Iranian consumers willingness to pay the premium price of green products.  Altruistic and biospheric values have a positive significant effect on consumers attitude toward environment.  consumers attitude toward environment can increase their awareness about consequences and problems of environment. This increased awareness leads to ascription of responsibility and then personal norm toward preserving environment.  pro-environmental personal norm increases consumers’ willingness to buy green products even when they are premium priced compared with similar products.