Environmentally Friendly

Opportunities to Alter Consumer Behavior

Environmental concerns have led people to adopt new behaviors worldwide; for example, recycling, pollution-free transportation, and environmentally friendly products, among others. The challenge for companies is to determine the extent to which consumers' new behavior toward protecting the environment has resulted in purchasing products from companies that are perceived to be environmentally friendly. A study by S. Singh and D. Carvalho (2005) reveals that consumers prefer purchasing gasoline from an oil company they perceive to be the most environmentally friendly and that they are willing to drive farther to locate their preferred gas stations. The implication is that companies need to understand consumers' purchasing behavior, as most do assess the effect on the environment of using a nonenvironmentally friendly product. Companies should seize the opportunity to alter consumer behavior by educating consumers about the value of purchasing [Page 130]environmentally friendly products. Governments and insurance companies may want to subsidize environmentally friendly products to create further value to the consumers and to induce behavior that encourages this. As a result, individuals may even choose to seek employment with environmentally friendly companies.

Opportunities to Develop Environmentally Friendly Products

Market economies encourage companies to invest in developing countries, giving marketing managers opportunities to globalize their brands. Although this activity gives rise to economic development and improvement in quality of life, it is imperative that companies develop environmentally friendly products (e.g., energy-saving lightbulbs and fuel-efficient cars, refrigerators, and houses, etc.) to satisfy the needs of consumers by keeping the natural ecological system intact. Further, environmental protection measures have stimulated the development of innovative technologies that conserve energy, reduce greenhouse gases (GHGs), and thus contribute to quality of life. Some companies are making energy efficiency and GHG emission reduction a key component of their corporate strategy. For example, Daimler Chrysler has reduced the GHG emissions per vehicle manufactured by 42 percent over the past decade. Syncrude Canada has reduced GHG emissions per barrel of production by 26 percent since 1988. Given this awareness, automakers are poised to introduce innovative green gasoline-based cars; for example, Volkswagen's desire to use hydrogen as a fuel and General Motors' invention, using a hybrid-drive full-size sports utility vehicle (the Cadillac Escalade), among others. Indeed, consumers may demand environmentally products from globally branded companies such as these, as they associate these companies with superior brands.

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