Eco-labels Impact Consumer Behavior

Eco-labels influence consumer behavior in two ways.  First, they introduce green as a considered attribute at the point of sale.  Second, they enable consumers to comparison shop based on green.  Over the past few years, there have been many new eco-labels launched by governments, manufacturers and retailers.  Many of these labels are listed on Consumer Reports’ Greener Choices site.

Interestingly, the Natural Marketing Institute’s 2007 LOHAS Consumer Trends Database report determined that not all eco-labels have the same impact.  In fact, consumers indicate that they are more likely to make eco-friendly purchase decisions if the eco-labels are also widely recognized and trusted brands in of themselves.  Familiar labels for programs like the EPA’s Energy Star have a more significant influence on consumer behavior than others. 

While such a finding reinforces the value of eco-labels, it does challenge the notion that CPG companies and retailers should necessarily launch proprietary labels to differentiate themselves on green.

Like all brands, eco-labels take significant time and resources to build.  Moreover, given the sensitivities regarding greenwashing, for-profit entities may have to overcome a higher hurdle than government or a non-profit organization given the appearance of conflict if proprietary labels adorn their own products.

 

As such, Marketing Green recommends that product companies and retailers focus on disclosing product information about environmental impact to differentiate themselves in the market rather than trying to define new green labels.  Disclosures provide consumers with information that can inform purchase decisions rather than certify a product’s greenness.  This is what HP has done with its launch of Eco Highlights labels on its products.   

Marketing Green also recommends that retailers simultaneously push for industry-wide labels.  While some retailers may consider proprietary labels as a competitive differentiator, it is likely that broadly recognized labels will accelerate consumer adoption while reduce the cost to support them. 

 

Moreover, retailers should differentiate themselves by sourcing more green products.  Arguably, this is one of Wal-Mart’s strategic priorities today.  Greater variety combined with recognized eco-labels will likely drive more sales as well as consumer loyalty.  In the end, this approach is likely to have more impact for both business and the environment.

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25 Responses to Eco-labels Impact Consumer Behavior

  1. Essentially what you are recommending is a credible environmental product declaration (EPD) program that communicates environmental impacts based on life cycle assessment. Some of the most credible ones comply with the ISO 14020 Series of international standards and are developed via a consensus process with open consultation and also include independent third-party verification of the environmental data and claims. The EPD label typically looks similar to a nutrition label.

  2. MC Milker says:

    Agreed!

    Launching various proprietary labels only adds to confusion in the marketplace as more and more corporations develop them. Interestingly, both retailers and in particular manufacturers/producers have repeatedly asked the FDA and the USDA to define such simple terms as “natural” and provide greater regulation of environmental claims…with somewhat dismal results.

    Currently, my best recommendation for manufacturers of eco products is to seek one of the better known organic/eco certifications for their products, if at all possible to heighten their green credentials.

    While providing eco information on the label is an excellent step for many neutral to green companies…for larger companies without green credentials but a commitment to going green, separate brands may be a better short term choice within a longer term “greener”strategy.

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  5. Texas Labels says:

    I think it’s awesome that ‘green’ labels affect consumers these days. It’s definitely a step in the right direction.

  6. Marlene Affeld…

  7. Its a start, I am sure that the labels will be improved in the future to address customer issues.

  8. Hello Dave,
    I’m glad to see you are still posting. I enjoyed this one on ecolabels. I wrote one recently about Alternatives to EcoLabels that you might enjoy.

    http://www.greenmarketing.com/index.php/blog/comments/alternatives-to-eco-labels/

    By the way, I’ve added yours to our blog roll. Here’s the URL for ours if you’d like to include a reciprocal link. http://www.greenmarketing.com/index.php/blog/

    Would be great some time to catch a lunch or coffee together to catch up. Would be great to learn more about recycle bank.

    All the best, Jacquie Ottman

  9. Dave, just realized I put in wrong email address above. Should be info@greenmarketing.com J.O.

  10. Hi there , that is very interesting and valuable content you have here. If people use gudliness you provide here I’m sure they will get great benefit. S.J.

  11. Hue Phuong says:

    Do you have thesis green marketing? I want to learn more. It is interesting.

  12. Lou Nguyen says:

    Eco-labels have value to consumers and manufacturers. In the book ‘The Value of Ecolabelling’ John Paull defines an eco-label as an environmental claim on a product . He reports the dollar values to consumers of some of the popular ecolabels that appear on food including organic, natural and eco.

  13. you could be a resource person to me on my Post Graduate Research on Consumer Education, Environmental Governance and green sticker encapsulated in this title “Kick starting a Neo Environmental governance and
    Consumer Environmental Education in Nigeria using the power of Green Sticker.”
    I am a student of Environmental management student in Nigeria and i realized that environmental education and governance is almost zero if not non-existence in the country; i want to use my work to kick start consumer environmental awareness and a new perspective to environmental management in Nigeria- God helping me, i would like to prepare a bill out of my work to our National Assembly where i expect an Act on Green Sticker to evolve.
    All i need from you is e-Literature and resources that would help me in better understanding of the ideal of Green Sticker from the time immemorial till date, what it can achieve for a nation and what it had achieved for a nation as far environmental management is concerned.

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