Green Product Purchasing Behavior of Young Thai Consumers

Introduction and Background

In the modern-day business community, organizations face an increasingly complex environment marked by an incremental emphasis on consumer benefit, environmental friendliness, and employee motivation. One of the most pressing demands placed on organizational leaders is the satisfaction of customers' evolving needs and wants.

Throughout the past decades, consumers have undergone a fundamental transformation. They have shifted from a passive force that purchased whatever manufacturers produced into an active force that dictates what items should be manufactured and sold. As customers have grown more demanding, elements such as product quality or high-quality service are no longer sufficient to attract and retain them. It is now necessary to understand customers deeply, to ensure that organizations create value through the purchase, and to simultaneously meet the demands of as many stakeholder categories as possible.

In order to comply with these needs, economic agents have placed incremental emphasis on a multitude of marketing endeavors. This research project is one such endeavor, aimed at recognizing the perspectives and behaviors of Thai consumers regarding green products. The research question emerged from the intersection of two distinct areas of contemporaneous interest: customer understanding and green products. In a context in which environmental threats are increasingly common, both the business community and consumers are striving to become more environmentally responsible (Johri and Sahasakmontri, 1998). This materializes in a series of efforts, including the replacement of older technologies with newer and more energy-efficient ones, sustained efforts to reduce greenhouse gas emissions, and the creation of green products.

The market for green products is still emergent and intriguing. On one hand, it is perceived as the necessary solution for implementing a healthier lifestyle — not only for the environment but for the population as well. On the other hand, it is perceived as expensive and more of a trend than a genuine necessity. In order to get to the bottom of this debate, it is necessary to interact directly with customers and comprehend their views, including their perspectives and the criteria that influence their buying behavior.

During this decade, individual consumers' purchasing decisions are no longer pegged strictly to product quality. A series of social and environmental factors have emerged to influence whether a client finalizes a purchase (Menon et al., 1999). Green marketing has been growing in popularity globally. Within the western hemisphere, for instance, green marketing has been gaining traction since the 1980s (Ottman et al., 2006). According to a study conducted in 1996 on European countries, 88 per cent of German consumers were prepared to switch to green products. Similarly, in Italy and Spain the percentages were 84 and 82 per cent respectively. Within the United States, an estimated 52 million households were believed to be included in the green market (Wasik, 1996). The trend that emerged in the western hemisphere is now gaining more popularity globally, with Asian economic agents and individual consumers placing greater emphasis on environmental stability. Within the business community, this has materialized in the necessity for companies to develop and implement environmentally friendly strategies. "While products and packaging will need to be brought into line with escalating consumer and regulatory demands, companies need to be seen as environmentally responsible. In the age of environmental consumerism, the perception is reality" (Ottman et al., 2006).

In the context of the Asian continent, a major threat to environmental stability is posed by emergent industry, which generates alarming levels of pollution. The rapid growth in industrial activity remains the root cause of pollution within the Asian region. Carter and Narasimhan (2000) expected that the current decade would bring about enhanced consumer awareness of environmental issues.

In Thailand specifically, environmental threats encompass a wide range of problems such as deforestation, wildlife trade, soil erosion, and air and water pollution — all relevant to green purchasing (WWF, 2010). Deforestation has resulted from attempts to convert forested land into agricultural land, causing Thailand's forest cover to drop from 53% in 1961 to 25% by 1998. Deforestation also generates a tremendous impact on global warming. As a result of rapid industrial expansion, high levels of air and water pollution have been registered: approximately 33 per cent of Thailand's water sources are categorized as having poor quality, and Thailand is ranked among the last Asian countries based on the amount of fresh water available per capita (WWF, 2010).

In this context, the Thai government and the Thai people have commenced paying greater attention to the effects of environmental problems. People make an effort to buy products that are environmentally harmless and, through them, to minimize the negative environmental implications of consumption. A first effort in this direction was the introduction of the Thai Green Label Scheme in 1993 and its formal launch one year later (Green Label Thailand, 2010). The scheme supports the development of the green products sector by introducing information for consumers and standards for businesses.

In order to satisfy green consumers, a product must be produced and delivered in a manner that is less harmful to the environment (Grankvist et al., 2007). These products not only respond to consumers' needs and wants but also generate long-term sustainability for the environment (Follow and Jobber, 1999). Beyond that, the consumer's choice of environmentally friendly products presents green producers with an opportunity to displace less pro-environmental products from the market (Thogersen, 2002).

On the other hand, Radman (2005) found that green products are more expensive than conventional products, leading consumers to purchase alternatives and treating price as a significant barrier. Economic agents themselves face several barriers in going green. For instance, replacing current technologies with more environmentally friendly ones is estimated to generate cost increases. Implementing and maintaining a green system is significantly more complex than doing so for a traditional system. Organizations are also limited by their lack of or reduced expertise in green operations. Finally, implementing a green system is associated with losses in operational productivity and profitability (Bernowski, 2008).

To guide this dissertation, five research questions were identified:

1. What is the perception of young Thai consumers regarding environmental stability?
2. What is the level of environmental consciousness revealed by young Thai consumers?
3. Does environmental consciousness impact the green product purchase decision?
4. What are the most important reasons supporting the green product purchase decision?
5. Which are the most important factors driving the decision to purchase green products?

The aim of this research is to examine the green-purchasing behavior of young Thai adult consumers and to identify the factors that influence it. This research also aims to help marketers understand how consumers make choices in the purchase of green products and to offer recommendations for developing marketing strategies for green products in Thailand.

Literature Review: Green Marketing and the Thai Consumer

In order to complete this aim, the following research objectives must be met: (1) the assessment of green marketing in Thailand; (2) the critical identification of factors and criteria that impact the decision to purchase green products among young Thai individuals; (3) the thorough analysis of Thai consumer perspectives through a questionnaire; and (4) the issuing of valid recommendations for green businesses on how to better respond to customers' needs, wants, and characteristics.

Green marketing is an increasingly common practice not only in the western hemisphere but in Thailand as well. Gurau and Ranchhod (2005) claim that green marketing is regarded as one of the most important trends in modern business. According to Walter (1993), green marketing can be defined as a business practice that captures consumer concerns about the conservation and preservation of the environment. Its components include concerns over global warming, environmentally friendly consumption, and purchase decisions aimed at conserving the environment.

Laroche et al. (2002) argue that green marketing is driven by consumers who have become more environmentally responsible and are thus forcing economic agents to develop and implement greener strategies: "Consumers' environmental knowledge is of paramount importance because the green revolution is primarily consumer driven. This implies that if consumers possess a superior understanding of environmental issues and channel it into ecologically conscious consumption behaviors, it is likely that profit-driven enterprises will be strongly motivated to apply the concept of green marketing to their operations."

Currently, green marketing is viewed as a widely used business strategy in Thailand, accepted as a management approach that satisfies customers' needs and society's demands in a profitable and sustainable way (Peattie and Charter, 1997). Green marketing helps consumers become more responsible individuals by raising their awareness of environmental threats. Thailand has started to increase its launch of green products within the market, though the category is still often perceived as a niche sector.

According to Cooper (2000), green products are items with a low environmental impact. In Thailand, the philosophical foundation for this approach was established by His Majesty King Bhumibol Adulyadej, who emphasized environmental and natural resources and developed the philosophy of the "Sufficiency Economy" to guide the Thai people toward balancing their way of life with the well-being of the environment. Starting in 1961, His Majesty the King initiated the Royal Chitralada Agricultural Projects, which aimed to promote higher quality standards for manufactured items and delivered services, encourage the use of natural materials to support Thai agriculture — the backbone of Thailand's economy — and set the basis for green marketing in Thailand (The Royal Chitralada Project, 2010).

The Thai Green Label Scheme was created in 1994 by the Thailand Business Council for Sustainable Development (TBCSD) in association with the Ministry of Industry of Thailand. It is an environmental certification awarded to products shown to have a less harmful impact on the environment. Products are assessed across their full lifecycle — including material consumption, the production process, and disposal — and categorized based on their comparative environmental performance (Green Label Thailand, 2010). The objectives of the Thai Green Label Scheme include: providing reliable information for consumers; creating green purchasing opportunities; motivating marketers to adopt green marketing; and reducing the overall threat of environmental problems in Thailand.

Most companies have also developed their own proactive environmental programs, including green products, reusable packaging, energy saving, waste reduction, recycling, and the creation of a green organizational culture (Carter et al., 1988). Three levels of green business can be identified (Aprisantanaruk, 2010): (1) Green level — the economic agent has environmentally friendly products or higher levels of green production compared to most competitors; (2) Greener level — businesses that create awareness of environmental threats and promote campaigns to change consumer attitudes and behavior; (3) Greenest level — businesses that encourage consumers to purchase green products and to behave in a more environmentally responsible manner.

Despite these efforts, the growth of green marketing in Thailand is slightly slower than in other Asian countries. The rationale is the relatively low emphasis on the environmental factor in Thai consumers' purchase behavior (Ministry of Natural Resources and Environment of Thailand, 2010). According to Schrum et al. (1995), consumers' concern about the environment and their desire for green products has not consistently converted into actual purchasing behavior.

Modern-day consumers are more concerned about the environment, and this concern has come to impact their purchase patterns. Green purchasing can be described as an environmentally conscious purchasing practice that helps reduce waste, supports recycling, and promotes the use of environmentally harmless materials (Min and Galle, 2001).

According to Strong (1996), green consumers are likely to avoid products that cause danger to their health or the health of others. They also take into account the environmental effect of a product as a result of its manufacture, use, and disposal — including the amounts of energy consumed, the level of waste generated, and the use of endangered materials in the production process.

Shabecoff (1993) suggested that consumers who manifest a high level of environmental concern are more likely to exhibit green consumer behavior. This argument is supported by Gerstman and Meyers Inc. (1989), who noticed a slight increase in the number of environmentally concerned consumers and in their purchase of green products. Additionally, environmentally conscious consumers are willing to pay more for green products. Suchard and Polonsky (1991) found that green consumers are willing to pay about 15–20 per cent more for environmentally harmless products. Laroche et al. (2001) support this, noting that consumers willing to pay higher prices for green products do not find it difficult to behave in a pro-environmental manner; they in fact believe it is essential to do so.

D'Souza et al. (2006) identify two green consumer segments: (1) The environmentally green consumers — extremely environmentally concerned and willing to purchase green products whenever possible, even at higher prices and with lower product quality; and (2) The price-sensitive green consumers — aware of environmental concerns and green products, but unwilling to pay the price premium, even when they are satisfied with the items.

Adrian and Dupre (1994) identified five types of green consumers based on criteria such as purchasing biodegradable items, buying products packed in recycled containers, household recycling practices, and financial contributions to environmental associations: (1) True-blue greens — the most dedicated environmentalists, small in number but vocal and influential, with a median age of 44; (2) Greenback greens — concerned and willing to pay more (generally up to 20 per cent), but not willing to sacrifice time or comfort to actively militate; (3) Sprouts — a large segment that is aware of environmental threats but does not fully recognize the value of paying more for green items; (4) Grousers — generally indifferent to environmental problems and unwilling to opt for green products unless these offer the best price-to-quality ratio; and (5) Basic browns — who acknowledge environmental threats but believe it is not their responsibility to solve them, purchasing green products only when these present the best price or quality alternative.

Getzner and Krauter (2004) organize the characteristics of green consumers into three major sets: demographic and socio-economic characteristics, psychographic characteristics, and behavior.

In terms of demographic and socio-economic characteristics, research has found that the green consumer tends to be younger than the average consumer (Straughan and Roberts, 1999). Laroche et al. (2001) suggested that women are more likely to be environmentally conscious than men. Higher income and education levels appear to positively impact environmental awareness and trigger more responsible behavior. Consumers with higher incomes can afford the price premium associated with green products, while education has been confirmed to be positively correlated with green attitudes and behaviors. Balderiahn (1988) suggested that environmentally concerned consumers tend to be more educated and to belong to the upper social class.

In terms of psychographic characteristics, consumers' environmental knowledge constitutes an important factor influencing all stages of the buying decision process (Chan, 1999). Consumer attitudes act as a moderator of environmentally friendly behaviors. However, Kollmuss and Agyeman (2002) argue that environmentally conscious consumers do not necessarily behave in a consistently green way or remain faithful to their purchase patterns.

In terms of behavior, Laroche et al. (2001) found that consumers who consider environmental issues are likely to pay more for green products. According to Manaktola and Jauhari (2007), drawing on Ajzen's (1998) theory of planned behavior, green consumer purchasing intentions may be influenced by environmental knowledge, the ability to sustain the selected behavior, or the opportunity to act in a pro-environmental manner. The two key variables shaping green purchasing behavior are: (1) Perceived consumer effectiveness — the belief that individual effort can make a difference in resolving environmental problems (Berger and Corbin, 1992); and (2) Ecological concern — the consumers' level of ecological concern, which is in direct correlation with their efforts to purchase green products (Amyx et al., 1994).

Ottman (1998) argues that the performance of green products is often considered substandard, with consumers believing that green products perform more poorly than conventional ones. Baker and Ozaki (2008) argue that consumers construct beliefs based on their level of information, their experiences, their familiarity with brands, and their satisfaction with those brands. The perception of substandard quality is largely based on the low quality of the first generation of green products and the subsequent propagation of that belief. Most customers would trust well-known brands or products when buying green (Baker and Ozaki, 2008).

A third component of the purchase decision involves the composition of the green product. Customers look for natural ingredients and limited use of chemical compounds, as well as adequate and non-wasteful use of natural materials in manufacturing, packaging, and delivery. They also care about the process by which the product was created and seek items produced in an environmentally friendly manner (McDaniel and McDaniel, 2010). This criterion is often difficult to assess due to limited access to details about manufacturing operations.

Green marketing encompasses the efforts of economic agents to convince individual customers to purchase environmentally friendly products. In Thailand, green marketing is implemented as a reputable organizational strategy helping economic agents satisfy customers and attain their business objectives in a sustainable and responsible manner. The relevant evidence supporting the green movement in Thailand is constituted by the Thai Green Label Scheme, which increases access to information, improves purchasing opportunities, and supports the reduction of environmental threats.

Thai green consumers, like green consumers worldwide, care for the well-being of the environment. They do not, however, purchase green products to the same extent as consumers in other countries. Green customers can generally be divided based on their commitment to green strategies, their brand loyalty, and their affordability of green products. According to the literature, the green consumer is typically younger than the average consumer, better educated, wealthier, more informed, and holds a positive attitude toward the environment. The elements that influence the purchase decision include product quality, product performance, consumer beliefs, brand strength, product composition, and manufacturing processes.

Overall, several elements need to be addressed in any analysis of young Thai consumers' perceptions and attitudes toward green products: age and education level of respondents; income; habits and categories of green product purchases; the most important criteria and barriers in green purchase decisions; customer awareness of environmental problems; the role of price, brand, recycling, and packaging; attitudes toward green product quality and availability; and levels of customer information and environmental engagement.

Research Methodology

The research question was identified through the recognition of two important features of modern society. First, there has been a fundamental shift in the balance of power from companies to customers. Historically, organizational clients would buy whatever companies produced, paying higher prices with little bargaining power. In more recent years, however, increased competition driven by technological development and globalization has compelled organizations to strive harder to satisfy the needs and demands of customers. Today, customers determine what kinds of products should be manufactured and sold, and economic agents must comply with their needs and wants.

The second variable was the recognition of major environmental problems. Due to irresponsible acts, massive deforestation, air, water, and soil pollution, and large emissions of carbon dioxide and greenhouse gases, the planet faces significant risks. The response of individuals has been to protect the environment by reducing human activities that generate negative impacts, such as replacing older technologies with energy-efficient ones, recycling materials, and creating green products. Economic agents are now increasingly viewing going-green strategies not merely as a financial burden but as an opportunity to improve their reputation and create a sustainable economic model.

In a context in which the green trend began in the west, a question arises about its manifestation in the east — specifically in Thailand. Assuming that economic agents do implement green strategies and create green products, do Thai consumers purchase them? In other words, what are the attitudes and behaviors of young Thai consumers toward green products?

In order to answer this question, a process of primary research was developed based on two specific elements. The first was the construction of a focus group to test several approaches to the research process. The second was the construction of a questionnaire to be answered by 100 individuals. The questionnaire was constructed using information retrieved from the focus group, correlated with findings from the specialized literature.

The first focus group was formed from five Thai students. They were engaged in discussion on three specific topics: (1) awareness of environmental problems; (2) individual concerns over environmental well-being; and (3) buying patterns and behaviors regarding green products. The information collected was processed and compared against the specialized literature. Based on the most crucial factors identified, a questionnaire was constructed and subsequently tested on a second focus group of ten Thai students to assess its validity, ease of understanding, and applicability.

Focus groups are a highly common and popular research tool associated specifically with qualitative research. They are not only popular because they offer various opinions efficiently, but they are also powerful: former British Prime Minister Tony Blair once stated that "there is no one more powerful than a member of a focus group" (Kitzinger and Barbour, 1999). Focus groups reveal several advantages over surveys: they are constructed on insight rather than rules; they identify social findings rather than purely individual perceptions; they are homogenous and flexible; and the information accessed is not limited to pre-established standards (Gate, 2005). Combining focus groups with surveys was intended to limit the disadvantages of each method and maximize their combined advantages.

The sample comprised 100 individuals, all young Thai consumers between the ages of 18 and 35, with a balance sought between genders. The sample is described below across five criteria:

Gender: 63 per cent female; 37 per cent male.

Age: The majority (79 per cent) belong to the 20–30 age group. Specifically, 38 per cent are between 20 and 25 years old, and 41 per cent are between 26 and 30; 12 per cent are between 31 and 35; 6 per cent are over 35; and 3 per cent are under 20.

Education: The majority are postgraduates or holders of master's degrees (63 per cent); 31 per cent are undergraduates; 3 per cent hold PhDs; and the remaining 3 per cent are high school graduates or below.

Occupation: 39 per cent are currently employed; 38 per cent are students; 14 per cent are business owners; 5 per cent are unemployed; and 4 per cent are stay-at-home spouses.

Monthly income: The majority earn between 12,001 and 35,000 Baht per month. Specifically, 29 per cent earn between 12,001 and 20,000 Baht, and 30 per cent earn between 20,001 and 35,000 Baht; 15 per cent earn between 5,001 and 12,000 Baht; 12 per cent earn between 35,001 and 50,000 Baht; 9 per cent earn more than 50,000 Baht; and 5 per cent earn less than 5,000 Baht.