Consumers’ Perception of Price Premiums for Greenwashed Products: An Abstract

These days’ markets are flooded with products that manufacturers promote as green by adding one or two green attributes to a conventional product. They do so take advantage of consumers’ willingness to pay higher for green products. We examine consumers’ perceptions of such products through a theoretical lens. From a theoretical grounding we predict that: H_1a: When consumers’ motivation to process information is high, both high-priced green and greenwashed products will be perceived high in monetary sacrifice.H_1b: When consumers’ motivation to process information is low, in comparison to a green product, the high price of a greenwashed product will be perceived high in monetary sacrifice.H₂: Perceptions of ethicality will mediate the evaluation of green and greenwashed products. Study 1 Sixty undergraduate students participated in the main study for extra credits. We randomly assigned participants to one of the four conditions in a 2 (motivation; low, high) × 2 (greenness, green, greenwashed) between-subjects design. The participants viewed the stimuli which consisted of an all-in-one printer with either one (greenwashed) or six (green) eco-friendly attributes and a fictitious brand name (Envyo) with a price of $399.99. We measured perceived monetary sacrifice, willingness to purchase the printer as well as three covariates. Results: An ANCOVA using individual preference for green products as a covariate showed a significant motivation x greenness effect on perceived sacrifice (F (1, 55) = 4.75, p < 0.05) with no significant effects of the covariates. Participants in the high motivation conditions perceived no significant difference between the two printers on perceived sacrifice (M_green = 7.4, M_greenwashed = 7.1; F (1, 27) = 0.40, p > 0.50). In low motivation conditions, the perceptions of sacrifice were higher for the greenwashed printer (M_green = 5.8, M_greenwashed = 7.0; F (1, 29) = 7.27, p < 0.05). Study 2a Using an implicit association task (IAT), this study demonstrated the implicit association of greenwashing (green) with unethicality (ethicality) of the firm (Greenwald, McGhee, & Schwartz, 1998). Forty-three undergraduate students participated in the IAT task. Results: Response times were significantly faster in the hypothesis-consistent blocks than those in the hypothesis-inconsistent blocks (F (1, 39) = 41.44, p < 0.001, D = 100). Mean response time in the hypothesis-consistent categories was 1295 milliseconds, compared with 1727 milliseconds in the hypothesis-inconsistent categories. Study 2b In this study, we measured ethicality concerns explicitly to test for mediation. Fifty-nine participants from Amazon Mechanical Turk were randomly assigned to one of the two conditions in a single-factor (greenness, green vs. greenwashed) between-subjects design. We used the vignettes from Study 1 to manipulate greenness and to create a low motivation to process information. Results from mediation analysis indicate that greenness significantly predicted ethicality (β = 1.41; 95% CI = 0.63 to 2.20), and ethicality significantly predicted perceived sacrifice (β = −0.23; 95% CI = −0.45 to −0.02). As expected, ethicality mediated the relationship between level of greenness and perceptions of sacrifice (indirect effect = −0.33; 95% CI = −0.76 to −0.03).