The impact of greenwashing on green marketing in Ireland

Abstract

Concern for the environment is on the increase and businesses today are now facing greater demands from consumers in relation to their environmental impact and sustainability practices. Consumers are now engaging in ‘ethical living’, adapting their lifestyles and shopping habits in line with environmental impacts (Clark, 2006). Given the increasing market for eco-friendly products and services, this has given rise to the practice of green marketing in many industries (Chen & Chai, 2011). Companies have begun to use green marketing in the hope of incentivising consumers to purchase their products and services. Lee (2008) notes that through green marketing practices, marketers hoped to increase goodwill, market share, and sales. Additionally, government regulation regarding the environment has forced many companies to adopt greener practices. However, research has shown that, in an effort to gain market share, many companies have engaged in claims of environmental friendliness that are false or misleading, otherwise known as greenwashing. Dahl (2010) states that the term “greenwashing” can be used to describe the ads and labels that promise more environmental benefit than they deliver. It refers to the practice of making unwarranted and inflated claims of environmental friendliness and sustainability in order to gain market share. The purpose of this dissertation is to investigate whether or not consumers in Ireland have experienced greenwashing across selected industries and if so, what impact, if any, this has on their perceptions of green marketing. While much research has been conducted in the area of green marketing and how it relates to both consumer perception and purchasing power, this has largely been confined to Asia, the Americas, and Southern Europe. Therefore generalisations made for one culture and geographic demographic may often be considered meaningless if applied to another (Rahbar & Wahid, 2011). If marketers are to understand their consumers in Ireland, further research is needed to discover how these consumers perceive green marketing and how this impacts on their green purchase behaviour. Furthermore, no study has examined consumer perceptions of green marketing across the three industries included in this study and in particular, with a focus on the act of greenwashing. This study used both secondary and primary research in an effort to gain an in-depth analysis into this area. A review of the current literature was conducted to identify current theories and key concepts related to the area of marketing ethics and more specifically, green marketing. These key concepts included the attitude-behaviour gap present in green purchase behaviour and the negative impact of greenwashing on consumer scepticism of environmental claims. Following this primary research was conducted in three forms: surveys, focus groups, and in-depth interviews with marketers in each of the industries that is under examination in this study. There were a number of key findings as a result of this research, among which included the high levels of price sensitivity among consumers in Ireland, regardless of income or environmental values; the impact of age, income, and environmental values on attitudes and behaviours; the lack of experience with greenwashing among consumers resident in Ireland; and the negative impact that would be incurred if consumers were to experience greenwashing. Interestingly, this negative impact was not confined solely to the company engaging in greenwashing practices, but could also have an impact on companies within the same sector and potentially across sectors (although not to the same extent). Ultimately, the aim of this dissertation is to provide marketers in industry with a knowledge of the attitudes and behaviours of consumers in Ireland in relation to green marketing and to apply the knowledge gained to make recommendations for Irish marketers in their use of green marketing.