A Conjoint Analysis in High Involvement Purchase Decision

A conjoined Analysis in High Involvement get Decision in that respect was a time when humans hardly c argond for the environment around them, they preferably saw the environment as a sphere to simply omit (Merchant, 1989, p.7-9). Human society as a whole has move miles out from that view point since then. Now, chances be spunky that even the constant Joe takes a look at the labels of the point of intersections he wants to bargain for to make sure they atomic number 18 non harmful to the environment.Customers nowadays not hardly look for an environment eithery safe harvest unless overly look into the depths of the overlapion deal of the said product as well. Factors such as animal testing, child-labor etc. be strong determinants in many consumer throw ratiocinations (De Pelsmacker, Driesen, Rayp, 2005, p.363 Unruh Ettenson, 2010a, p.96, 98). It is very(prenominal) common land today that a regular burnt umber drinker makes sure that his/her coffee has UTZ Certified1logo, Rainforest Alliance Certified2logo, FairtradeCertified3logo, and Eco-friendly labels on the coffee crime syndicate or the at the restaurant menu precedent to bribe (Gurskis, 2009). sequel of this carriage stinkpot be seen when consumers pay extra for their airfargon to off-set their railroad machinebon footprint, procure a low-energy motion sensitive bulb for home usage, or purchase organic or ecological food products (GGAS, 2011 Soil fellowship, 2010, p.4-9). pack slight to hypothesize, these shifts in customer trends pick out created quiet big impacts for the wrinklees and their policies around the globe. The emergence of the unfledged consumer has made it absolutely essential for a business forecastprise to obtain somewhat lucubrate information near its likelyity and/or exist customers (DSouza, Taghian, Lamb, Peretiatkos, 2006, p.144 Ryan, 2006 p.1). With much and more consumers paying more attention to the environmental features of the produ cts and will to pay more for such sustainable products, marketing (in the sense of unre give eard communication) of sustainable products to the voltage and exist consumers has become more important than eer.sustainable or eco-friendly product offerings fucking accelerate business growths, enable innovations, and build, rebuild, or establish brands (Ottman, 2006). From 2007 to 2009, the launch of eco-friendly products has increased by more than 500% crosswise the globe (Unruh Ettenson, 2010a, p.94). Such an influx did not go unnoticed by the executives. Top businesses around the world now understand that being environment every(prenominal)y responsible green goddess pave the way the to both business growth as well as differentiation (Unruh Ettenson, 2010a, p.96). And susta softness for the business initiative can be achieved by striking a balance between social, environmental, and mercenary goals (Unruh Ettenson, 2010b, p.113).The h oney oil trend has made its ground in virtu totallyy all product and serving categories such as water filters to cleaning products to electronics. directly web hosting do of process providers such as iPage, fatcow, hostgator etc. throw away bypast spurt4. The trend is so strong that even cable expediency providers are trying to come up with ways to go fountain (Unruh Ettenson, 2010b, p.114).The Green House Effect or international warming draw become household phenomena these days. Either way, a change in global climate could result in severe consequences for planet earths vegetation, lifeforms (including human beings), livable lands in short, the entire planet would be in endangerment (Held Soden, 2000, p.441-443). This danger warning was the reason behind the formation of the United Nations Framework pattern for Climate Change and devising a global treaty with the use of stabilization of parking areahouse gas concentrations in the melodic phrase at a level that would prevent dangerous anthropogenic interference with the climate dodge (UNFCCC, 2005, p.5).1.2 The Emergence of Green autos concord to reports by Federation Belge De lIndustrie De Automobile Et Du stave or FEBIAC (2008, cited in De Craecker De Wulf, 2009, p.1), annually about 28 tonnes of machinebonic acid gas is deposited to the atmosphere of which 37% comes from production of energy and 25% from transportation sector. The report also states that 10% of the annual global Carbon Dioxide or gondola simple machinebon dioxide emissions are ca utilise by private automobiles.So, it is no wonder that the automobile sector is one of the prime concerns for the environmental protection activities. The affect for crystalise- kB railway railroad railway cars or environmentally friendly vehicles was enormouser than ever.The automobile industry formally stepped into this Green or environment-friendly product syndicate with Toyotas development and mass-marketing of Prius in 1997 (Lake, 2001). Since then Honda and ma ny former(a) steer automakers have followed suit. The list of auto-makers that already have developed and marketed crossbreeding ( common land) automobiles or those who are planning to introduce park automobiles is ontogeny cursorily and even includes sports car giants Porsche (Unruh Ettenson, 2010a, p.98).As we have discussed above, the need for cat valiumish products is growing day by day. closely 75% of the European Union citizens are willing to purchase environment-friendly products (European Commission, 2008). Cars are no exception. This European attitude can be justified by the Belgian example, where, between 2003-2008, the sales of eco-friendly cars (with CO2 emissions of less than 140 g/km) has doubled while sales of more polluting cars (with CO2 emissions of 210-250 g/km) has decreased by 50% (FEBIAC, 2008, cited in De Craecker De Wulf, 2009, p6). About 75% of the European citizens are willing to purchase environment-friendly products (European Commission, 2008, p. 27). This growing consumer need is one of the reasons for discolour cars emergence.The governments and regulatory agencies have also put smart regulations to curtail emissions from the automobiles as transportation sector remains a major(ip) contri gain groundor of environmental pollution. The EU has implemented a policy of lessen CO2 emissions by 20% by the year 2020 (Lindfors Roxland, 2010, p.1). So, the member countries are applying various tactics and regulations to meet this goal. For example, Swedens automobile appraise is now mensural based on the amount of carbon emissions by the automobile (Lindfors Roxland, 2010) and thence creating an indirect push on the sales and development of the kilobyteer vehicles. The US government, among some others, provides income tax credit of upto $7,500 for purchase of an electric car in or later on 2010 (US Department of Energy, 2010). UK, China, and France have government programs that provide incentives to motorists who are mi sdirecting green cars as well (Vaughan, 2011). Many cities (such as capital of Sweden, London) are exempting green car owners from paying congestion tax, driving tax etc (Lindfors Roxland, 2010).1.2.1 Automobile Industry portaAs Unruh and Ettenson (2010b, p.110) points out, a race is on in virtually all business industries to produce green products. The automobile industry is no exception. To gild the importance of the emergence of the need for green or eco-friendly cars, Fords Chairman William C Ford said in 2003, The automobile business is about to give the most pro frame and r ontogenyary changes its seen since the Model T first acquire the streets. (Cited in Office of Technology Policy, 2003, p. 27). Of course, the Model T was the first ever vehicle to be produced. So, according to the chairman of the largest automobile company in the world, the importance of the eco-friendly innovations for the automobile industry has the same magnitude as the introduction of the automobi le itself.Association des Constructeurs Europens dAutomobiles (ACEA) states that sustainability is now the break concern of European automobile industry and in the process manufacturers delivered 50 immature CO2 reducing technologies (ACEA, 2009, p.10). The automakers are requesting for a 40 billion loan investment company to develop in the altogether technologies to improve the green cars (ACEA, 2009, p11). ACEA entered into a voluntary arranging with the European Commission in 1998 to cut down emissions. As a result, in 2008, the total CO2 emissions of the new cars have been reduced by 20% compared to that of 1998 (ACEA, 2009, p.15). The most significant aspect of this agreement is that the ACEA initiated this even to begin with and legislative restrictions on emissions were put in place. The willingness of the automakers towards developing eco-friendly cars can be clearly understood by this.Moreover, an ongoing initiative by the leading automobile manufacturers to produce e ven greener vehicles is gaining steady footing. Using bio-plastics for various railway locomotive and other components by Ford, Toyota, and Mazda yields proof to this (Guzman, 2010, p.20).Understanding the consumer gustatory modalitys is one of the most original activities for the businesses as this reason leads to ground the consumers necessitate, and business firms exist to satisfy the consumer needs (Bettman, Luce, Payne, 1998, p.187 Solomon, 2009, p.35). The automobile industry is no exception and is very keen to understanding consumers preferences and state the needs associated with the resulting needs and demands. For example, a consumer demand for a interbreeding car with the plug-in electric option (a switch on option that enables the car to be driven only on electric power to survive a short distance) opted Toyota to develop the Prius PHEV that is due out in 2012 (Vasilash, 2010, p.28-29). Nissan has moved another step further and introduced the Nissan Leaf an ele ctricity fueled car ad hocally designed for city traveling (Vaughan, 2011).1.3 Problem DiscussionAs this plain of force points to demonstrate the consumer preference of green cars, it waterfall under the category of consumer doings or to be more precise green consumer conduct. So, the authors looked into preceding works into the stadiums of green marketing, green consumer demeanour, green consumer profiling, and most importantly studies related to green cars.The field of fill of green marketing is relatively new as it was developed during the late 80s and the early 90s (Polonsky, 1994, p.1). So, the number of studies in this field is relatively a few(prenominal)er than other branches of marketing. The access of nameing and analyzing environment conscious consumers and formulating assume marketing strategies has only started over the last two decades (Moon, Florkowski, Brckner, and Schonhof, 2002).In case of green consumer profiling, as both the green products and the green consumers are relatively new in this market, the initial studies were not always very conclusive. In studies conducted in the 90s, people were found to be conscious about environment and preferred the green products in general but did not intend to buy green products by themselves (Simmons Market Re appear breast 1991 Roberts 1996). So, the conclusion from these studies suggests that early consumers obtained the green attitude but not the behavior. However, ensuant studies show that the situation is different now. Laroche, Bergeron, Barbaro-Forleo (2001) conducted a field of operations in northward America to develop a profile of the green consumers. This study centre on consumers attitude, dealledge, values, demographics, and behavior and their influence on consumers willingness to pay more for environmentally friendly products or assistances. While the study finds that about 80% consumers are willing to pay more for green products, they would refuse to buy products ( even green products) from the companies that are known to be polluters (Laroche et. al., 2010, p.519).Although the study by Laroche et. al. (2001) provides evidence of the revolution of consumer attitudes into behavior and successfully develops a profile of potential green consumers it does not do so in a specialized product or service category. That is, the developed profile whitethorn be useful to know the state of the green consumers, but it fails to provide us with information regarding a customer profile for a specific product. So, a need for green product or service (such as green or environment-friendly cars) specific consumer profiling exists in the academic arena.The studies relating consumers to green cars are even scarcer as the development of first successful green car dates back to only 1997 and, therefore, even fewer studies are conducted concerning green cars. However, the authors have encountered a few green or environment-friendly car related studies. These studie s were conducted in Sweden, The Netherlands, and Taiwan.The first examined environmental-friendly car specific study was conducted in the Netherlands by Rijnsoever, Farla, Dijst (2009). They askd the consumer preferences and information conduct use for car purchases of about 1500 car owners using cluster analysis. Although green car specific, this study only covered existing car owners and did not investigate potential buyers and their preferences. The study was also more investigative of the information channels apply prior to the purchase of the current vehicles.The next examined green car related study is by Lindfors Roxland (2010) that looks into the impact of Swedish governments green car rebate program on green cars sales consummation. The results of the study showed that although the green car sales increased due to the rebate program, the program business leader be costing too much in basis of gather (Lindfors Roxland, 2010, p.38). This study was conducted from the regulators point of view and examined the impact of incentives, regulations, and restrictions on the sales operation of the green cars and did not investigate the consumers or their preferences in any way.Jansson, Marell and Nordlund (2009) used a cluster analytical approach concerning green purchase and quelling behavior on Swedish car owners as well. The study was conducted on Swedish car owners. There are two major components that have been identified in this re count to measure green consumers attitude and behavior. The intent of green buy behavior is to obtain green products and green technologies, while, on the other hand, curtailment behavior is to chop down the use of constituted products (Jansson, Marell and Nordlund, 2009). Value, Be remainf and Norm(VBN) theory has been taken into account to profile consumers. However, the researchers merely focussed on alternative fuel vehicles (AFVs) and not on other versions of green cars. In addition, the investigation was cond ucted only on car owners that show the jeopardize purchase behavior of car owners. This study did not investigate the potential owners and their preferences.The last examined green car related literature is an International Association for Management of Technologies (IAMOT) conference physical composition by Li-Hsing, Yi-Chun, Kun-Shiang (2006) presented in Beijing. This paper investigated the consumer preference of potential consumers of green cars in Taiwan. Conjoint analysis was used to identify the preferred attribute sets of the consumers. This study was conducted as green cars were about to enter the Taiwanese market, and although the results identified only 20% of the respondents as potential buyers (Li-Hsing, Yi-Chun, Kun-Shiang, 2006. p.6-8). Although this paper works to develop a consumer profile of green cars in Taiwan, it is neither as it could not take into account the post-purchase behavior (as green cars were to be introduced to the market and therefore no existi ng owners were there) of the consumers. The authors also acknowledge the inability of the study to be representative of Taiwanese market due to online entropy collection process and therefore the lack of reliability of the responses (Li-Hsing et.al., 2006. p.7).From the reviewed studies, we can fold that a study that represents the potential owners of green automobiles may be of great importance from both business and academic perspective. Now, with the emergence of the Green Cars, consumers have different options in selecting their automobile of option. So, an understanding of what factors or attributes of a green car can make a consumer tick or vacate away can be of great academic interest. And, in light of the prior literature review, the authors believe that a green car specific study focusing on consumer preferences (including both existing car owners and potential car owners) is important to gain further knowledge in the field of green consumer behavior. And to the best of our knowledge, no other previous studies have used conjoint analysis to examine preferences of both potential and existing consumers on green cars rather they used cluster analysis, cross-sectional surveys, or co-variance models. So we believe a study employing Conjoint analysis would enable us to obtain an indirect mapping of the consumer preferences that would be helpful in answering the identified research gap.1.4 Research QuestionThe research questions that the authors would like to answer through this study isWhat are the find attributes of consumers green car superior?How the defined attributes influence the consumer ratiocination concerning green cars?1.5 Research purposeThe authors intend to study the consumer preferences concerning green car purchase. The authors would identify the determining factors in the green (car) purchase decision process. The study would examine both the existing and the potential green car owners to get the measure of the attitude towards the different attributes of green cars. A secondary purpose would be to partially develop a consumer profile of green car consumers.1.6 Limitations of the StudyThis study will be conducted in Sweden and therefore only the Swedish commentary of Green car will be taken into account. We understand that doing so, a global generalization may be inappropriate and unachievable.We conducted our study based on respondents from Ume and Stockholm only. Although we tried to study the Swedish consumers attitude towards green cars, a study based on only two cities may not be entirely representative of entire Sweden.While our study relates to the marketing field of Green Consumer Behavior, we have only focused on the automobile sector. A study incorporating other aspects of green consumer behavior might have yielded a better understanding.This study will examine the consumer preferences related to the specifications open to existing green cars only. The developments in the pipeline are not conside red. So, upon the arrival of such developments, a similar study might be conducted.We understand that the green market is evolving fast. This study aims to examine the current green consumers. Further evolution to the green consumer behavior may yield a need to study many different aspects of the consumer preferences apart from the ones we will examine in this study.1.7 desire** Text will be added here.CHAPTER-TWO(Work is in progress)2. Theoretical Framework2.1 delineate Green CarThe exact definition of green cars differs from one surface area to another. However, we may start by stating the conventional perception of green cars. all car that pollutes less (in reality, emits less CO2 or other pollutants into the atmosphere) may be considered to be environment friendly or green. There are many versions of green cars available in the market. These include, Alternative Fuel fomite or AFV, Patrol- electricity Hybrid, Diesel-Electricity Hybrid, Bio-Fuel vehicle, and Electric vehicles .The AFVs run on non-fossil fuel such as Ethanol (alcohol), while the Hybrids use traditional fossil fuel along with an electric motor for reduced emission and increased efficiency. Bio-fuel vehicles use fuels produced from renewable organic sources such as Bio-diesel. These vehicles produce less emissions than traditional vehicles. Electric vehicles do not use any fuel at all and run on rechargeable battery- supply engines. These vehicles produce zero or no emissions, however, they have fair short driving range.2.1.1 Green Car in Swedish ContextBoth the authors are currently residing in Sweden and therefore would like to conduct this study on Swedish consumers of green cars. So, the specific Swedish definition of green cars would be appropriate here. harmonise to Svensk frfattningssamling (SFS 2007, cited by Lindfors Roxland, 2010, p.4), the Swedish definition of Environment-friendly Vehicles or Green Cars depends on the amount of carbon emissions and/or fuel consumption by a ve hicle. For AFVs, if their consumption lies beneath the energy equivalent of 9.2 liters of gasoline/100 km, or 8.4 liters of diesel/100 km or 9.7 m3 of gas/100 km, they would be considered as green cars. Electric cars are considered green if the consumption lies below 37 kWh/100 km. For traditional or fossil-fuel powered vehicles, if their carbon dioxide emissions lie below 120 g/km, they would be considered to be green. Diesel powered cars must also have a particle emission of less than 5 mg/km meaning that they need to have a particle filter fitted to be green.2.2 Green Consumer BehaviorGreen consumer behavior may refer to the consumers attitude towards environment friendly products (Roozen De Pelsmacker, 1998, p.23). From this simple definition we can derive that when the consumer attitude towards purchasing (or not) a product is influenced by the green or environment friendly features of the product, we may call that green behavior. Aside from just purchasing, green behavior al so includes performing other environmentally responsible activities as well, such as recycling, working in environmental organizations, taking part in environmental-friendly movements etc. (Haanp, 2007, p.478).In terms of purchasing green, juvenility, Hwang, McDonalds, Oates (2010) state that consumers purchase green products for everyday use fairly easily but search for information extensively when it comes to blue-technology products. They also say that in case of high-technology products, consumers are willing to pay extra and buy green product if it has credible environmental labelling, such as European Commission or EC Energy Label (Young, Hwang, McDonalds, Oates, 2010, p.23). So, having a steady-going certification is an important aspect for green consumers.As mentioned earlier, green consumer behavior is not only concerned with purchase of product(s), it also involves not purchasing as well. As Laroche et.al. (2001) point out, majority of the consumers would not purchase products of polluting companins, Young et.al. (2010) find that brand boycotting over environmental concerns has become a regular occurrence as well (De Pelsmacker et.al., 2005, p.364 Young et.al., 2010, p.23).2.2.1 Determinants of Green Consumer BehaviorThe determining factors for green consumer purchases tend to be consumers strong green value, prior purchase experience, available time for information search concerning the product(s), knowledge about product relevant environmental issues, approachability of the product, and of course, affordability of the said product (Young et.al., 2010, p.29).So, an absence or weakened presence of any of these factors may adversely effect green consumer behavior. This can be justified by the finding of De Pelsmacker et.al. (2005). In that study, the key causes of not performing green stems from unavailability or limited availability of green products, lack of credibility of green label issuer, and lack of availability of green product informat ion (De Pelsmacker et.al., 2005, p.383).2.2.2 Consumer Preference towards GreenConsumer preference is the base groundwork to measure consumer demand and how they act in terms of buy a product. In economic and cognitive psychology traditions, consumer behavior is delusive as rational and consistent. Consumers act consistently on the basis of their preferences and beliefs (Rokka and Uusitalo, 2008,p.517). This is the infixed experience of an individual through which one can measure product attributes from various bundles of goods. As heightened rise of environmental issues consumers are well mindful of their environmental product selection. In terms of auto mobility, studies have been found that consumers are highly aware about negative impacts of auto mobility but can not be referred to the changes in car use and purchase behavior. Although attitude and corresponding behavior are interrelated but in practice they find it hard to translate these values of attitude into behavior (Young et. al. 2010, p.20 Rijnsoever et.al. 2009,p.335).2.3 Consumer Decision-Making ProcessConsumer behavior is an intermingle of more than one academic disciplines. It blends with psychology, sociology, economics, business and anthropology (Jansson, 2009, p.17). But the relationship of consumer behavior with marketing is inseparable. However, consumer behavior is a considerable area of subject that starts with paradox recognition and ends up with post-purchase behavior and military rank (Jansson, 2009, p.17).In rate to understand green consumer behavior, we must start from our understanding of the consumer decision do process. This decision making is the outcome of a consumers behavior (be it substantiative or negative) towards a certain product or service2.3.1 The Five Stage Consumer Decision making ProcessIn order to understand green consumer behavior completely, we must start from our understanding of the consumer decision making process. This decision making is the outco me of a consumers behavior (be it positive or negative) towards a certain product or service.A consumer goes through five arranges during the decision making process. These stages are, Problem Recognition, learning Search, Evaluation of Alternatives, crossing Choice or Purchase Decision, and Outcomes or Purchase Evaluation (Solomon, 2009, page 350-352).Figure01 Stages of Consumer Decision Making ProcessImage source Solomon, 2010, p.351A consumer, recognizing the need searches for information available for satisfying that specific need. The information search may have various sources, such as friends, family, product commercials, profits search etc. Upon receiving sufficient information, the consumer evaluates or compares available alternative products or services that would meet his/her needs. Upon completion of this comparison process, the consumer then decides on which product or service to obtain, and after completing the purchase, the consumer evaluates the purchased produc t or service against the original need. If there is a gap between the product performance and the need, the consumer starts over these stages by initiating further information search and so on.1. Need Recognition This is the initial stage in the consumer decision process. A consumer recognizes or realizes his/her need to solve a task or fulfill a deficiency at this point. The need could be as simple as need for food, or as complex as need for enjoying a movie in a THX certified surround sound system.2. Information Search Now the consumer begins acquiring information concerning the solution to his/her problem or need. For low- interest group purchases, this stage tends to be short while for the high- involvement purchases information search is near always extensive (Jobber, 2004, p79).3. Evaluation of Alternatives Upon collecting sufficient information, the consumer evaluates and compares among the available alternatives that would serve the need. Usually for the higher costing and/or technical products, this step is very extensive as the consumer usually wants the alternative list to be complete(a) (Jobber, 2004, p.79)4. Purchase Decision This step is the outcome of the alternative evaluation step. here the consumer chooses the alternative that would satisfy his/her need. The consumers decision of not selecting any alternatives (as none of the available alternatives may be suitable for the need) is also taken in this stage. Upon deciding, the consumer makes the purchase.5. Purchase Evaluation This perhaps is the most important step for the business enterprise in the consumer decision making process. Here, the consumer evaluates his/her purchase decision and measures his/her satisfaction. If a high degree of satisfaction is attained, likelihood of repeat purchases would be greater, while dissatisfaction would not only eliminate the chance of a repeat purchase but also result in negative marketing of the product/service by the concerned consumer.This is a very basic and simple approach that we as consumers take almost everyday while selecting products to shop. This process implies that a product or service is a solution to a problem and we respond to that problem by researching, deciding, and finally acquiring the product/service that answers the said problem.The above mentioned five stages are not always evenly important. For example, the decision process for purchasing hand soap and a TV would be different. While a consumer might rely on prior experience during a hand soap purchase and get it through with(p) in minutes without even comparing between alternatives, s/he might spend days in the information search stage and in comparison stage before finally deciding and making a TV purchase.As we mentioned earlier that automobile purchase falls under the high involvement product purchase category, some further understanding is required aside from this simple five stage process. As the green car is not merely the solution to a pro blem but is an effort to answer the growing consumer awareness of the environment, we need to examine the product decision process in a different and detailed way.2.3.2 High Involvement Purchase Decision Making The Cognitive ConsumersThe decision making process is comparatively complex in terms of high involvement purchase process. Consumers undertake more extensive pre-purchase information search in high involvement purchase (Foxall, Goldsmith, and Brown, 1998, p.28). The central point of this study is environment friendly cars. So, the framework has drawn on high involvement green car purchase decision process.Consumers seek information volitionally in terms of extensive problem solving situation (Peter and Olson, 2005, p.188). According to Foxall, et.al. (1998, p.28-29) there are three major steps of high involvement decision making process stimulus (receiving environmental stimuli- attentional and perceptual filter), organism (interpretation, formation and evaluation), and resp onse (developing, acting, re-evaluating, storing). The S-O-R psychology is based on cognitive science. The three steps decision process can be simplify as inputs, central processing and outputs. The process primarily generated from social, business, cultural, political and economic environment (Foxall, et. al. 1998, p.29).Figure 02 Consumer Choice Process ModelSource vary from Foxall, Goldsmith, and Brown, 1998,p.29According to, Rijnsoever, Farla, and Dijst (2009, p. 335) consumers form an attitude before they get involved into purchasing a new car that lead them towards the probability of possessing a new car.2.3.3 Multi-Attribute Attitude ModelA car is a product that can be seen as a bundle of attributes. So, we need to consider choice behaviors as an automobile purchase involves a choice among two or more options (Ajzen, 2008, p.526). The Multi-At