Bachelor thesis
The moderation effect of age and cultural background on the relationship between
green marketing and brand equity.
Name:
Salar Habibi
Student number:
10574638
Date of submission: 26-06-2018
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Statement of Originality
This document is written by Salar Habibi (student number
10574638) who declares to take full responsibility for the
contents of this document.
I declare that the text and the work presented in this
document are original and that no sources other than those
mentioned in the text and its references have been used in
creating it.
The Faculty of Economics and Business is responsible solely
for the supervision of completion of the work, not for the
contents.
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Abstract
Climate change is a much discussed topic nowadays. It is noticed by customers, firms and even world leaders. Firms use therefore green marketing techniques to respond on the environmental concern to create a positive image towards customers, win their loyalty and trust. But in a time of globalization, it is not known if those techniques affect all customers in the same way. This study aims to discover the effect of green marketing on brand equity, controlled for age and cultural background. More specifically, first of all it is proposed that there is a positive relationship between green marketing and brand equity and that the use of more green marketing techniques will result in a more positive brand equity. Secondly it is proposed that cultural background moderates the relation between green marketing and brand equity and finally it is proposed that age moderates that effect in a negative way. Those hypotheses are based on Hofstede’s cultural dimensions (1984), and Roberts’ age
hypothesis (1999). The hypotheses were tested by spreading out an online survey among 106 Dutch respondents. The data was analyzed for correlations and significance by a single regression. The proposed hypotheses are supported partly. The results show there is a positive effect between green marketing and brand equity. Brand equity is affected more positively by green marketing than when no green marketing is used, but extreme green marketing does not show more positive significant outcomes. Further, age does not has any moderating effect on the relationship of green marketing and brand equity. However, a moderating effect for cultural background is found in some cases and for some measures of brand equity.
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Table of Contents
1.Introduction ... 4
2.Litertature review ... 6
2.1 What is green marketing ... 6
2.2 The green marketing mix ... 6
2.3 Green marketing strategies ... 8
2.4 Failure of green marketing strategies ... 9
2.5 Reputational advantage ... 10
2.6 The green consumer... 11
2.6.1 Types of green consumers ... 11
2.6.2 Cross-cultural differences ... 12
2.6.3 Green consumer decision making ... 13
2.7 What is brand equity? ... 14
2.7.1 Brand trust ... 15
2.7.1 Brand loyalty ... 15
2.7.1 Brand image ... 16
2.8 Conceptual framework ... 16
3.Methodology ... 18
3.1 Research design ... 18
3.2 Sample ... 18
3.3 Measures ... 19
3.3.1 Independent variable ... 19
3.3.2 Dependent variable ... 19
3.3.3 Moderating variable ... 20
3.4 Data analysis ... 21
4. Results ... 22
4.1 Sample characteristics ... 22
4.2 Descriptive statistics and correlations ... 22
4.3 Hypothesis testing... 24
5.Conclusion... 28
6.References ... 32
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1. Introduction
Besides the rapid globalization, climate change is a topic that is discussed every day, worldwide. Reduction in Artic ice, rising sea levels, damage of coral reef, uncommon seasonal temperatures and the negative effect of climate change on human health and disease rates are consequences of the global warming (Gore, 2006, PP.494-495). World leaders and CEOs of big companies can’t ignore the global warming and its consequences for society any more. Therefore, in 2015, the United Nations adopted an agreement on climate change, with 195 participating countries, known as the Paris agreement (Rogelj, Den Elzen, Höhne, Fransen, Fekete, Winkler & Meinshausen, 2016). Their aim is to limit the average global temperature increase well below two degree Celsius, starting in 2020.
Besides international agreements, the United Nations introduced new agreements towards carbon pricing, which is a regulatory policy that aims to charge companies variable tax rates based on the amount of carbon used (Zakeri, Dehghanian, Fahimnia & Sarkis, 2015). Therefore not only society has to watch their damage to the environment, but also companies. That’s why the implementation and acknowledgement of Corporate social responsibility (CSR) is increased strongly (McPherson, 2016). CSR includes the firm's citizenship and taken initiatives to reduce the negative environmental and social-economical footprints that are caused by their
operations (Auld, Bernstein, & Cashore 2008).). CSR was introduced in 1960, and became more important over the years (Holme & Watts, 1999). Schwartz (2017, PP.505-510) states that CSR has three responsibility areas: the economic domain which includes the direct and indirect activities that have positive economic value for the company (sales, maximization share value, company image), the legal domain which includes the firm's
responsiveness to legal expectations of society through legal principles, and finally the ethical domain which refers to the ethical responsibilities of the company, which are expected from the population and stakeholders.
One way for firms, to react towards the economic domain Schwartz (2017, PP.505-510) mentioned, is the use of green marketing, or “going green’’. Green marketing contains the activities that are designed to generate and facilitate exchanges that are intended to satisfy customer wants and needs, such that the satisfaction of these needs and wants occurs, with minimal harmful impact on the natural environment (Polonsky & Mintu-Wimsatt, 1997). That means that firms try to continue their production, but do keep in mind the potential environmental consequences. Multinationals like General Electric, Starbucks and Coca Cola are investing a lot money in green marketing techniques and environmental-friendly packaging or sustainability programs.
Green marketing is a tool for companies to maintain or strengthen their reputational advantage, to earn consumer trust and loyalty, to sell more products (Parish, 2015). Consumer trust, brand image and loyalty are part of the organization’s brand equity (Keller, 1993). For firms it is important to have a strong brand equity, because brand equity has a strong positive relationship with the firm’s financial performance (Baldauf, 2003). But consumer behavior is a complex phenomenon and differs between humans. For instance there are similarities but also differences between consumer decision making behavior in North American and Asian countries (Hafstrom, Chae
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& Chung, 1992). Another factor is for instance gender. There are differences in consumer decision making between males and females (Mitchell & Walsh, 2004). And finally, consumer decision making can be influenced through other demographic factors like social class, environment, age and education (Mainieri et al., 1997). Because we live in an era of rapid globalization, people with different nationalities, thoughts, cultures and beliefs live among each other. Therefore it is important, as a company, to get more insights in the customer decision making and buying behavior process.
This research aims to contribute to existing literature by examining the reasons and effects of green marketing programs, what brand equity is and how it is measured and how it can be affected by the use of green marketing. By testing the direct relationship between those two variables, moderated by cultural background and age, this thesis aims to contribute to the current body of literature by addressing this research gap. The research problem can be described as the following question:
What is the effect of cultural background and age on the relationship between the levels of green marketing used and brand equity?
This thesis is structured at the following way: First the existing literature about green marketing and brand equity will be discussed in the theoretical framework. Literature about the effect of cultural background and demographic factors will also be introduced. Secondly, the conceptual model will be introduced, strengthened by the
hypotheses that will be tested in this thesis. Thirdly, the research design will be discussed, and an overview will be given about the sample selection, data collection method and reliability. Following, there will be an overview and analysis of the founded data and statistical outcomes, and finally there will be a brief discussion and conclusion, limitations and recommendations for further research.
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2. Literature review
In this chapter existing literature about green marketing and brand equity is examined, and hypotheses are constructed. Finally the conceptual framework is introduced.
2.1 What is green marketing?
Consumers choose more for sustainable products because after fulfilling its self-actualizing needs, he/she looks for other factors that are important, and have direct effect on society (Maslow, 1967). Green marketing was
introduced in 1980, when consumers began to shift towards greener alternatives (Prothero, 1990). Green marketing emerged from the societal marketing concept. This concept states that besides the firm's objectives of profitability and survival, it is important to consider the long term effects of those decisions on society, when making marketing decisions (Prothero, 1990).
There is not just one definition that fully describes green marketing. Green marketing, also known as environmental or ecological marketing, can be described as the holistic management process responsible for identifying, anticipating and satisfying the needs of customers and society, in a profitable and sustainable way (Do Paço, Raposo & Leal Filho, 2009). Tiwari, Tripathi, Srivastava and Yadev (2011) define green marketing as ‘’a holistic marketing concept wherein the production, marketing consumption and disposal of products and services happen in a manner that is less detrimental to the environment with growing awareness about the implications of global warming, non-biodegradable solid waste, harmful impact of pollutants, etc.’’. Green marketing contains thus not only change, but also the creation of more eco-friendly products, more sustainable packaging, ‘’greener’’
advertising and communication towards customers and finally ecological distribution and logistics systems (Tiwari et al., 2011). For this research, the first definition was used because it is an easier definition, which prevents misinterpretations.
2.2 The green marketing mix
There are two levels at which firms can go “green’’: firm-level, including management systems and promotions, and product-level, what is focused on the production process (Prakash, 2002). Like ‘’normal’’ marketing, green marketing has also a marketing mix, called the green marketing mix. This framework consists of green price, green product, green distribution and green promotion.
The green price is a crucial part of the green marketing mix. The price of a product is constructed by
summing up product(ion) costs, costs for transportation, consumer and manufacturer premiums. To meet the requirements of being a green company, companies have to remodel, redesign and restructure their production process and methods of manufacturing and materials used (Kirgiz, 2016, PP.41-43). Those changes leads to additional costs, and therefore are those environmentally sensitive products sold with higher prices compared to equivalent “non-green’’ products (Kirgiz, 2016, PP.41-43). Price is the main reason why consumers choose less expensive alternatives over green products (Boztepe, 2012). But when prices are (almost) similar, the
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can be explained by the microeconomic theory which assumes that consumers not only try to lower the price of the product bought as much as possible, they also want to raise the environmental benefits to ben obtained to the maximum. So if customers choose to purchase green products, the benefit-cost tradeoff they have made is in their eyes more beneficial than other habitual products (Boztepe, 2012)
The green product, also known as the environmental-friendly product, are products that don’t cause
pollution, depletion of scarce natural resources and can be recycled or preserved (Kirgiz, 2016, PP.24-25). Green products are made from recycled products that cause less release of toxic, with a high durability without harm to the natural life (Kirgiz, 2016, PP.24-25). The green product is consists of green packaging and green labeling (Kirgiz, 2016, PP.24-25). Green packaging is a very important part of the green marketing mix because from the consumer point of view, the first connection the consumer makes with a product, is through the package (Ampuero & Vila, 2006). Thus the first association and impression depends on the package of the product. From the company point of view, this is a way of communication with the consumer. The company can communicate their beliefs and benefits through their packages (Ampuero & Vila, 2006). Green labels (eco-labels) are used to show the environmental friendliness of the product (Rex & Bouwman, 2007). Green labels can be distinguished between mandatory labels, like energy labels which companies legally have to show on packages, and voluntary labels, which are labels that companies can choose for to print on their packaging, like cooperation or recommendation with/of famous “green” foundations (Rex & Bouwman, 2007).
Green distribution (place) is the process of transportation, warehousing, stock management, receiving
orders, loading and unloading, and reverse logistics of the firm, with as goal, the minimization of environmental costs of those processes in the supply chain, and increase effectiveness of each process. Examples are maximum utilization of space, reduction of handlings required, combining loads in transportation, encouraging the use of railways instead of highway for long transportation routes (Ninlawan, Seksan, Tossapol, & Pilada, 2010; Kirgiz, 2016, PP.46-47). A major breakthrough on sustainable transportation was the new fully electric truck Tesla had manufactured, with a maximum range of 800 Km with 1 fully charged battery. With over 500 reservations, Tesla tried to contribute as an important player on the sustainable transportation market (Tesla Semi, 2018).
All activities that has to do with advertising, direct marketing and public relations, executed in an ecological way to spread the ‘’green message’’, is part of the Green promotion (Kirgiz, 2016, PP.55-57). Companies use green advertising to communicate the positive environmental effects their products and services have with all customers, and try to spread their ecological message (Banerjee, Gulas & Iyer, 1995). Examples are (TV) ads, articles in newspapers and magazines & billboards. Green direct marketing is based on the delivery of the ‘’green message’’, through one on one contact between the marketer and the consumer (Kirgiz, 2016, PP.55-57). Tools that can be used are: e-mail, online shopping, SMS, telemarketing, mail post or brochures. Companies can also go further and try to reach the customer directly without the waste of paper and plastic, by switching from using physical tools (brochures and mail post) to electronic tools (emails, websites and electronic stores). Finally, green public relations are the efforts of a company to create and maintain positive relations with interest groups in
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society, by releasing for example press releases about recycling initiatives or plans for energy reduction or promoting collaborations with nature foundations (Kirgiz, 2016, PP.55-57).
2.3 Green marketing strategies
After examining the four dimensions of the green marketing mix, different green marketing strategies will be discussed. First, Ginsberg & Bloom (2004) introduced the green marketing strategy matrix. This model considers the ability to differentiate on being green (does the company has the knowledge and resources to beat
competitors on this dimension?), and the size of the green market in a certain industry (can the company increase its revenue by improving its green practices?). Therefore they introduced 4 different green marketing strategies: lean green, defensive green, shaded green and extreme green. All four strategies are based on the amount of P’s of the marketing mix used in the new green strategy.
Lean green firms are companies who take their corporate citizenship responsibility, but are not focused
on marketing those green initiatives (Ginsberg & Bloom, 2004). Lean green firms aim to reduce cost and achieve competitive advantage through environmental friendly practices. These firms don't promote their green activities because the probability that their brand will be compared against a higher benchmark. They fear that because of that benchmarks, they won’t be able to meet the expectations and finally won’t be able to differentiate them from others (Ginsberg & Bloom, 2004). A good example is Coca Cola. The general public does not know that Coca Cola has invested in a global recycling program, because they do not advertise on it. They fear the fact that if they do, consumers will recognize them as a green brand, and set expectations which cannot be met.
Defensive green companies use green marketing mostly as a counter attack on competitors. Defensive
green companies try to reduce damage and increase their brand image by recognizing green environmental friendly initiatives. Those firms do not use aggressive advertising, but instead do small and temporary promotion. Aggressive green promotion could, like lean green strategy, lead to customer expectations that cannot be met.
Shaded green companies make investments in long-term environmental friendly processes. Green
products can create needs in their opinion and serve as a competitive advantage. But these companies promote environmental benefits as a secondary factor and not as main factor. According to Ginsberg & Bloom (2004), this type of promotion helps only when the customers save on costs by choosing for the product such as saving on energy costs or electricity.
Extreme green companies are companies who have sustainability integrated in their organizational
culture, business and product life cycle since the first day. Sustainability serves as a major driver for the organization (Ginsberg & Bloom, 2004). They have integrated ‘’green’’ in their products, prices, places and promotions. A good example is The Body shop. The company is aware of the climate changes and have set up some initiatives to be a sustainable company. Some examples are the use of online advertisement instead of physically in store, reduce the energy used and increase the use of renewable energy in stores, reduces the use of fossil fuels in the packaging, and use fair trade ingredients for their products. Also the prices of their products are
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higher than comparable products of another brand (Wycherley, 1999; Deery, 2012, PP.157-163).
Furthermore, Olausson (2009) presents a framework for the amount of ecological effort companies take. She divides companies in three different levels:
First category companies, also called gray companies, do not have any concrete sustainability initiatives or ecological certificates and don’t have sustainability integrated in their processes.
Second category companies, also known as light green companies, are those who have low level sustainability initiatives, but are not focused on sustainability on the long period.
Third category companies, also known as dark green companies, are focused on implementing green policies in the company’s core values and developing long term sustainable marketing and production strategies (Olausson 2009). This framework covers mostly the same theory. Ginsberg & Bloom, however, have a more detailed framework and for that reason, their framework will be used in this research.
For this research, the model of Ginsberg and Bloom is used because it is a more detailed and clear model which fits the green marketing mix better.
Figure 1: Area’s firms are prepared to invest in green initiatives (Ginsberg & Bloom, 2004).
2.4 Failure of green marketing strategies
As mentioned before, firms can use different green marketing strategies. Each strategy has of degree of
“greenness” and is focused on different components of the marketing mix. But green marketing strategies are not always successful. When a company is portrayed and criticized as being unclean, because the industry it is active in (automotive, chemicals, oil), firms are often inclined to prepare a counter reaction, mostly by PR offensives, lobbying and press releases, to prove the outside world the opposite (Peattie & Crane, 2005). This is a popular and reactive way to take away public concerns. This way is also a tool which is used in reputational management, and in this way green marketing is more incorporated in the PR function. Therefore there is little opportunity to affect product, production or policy decisions (Peattie & Crane, 2005). There is also not much attention for product development and customer focus because there is put more effort in the company name and position. Those kind of companies are called green spinners. Green spinners are characterized by their conservatism and their restraint in understanding different opinions of different stakeholders (Peattie & Crane, 2005).
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be more popular and demanded more often. Instead of developing a new green(er) product, firms chose to take advantage of the situation and added a little “greenness” to their advertisement. This is called green selling (Peattie & Crane, 2005). With this tool, marketers try to get the attention of the customer. This marketing strategy failed when consumers examined the environmental benefit of those products and find out that only the
advertisement presented “greenness”.
2.5 Reputational advantage
One of the factors that can explain the difference in profitability between firms is the effect of customer loyalty (Reichheld, 1993). Loyal customers are more likely to buy the products a firm offers, which leads to a higher profit over time. Therefore, it is important for firms to focus on earning customer loyalty which serves as a source of income (Reichheld, 1993). One way to attract those customers, is by having a reputational advantage (Selnes, 1993). A reputation is all the perceptions that are created of a company, by people inside and outside that company (Miles & Covin, 2000). A reputational advantage makes customers choose your product over an alternative brand (under the same conditions), and thus leads to sustainable competitive advantage (Reichheld, 1993). A company’s reputational advantage can be derived by combining the degree of credibility, trustworthiness, reliability and responsibility (Miles & Covin, 2000). Environmental responsibility, which is the firm’s attitude and behavior towards the environment, is one of the main responsibilities that a company has (Waddock & Graves, 1997; Rodríguez & Cruz, 2007). Firms are trying to be more environmentally responsible because of pressure of different stakeholders. Those stakeholders could be customers (society), shareholders, competitors and the government (Polonsky, 1994; Miles & Covin, 2000). Therefore it is assumed that:
H1: The use of green marketing has positive effect on brand equity (brand trust, brand loyalty and brand image).
Not only customers, but firms are also part of society. In an era where green, sustainability and healthiness are important concepts, customers have expectations of firms to pay attention to those concepts. Fifteen percent of the consumers take health and sustainability into account making a buying decision, and more than a quarter of the customers take the environmental benefit into consideration while making a buying decision (Nidumolu, Prahalad & Rangaswami, 2009). Therefore firms are almost forced to contribute in green practices, to keep their consumer satisfied. To promote that, firms can choose to use the fact that they are more environmentally friendly as marketing tool, or they can become more responsible without promoting this fact (Polonsky, 1994). Therefore it is assumed that:
H1.1: The use of lean green marketing has more positive effect on brand equity than no use of green marketing.
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to see more environmental friendly practices, products or initiatives, they can form a group and put pressure on a company, because they are the firm’s main capital providers (Polonsky, 1994).
Competitors try to attract customers by offering alternatives or substitutes of the product of service a firm offers. By investing in environmentally friendly initiatives, they can differentiate themselves and attract customers (Polonsky, 1994). Often this leads to major changes in the industry, when one firm focuses on being more environmental friendly, which causes a chain reaction which influences the other firms. Their initiatives become a benchmark in the industry. For example when Xerox decided to switch to 100% recycled paper. Their initiative was successful. In this way, Xerox had set a standard in the industry. Therefore, other companies adopted this initiative by also using recycled paper in the photocopier industry.
Besides consumers, shareholders and competitors, the government can also put pressure on firms to invest in sustainable initiatives. One of the tasks of the government is the protection of society and the country. To do that properly, they have the power to set rules to prevent or stimulate products and services (Barro & Gordon, 1983). The government can thus make laws, or set taxes or support environmental friendly activities. Besides the government, there are rules and standards set by the European Union where each country has to meet (Davies, 2017, P.57). That is why governments have the ability to put pressure on companies.
Companies do not only choose to invest in environmental responsibility initiatives because of pressure from stakeholders, but it can also lead to new opportunities (Polonsky, 1994; Baker, 2003, P. 736). First of all it can lead to new market opportunities through entering new growing green markets. There are also new opportunities in serving niche markets where the consumers have different ecological preferences (Baker, 2003, P.736). Secondly companies can obtain differentiation opportunities. Like mentioned in the example of Xerox, the company took the opportunity to differentiate herself from the competitors by using 100% recycled paper. Finally, green initiatives can provide cost advantage opportunities (Polonsky, 1994; Baker, 2003, P. 736). By investing in new radical ecological practices, firms can reduce the need of raw materials, waste and energy. Those initiatives can thus serve as a double cost save. Therefore it is assumed that:
H1.2: The use of extreme green marketing has more positive effect on brand equity than the use of lean green marketing.
2.6 The green consumer
2.6.1 Types of green consumers
After examining green marketing strategies, the green consumer segments will be discussed. The number of consumers who are concerned of the environmental changes are growing in different levels in different layers of society (Jansson, Marell & Nordlund, 2010). Therefore the supply of ecological products have increased and niche markets arised (Jansson et al., 2010). Because there is a variety of consumers with a personal level of ecological needs and wants, they are segmented in five different stages: apathetics, grousers, sprouts, greenback greens and
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true blue greens (Das, Dash, & Padhy, 2012).
Apathetics are consumers who are not concerned about any social and environmental issues at all. They are not willing to put any effort in positive change like waste reduction of resources (water, electricity). They represent 18% of society.
Grousers do acknowledge the environmental changes, but are not willing to put effort in positive change. They belief that individuals behavior can’t lead to any environmental changes. They aren’t mostly interested in social and environmental issues. About 15% of society are grousers.
Sprouts are located in the middle. Sprouts are environmentally concerned. They are only willing to positively support and contribute to initiatives they think will help, but only if it meet their needs. Around 26% of the people are sprouts.
Greenback greens are consumers who are willing to pay for environmental friendly products and invest in initiatives, but are not politically active in this domain and limit their efforts to every day obligation. That is where greenback greens differ from the true blue greens. About 10% of society is a greenback green.
True blue greens are known from their passion, enthusiasm and knowledge about environmental issues. They are seen as (politically active) leaders or activists. They are also more engaged in environmentally conscious behavior and purchases than the average consumer. About 30% of the people are true blue greens.
2.6.2 Cross-cultural differences.
As mentioned above, not everyone makes the same decisions. Hafstrom et al. (1992) stated that there are
differences between the decision making process in North-American countries and Asian countries. This difference can be explained by the cultural dimensions model Hofstede (1984) introduced. The theory states that countries differ in terms of masculinity vs femininity, individualism vs collectivism, strong vs weak uncertainty aversion and large vs small power distance, which can affect the decision making process.
Masculinity vs femininity is about the allocation of the social roles of men and female. A masculine society strives for a society with maximum gender differences, where the more outgoing and assertive roles are given to men, and the more caring and nurturing roles to the female (Hofstede, 1984). The opposite type of society is called feminine and strives for minimal social difference and an opposite role allocation between male and female. So it is important to examine in which degree men can take over female jobs and vice versa. Individualism vs collectivism examines the degree which individuals take care just for themselves and direct relatives, or that individuals are prepared to take care of each other, (I versus we). Risk aversion is about the degree society is comfortable with uncertainty and ambiguity (Hofstede, 1984). Strong uncertainty avoidance societies have strict beliefs and
behavior and don’t appreciate different ideas. The less risk taken, the better. Weak uncertainty avoidance societies are more relaxed. Different ideas are accepted easier and taking risk is more common. Finally, power distance also affects society and decision making. Power distance is the extent that individuals accept the fact that
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power (democracy). Whereas people in high power distance societies accept hierarchical order, without any justification (dictatorship) (Hofstede, 1984).
Norms, values and beliefs do also affect decision making (Jansson et al., 2010). Eid & Diener (2001) found in their research that those norms, values and beliefs differ between countries, and especially between
individualistic and collectivistic countries. There is also a slightly difference between social classes within a country. Therefor it is assumed that:
H2: Cultural background moderates the effect of green marketing on brand equity.
2.6.3 Green consumer decision making
There are different categories of green consumers with each a different level of environmental awareness, which determines their choices. But green consumer behavior depends on multiple other factors, like values and norms, beliefs, habits, personal capabilities, demographics, political orientation etc. (Straughan & Roberts, 1999; Baker, 2003, P.736; Jansson et al., 2010).
Value, beliefs and norms are all three attitudinal factors which affects green consumer behavior, also known as the VBN-theory (Jansson et al., 2010). First of all, this theory states that consumers with social-altruistic (concern of welfare of others) and/or biospheric (concerned of the biosphere and ecosystem) values have more positive effects towards green consumer behavior, where egoistic values (the personal benefit has to exceed the costs) will have a negative effect (De Groot & Steg, 2008; Jansson et al., 2010). Beliefs can, together with norms, have also effect on green consumer behavior (Jansson et al., 2010). Beliefs are combined with norms. Beliefs are created when consumers are aware of the environmental changes that their behavior causes and ascribe responsibility to themselves for behaving environmental friendly. Because of those beliefs, an environmental friendly norm arises which influences the behavior (Schwartz, 1977). When consumers deny their responsibility for environmental changes, ecological behaviors won’t occur (Jansson et al., 2010). Those behaviors are for example recycling, less use of fossil fuel and the reduction of air pollution. Finally, the personal norm is an important factor in green consumer behavior (Jansson et al., 2010). Personal norm is the moral obligation and the positive feeling a consumer has which stimulates the willingness to behave more environmentally responsible (Stern, 2000; Jansson et al., 2010). Personal norm positively contributes to the willingness to use more green transportation, willingness to pay a higher price for more green food and willingness to buy more durable products (Stern, 2000; Jansson et al., 2010).
Change in green consumer behavior also contains change in habits (Jansson et al., 2010). A habit is an automatic behavior someone shows towards a specific goal. This behavior is without much thinking and effort. A specific behavior is a habit if it is repeated many times and in a specific (approximately same) setting (Verplanken, Aarts & Knippenberg, 1997). Finally, there has to be a rewarding consequence available. Habits are translations of beliefs and norms into behavior (Verplanken et al., 1997). When consumers have strong habits, it will be very
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difficult to stop them. Choose for the sustainable option is less likely when the habit is not that strong (Jansson et al., 2010). Even if a customer is willing to be more sustainable, the strength of their habits determine whether they can execute it or not (Verplanken et al., 1997)
Personal capabilities is a summary of intangible capabilities like knowledge, skills and time that someone needs to fulfill a particular action, and tangible capabilities like money and other resources (Stern, 2000). Even if a person is willing to switch to an eco-friendly alternative, if it needs the skills or time the customer lacks, the choice can’t be made. If the customer does not have the money to switch to an eco- friendly alternative or to buy somehow the intangible resources, the deal can’t be made as well. So there are some constraints a customer has to deal with, even if he/she is willing and really want to behave more sustainable (Stern, 2000; Jansson et al., 2010).
Finally, there is also a difference in the consumer’s age and the degree of ecological consciousness (Liere & Dunlap, 1980; Straughan & Roberts, 1999). Liere & Dunlap (1980) found a negative correlation between age and green attitudes. Their hypothesis states that younger people are less involved in the economic system. Therefore they are less aware of the consequences that green innovations have for companies and the changes that will occur in the existing social order and traditional values. Because of that, older people (who are aware of that) are less optimistic, because they see the hazards (Liere & Dunlap, 1980). Straughan & Roberts (1999) found that young consumers are also more concerned in the environmental changes than older consumers because they are grown up in a time where environmental issues were the topic of argument, are more sensitive towards those topics (Straughan & Roberts, 1999). Therefore it is assumed that:
H3: Age moderates the effect of green marketing on brand equity negatively.
2.7 What is brand equity
Brand equity comes in the form of names, symbols and brand associations that the consumer memorizes, which adds value to or subtracts value from the product or service a firm provides (Keller, 1993; Aaker, 2001, P.165). Feldwick (1996) states that brand equity can be seen as the value the brand has as a separate asset (e.g. on the balance sheet). He also states that brand equity can be measured as the strength of the attachment of the consumers to a certain brand (Feldwick, 1996). Brand equity can be categorized as an relational market based asset, because it is not something a firm owns, but what is created by external relationships and is available everyone outside a company (Delgado-Ballester & Munuera-Alemán, 2005). Brand equity is a relationship a firm slowly builds with consumers, and is non-substitutional and inimitable. A positive brand equity can serve as a source of sustainable competitive advantage, which results in greater sales and market share, higher margins and an increase in firm value (Simon and Sullivan, 1993; Park and Srinivasan, 1994; Hooley, Greenley, Cadogan & Fahy, 2005). Brand equity can be measured from consumer or financial perspective (Kocak, Abimbola & Özer, 2007). When brand equity is measured through financial data, it will be defined as financial based brand equity. If brand
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equity is measured on individual consumer level, using questionnaires to capture consumer’s thoughts will be defined as consumer based brand equity (Pappu, Quester & Cooksey, 2005). This research won’t take financial based brand equity into account, and is focused on customer based brand equity. Sources of brand equity are brand loyalty, brand image (and other associations), awareness, credibility (brand trust) perceived quality and many more (Aaker, 2001, P.165; Srinivasan, 2001; Kocak et al., 2007). For this research, brand loyalty, brand trust and brand image are used as measures for brand equity. In the next chapters the three chosen measures will be discussed in greater detail.
2.7.1 Brand trust
Brand trust is one of the components of brand equity. Trust can be defined as the confidence that someone gets because of the presumption that he/she will find something desirable from another instead of something undesirable (Deutsch, 1973). Because relationships are mainly based on trust, it is important to examine this concept (Delgado-Ballester & Munuera-Alemán, 2005). Brand trust is the willingness of the consumer to trust and rely on the products/services a company offers and their functioning (Chaudhuri & Holbrook, 2001).
Delgado-Ballester & Munuera-Alemán (2005) define brand trust as the consumer’s belief that a brand offers the quality they expect, and that they offer consistent, honest, responsible and competent products/services. Brand trust can be categorized as a relational asset. From a company’s perspective, brand trust has two dimensions: the first dimension covers the company’s ability and willingness to be honest and to keep her customers satisfied. The second dimension (intentions) comprises the attribution of good intentions to the brand in relation to the
consumers’ interests and welfare, for example when unexpected problems with the product arise. The second dimension covers the attribution of those good intentions to the customers (Delgado-Ballester & Munuera-Alemán, 2005). An overall customer satisfaction leads to a higher brand image than negative satisfaction. Thus, it is important for a company to create a strong brand trust since it is an important factor for building and maintaining strong long-term relationships with the customer (Delgado-Ballester & Munuera-Alemán, 2005).
2.7.2 Brand loyalty
As mentioned, brand trust is an important concept for creating strong long term relations. But brand trust contributes and is also an important factor in the creation of brand loyalty (Lau & Lee, 1999). Brand loyalty is the commitment customers have towards a product/service/brand, whereby they are willing to rebuy, even if there are comparable alternatives with attractive marketing efforts present themselves (Oliver, 1999). When someone trusts a brand, it is more likely for that customer to buy it and be loyal to the brand (Lau & Lee, 1999). If a consumer is loyal to a brand, he/she is willing to pay a higher price for that brand because they trust on the delivered quality and because of the fact that they think the brand has something that the competitors don’t have (Chaudhuri & Holbrook, 2001). This will lead to higher market share because of the re-purchases of loyal
(Delgado-16
Ballester & Munuera-Alemán, 2005).
2.7.3 Brand image
The image customers have of a brand determines how they evaluate a brand and which attitude they have towards that brand (Faircloth, Capella & Alford, 2001). Brand image captures the beliefs, imaginations and perceptions that consumers associate with a brand (Meenaghan, 1995; Faircloth et al., 2001). When the consumer has to choose between two physically identical products without any functional differences, they will base their choice on the basis of the brand image they have (Faircloth et al., 2001). Therefore, companies will always try to positively influence the consumers’ image of the brand. The images and associations that consumers have of a brand can partly explain brand equity. Therefore high equity brands have a more positive brand image than low equity brands (Faircloth et al., 2001). Brand image is also used to build a personality for a product where consumers can identify themselves with (Meenaghan, 1995). In a time where sustainability is a topic of interest among consumers, they create their needs for green products and will create expectations towards companies about sustainability (Ginsberg & Bloom, 2004). Besides developing greener technology and sustainable products, the use of green marketing can lead to a more positive brand image (Ginsberg & Bloom, 2004).
2.8 Conceptual framework
In the constructed conceptual model, green marketing served as the independent variable (no green marketing used, lean green marketing or extreme green marketing), brand equity (measured as brand trust, brand loyalty and brand image) was the dependent variable. As shortly described in the introduction, certain factors can cause differences in consumer behavior (Hafstrom et al., 1992; Mainieri et al., 1997; Mitchell & Walsh, 2004). Therefore, cultural background and age were chosen to be incorporated in the model. Because the research was conducted within the Dutch population, cultural background was measured as: at least one of the biological parents born in another country than the Netherlands.
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Hypotheses:H1: The use of green marketing has positive effect on brand equity (brand trust, brand loyalty and brand image).
· H1.1: The use of lean green marketing has more positive effect on brand equity than no use of green
marketing.
· H1.2: The use of extreme green marketing has more positive effect on brand equity than the use of lean green
marketing.
H2: Cultural background moderates the effect of green marketing on brand equity. H3: Age moderates the effect of green marketing on brand equity negatively.
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3. Methodology
In the methodology section, the research design, research sample and variables are described. The Internal validity and used scales are also discussed.
3.1 Research design
The aim of this study was to examine what associations and thoughts people get when they are exposed to green marketing initiatives used by firms. First of all, existing literature researchers have written about green marketing and brand equity was examined. After that, the existing literature was tested and moderated by different factors. This is also known as the deductive approach (Saunders, Lewis, & Thornhill, 2012, PP. 166-169). An explanatory single method quantitative study was conducted. The data was collected by a survey (see Appendix 1). The use of a survey can help finding out how a population thinks or behaves in as a reaction to a particular issue or
circumstance (Saunders et al., 2012, P. 177). There were two versions of the same survey. The respondents were shown in both versions three logos of three firms: Burger King, McDonalds and Subway. Those are examples of firms using no green marketing, lean green and extreme green marketing strategies (within the same business). One survey version had an additional part of information per logo about the sustainability initiatives each organization has, and the other version did not have this information. The respondents were asked to share their feelings and associations towards those companies. Every question mentioned explicitly that the respondents had to share their feeling under the assumption the price and products these companies offer are exactly the same, to prevent answers based on personal opinions on a certain product. To gather that information, a 5 point Likert scale was used. Quantitative research methods make it possible to analyze variables in a numerical and statistical way (Saunders et al., 2012, PP. 166-169). The use of a survey facilitates getting quick responses, by making 1
questionnaire and sending into the population. However, because of the limited amount of questions a
questionnaire can contain, the data that is collected will not be very wide ranged (Saunders et al., 2012, P. 178). The five-point Likert scale is chosen to use in the survey as measurement device instead of seven-point Likert, to prevent confusion and frustration of the respondents (Weijters, Cabooter & Schillewaert, 2010). Therefore, the chance of miscommunications would be reduced.
3.2 Sample
Because the research was about image, loyalty and trust in a brand, which will lead into consumption, the targeted population was anyone with the age of eighteen years and older, regardless of his/her cultural background or gender. There was no chosen maximum age, because age was a control variable in this research. Another control variable was cultural background. This is defined as “at least one of the biological parents born in another country than the Netherlands’’. Because the research was conducted in the Netherlands, all respondents had to be Dutch citizens. Two non-probability sampling techniques were used to collect data: snowball sampling and self-selection sampling. This was chosen because there is no sampling frame, and the population is large (Saunders et al., 2012,
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P. 295). A self-made online questionnaire was spread through social media, colleagues and relatives to other respondents. Some of the respondents were approached personally. The data was collected in four days.
There were two versions of the survey available. The online questionnaire randomly chose to display version one or version two. These sampling techniques have low costs (time and money) and are easy to use. Secondly, the chance of getting respondents with desired characteristics/personal situation is higher than
probability sampling techniques, which leads to more accurate results (Lee, 1993, PP.62-65). However, because of the use of non-probability techniques, the likelihood of the sample being representative will be lower (Lee, 1993, PP.62-65; Saunders et al., 2012, P. 298).
3.3 Measures
3.3.1 Independent variable
The independent variable is always manipulated to measure the impact on the dependent variable (Saunders et al., 2012, P. 179). The level of green marketing was the dependent variable. The survey began with the logo of three firms, each with a different amount of green marketing initiatives. After showing the logos, the respondents were asked to tell which level of green marketing each firm uses. This was measured by a five-point Likert scale (1= strongly disagree and 5=strongly agree), using the scale of Rust, Zeithaml & Lemon, (2001, PP.328-330). However, the level of green marketing was only measured by the question: “I think this brand is a green (sustainable) company”. Therefore, there was no Cronbach's alpha calculated for this measure. This will affect the validity and reliability of the measure negatively.
3.3.2 Dependent variable
The dependent variable changes in response to changes in other variables (Saunders et al., 2012, P. 714). Brand equity was in this case the dependent variable. But because brand equity was an addition of different variables, and therefore it was measured by three independent variables: brand loyalty, brand trust and brand image.
Brand loyalty is the first dependent variable, measured by three items: ‘’I'm willing to return to this brand instead of choosing for other competitors’’, ‘’I'm willing to pay more for the products this brand offers.’’ and ‘’I recommend this brand to others’’. These items were derived from the scales used by from Lau, (1999) and Ballester, (2014). Each item consists of a five-point Likert scale (1= strongly disagree and 5=strongly agree). This question was asked for each firm. The internal consistency per firm is given below
Loyalty Cronbach’s alpha
Burger King 0.700
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Subway 0.729
The internal reliability of the brand loyalty scale is between 0.7 and 0.8, which indicates reasonable measures. Brand image is the second independent variable measured. This was measured by also three items: “I think this brand has created a positive image”, “When thinking about fast food brands, this brand pops up quickly in my head” and “I often see/pay attention to the advertisements of this brand”. Each item consists of a five-point Likert scale (1= strongly disagree and 5=strongly agree). This scale was derived from Lau, (1999) and Ballester, (2014). The internal consistency is given below
Image Cronbach’s alpha
Burger King 0.729
McDonalds 0.654 (0.536)
Subway 0.635
The alphas for Burger King and Subway were reasonable, but the alpha for McDonalds was low. Therefore the third question, ‘’I often see/pay attention to the advertisements of this brand” is deleted for McDonalds. Before
deleting, the alpha was 0.536 and after deleting the third question, the alpha rose to 0.654. An explanation for the difference can be that the respondents did not understand the questions correctly, and were influenced by their preference for the products those firms offer instead of looking at the company as whole. Another explanation can be a too small sample or the low number of questions (Tavakol & Dennick, 2011).
The last dependent variable is brand trust. Brand trust was measured by two items: ‘’this brand always meets my expectations’’ and ‘’when buying this brand, I'm confident and certain about the result’’. The scales of Ballester, 2014 and Lau, 1999 were used. Each item consists of a five-point Likert scale (1= strongly disagree and 5=strongly agree). The Cronbach alphas for this measure are given below
Trust Cronbach’s alpha
Burger King 0.713
McDonalds 0.724
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All alphas were higher than 0.7, which indicates that the internal consistency is reasonable.
3.3.3 Moderating variable.
A moderator variable affects the relationship between the dependent and independent variable (Saunders et al., 2012, P. 178). Hypothesis two and three stated that age and cultural background have a moderating effect on the relationship between green marketing and brand equity. The variable age was measured by asking the
respondent’s age in whole numbers. For cultural background was also no scale used. First the respondent was asked if they have at least one parent born in another county than the Netherlands. If answered yes, they were asked which cultural background that parent/parents have (nationality in words). This variable was a dichotomous variable (yes/no question), which was therefore transformed into a dummy variable to make a regression possible. The respondents who answered this question with no, were marked by a one, and the others by a zero. To test the moderation effect, first it was tested if the moderator had a direct effect on the dependent variable. After that, interaction variables were created to test the moderation effect. First, the independent variable and the moderator variable were centered, by subtracting the variable’s mean off the value of the variable. With the means subtracted, the centered version of age and cultural background were multiplied by greenness. The variables Green*Age, and Green*Cultback were created (see appendix 2, model 4)
3.4 Data analysis
All the collected data was analyzed by a statistical program, checking for significant effects. Hypothesis one was tested by a simple regression to examine the effect of green marketing on brand equity (see table 1, 2 and 3, model 1). Because brand equity was measured by brand loyalty, image and trust, a simple regression was
conducted on the effect of green marketing on all 3 components of brand equity, for each firm. For hypothesis two and hypothesis three, the moderation effect was tested by the interaction effect between those variables. This effect was examined for each component of brand equity and for each firm. To test the moderation, different theories are applicable. Aiken, West & Reno, (1991, P.169) state that the moderator variable has to be tested as independent variable in the first step. Before adding the interaction variables in the second step, there has to be a significant direct effect.
However, Bennet (2000) claims that the independent variables do not have to be significant predictors of the dependent variable, in order to test for an interaction effect. When there is no direct effect, it means that the interaction variables can’t function without each other. Therefore, both ways of regression analysis were used. Model 1 tested the direct effect of the dependent and independent variable. Model 2 and 3 measured the direct effect of the dependent and moderator variable on the independent variable and model 4 tested for the interaction effect.
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4. Results
First of all, the characteristics of the sample will be discussed. Secondly, the descriptive statistics and correlations will be presented. Finally, the hypotheses will be tested, and the results will be discussed further.
4.1 Sample characteristics
The survey was filled in by 106 respondents (N=106). About 48% of the respondents were male and 52% of the respondents were female. The respondents age varied between the 18 and 64 with a mean of 25.96 years (SD=8.683). 60.4% of the respondents were between the 20 and 30 years. 19.8% of the sample was aged between the 30 and 65 and the last 19.8% of the sample was between the 18 and 20 years old. 81.1% of the respondents completed a bachelor at university of applied science (HBO) or higher. Half of those people completed an academic bachelor or master. Only 18.9% of the respondents had a community college (MBO) degree or lower. These frequencies showed that the sample was not distributed equally. The sample consisted of more (relative) younger and higher educated respondents. This can be explained by the sampling method used. The researcher’s network consists of relative higher than lower educated people. Because the use of non-probability sampling method, younger respondents were reached than older respondents. The respondents were also asked of at least one of their parents was born a country other than the Netherlands. 29.24% of the respondents answered this question with yes, and 70.76% with no, which means that almost three out of ten respondents have a different cultural background.
4.2 Descriptive statistics and correlations
Before testing the relationship between the dependent and independent variables, the means, standard deviations and the correlations between variables were calculated in table 1. This gave a first impression of how the variables are connected with each other. The variables brand image, loyalty and trust are shown, each for every company (Subway, McDonalds, Burger King). The moderator variables age and cultural background are also shown at the top of the table. Because brand equity is an addition of brand loyalty, trust and image, it was expected that those variables are also correlated with each other (further as LOY, IM, and TRU). As expected for Burger King, all three variables are significantly correlated: LOY and TRU r (106) = 0.311, P<0.01), LOY and IM r (106) =0.627, P<0.01, IM and TRU r (106) =0.556, P<0.01). Also as expected for McDonalds: LOY and TRU r (106) =0.455, P<0.01), LOY and IM r (106) =0.608, P<0.01, IM and TRU r (106) =0.461, P<0.01). And finally the correlations of Subway met the
expectations: LOY and TRU r (106) = 536, P<0.01), LOY and IM r (106) =0.685, P<0.01, IM and TRU r (106) =0,591, P<0.01). All correlations are bigger than 0.4 which indicates that the variables are correlated strongly. However the moderator variables age and cultural background did not show a significant correlation except for the correlation between age and TRU Burger King, r (106) =0,214, p<0.05) and the correlation between cultural background and LOY Burger King, r (106) =0.207, p<0.05). This could be coincidence. After doing a regression analysis, there will be more information available about the variables.
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Table 1: Descriptive statistics and correlation (Cronbach’s alphas on the diagonal)
M SD 1 2 3 4 5 6 7 8 9 10 11 12 13
Type of firm Measures
1.Age a 25,96 8,683 2.Gender b 1,519 0,502 0,251** 3.Education c 5,717 1,782 -0,030 -0,111 4.Cultural background d 1,708 0,457 0,132 ,336** 0,003 5.Loyalty 6.576 2.499 0,034 -0,104 -0,074 ,207* (0.700)
Burger King 6.Trust 5.868 1.971 0,214* -0,103 -0,003 0,010 0.311** (0.713)
7.Image 8.669 2.262 -0,055 -0,015 -0,087 0,108 0.627** 0.556** (0.729) 8.Loyalty 8.169 3.068 -0,156 0,091 0,000 0,117 0.316** -0.103 0.144 (0.752) McDonalds 9.Trust 6.867 1.961 0,077 -0,094 0,090 -0,086 0.812 0.380** 0.162 0.445** (0.724) 10.Image 10.452 2.255 -0,170 0,001 -0,008 0,037 0.181 0.166 0.358** 0.608** 0.461** (0.654) 11.Loyalty 7.905 3.031 -0,088 0,045 -0,003 0,049 0.232 -0.005 0.255** 0.284** 0.052 0.235* (0.729) Subway 12.Trust 6.283 2.017 0,044 -0,024 0,044 -0,033 0.066 0.263** 0.231* 0.109 0.214* 0.239* 0.563** (0.734) 13.Image 8.584 2.621 -0,064 -0,139 -0,046 -0,063 0.204* 0.124 0.360** 0.104 0.093 0.280* 0.685** 0.591** (0.635) N= 106, *p<.05, **p<.01 a Age in whole numbers
b 1=Male, 2=Female, 3=Other, 4= Don’t want to share.
c 1=Middelbare school MAVO, 2= Middelbare school HAVO, 3= Middelbare school VWO, 4= MBO, 5= HBO bachelor, 6= HBO master, 7= WO bachelor, 8= WO master
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4.3 Hypothesis testing
For testing the hypotheses set in this research, a simple regression was used. A simple regression analysis is a good way to predict an outcome variable from one predictor variable (Field, 2009, P.198). The direct effect of green marketing on brand equity can therefore be derived by a single regression. Because brand equity was an addition of brand loyalty, image and trust, those are marked as the dependent variables. A regression analysis was executed on all three variables. Three different levels of green marketing (three firms) were assumed, and therefore for each level of green marketing was a regression analysis conducted. Appendix 2 shows three tables are available. For each dependent variable one. Each table contains four models, and each model is tested for each firm.
Model 1
First of all, the relationship between green marketing and brand trust, loyalty and image were measured in model 1 for all firms (See Appendix 2, Table 1, 2 and 3). For Burger King, the results showed that there was a positive significant effect on greenness and brand loyalty, B=0.997, P<0.001. For brand trust the effect was less strong, B=0.351, P>0.05, ns, and for brand image, B=0.794, P<0.001. McDonalds also had positive significant results. The effect of greenness on brand loyalty was B=0.992, P<0.001 and the effect of brand image was B=0.864, P<0.001. The effect of greenness on brand trust was B=0.209, P>0.05, ns. Finally for Subway the results were also positive. The effect of greenness on brand loyalty was B=1.074, P<0.001. For brand image the results were B=0.778, P<0.001. Finally for brand trust, the effect was B=0.405, P<0.001. This firs model showed that in almost all cases, an increase in green marketing (greenness), will lead in an increase in brand equity, loyalty and trust.
All results were positive and significant, except for brand trust in the McDonalds case. After testing for significance, a mean comparison is done
LOYALTY
BURGER KING
MCDONALDS
SUBWAY
WHOLE SURVEY
6.575
8.169
7.905
VERSION 1
6.146
8.024
6.561
VERSION 2
6.846
8.261
8.758
IMAGE
BURGER KING
MCDONALDS
SUBWAY
WHOLE SURVEY
8.669
10.452
8.584
VERSION 1
8.414
10.243
7.609
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Looking at the mean comparison, for brand loyalty and brand trust the mean of the whole survey was higher for the brands using green marketing than for Burger King that does not use green marketing. Only for brand image, the mean for Subway was lower than the mean of Burger King. The brand trusts coefficient for McDonalds was not significant in the previous part, therefore a t-test was conducted for the means of Burger King’s and McDonalds’ brand trust (see appendix 3). The mean calculated for McDonalds was significantly higher than for Burger King (T=-4.699, P<0.001)
Therefore, H1: The use of green marketing has positive effect on brand equity (brand trust, brand loyalty and brand
image), was partly supported. All coefficients of the regression were positive and significant, except for brand trust
in the McDonalds case. Therefore, a mean comparison was executed and the mean difference for brand trust in the McDonalds case was significant. An explanation can be a too small sample, or to low scale reliabilities.
Therefore, more research has to be conducted. The same with the brand image in the Subway case. The mean was lower than the other two companies (which is against the expectations), but the coefficient was significant. Therefore more research is also needed for that part.
Secondly, H1.1: The use of lean green marketing has more positive effect on brand equity than no use of
green marketing, is supported. After testing the mean differences between Burger King and McDonalds, the
calculated means for McDonalds were significantly higher than the means calculated for Burger King (appendix 3).
The same mean comparison analysis was executed for the difference between McDonalds and Subway
(see appendix 3). Only the mean difference of brand loyalty was not significant. Brand image and brand trust had a significantly higher mean for McDonalds that Subway. After the comparison of the whole survey means, the two versions were compared. First an independent sample t-test was executed to compare the means of version 1 and 2 (see appendix 4). The results showed that for Subway, there was a significant difference between the mean of version 1 and version 2. The results of version 2 show that brand trust and loyalty exceeded the means of McDonalds, and brand image came closer to the score of McDonalds. Version 2 had a view additional lines, with the sustainability initiatives those firms have. Therefore H1.2: The use of extreme green marketing has more
positive effect on brand equity than the use of lean green marketing is not supported only if there is no additional
information about the firms. The additional information had a strong effect on the respondents’ answers.
Model 2
In the second model, the direct effect of the moderator variable age was measured (see appendix 2, table 1, 2 and 3). Before calculating the interactions, a direct effect of the moderator variable on the dependent variable was
TRUST
BURGER KING
MCDONALDS
SUBWAY
WHOLE SURVEY
5.867
6.867
6.283
VERSION 1
5.780
7.243
5.414
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checked. The results of Burger King showed that the direct effect of age on brand loyalty B=0.017, was not significant (P>0.05). The effect on brand image and trust, were both positive, B=0,051, P<0.01. For McDonalds, effects on all three variables were 0.024 and not significant (B=0.024, P>0.05, ns).Finally, for Subway, the results were not significant (P>0.05). Brand loyalty had a beta of 0.04 and brand image & trust had a beta of 0.024. From the results it could be concluded that age had only a significant direct effect on brand image and trust of Burger King, but not for the other companies.
Model 3
The third model tested the direct effect of the moderator variable cultural background. After transforming the dichotomous variable into zero’s and ones, a regression analysis was done. First, for Burger King the effect of the respondent’s cultural background on the brand loyalty score had was B=1.175, P>0.05, ns. The effect towards brand image was B=0.619, P>0.05, ns and toward brand trust was B=0.645, P>0.05, ns. Thus, in the case of Burger King, cultural background had no direct effect on the brand equity measures. When examining McDonalds, the brand loyalty coefficient was B=-0.407, P>0.05, ns. For brand image the score was B=-0.207, P>0.05, ns and for brand trust it was B=0.407, P>0.05, ns. For the McDonalds case, these results had also no significant direct effect. For Subway, the effect of cultural background on brand loyalty was B=0.122, brand image was B=-0.505 and brand trust had a score of B=-0.224, all three with a P-value >0.05, ns. Therefore, this study shows no evidence that cultural background had a direct significant effect on the measures of brand equity in any of the cases
.
Model 4
The final model measured the interactions between the moderators, dependent and independent variables. The interaction term for age and greenness is called Green*Age, and for cultural background it was called
Green*Cultback (see appendix 2, table 1, 2 and 3). For Burger King, Green*Age has a small effect of B=0.004, P>0.05, ns) but Green*Cultback has a significant score of -0.397, P<0.01. For brand image, the effect of Green*Age was 0.011, P>0.05, ns and for Green*CultBack it was B= -0.395, P<0.05. For brand trust the effect of Green*Age was B=0.04, P>0.05, ns, and Green*CultBack was -0.397, P<0.05. Thus in the Burger King case, age had no
moderation effects on the brand equity components, but cultural background had a negative moderation effect on brand image, trust and loyalty. Thus, for respondents who had no different cultural background (dummy variable: 1), the effect of green marketing on brand equity would be negatively influenced, for the Burger King case. For McDonalds, for brand loyalty, the coefficient of Green*Age was 0.004, and Green*CultBack was -0.390, both with p>0.05, ns. For brand image, the coefficient for Green*Age was B=0.004, P>0.05, ns and for Green*CultBack was B=-0.390, P<0.05. Finally, for brand trust the effect of Green*Age was B=0.004, P>0.05, ns and Green*CultBack was -0.390, P<0.05. Thus, for the McDonalds case, age had no moderation effect on any variable, but cultural
background had a negative moderation effect on brand image and brand trust. However, cultural background did not moderate the effect of green marketing and brand loyalty. Finally, for the Subway case, for brand loyalty, the
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effect of Green*Age was B=0.005, P>0.05, ns and for Green*CultBack it was B=-0.207, P>0.05, ns. For brand image, the effect of Green*Age was B=-0.013, P>0.05, ns and for Green*CultBack its B=-0.236, P>0.05, ns. Lastly, for brand trust, the effect of Green*Age was B=0.012, P>0.05, ns and for Green*CultBack it was B=-0.010, P>0.05, ns. Thus, for the Subway, age and cultural background did not moderate the effect of green marketing and brand equity. The second and third hypothesis stated that the relation between green marketing and brand equity is moderated. After analyzing model 4, it could be assumed that H2: Cultural background moderates the effect of
green marketing on brand equity, was partly supported. There was in model 3 no evidence that cultural
background had a direct effect on the components of brand equity. In model 4, cultural background moderated in the Burger King case the relation between green marketing and all components of brand equity. In the McDonalds case, cultural background only moderated the effect on brand image and brand trust. In the Subway case, cultural background did not moderate anything.
Finally, H3: Age moderates the effect of green marketing on brand equity negatively, was not supported. Age didn’t had a significant direct effect in Model 2, and had no significant interaction effect in the last model for all companies.
