Sunday, May 29, 2011

ENVIRONMENTAL BUYING DECISIONS: A KENYAN PERSPECTIVE


ENVIRONMENTAL BUYING DECISIONS: A KENYAN PERSPECTIVE


ABSTRACT
The study aimed to assess the impact of environmental factors that determine the buying decisions among tertiary students in Kenya.  This is because there have been concerns for the protection of the environment which has led scientists to study human behaviour in relation to environmental issues. Given this scenario there was a need to conduct such a study in Kenya. The specific objectives of the study were to: determine the environmental buying decisions made by tertiary students and to find out the socio-demographic factors that influence the buying decisions that tertiary students make.
The study employed both quantitative and inferential methodology to achieve the objectives and also test the hypothesis. The target population of the study was all the students at Strathmore University Madaraka campus, in Nairobi, Kenya and a sample of 203 respondents was drawn.
The study concluded that age is a key factor when making buying decisions regarding the issue of the environment. The results indicated that the more the older the person the more the individual will consider the environmental issues when making a decision to purchase an item The study also noted that the decision to be environmentally conscious lies on an individual but not whether one is a man or a female. The study also concluded that the level of income does not at all influence the buying decisions that people make. 



Keywords: environmental concern; purchase behaviour;


INTRODUCTION
Introduction
Environmental issues have stimulated research in the last few decades. Research exists on the impact of human behaviour on the environment, air pollution, climate change, water pollution and depletion of resources (Lehman & Gellar, 2004).  A lot has also been written regarding the handling of solid waste, soil erosion and contamination loss of green space and species diversity (Lehman & Gellar, 2004). Concern for the protection of the environment has led scientists to study human behaviour in relation to environmental issues. Behavioural intervention or pro–environment behaviour has been proposed, setting targets and techniques to promote constructive behaviour towards the environment (Lehman & Geller, 2004).

However the concern of marketers regarding environmental issues is to establish the impact that these have on consumer buying decisions.  There is evidence in research that environmental concerns do affect consumer buying decisions (Hackett, 1992; Grunert-Beckmann et al., 1997; Kilbosrne and Beckmann, 1998).  Companies are more sensitive towards environmental friendly goods and services (Schlossberg, 1992, Menon and Menon, 1997; Polonsky and Ottman, 1998) and consequently these companies have an interest in segmentation analysis to enable them to target their market of environmentally conscious consumers more effectively (Meffert and Bruhn, 1996; Prendergast and Thompson, 1997).

The impact of behaviour on the environment
The earth’s population has been on the increase over the past 100 years from approximately 1.5 billion in 1900 to 6.3 billion in 2003 (Brown & Flavin, 1999; Cohen, 2003). The United Nations has projected that the world’s population will reach 8.9 billion by the year 2050 (United Nations, 2002).  Though the earth’s carrying capacity is not well known, even with the current population, many practices are not sustainable, so that the consequences of our actions and the limited resources available will interfere with what the future generations will have to depend on (Lehman & Geller, 2004).  Many of the products people use today are used and then discarded and this leads to the accumulation of waste and pollution of the environment.

Scholars have for a number of years successfully profiled consumers according to their environmental awareness (Schlegelmilch & Bohlen, 1996); for example some have measured environmental attitudes (Buttel, 1979), capturing individuals’ level of concern/interest regarding specific aspects of the environment.  Other studies have looked at past, current and future or intentional commitment towards involvement in activities that aim at minimizing the negative impact on natural environment (Brooker, 1976).  However, though a weak link between attitudes and behaviour has been noted (Gill et al., 1986; Rothschild, 1979), attitudinal components alone have failed to predict actual behaviour.  More recently researchers have argued that in order to be ‘green’ individuals require an understanding of the consequences of their behaviour (Bohlen et al., 1993).  The awareness of the negative impact that certain actions can have on the environment together with a sense of responsibility could lead to increased likelihood of recycling actions according to Schwart’s norm activation theory (Stern et al., 2005). The behaviour of the individual is driven by a personal norm, such as altruism, and this affects attitudes and actions towards the environment for example recycling (Stern et al., 2005; Vinig & Ebreo, 2002).  The altruistic motivation stems from a real concern for the ‘common good’ rather than a perceived immediate personal benefit (Huge, Brodin & Anderson, 2008). This will include the good of society at large, the future generations and respect for natural environment.  The altruistic behaviour then becomes the basis for sustained recycling activities (Huge Brodin &Anderson, 2008).

Scholars have generated studies on environment from different points of view,  Kaiser, Wolfing and Fuhrer (1999), looked at environmental attitude as a predictor of ecological behaviour; Diamantopoulos, Schlegemilch, Sinkaovics &  Bohlen (2003),  explored whether socio demographics still have a role to play in profiling green consumers in which they paid some attention to the environmental consciousness of consumers. Lehman and Gellar (2004) analysed behaviour and environmental protection in which they looked closely at accomplishments and potential for more.  Some studies have tried to link green behaviour with purchasing decisions as well as measures of environmental consciousness as Schelgelmilch & Diamantopoulos (1996).  In their paper they explored variables specific to environmental consciousness to see if they were suitable for categorizing consumers’ green purchasing decisions.  They measured environmental knowledge, attitudes and behaviour, a study they carried out among students in the UK. 

Two types of consumer behaviour reflecting environmental concern have been identified by Bohlen, Schlegelmilch and Diamontopoulos (1993), namely purchasing and non-purchasing behaviour. These are reflected in Figure 1.

Figure 1           A model of environmental concern behaviour





Behaviour (actions)








Recycling actions





Political action






 Adapted from: Bohlen, Schlegelmilch and Diamontopoulos (1993)

Given the link between knowledge attitudes and behaviour, it is obvious that the type of outcomes may be influenced by country-specific factors such as levels and types of pollution, the existing legislation regarding environmental issues as well as the availability of green products which in turn affect the environmental consciousness construct and how it can be operationalized (Schelgelmilch & Diamantopoulos, 1996). 

In Kenya a number of organizations have made efforts to take care of aspects of the environment.  Campaigns for cleaning the rivers, planting trees, cleaning up facilities or estates are carried out from time to time and are generally well publicized by the media.  The government has put a few laws in place to protect the environment.  However there is a lack of a clear coordinated plan or policy to address environmental issues.  This could be due to lack of sufficient exposure of people to the growing environmental problems consequently the population has not developed habits of taking care of the environment.  There is no literature available on environmental buying decisions in the Kenyan market.  This paper hopes to identify whether there is a relationship between the environmental concern/interest and buying decisions among tertiary students.

Research Objectives

A number of environmental protection initiatives have been implemented or considered in a number of communities.  These are not very wide spread and they are limited to certain communities.  Tertiary institutions by virtue of their access to young people (who may be more exposed to environmental concerns) are an ideal place to conduct research:  The following research questions can then be posed:
·         What are the environmental buying decisions made by tertiary students?
·         How do socio-demographic factors influence the buying decisions that tertiary students make?

The research objective for this specific project is to determine the environmental buying decisions made by tertiary students in the Kenyan context.

Hypothesis
Though studies using socio-demographics to determine their effect on environmental behaviour have yielded mixed results (Diamantopolous et al., 2003), we undertook this research in an effort to establish if there is any awareness of the need to conserve the environment and if this awareness has any influence on the buying decisions people are making in an emerging economy like Kenya.  We have not found any published research in this area carried out in Kenya.
A number of hypotheses can be formulated for the project:
H1: Customers who are older will exhibit more buying decisions based on environmental concerns
H2: Women exhibit more buying decisions based on environmental concerns
H3: Customers from middle income group exhibit more buying decisions based on environmental concerns

RESEARCH METHODOLOGY
Use was made of a quantitative methodology. The research was of a descriptive design whose aim was to conduct an initial exploration of the environmental issues. In this research a paper-based self administered survey was used to collect data from respondents. 

The target population of the study was all the students at Strathmore University Madaraka campus, in Nairobi, Kenya.  This is a private University that has a population of students from different ethnic, social and economic backgrounds and therefore fairly representative of the population of the country at large.    The population consisted mainly of students at this University. The data was collected by volunteer students during the break periods and after classes on campus. A convenience sample of 203 respondents was drawn.    

The research instrument consisted of four sections:
Section A:       Demographics of the respondents
Section B:       Measurement of abstract knowledge on a five-point unlabelled Likert scale (where 1=unconcerned and 5= very concerned). There was also measurement of some concrete knowledge regarding questions posing where to recycle and what can be recycled.
Section C:       Attitudes to environmental issues, including belief and affect components. The 23 statements are derived from a study done by Bohlen et al. (1993), as well as from Maloney, Ward & Braucht (1975). The scale used was a five- point unlabelled Likert scale (where 1=strongly disagree and 5= strongly agree).
Section D:       Actions or behaviours exhibited with respect to environmentalism. They are also linked to the studies conducted by Bohlen et al. (1993), Vining and Ebreo (1990) and Maloney et al. (1975), and contain statements that relate to both buy- and non-buying actions. The scale used was a five-point unlabelled Likert scale (where 1=never and 5= always).

This research determined the reliability of the measurement set and the distribution of the results.  The scores were calculated for the different components of the study and the hypotheses were tested using parametric test.

FINDINGS OF THE RESEARCH
Results
203 usable responses were retrieved. The following sections present the results on reliability tests and the distribution of measurement set, profile of the respondents, the findings on the awareness, attitudes and actions on environmental issues and the outcome of the hypothesis testing.
Reliability
Reliability was measured using Cronbach’s Alpha technique.  The dimensions of awareness and actions registered a high reliability of 0.875 and 0.823 respectively whereas the dimension on attitudes recorded a satisfactory reliability of 0.728.  A value of less than 0.7 according to Hair, Bush & Oritneau, 2006, indicates a low level internal reliability.  This measurement set is therefore deemed to be reliable.




Table 1
Dimension
Number of items
Cronbach’s Alpha
Reliability
Awareness
12
0.875
High reliability
Attitudes
23
0.728
Satisfactory reliability
Action
13
0.823
High reliability



Respondent profile

The table 1 presents the profile of the respondents in this research. The majority of the respondents were in their 20’s (79.3%), female (62.1%), and 37.9% male. The question on the level of education was misunderstood and contradicts the question on employment it was therefore ignored. The home language category has a mixed distribution of 39.1% of category including the Kalenjin/Maasai/Kikuyu/Mijikenda having the largest percentage while the category with Kisii/Embu/Dholuo/Turkana had 15.3%.  The distribution is a good representation of the general population.   For the income category, the greatest percentage is those who came from households earning less than Ksh 25,000 per month (59.7%) of those who responded. However, 34.3% of the total respondents did not answer this question.  All the respondents were Kenyan (100%) and a good mix of students studying the University with the largest group drawn from the Faculty of Commerce (37.6%) incidentally this is the largest department in the University.
Table 2

Characteristic
Distribution
Age
15.3% younger than 20; 79.3% in their 20s; 3.0% in their 30s and 2.5% in their 40s
Gender
37.9% male; 62.1% female
Education completed
10.3% had completed high school;  9.4% had a technical qualification; 78.3% had an undergraduate qualification and 1.0% had a postgraduate qualification
Employment status
9.4% were employed on a full-time basis; 5.4% part time; 77.2% were students and 7.9% unemployed
Home language
16.8% Kiswahili; 13.4% English; 39.1% Kalenjin/Mijikenda/Maasai/Kikuyu; 15.8% Kisii/Embu/Dholou/Turkana; 21.3% Meru/Kamba/Kiluhya/Kuria; 8.4% “Other Kenyan”;  0.5% Other Asian; 0.7% other European languages
Net monthly household income
59.7% less than Ksh25,000; 8.2% Ksh25,000 – Ksh45,000; 5.2% Ksh45,001 – Ksh60,000; 4.5% Ksh60,001 – Ksh80,000; 5.2% Ksh80,001 – Ksh110,000; 6.0% Ksh110,001 – Ksh160, 000; 6.0% Ksh160,001 – Ksh300,000; 5.2% Ksh300,001 and above;
Note: 34.3% missing i.e. did not respond
Nationality
100% Kenyan
Place of residence
49.8% live less than 5km from campus; 50.2% live more than 5km from campus
Faculty/School of registration
18.8% School of Accountancy; 37.6% Faculty of Commerce; 22.8% Faculty of Information Technology; 20.8% School of Tourism and Hospitality

The component of action on environmental issues
The highest mean recorded was on the statement (3.90) ‘I choose an environmentally friendly alternative if one of a similar price is available’ and the lowest was (2.24) was on ‘I boycott organisations that are not environmentally responsible’. The statement which recorded the lowest standard deviation was ‘I have changed to products that are environmentally friendly’. This reflects that many people are making deliberate choices to promote environmentally friendly products.
1.0 Actions



Figure 1.1 Recycling

Figure 1.1 shows the results of whether individuals recycle items. As can be seen from the figure 30 percent of the respondents agreed to recycling different items while the majority 31.58 percent revealed that they don’t recycle irrespective whether the items in question are recyclable. 30 percent of the other respondents revealed that they e do recycle sometimes while 8 percent confirmed that they recycle if its necessary to do so. The results implies that overall the majority of the respondents are keen on environmental issues more so on recycling products. However a lot of efforts need to be done since the percentage of those who said that they don’t recycle is quite high.
Table 3: Descriptive statistics on actions statements


Action

Descriptive Statistics
Mean
Std. Deviation
I choose an environmentally-friendly alternative if one of a similar price is available
3.95
1.147
I would join an environmental group to protect the environment
3.81
1.213
When possible, I prefer to buy organically grown fruit and vegetables
3.79
1.465
I encourage other people to recycle
3.25
1.410
I take shopping bags when doing grocery shopping
3.22
1.612
I make a special effort to buy products in recyclable containers
3.19
1.437
I prefer to buy recycled paper products
3.01
1.341
I have changed to products that are environmentally-friendly
2.96
1.241
I buy products that have not been tested on animals
2.91
1.720
I try to buy environmentally-friendly detergents and cleaning materials
2.79
1.296
I choose environmentally-friendly products regardless of the price
2.76
1.196
I try to find out about the environmental effects of a product before I buy it
2.50
1.234
I boycott organizations that are not environmentally responsible
2.41
1.363

DISCUSSION OF FINDINGS

1.1. Environmental buying decisions made by tertiary students

Table 3 indicates the environmental buying decisions made by the tertiary students. Results in table 3 indicates three issues that the students always consider when making the environmental buying decisions (mean >= 3.5 with significant standard deviation).These include: Choosing an environmentally-friendly alternative if one of a similar price is available, joining an environmental group to protect the environment and when possible buying organically grown fruit and vegetables. The results from the table also indicates some of the decisions that the students sometimes make when purchasing items (mean >=2.5 with significant standard deviation).These include: encouraging other people to recycle, taking shopping bags when doing grocery shopping, making special effort to buy products in recyclable containers, buying recycled paper products, changing to products that are environmentally-friendly, buying products that have not been tested on animals, buying environmentally-friendly detergents and cleaning materials, choosing environmentally-friendly products regardless of the price and trying to find out about the environmental effects of a product before  buying it. However the students never boycott organizations that are not environmentally responsible.

1.2 Effects of socio-demographic factors on the buying decisions

Table 4: Cross tabulation between the level of education, gender  and choosing an environmentally-friendly alternative if one of a similar price is available


choosing an environmentally-friendly alternative if one of a similar price is available
Never
Sometimes
Always
Not applicable
Female

University degree (undergraduate)
11.0%
31.0%
56.0%
2.0%
Technical diploma/degree

30.0%
60.0%
10.0%
Completed high school

36.4%
63.6%

Male






University degree (postgraduate)
50.0%
50.0%


University degree (undergraduate)
10.9%
21.8%
65.5%
1.8%
Technical diploma/degree

22.2%
66.7%
11.1%
Completed high school
30.0%
10.0%
60.0%


Table 4 shows the results of cross tabulation between the levels of education, gender and choosing an environmentally friendly alternative if one of a similar price is available. The results indicate that 11 percent of female university graduates never consider choosing an environmental friendly alternative product while the majority of female’s graduates at (56 percent) do consider making a choice between the alternatives. In the case of males, half of the university graduates never consider these alternatives while the other half not always but sometimes make these decisions. The results also indicate that 30 percent of females with technical courses sometimes consider choosing the alternative products based on environmental issues while 60 percent of the ladies are always guided by this principle. In the case of males, only 30 percent of high school leavers never make this decision while the majority of them actually decide between buying the items which are environment friendly if the alternatives are available.


Table 5: Cross tabulation between the income level and choosing environmentally-friendly products regardless of the price



Level of income
Choosing environmentally-friendly products regardless of the price
Total
Never
sometimes
Always

Less than Ksh 25,000
37.2%
37.2%
21.8%
100.0%
25,000 - 45,000
27.3%
63.6%
9.1%
100.0%
45,001 - 60,000
28.6%
57.1%
14.3%
100.0%
60,001 - 80,000
50.0%
16.7%
33.3%
100.0%
80,001 - 110,000
57.1%
28.6%
14.3%
100.0%
110,001 - 160,000
50.0%
50.0%

100.0%
160,000 - 300,000
37.5%
25.0%
37.5%
100.0%
300,001 and above
50.0%
33.3%
16.7%
100.0%



Table 5 shows the cross tabulation results between the level of income of respondents and choosing environmentally friendly products regardless of the price. The results indicates that 37.2 percent of all  the respondents earning less than 25 000 shillings never consider making decisions on environment when purchasing items while 21.8 percent of the respondents in the same income group always takes into considerations environmentally considerations regardless of the price. Those respondents in the income group ranging from (110,001 - 160,000) never take into considerations about the environmental issues when doing their purchases. 50 percent of the most paid respondents also do not take into considerations the environmental aspect when making their decisions to purchase commodities.

Hypothesis Testing

Table 4: Regression Results




Coefficient
Std Error
t-Ratio
P value
C
3.131315
0.113182
27.66615
0.0000
Gender
0.042149
0.110449
0.381616
0.7032
Income
-0.156121
0.367045
-0.425345
0.4253
Age

0.554495

0.128920
4.301088
0.0002
R-squared
0.510819






Adjusted R-squared
0.417868






Durbin-Watson stat
1.391710






F-Statistic
7.647237








Prob (F-statistic)
0.000014






 

2.1 Testing Hypothesis 1

H1: Customers who are older will exhibit more buying decisions based on environmental concerns.
The study used simple multivariate regression analysis to test all the three hypothesis. From the regression analysis the test indicated a positive correlation between the ages of the respondents and the environmental buying decisions. With a P-value of 0.0002, it implies that the coefficient of the variable age is statistically significant in influencing the buying decisions. The more the older the person the more the individual will consider the environmental issues when making a decision to purchase an item.

The results imply that the older generations are more environmental conscious than the young people. Older people will put into considerations environment issues before committing to several issues. This means that environmental awareness is more pronounced amongst the older generation.

 

2.2 Testing Hypothesis 2

H2: Women exhibit more buying decisions based on environmental concerns

 

The second hypothesis was also tested using the regression analysis. Gender was captured by use of a dummy variable in the regression analysis. (1:If female, 0: Otherwise). The regression analysis results indicated that the variable for gender had a P- value of 0.7032 at 95 percent confidence interval. This implies rejecting the hypothesis against the alternative. The results imply that gender does not influence at all the decisions that individuals make when buying different items. The decision lies on an individual whether its a man or a female but it doesn’t depend on the gender of a person.


2.3 Testing Hypothesis 3

H3: Customers from middle income group exhibit more buying decisions based on environmental concerns

The third hypothesis was also tested using the regression analysis. The results lead to the rejection of the hypothesis at 95 percent confidence level. This is because the coefficient of the variable income had a P value of 0.4253. The results means that the level of income does not at all influence the buying decisions that people make. This fact can be simply explained by the economic situation in the country where people base their consumption on the price and the availability of the commodity rather than the other factors that do influence the demand of a commodity.

Another key observation from the results reveals that the level of income and the buying decisions are negatively correlated. This means that as income of an individual increases the less that individual takes time to make any decisions regarding any purchases. The negative correlation between buying decisions could be explained by the fact that with higher purchasing power parity the less concerned the individuals become towards making environmental   based decisions.

The coefficient of the constant term had A P-value of 0.000 at 95 percent confidence interval. This means that there are other factors which were not included in the model that influences buying decisions of individuals. These could include the level of awareness amongst individuals, the level of education among many other factors.


1.3 LIMITATIONS OF THE RESEARCH

A major limitation of the study is the fact that the study was conducted in the same tertiary institution. There is a tendency of people who live in the same neighbourhood to behave more or less the same irrespective of their different backgrounds. Lack of incorporating views from other tertiary learning institutions makes it hard for the study to generalise the behaviour of all students in these institutions.

1.4 MANAGERIAL FINDINGS

Consumers can play a crucial role in environmental issues since they chose the kind of products they buy in the market. Through this simple fact they determine the kind of products that are made by manufacturers since products are manufactured depending on the consumer needs. However individual consumers can only be influential if they organize themselves in pressure groups. Consumer pressure groups can request or demand companies for example to reduce their packaging or to produce healthier products. On the other hand, consumers can also block or slow down the introduction of environmental innovative products in the market place, because they are not willing to pay a higher price or to accept less comfort (or have the perception that environmental innovative products are more expensive and less comfortable).

Another key area to enforce environmental issues in the line of marketing is by incorporating the manufacturer through product orientation. Product orientation is a strategy where the company believes the consumers prefer products that are widely available and affordable (Leeflang, 1997). The organization needs to be as efficient as possible in production and distribution techniques, which is the prime task of management. The product concept holds that consumers will favor those products that offer the most quality, performance, or innovative features. With this notion the manufactures will be forced to produce products that are more environmental friendly if the consumers demand so.  Managers in product oriented organizations focus their energy on making superior products and improving them overtime so as to meet the demands of their clients.

Focus should also be emphasized on the role of marketing in creating environmental awareness. Majority of the individuals base their decisions on what they have seen or what they have heard. Thus through marketing many people could be made aware maybe of different products in the market that are environmental friendly. Rather than promoting the technology or type of pollution abatement a firm undertakes, most environmental marketing campaigns push a specific product, which itself might be advertised as having environmental benefits (e.g., being recyclable, made with nontoxic material, using less packaging). Some environmental advertisements are primarily aimed at promoting a good corporate image. These advertisements might address environmental innovations, list awards the company received, or simply talk about environmental concerns. Although a few specific products or marketing campaigns do involve some aspect of pollution prevention, compliance issues, or other public policy concerns should be enhanced from the marketers perspective.

1.5 CONCLUSION

The study concludes that the most prominent factors the students always consider when making the environmental buying decisions include: Choosing environmentally-friendly alternatives if one of a similar price is available, joining environmental groups to protect the environment and when possible buying organically grown fruit and vegetables. The study also concludes that the students never contemplate boycotting organizations that are not environmentally responsible.

The study also concludes that age is a key factor when making buying decisions regarding the issue of the environment. The results indicated that the more the older the person the more the individual will consider the environmental issues when making a decision to purchase an item. This simply means that the older generations are more environmental conscious than the young people.  A key challenge would thus to create awareness among the young people of this nation so as to make them more environmental conscious. This can be achieved through incorporating environmental issues in the curricula’s within schools. Another method could be through creating awareness among the youth through forums or even sports. 

The results from the cross tabulation shows that women seem to be more  conscious when making the buying decisions but a further analysis through regression analysis indicates otherwise. The regression results reveal that gender does not influence at all the decisions that individuals make when buying different items. The decision to be environmentally conscious lies on an individual but not whether one is a man or a female.


The study also concludes that the level of income does not at all influence the buying decisions that people make.  The results also revealed that the level of income and the buying decisions are negatively correlated. This means that as income of an individual increases the less that individual takes time to make any decisions regarding any purchases and vice versa. This could mean that the awareness should be enhanced across the board incorporating the poor to the rich since the actions that people commit to today will impact on everyone in the future.

1.6 SUGGESTIONS FOR FURTHER STUDY

The study found out that there are many other factors which do influence the buying decisions of individuals. This study thus suggests that another study should be done to evaluate the impact of all these other factors on the buying decisions of individuals.

In view of the economic challenges such as demographic burden and the climatic change it becomes increasingly important to explore the role of government’s efforts towards environmental issues. The government has initiated several programs to conserve the environment. This study would recommend that a survey to be done to find out the awareness levels of these government efforts from the public as well as exploring whether these government efforts have had any impact on the preservation of the environment.














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