3.4 Ethical Issues in Consumer Buying Behavior
4 min read•june 24, 2024
Ethical considerations are reshaping consumer buying behavior. People now prioritize sustainability, social responsibility, and animal welfare when making purchases. This shift has led to unethical brands and supporting ethical ones, even if it means paying more.
Companies are responding by incorporating ethics into their brand identity. They're emphasizing transparency, collaborating with non-profits, and developing ethical product lines. This approach helps them differentiate themselves and appeal to ethically-conscious consumers.
Ethical Considerations in Consumer Buying Behavior
Ethical influences on purchasing
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- Consumers prioritize ethical factors when making purchasing decisions
- Environmental sustainability drives preference for eco-friendly products and packaging while avoiding products with high carbon footprints or negative environmental impact ( materials, energy-efficient appliances)
- Social responsibility leads to support for companies with fair labor practices and working conditions and avoidance of products associated with child labor, sweatshops, or exploitative practices ( certified, certification)
- Animal welfare concerns result in preference for cruelty-free and vegan products and avoidance of products tested on animals or using animal-derived ingredients ( certified, plant-based alternatives)
- Ethical considerations lead to boycotting or "" certain brands or products
- Boycotting involves avoiding purchases from companies with unethical practices (fast fashion brands, unsustainable palm oil producers)
- Buycotting means intentionally purchasing from companies with ethical practices to show support (Patagonia, Seventh Generation)
- Willingness to pay a premium for ethically produced goods and services as higher prices are accepted as a trade-off for aligning purchases with personal values and beliefs (organic food, sustainable fashion)
- drives demand for products and services that align with ethical values and sustainable practices
Characteristics of ethical consumers
- Heightened awareness and concern for ethical issues in production and consumption leads ethical consumers to actively seek information about company practices and product origins and engage in research to make informed purchasing decisions (, third-party certifications)
- Strong sense of personal responsibility and belief in the power of individual actions drives ethical consumers to view purchasing decisions as a form of voting with their dollars and believe that collective consumer choices can drive positive change (supporting ethical brands, boycotting unethical companies)
- Consistency in applying ethical principles across various product categories and aspects of life as ethical consumers strive to maintain in purchasing habits and may extend ethical considerations to other areas, such as investments and lifestyle choices (, plant-based diet)
- Willingness to sacrifice convenience or lower prices for ethical alternatives leads ethical consumers to prioritize ethical considerations over factors like price, brand loyalty, or product availability (choosing local businesses over big box stores, opting for reusable products)
- Engagement in advocacy and spreading awareness about ethical consumption as ethical consumers share information and experiences with others to encourage ethical purchasing and participate in campaigns or movements promoting (social media activism, attending sustainability events)
- Support for practices that minimize environmental impact and promote long-term resource conservation
Ethics as brand differentiation
- Incorporating ethical practices into brand identity and positioning by emphasizing commitment to sustainability, social responsibility, or animal welfare and communicating ethical values through branding, packaging, and advertising (Toms Shoes, Lush Cosmetics)
- Transparency and disclosure of ethical practices build trust with consumers through providing detailed information about supply chain, production processes, and ingredient sourcing and engaging in third-party certifications or audits to validate ethical claims (Everlane, Fairtrade International)
- Collaborating with non-profit organizations or causes aligned with ethical values by partnering with environmental, social, or animal welfare organizations for credibility and engaging in cause-related marketing campaigns to raise awareness and support (Patagonia's 1% for the Planet, Ben & Jerry's social mission)
- Developing and promoting ethical product lines or initiatives through introducing eco-friendly, fair trade, or cruelty-free product ranges and implementing recycling or take-back programs for used products (H&M Conscious Collection, Apple's recycling program)
- Leveraging ethical practices to target and appeal to ethically-conscious consumer segments by tailoring marketing messages and campaigns to resonate with ethical consumers and engaging ethical influencers or thought leaders for endorsements and collaborations (Reformation's sustainable fashion, Greta Thunberg's partnerships)
- Implementing practices to ensure responsible procurement of materials and labor throughout the supply chain
Corporate Responsibility and Sustainability
- initiatives demonstrate a company's commitment to ethical practices and positive societal impact
- practices ensure transparent and honest communication with consumers about products and services
- approach balances financial performance with social and environmental considerations
- principles promote resource efficiency and waste reduction in product lifecycles
Key Terms to Review (22)
B Corp: A B Corp, or Benefit Corporation, is a for-profit company that has been certified by the nonprofit B Lab to meet rigorous standards of social and environmental performance, accountability, and transparency. B Corps are committed to balancing profit with purpose and considering the impact of their decisions on their workers, customers, suppliers, community, and the environment.
Biodegradable: Biodegradable refers to the ability of a substance to be broken down and decomposed by natural biological processes, such as the action of microorganisms, over time. This property is particularly important in the context of environmental sustainability and responsible consumption.
Boycotting: Boycotting refers to the act of refusing to purchase or use products or services from a particular company or organization, typically as a form of protest or to pressure the target to change its policies or practices. It is a consumer-driven strategy used to influence corporate behavior and promote ethical or social change.
Buycotting: Buycotting is a consumer behavior where individuals deliberately choose to purchase products or services from companies that align with their ethical, social, or political beliefs. It is the opposite of boycotting, where consumers avoid certain products or companies for similar reasons.
Circular Economy: A circular economy is an economic system that aims to eliminate waste and the continual use of resources. It is designed to keep products, components, and materials at their highest utility and value at all times, distinguishing it from the traditional linear economy of 'take, make, waste'.
Conscious Consumerism: Conscious consumerism is the practice of making purchasing decisions based on a person's values, ethics, and environmental or social impact considerations, rather than solely on price or convenience. It involves being mindful of the consequences of one's consumption habits and actively choosing products and services that align with one's personal beliefs and principles.
Consumer Behavior Analysis: Consumer behavior analysis is the study of how individuals, groups, and organizations select, purchase, use, and dispose of goods, services, ideas, or experiences to satisfy their needs and desires. It examines the factors that influence consumer decision-making and the impact of those decisions on the marketplace and society.
Corporate Social Responsibility: Corporate Social Responsibility (CSR) is a business approach where companies integrate social and environmental concerns into their operations and interactions with stakeholders. It involves a company's commitment to operate in an economically, socially, and environmentally sustainable manner while considering the impact of its decisions and actions on various stakeholders, including employees, customers, communities, and the environment.
Ethical Banking: Ethical banking refers to the practice of financial institutions operating in a socially responsible and sustainable manner, prioritizing the well-being of their customers, communities, and the environment over pure profit maximization.
Ethical Consistency: Ethical consistency refers to the principle of maintaining a coherent and unwavering set of moral standards in one's decisions and actions, even in the face of changing circumstances or temptations. It is a fundamental aspect of ethical behavior that ensures individuals and organizations act in a manner that is aligned with their stated values and principles.
Ethical Consumerism: Ethical consumerism refers to the practice of purchasing products and services based on the social, environmental, and ethical implications of their production and distribution. It involves making conscientious choices as a consumer to support businesses and practices that align with one's personal values and beliefs, while avoiding those that are perceived as unethical or harmful.
Ethical Decision-Making Model: The ethical decision-making model is a framework that guides individuals and organizations in making ethical choices by considering various factors, principles, and potential consequences. It provides a structured approach to navigate complex moral dilemmas and arrive at decisions that align with ethical standards and values.
Ethical Impact Assessment: Ethical Impact Assessment is a process of systematically evaluating the potential ethical consequences of a decision, policy, or action. It aims to identify and address any ethical concerns or risks associated with a given course of action in order to ensure that the decision-making process aligns with ethical principles and values.
Ethical Marketing: Ethical marketing is the practice of promoting and selling products or services in a manner that is morally and socially responsible. It involves making decisions and taking actions that consider the well-being of consumers, society, and the environment, rather than solely focusing on maximizing profits.
Ethical Sourcing: Ethical sourcing refers to the practice of obtaining goods and services in a responsible and sustainable manner, considering the social, environmental, and economic impacts of the supply chain. It involves ensuring that the production and procurement of products adhere to ethical standards, such as fair labor practices, environmental protection, and social responsibility.
Fair Trade: Fair Trade is an ethical and social movement that aims to ensure fair wages, safe working conditions, and sustainable practices for producers, particularly in developing countries. It is a certification system that promotes equitable trade relationships and empowers marginalized communities by providing them access to global markets on more favorable terms.
Greenwashing: Greenwashing is the practice of making misleading or deceptive claims about the environmental benefits or sustainability of a product, service, or company in order to appear more eco-friendly than they actually are. It involves the use of marketing and advertising tactics to create a false impression of environmental responsibility, often with the goal of increasing sales or improving a company's public image.
Leaping Bunny: The Leaping Bunny is a certification program that ensures that a company's products are free from animal testing. It is a voluntary certification that demonstrates a company's commitment to ethical and cruelty-free manufacturing practices.
Stakeholder Theory: Stakeholder theory is a framework that considers the interests and concerns of all parties affected by a business's operations, not just its shareholders. It emphasizes the importance of balancing the needs of various stakeholders, including customers, employees, suppliers, the community, and the environment, in order to achieve long-term success and sustainability.
Supply Chain Transparency: Supply chain transparency refers to the visibility and disclosure of information throughout the various stages of a product's supply chain, from raw material sourcing to final delivery to the consumer. It involves the open sharing of data, processes, and practices among all stakeholders in the supply chain to promote accountability, sustainability, and ethical business practices.
Sustainable Consumption: Sustainable consumption refers to the use of products and services in a way that has low impact on the environment, conserves natural resources, and meets the needs of the present without compromising the ability of future generations to meet their own needs. It involves making conscious choices to reduce, reuse, and recycle in order to minimize waste and promote environmental sustainability.
Triple Bottom Line: The triple bottom line (TBL) is a framework that businesses use to measure their performance not just in the traditional financial bottom line, but also in their social and environmental impact. It expands the traditional reporting framework to take into account ecological and social performance in addition to financial performance.