IDEAS home Printed from https://ideas.repec.org/a/gam/jsusta/v15y2023i3p2403-d1050166.html
   My bibliography  Save this article

Influence of Utilitarian and Hedonic Attributes on Willingness to Pay Green Product Premiums and Neural Mechanisms in China: An ERP Study

Author

Listed:
  • Qiang Wei

    (School of Education, Jianghan University, Wuhan 430056, China)

  • Dong Lv

    (School of Education, Jianghan University, Wuhan 430056, China)

  • Yixin Lin

    (School of Energy and Power Engineering, Huazhong University of Science & Technology, Wuhan 430074, China)

  • Dongmei Zhu

    (School of Education, Jianghan University, Wuhan 430056, China)

  • Siyuan Liu

    (School of Education, Jianghan University, Wuhan 430056, China)

  • Yuting Liu

    (School of Education, Jianghan University, Wuhan 430056, China)

Abstract

Green consumption is expected to become a new driving force for sustainable economic growth. The production cost of green products leads to the existence of a green premium, which affects the willingness to pay for green consumption. Moreover, willingness to pay is influenced by the product’s own attributes, such as its hedonic and utilitarian attributes. Our study used the event-related potentials (ERPs) technique to investigate how product attributes and premiums affect information processing and subsequent decision-making by comparing consumers’ acceptance of hedonic and utilitarian green products with different levels of premiums. Behavioral results indicated that consumers were more willing to pay premiums for utilitarian attributes than for hedonic attributes. ERPs results showed that hedonic attributes induced a greater P2 component, suggesting that price increases for hedonic products elicited more cognitive attention in the early cognitive stage and that the high premium condition did not match the hedonic attributes. In the late cognitive stage, where the utilitarian attribute induced higher N4, the consumers used the green consumption concept as a reason to reduce the negative emotions generated by the hedonic attribute and thus were more willing to accept the green premium for the hedonic product. The findings can be used to explain the psychological and neural activities of consumers at different stages when faced with the degree of product attribute-premium and help companies optimize their pricing strategies by using green products’ attributes.

Suggested Citation

  • Qiang Wei & Dong Lv & Yixin Lin & Dongmei Zhu & Siyuan Liu & Yuting Liu, 2023. "Influence of Utilitarian and Hedonic Attributes on Willingness to Pay Green Product Premiums and Neural Mechanisms in China: An ERP Study," Sustainability, MDPI, vol. 15(3), pages 1-16, January.
    • Handle: RePEc:gam:jsusta:v:15:y:2023:i:3:p:2403-:d:1050166
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/2071-1050/15/3/2403/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/2071-1050/15/3/2403/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Kivetz, Ran & Simonson, Itamar, 2002. "Self-Control for the Righteous: Toward a Theory of Precommitment to Indulgence," Journal of Consumer Research, Journal of Consumer Research Inc., vol. 29(2), pages 199-217, September.
    2. Yong Geng & Joseph Sarkis & Raimund Bleischwitz, 2019. "How to globalize the circular economy," Nature, Nature, vol. 565(7738), pages 153-155, January.
    3. Qiuzhen Wang & Liang Meng & Manlu Liu & Qi Wang & Qingguo Ma, 2016. "How do social-based cues influence consumers’ online purchase decisions? An event-related potential study," Electronic Commerce Research, Springer, vol. 16(1), pages 1-26, March.
    4. Liying Xu & Feng Yu & Xiaojun Ding, 2020. "Circular-Looking Makes Green-Buying: How Brand Logo Shapes Influence Green Consumption," Sustainability, MDPI, vol. 12(5), pages 1-13, February.
    5. Joël Berger, 2017. "Are Luxury Brand Labels and “Green” Labels Costly Signals of Social Status? An Extended Replication," PLOS ONE, Public Library of Science, vol. 12(2), pages 1-17, February.
    6. Strahilevitz, Michal & Myers, John G, 1998. "Donations to Charity as Purchase Incentives: How Well They Work May Depend on What You Are Trying to Sell," Journal of Consumer Research, Journal of Consumer Research Inc., vol. 24(4), pages 434-446, March.
    7. Isabella, Giuliana & Mazzon, José Afonso & Dimoka, Angelika, 2017. "Impacts of product type and representation type on the perception of justice and price fairness," Journal of Business Research, Elsevier, vol. 81(C), pages 203-211.
    8. Ofir, Chezy, 2004. "Reexamining Latitude of Price Acceptability and Price Thresholds: Predicting Basic Consumer Reaction to Price," Journal of Consumer Research, Journal of Consumer Research Inc., vol. 30(4), pages 612-621, March.
    9. Zhu, Lichao & Song, Qingbin & Sheng, Ni & Zhou, Xiu, 2019. "Exploring the determinants of consumers’ WTB and WTP for electric motorcycles using CVM method in Macau," Energy Policy, Elsevier, vol. 127(C), pages 64-72.
    10. Choi, Jungsil & Madhavaram, Sreedhar R. & Park, Hyun Young, 2020. "The Role of Hedonic and Utilitarian Motives on the Effectiveness of Partitioned Pricing," Journal of Retailing, Elsevier, vol. 96(2), pages 251-265.
    11. Andreas Aigner & Robert Wilken & Sylvie Geisendorf, 2019. "The Effectiveness of Promotional Cues for Organic Products in the German Retail Market," Sustainability, MDPI, vol. 11(24), pages 1-15, December.
    12. Wei, Shuqin & Ang, Tyson & Jancenelle, Vivien E., 2018. "Willingness to pay more for green products: The interplay of consumer characteristics and customer participation," Journal of Retailing and Consumer Services, Elsevier, vol. 45(C), pages 230-238.
    13. Junichiro Onishi & Yongheng Deng & Chihiro Shimizu, 2021. "Green Premium in the Tokyo Office Rent Market," Sustainability, MDPI, vol. 13(21), pages 1-17, November.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Michael G. Luchs & Minu Kumar, 2017. "“Yes, but this Other One Looks Better/Works Better”: How do Consumers Respond to Trade-offs Between Sustainability and Other Valued Attributes?," Journal of Business Ethics, Springer, vol. 140(3), pages 567-584, February.
    2. Balabanis, George & Stathopoulou, Anastasia, 2021. "The price of social status desire and public self-consciousness in luxury consumption," Journal of Business Research, Elsevier, vol. 123(C), pages 463-475.
    3. Chang, Chia-Chi & Chen, Po-Yu, 2019. "Which maximizes donations: Charitable giving as an incentive or incentives for charitable giving?," Journal of Business Research, Elsevier, vol. 97(C), pages 65-75.
    4. Michael Giebelhausen & Benjamin Lawrence & HaeEun Helen Chun, 2021. "Doing Good While Behaving Badly: Checkout Charity Process Mechanisms," Journal of Business Ethics, Springer, vol. 172(1), pages 133-149, August.
    5. Joon Yong Seo & Sukki Yoon & Milena Vangelova, 2016. "Shopping plans, buying motivations, and return policies: impacts on product returns and purchase likelihoods," Marketing Letters, Springer, vol. 27(4), pages 645-659, December.
    6. Xiaoyun Zhang & Feng Dong, 2020. "Why Do Consumers Make Green Purchase Decisions? Insights from a Systematic Review," IJERPH, MDPI, vol. 17(18), pages 1-25, September.
    7. Tejaswi Patil & Zillur Rahman, 2023. "A bibliometric analysis of scientific literature on guilt in marketing," Management Review Quarterly, Springer, vol. 73(3), pages 1385-1415, September.
    8. Hsin-Hsien Liu & Hsuan-Yi Chou, 2022. "Attribute specification effect on hedonic and utilitarian options," Australian Journal of Management, Australian School of Business, vol. 47(2), pages 322-341, May.
    9. Briers, Barbara & Pandelaere, Mario & Warlop, Luk, 2007. "Adding exchange to charity: A reference price explanation," Journal of Economic Psychology, Elsevier, vol. 28(1), pages 15-30, January.
    10. Briers, B.M.E. & Pandelaere, M. & Warlop, L., 2007. "Adding exchange to charity : A reference price explanation," Other publications TiSEM 7b0069ad-8251-4e7d-82ba-a, Tilburg University, School of Economics and Management.
    11. Tiefenbeck, Verena & Staake, Thorsten & Roth, Kurt & Sachs, Olga, 2013. "For better or for worse? Empirical evidence of moral licensing in a behavioral energy conservation campaign," Energy Policy, Elsevier, vol. 57(C), pages 160-171.
    12. Vera Herédia-Colaço & Rita Coelho do Vale, 2018. "Seize the Day or Save the World? The Importance of Ethical Claims and Product Nature Congruity," Journal of Business Ethics, Springer, vol. 152(3), pages 783-801, October.
    13. Sheng, Margaret L. & Teo, Thompson S.H., 2012. "Product attributes and brand equity in the mobile domain: The mediating role of customer experience," International Journal of Information Management, Elsevier, vol. 32(2), pages 139-146.
    14. Hagtvedt, Henrik & Patrick, Vanessa M., 2016. "Gilt and Guilt: Should Luxury and Charity Partner at the Point of Sale?," Journal of Retailing, Elsevier, vol. 92(1), pages 56-64.
    15. Didi Alaoui, Mohamed & Valette-Florence, Pierre & Cova, Véronique, 2022. "How psychological distance shapes hedonic consumption: The moderating role of the need to justify," Journal of Business Research, Elsevier, vol. 146(C), pages 57-69.
    16. Katharine M. Howie & Lifeng Yang & Scott J. Vitell & Victoria Bush & Doug Vorhies, 2018. "Consumer Participation in Cause-Related Marketing: An Examination of Effort Demands and Defensive Denial," Journal of Business Ethics, Springer, vol. 147(3), pages 679-692, February.
    17. Champniss, Guy & Wilson, Hugh N. & Macdonald, Emma K. & Dimitriu, Radu, 2016. "No I won't, but yes we will: Driving sustainability-related donations through social identity effects," Technological Forecasting and Social Change, Elsevier, vol. 111(C), pages 317-326.
    18. Inwon Kang & Deokhee Cheon & Matthew Shin, 2011. "Advertising strategy for outbound travel services," Service Business, Springer;Pan-Pacific Business Association, vol. 5(4), pages 361-380, December.
    19. Nadezhda Kvasha & Olga Bolotnikova & Ekaterina Malevskaia-Malevich, 2023. "Biotechnological Basis of the Pulp and Paper Industry Circular Economic System," Economies, MDPI, vol. 11(12), pages 1-13, December.
    20. Kautish, Pradeep & Paço, Arminda & Thaichon, Park, 2022. "Sustainable consumption and plastic packaging: Relationships among product involvement, perceived marketplace influence and choice behavior," Journal of Retailing and Consumer Services, Elsevier, vol. 67(C).

    More about this item

    Keywords

    green consumption; green premium; green marketing; event-related potentials (ERPs); P2; N4;
    All these keywords.

    JEL classification:

    • P2 - Political Economy and Comparative Economic Systems - - Socialist and Transition Economies
    • N4 - Economic History - - Government, War, Law, International Relations, and Regulation

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gam:jsusta:v:15:y:2023:i:3:p:2403-:d:1050166. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.