Effect of Eco-Labels on Consumers' Buying Decisions: An Empirical Study

Abstract

Rising environmental concerns and awareness of sustainable consumption have motivated business organizations to adapt eco-labels as a means of communicating the environmental attributes of their products. Eco-labels help customers identify products that meet specific environmental standards and support informed buying decisions. However, the effectiveness of eco-labels depends on awareness of consumers, their trust, perceived credibility, environmental knowledge, and willingness to pay for environment friendly products. This empirical study examines the effect of eco-labels on consumer’s buying decisions by analysing the relation between eco-labels awareness, perceived credibility, environmental concern, product quality perception, and purchase intention. It is indicated that eco-labels positively influence consumer’s buying decisions by improving trust level, increasing credibility of products, and strengthening perceptions of environmental responsibility. Consumers with higher environmental awareness and trust in eco-label certifications are more likely to buy eco-labelled products despite of their higher prices. A sample of 351 was collected to find the result of the study. The factors studying the Effect of Eco-Labels on Consumers' Buying Decisions are Eco-label awareness, Trust in eco-labels, Environmental Concern and Perceived Product Quality.