factors affecting consumption behavior of green products in hanoi

FOREIGN TRADE UNIVERSITY FACULTY OF INTERNATIONAL ECONOMICS RESEARCH PROPOSAL ASSIGNMENT FOR FINAL EXAM Subject RESEARCH METHODOLOGY FOR ECONOMICS AND BUSINESS Topic FACTORS AFFECTING CONSUMPTION BEHA.

FOREIGN TRADE UNIVERSITY FACULTY OF INTERNATIONAL ECONOMICS

-RESEARCH PROPOSAL ASSIGNMENT

FOR FINAL EXAM Subject: RESEARCH METHODOLOGY FOR

ECONOMICS AND BUSINESS

Topic: FACTORS AFFECTING CONSUMPTION BEHAVIOR OF

GREEN PRODUCTS IN HANOI

Group:

Class: KTEE206 (GD1-HK1-2223).1 Intake: K60

Instructor: Professor Pham Thi Cam Anh

Ha Noi, October 2022

1 THE URGENCY OF THE SUBJECT 5 1.1 Reasons for choosing the topic 5 1.2 Objectives of the research 5

2 THEORETICAL BASIS 6

2.2 Theoretical research models 7 2.2.1 Theory of rational action - TRA 7 2.2.2 Theory of Planned Behaviour – TPB 8 2.3 Previous studies related to the topic 9

3 RESEARCH MODEL PROPOSAL 13

3.2 Research model proposal 14 3.3 Hypotheses in the research model 14 3.3.1 Attitude to the environment 14 3.3.2 Awareness of environmental responsibility 15 3.3.3 Green product characteristics 15 3.3.4 Green product prices 15

4 RESEARCH METHODS 16 4.1 Research sample and data collection method 16 4.2 Data processing method 16 4.2.1 Cronbach's Alpha reliability test 16

4.2.2 Exploratory factor analysis (EFA) 17 4.2.3 Pearson's correlation analysis 17 4.2.4 Regression analysis 18

1 THE URGENCY OF THE SUBJECT

1.1 Reasons for choosing the topic

After the industrial revolution, the world economy changed drastically, along with the miraculous economic growth rate of many countries However, the exploitation of nature by humans is increasingly damaging the environment A range of global and regional ecological, environmental and resource security issues, such as global warming, the occurrence of climate anomalies, such as floods, droughts, tsunamis depletion of resources, destruction of species, and adverse effects on human health are the price to pay for the industrialization process

Currently, Green Purchasing is growing rapidly around the world, promoting production enterprises and consumers to consume environmentally friendly products In Vietnam, although there are no separate regulations on green consumption; many contents related to green consumption and sustainable consumption were soon included in the policy, integrated and regulated in many documents of the Party and State In addition, movements and action programs on green consumption have also been widely launched across the country, attracting a large number of participants

Climate change has direct impacts on all human socio-economic activities, especially for coastal countries like Vietnam Recent studies have shown that human activities are one of the direct causes of climate change, especially when it comes to greenhouse gas emissions, which is mainly generated by production and consumption activities Concerned about the direct consequences of environmental problems, and receiving extensive information from the propaganda activities of environmental protection organizations, the world's consumers are gradually forming a trend The new consumption trend is green consumption or environmentally friendly consumption This will contribute to transforming and forming a new form of competition in the near future The study of factors affecting the intention to buy green products is a matter of great urgency to provide a scientific basis for business strategy development, and policy making for businesses From there, sustainable development goals could be achieved through policies which help encourage and meet green consumption needs of customers Therefore, green consumption is the top concern of businesses The topic needs to

be researched in a scientific way to promote business efficiency, as well as meet the needs of green consumption

For these reasons, the authors decided to choose the topic " Factors affecting consumption behavior of green products in Hanoi" as their research topic From

there, it is possible to propose some managerial implications to help businesses improve their marketing activities to encourage and meet the green consumption needs of consumers

1.2 Objectives of the research

General objective: The objective of this thesis is to evaluate the impact of factors affecting green consumption behavior of consumers in Hanoi city From there, the authors determine the influence levels and propose managerial implications for developing green consumer behavior

Detail goal:

● Determining the factors affecting the green consumption behavior of consumers in Hanoi city

● Determining the level of impacts of factors affecting green consumption behavior of consumers in Hanoi city

● Contribute some ideas to develop activities to promote customers’ green buying behavior

1.3 Scope of the research

Research object: Buying behavior of green products of consumers

Research space: Hanoi market

The time to carry out the research on the topic is from October 2022 to November 2022

1.4 Research question

(1) What factors affect the green consumption behavior of consumers in Hanoi city?

(2) How do these factors affect the green buying behavior of consumers in Hanoi city?

(3) What are the appropriate solutions to improve the green buying behavior of consumers in Hanoi city?

2 THEORETICAL BASIS

2.1 Basic concepts

2.1.1 Green consumption

Green consumption is the purchase and use of environmentally friendly products that do not harm human health and do not threaten the natural ecosystem (Shrum & Shenhav, 1995)

Green consumption is understood as part of sustainable consumption Green consumption is the act of buying, using, and discarding in which consumers

consider their responsibilities to society and the environment by minimizing their impact on the environment, while still meeting meeting individual needs and desires, ensuring quality of life in daily living - eating - working activities (Shrum

& Shenhav, 1995)

2.1.1 Green consumers

A green consumer is anyone whose buying behavior is influenced by concern for the environment (Shrum & Shenhav, 1995), specifically those who “avoid products that are harmful to their health or others, avoid products that are hazardous

to the environment in the production process, as well as products that use waste, consume waste of energy, use of raw materials threatens the sustainability of the environment” (Strong & Mattox, 1996) According to researchers around the world

on green consumption behavior, they found different characteristics and levels in green consumers

Another study by Outman (1998) shows that the Roper Organization has identified five consumer market segments in the US based on their level of commitment to the environment First, “except blue green” consumers strongly believe that their actions have an impact on the environment, they are willing to invest more in green products and are willing to participate in ecological activities such as recycling, organic waste treatment They are the most environmentally conscious group of consumers and will definitely buy green products from companies that are truly environmentally conscious “greenback green”, consumers also invest more in green products but are not willing to participate in environmental protection activities To protect their lives These consumers only engage in environmental activities through monetary means Third, ''sprouts'' are consumers who support environmental regulations but are less likely to pay only for green products Private "grousers" believe that solving environmental problems does not Ultimately, "basic brown" is no personal, commercial or political effort that can solve the ecological problem Thus, from this definition, it shows that consumers in the first three segments are interested in the environment, but only the first two segments are willing to pay for eco-friendly products school The remaining two segments are mostly not responsible for environmental issues

According to Kumar and Ghodeswar (2015), green consumers are described

as those who take environmental factors into account in their decision to purchase and use products and intend to change their product purchasing and consumption behavior to reduce environmental impact

2.1.2 Consumer behavior

According to Philip Kotler (2012), “Consumer buying behavior is the totality

of actions that consumers reveal in the process of exchanging products, including: investigating, purchasing, using, evaluating and spending on goods and services services to satisfy their needs”

It is also possible to consider consumer behavior as the way in which consumers will make decisions about the use of their assets (money, time, effort ) related to the purchase and use goods and services to satisfy individual needs

2.2 Theoretical research models

2.2.1 Theory of rational action - TRA

Theory of Reasoned Action defines the relationship between attitudes and behavior in human actions (Ajzen & Fishbein, 1980) The theory of rational action

is used to predict behavior based on a person's inherent behavioral intentions and attitudes A person will act based on the results they expect from performing the behavior (Vallerand et al, 1992)

Figure 1 Theory of Reasoned Action model (TRA)

Source: Ajzen & Fishbein (1980)

From research on social psychology, models and theories of persuasion, attitude, two psychologists Martin Fishbein and Icek Ajzen have developed a theoretical model of rational action (TRA), showing that there is a relationship between attitude towards behavior, subjective norm that affects behavioral intention and has an impact on human behavior (Ajzen & Fishbein, 1980)

However, the theory of rational action is not a complete theory to analyze human behavior (Cooke & French, 2008) According to Ajzen (1991), it does not ensure the implementation of the intended behavior

The limitations of the theory arise from the assumption that behavior is controlled by the will, and the fact that the behavior does not necessarily have to be done from the existing intention Another limitation is that attitudes and behavior sometimes are not associated with intention Therefore, the theory of rational action can only be applied to pre-intentioned behavior, this theoretical model cannot be applied to habits, unconscious actions, etc (Ajzen, 1991) In subsequent studies, Martin Fishbein and Icek Ajzen have continuously worked to overcome the limitations of the theory of rational action

2.2.2 Theory of Planned Behavior – TPB

The Theory of Planning Behavior is a theory that defines the relationship between a person's beliefs and behavior (Ajzen, 1991)

The theory of planned behavior is extended from the theory of rational action (Ajzen & Fishbein, 1980) According to Ajzen (1991), the theory of planned behavior aims to improve the theoretical model of the theory of rational action by adding to the model of cognitive factors controlling behavior, overcoming the limitation of thinking that human behavior is completely controlled by reason

The theory of planned behavior is the most widely used and cited behavioral theory (Cooke & Sheeran, 2004) It is applied to many different research fields such

as marketing, sports, health, etc

Figure 2 Theoretical model of planned behavior (TPB)

Source: Ajzen (1991)

The theoretical model of planned behavior holds that behavior can be predicted or explained by intentions to perform that behavior According to Ajzen (1991), intention is a function of three factors: Attitude towards the Behavior; Subjective Norms; Perceived Behavioral Control

2.3 Previous studies related to the topic

2.3.1 Domestic research

2.3.1.1 Research by Mai Ngoc Dinh (2018)

Author Mai Ngoc Dinh (2018) did research on the topic "Factors affecting

consumers' intention to buy green products in modern retail channels in Ho Chi Minh City" The main purpose of the study is to measure the influence of factors on

consumers' intention to buy green products in modern retail channels in Ho Chi Minh City Based on theoretical basis and qualitative research, the author has identified 3 factors affecting consumers' intention to buy green products in modern retail channels in Ho Chi Minh City, including: Green brand positioning, Green brand knowledge and Green brand attitude The official study was conducted through a quantitative survey questionnaire on 300 customers who shopped in retail channels in Ho Chi Minh City The measurement scales of the research concepts of the article all meet the requirements of reliability and validity as shown by the results of Cronbach alpha and factor analysis EFA, SEM The results of SEM

analysis show that there are 3 factors that have a positive impact on the intention to buy green products of customers shopping in modern retail channels in Ho Chi Minh City, which are Green brand positioning, Thai Green Brand Orientation and Green Brand Knowledge

Intention to buy green products

Figure 3 Research model of Mai Ngoc Dinh (2018)

Source: Mai Ngoc Dinh (2018)

2.3.1.2 Research by Hoang Trong Hung and colleagues (2018)

Author Hoang Trong Hung et al (2018) conducted a study on the topic

"Factors affecting green consumption behavior of consumers in Hue city" The

objective of this study is to determine the factors affecting the green consumption behavior of consumers in Hue city The model of the study is established based on the extended model of the theory of planned behavior (TPB) By directly surveying

200 consumers and using the Structural Equation Modeling (SEM) model, the research results show that there are two main factors affecting green consumption intention Indirectly affecting green consumption behavior of consumers in Hue city

is the attitude towards green consumption and concern for the environment For such reasons, it is necessary to improve consumers' attitudes and understanding of environmental concerns in order to enhance consumption intentions and promote green purchasing behavior of consumers in Hue city

Figure 4 Research model of Hoang Trong Hung and colleagues (2018)

Source: Hoang Trong Hung et al (2018)

2.3.1.3 Research by Duong Thi Anh Tien and colleagues (2021)

Author Duong Thi Anh Tien and colleagues (2021) have researched the topic

"Factors affecting green consumption behavior of Quang Ngai people: Approaching the perspective of social responsibility" The objective of the article is to analyze the

factors affecting green consumption behavior of Quang Ngai people The study’s approach to social responsibility is based on the theory of rational behavior (TRA) and theory of planned behavior (TPB) Using a survey sample of 491 consumers in Quang Ngai city and quantitative analysis methods, the research results show that from 6 factors proposed in the original research model, the results of factor analysis are reduced to 4 factors that have a positive impact on the green consumption behavior of Quang Ngai people

Figure 5 Research model of Duong Thi Anh Tien and colleagues (2021)

Source: Duong Thi Anh Tien et al (2021)

2.3.2 Foreign studies

2.3.2.1 Chan and Lau's research (2002)

Authors Chan and Lau’s study (2002) aimed to examine the applicability of the Theory of Planned Behavior to green purchasing behavior in Chinese and American cultural environments Consumers in Shanghai and Los Angeles were surveyed, and the related structural equation model analysis indicated a satisfactory extrinsic validity of the model in explaining eco-friendly purchases of Chinese and American consumers According to the research’s result, there are 5 factors affecting green consumption behavior, including: Reducing environmental problems, Resource saving, Product price, Social responsibility, and High risk