Ethical Shopping: Why Good Intentions Go Bad Kyle Freund Julie - - PowerPoint PPT Presentation

Ethical Shopping: Why Good Intentions Go Bad

Julie Irwin Business, Gov’t & Society Dept. McCombs School of Business University of Texas Kyle Freund Kyle Freund Consulting (& Fairtrade America) Daniel Zane Marketing Department Miami Business School University of Miami

March 13, 2019 - #SXSW2019 - #EthicalConsumer

Consumers are Terrible

• A million plastic bottles are bought every minute;

projected to jump by 20% by 2021.

• There are more than 2 million children engaged in

hazardous work in the cocoa fields of West Africa.

• More than 100 million animals are killed in the U.S.

every year in chemical, drug, food & cosmetics tests (Peta.com)

• Trafficking and forced labor, e.g.

Qatar (HRW 2016).

March 13, 2019 - #SXSW2019 - #EthicalConsumer

But People are Wonderful

• Charitable giving reached $410 billion in 2017 in US

(2.1% of GDP)

• In 2014, 5,537 people donated one of their kidneys to

someone in need.

• More than 35,000 in US have donated bone marrow to a

stranger (ij.org)

• 29% of cats and dogs are adopted from

shelters and rescues, 35% of cats are adopted as strays (aspca.org)

March 13, 2019 - #SXSW2019 - #EthicalConsumer

Why the disconnect?

People see themselves as moral and ethical, but their buying habits say otherwise. Research in behavioral economics can help us understand.

March 13, 2019 - #SXSW2019 - #EthicalConsumer

Two behavioral reasons consumers do not reflect their ethics in purchasing:

• 1. Willful ignorance
• 2. Faulty interpretation of attributes

March 13, 2019 - #SXSW2019 - #EthicalConsumer

My Research: Willful ignorance

People often avoid finding out if a product is ethical or not. E.g. If it’s made using child labor or if it has a negative influence on the environment. People will avoid the information even if they would use it if it were available (Ehrich and Irwin, 2005)

March 13, 2019 - #SXSW2019 - #EthicalConsumer

Willful Ignorance

§Willful ignorance is nonsensical in a rational sense. §The marketplace does not always provide information, however, and this nondisclosure does not seem to hurt companies

March 13, 2019 - #SXSW2019 - #EthicalConsumer

Ehrich, Kristine and Julie R. Irwin (2005), “Willful Ignorance: The Avoidance of Ethical Attribute Information,” Journal of Marketing Research, 42 (3): 266-277.

Understanding Willful Ignorance

§ 182 Subjects (Within subjects) § Blank matrix followed by conjoint with full matrix § Shopping for wooden desk and chair set on 4 Attributes

§ Workmanship (designer, medium, low) § Comfort (excellent, medium low) § Type of Wood (tree farm, rainforest, combination farm/rainforest) § Price ($750, $550, $350) § Likelihood of purchase

March 13, 2019 - #SXSW2019 - #EthicalConsumer

§ Dependent Measures: § ‘Request’ & ‘Use’ of Attribute Information

Rank of attribute (higher = used more, requested sooner)

• Comparison of Rainforest Attribute ‘Use’ to ‘Request’

1.2 1.3 1.4 1.5 1.6 1.7 1.8 1.9 Use Request

March 13, 2019 - #SXSW2019 - #EthicalConsumer

0.5 1 1.5 2 2.5 3 Low Importance Medium Importance High Importance Use Request

Importance of Rainforest Wood to the Consumer and Willful Ignorance

March 13, 2019 - #SXSW2019 - #EthicalConsumer

Why Avoid? Avoidance Reduces Anger & Sadness

0.5 1 1.5 2 2.5 3 3.5 4 1 2 3 Predicted Sadness Predicted Anger

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What this means & what we can do

If consumers knew about it, many would use ethical information

• Marketers: Tell people what you are doing right
• Governments: Do not expect people to find out who is doing

something wrong (or right for that matter).

• Consumers: Go find out.
• Make yourself find out.

March 13, 2019 - #SXSW2019 - #EthicalConsumer

Two behavioral reasons consumers do not reflect their ethics in purchasing:

• 1. Willful ignorance
• 2. Faulty interpretation of attributes

March 13, 2019 - #SXSW2019 - #EthicalConsumer

Faulty interpretation of attributes

• Research on implicit attitudes shows that people associate ethicality

with gentleness and lack of ethicality (self-interest) with strength.

March 13, 2019 - #SXSW2019 - #EthicalConsumer

Luchs, Michael, Rebecca Walker Naylor, Julie R. Irwin and Rajagopal Raghunathan (2010), “The Sustainability Liability: Potential Negative Effects of Ethicality on Product Preference,” Journal of Marketing, 74, 18-31.

Faulty interpretation in action

March 13, 2019 - #SXSW2019 - #EthicalConsumer

Ethicality & Functional Performance: Purex versus 7th Generation

People worry ethical means not strong, but…

March 13, 2019 - #SXSW2019 - #EthicalConsumer

What this means

• Sustainable products suffer from ‘Sustainability Liability’. If a product is

sustainable, people think it’s not strong.

• For products people expect to be gentle (e.g. baby shampoo),

sustainable is fine.

• For products expected to be strong (e.g. tires), fix the liability by

reassuring consumers that the product is strong.

• The key is knowing what consumers are worried about…
• Do they think grass-fed beef is less delicious?
• Do they worry that organic perfumes don’t last as long?
• Do they assume sustainable means more expensive?
• If you know what they worry about, you can address their fears.

March 13, 2019 - #SXSW2019 - #EthicalConsumer

Does our social environment help

• r hurt ethical purchasing?

Our propensity to compare ourselves to others affects ethical purchasing, and perhaps not as expected.

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What happens when other consumers seem more ethical than us?

How do willfully ignorant consumers respond after seeing these posts?

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Two possible reactions when a consumer’s willful ignorance is highlighted by others:

• Feel inspired à Moral elevation

(Haidt, 2003)

• When viewing exceptional acts not related

to something you failed to do

• Feel threatened à Denigration

(Fein & Spencer, 1997)

• When viewing relevant acts directly related to

something you failed to do!

March 13, 2019 - #SXSW2019 - #EthicalConsumer

Zane, Daniel M., Julie R. Irwin, and Rebecca Walker Reczek (2016), “Do Less Ethical Consumers Denigrate More Ethical Consumers? The Effect of Willful Ignorance on Judgments of Others,” Journal of Consumer Psychology, 26 (3), 337-349.

Study: Jeans Decision Task

• Four brands of jeans differed on four attributes

1) Style: Boot Cut or Regular Cut 2) Price: $65 or $75 3) Wash: Regular Wash or Dark Wash

• Participants freely chose 2 out of 4 attributes to view
• One of the attributes they did not view was the focal attribute

4) Labor Practices of Manufacturer: Employ Child Labor or No Child Labor 4) Delivery Time: Three Days or Five Days Ethical Attribute Control Attribute

OR

March 13, 2019 - #SXSW2019 - #EthicalConsumer

If you are a more ethical consumer than I am, you are also…

• LESS:
• Fashionable
• Attractive
• Sexy
• etc.
• MORE:
• Odd
• Boring
• Preachy
• etc.
• 2.65

1.28

• 3
• 2
• 1

1 2 3

Willfully ignored ethical attribute Ignored delivery time attribute Positivity Score

Dependent Variable: Positivity Score of Focal Other (Positive traits – Negative traits)

March 13, 2019 - #SXSW2019 - #EthicalConsumer

#SXSW 2019 - #EthicalConsumer

Social comparisons (especially in the online age) make willful ignorance worse

Putting down ethical others is a short-term solution with potentially significant future consequences

Disparaging consumers who consider whether products use recycled materials LESS anger towards underlying ethical issue LOWER Willingness to take eco-friendly pledge

March 13, 2019 - #SXSW2019 - #EthicalConsumer

Might this social comparison issue scale up beyond individual consumers?

• Third-party industry reports implicate several companies at once
• No need for a single company to change if it isn’t less ethical than others
• Implicated companies might find easy ways to distance themselves from firms

not in the report (product quality, price, corporate culture, etc.)

• Advocacy groups might catch flak in part because audiences feel

threatened by their perceived moral superiority

March 13, 2019 - #SXSW2019 - #EthicalConsumer

On Social Comparison

• It’s hard to feel bad, it’s even harder to acknowledge that you’re

feeling bad for deeper-rooted reasons!

• Marketers:
• Stop social comparisons by providing ethical information from the start
• Consumers:
• Don’t make others feel bad about their choices
• Question your own motives when criticizing ethical consumers

March 13, 2019 - #SXSW2019 - #EthicalConsumer

From the ethical trenches

Future depends on changing consumption habits. How do we get over these issues?

March 13, 2019 - #SXSW2019 - #EthicalConsumer

Ideas for marketers

• Consumers do care – they want to do what’s right
• Make people feel good
• Make it clear on the label, but…
• Be authentic & honest – don’t overclaim
• Open the door by figuring out what matters
• Whether we start introducing more sustainable products or not,

we’re all going to have to do better soon.

March 13, 2019 - #SXSW2019 - #EthicalConsumer

Stories from the ethical trenches

March 13, 2019 - #SXSW2019 - #EthicalConsumer

Ideas for everyone

• Think LOFT-y – local, organic or Fairtrade (also

consider Made in USA, Cruelty-free & Recycled)

• Look for 3rd Party Certified
• Work within your means & prioritize – my

pants or chocolate

• Stop a second – do you really need that?
• Advocate – ethical shopping & certification are

limited; hold your government accountable

March 13, 2019 - #SXSW2019 - #EthicalConsumer

Resources

• Green America’s Green Living Guide

www.greenamerica.org/green-living

• Consumer Reports’ Greener Choices www.greenerchoices.org
• International Labor Rights Forum www.laborrights.org
• Fair World Project www.fairworldproject.org
• Fairtrade America www.fairtradeamerica.org
• Fair Trade Campaigns www.fairtradecampaigns.org
• Animal Welfare Institute Guide to Labels

www.awionline.org/content/consumers-guide-food-labels-and- animal-welfare

March 13, 2019 - #SXSW2019 - #EthicalConsumer