Full Program »
The influence of product lifetime labelling on purchase decisions
The lifetime of products has hardly improved over time, despite its considerable potential in limiting resource depletion, emissions of pollutants and residual waste. The introduction of a product lifetime label is therefore increasingly discussed by policymakers. The underlying assumption is that such a label could activate hidden consumer preferences for product longevity by directly communicating expected product lifetimes. Consequently, a demand shift towards longer lasting products could be initiated. So far, it has been difficult for consumers to evaluate a product’s functional durability because of which consumer tend to consider rather insufficient quality signals such as price or brand. Previous studies have, thus, called for future research on the impact of enhanced product lifetime information. However, behavioural insights about the influence of product lifetime labelling on consumers’ purchase decisions are still lacking behind. This study addresses the research gap by measuring consumers’ reactions towards the introduction of a product lifetime label. The main research questions are ‘How are consumer preferences for a product lifetime label shaped?’ and ‘How does the introduction of the product lifetime label affect consumer preferences for other product attributes?’ The conceptual framework of this study is based on the well-established consumer theory of Lancaster which claims that consumer preferences are not directed to the goods themselves but to their attributes. The economic model is tested by using choice-based conjoint analysis – a highly effective multivariate method for measuring consumer preferences for specific product attributes (here: product lifetime label, price, brand, equipment and energy efficiency). Compared to traditional conjoint analyses, choice-based conjoint analysis constitutes a more complex but also a more realistic approach. By means of an experimental online survey, discrete choice experiments for washing machines were administered to a large population-representative sample of German consumers. The study design has been improved based on the insights of a pilot study which was conducted in 2018. The questionnaire of the main study was extended by a second experimental phase which enables the comparison between the market situation without a label (status quo) and the hypothetical market situation after the label has been introduced. Preliminary findings indicate that the product lifetime label strongly influences purchase decisions. Consumers tend to prefer washing machines labelled with above average product lifetimes and, thus, be willing to pay more for longer lasting appliances. At the same time, former highly influential product attributes such as brand and price seem to lose much of their importance. Furthermore, compared to a large amount of the previous research emphasising consumer preferences for energy efficiency of large household appliances, this study indicated that – compared to product lifetime – energy efficiency plays just a minor role for consumers. Based on additional psychological, behavioural and socio-demographic questions, preferences for product longevity are examined in more detail. Consumers who are willing to buy longer lasting appliances can therefore be identified and characterized. Consequently, marketers and politicians can learn from the study how a product lifetime label could affect existing consumer preferences and whether it could trigger demand for longer lasting products.