Exploring the Effect of Ethical Concerns on Consumer Buying Behaviour

This literature review examines the effect of ethical concerns on consumer buying behavior, drawing from various secondary data sources and theoretical frameworks. It begins by providing an overview of ethical concerns related to consumer buying behavior, highlighting the importance of ethical conduct by organizations and the rise of ethical consumerism. The review then delves into theoretical understandings of consumer buying behavior, including the Howard-Sheth Model and the Black Box model, emphasizing the psychological, social, and marketing influences on consumer choices. The concept of ethical consumerism is explored, noting the increasing awareness of consumers regarding ethical sourcing and production. The review also touches upon different ethical approaches and the stages of consumer decision-making, as well as factors influencing buying behavior. It concludes by discussing the gap in the literature and summarizing the key findings, emphasizing the need for businesses to respond to ethical consumerism by focusing on transparency, fair labor practices, and sustainability. This document is available on Desklib, a platform offering study tools and resources for students.

Running head: LITERATURE REVIEW
Literature Review
Topic: Exploring the effect of ethical concerns on consumer’s buying behaviour
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Table of Contents
Introduction......................................................................................................................................2
Overview of ethical concerns about consumer buying behaviour...................................................2
Theoretical understanding of consumer buying behaviour.............................................................4
Concept of ethical consumerism......................................................................................................7
Five ethical approaches....................................................................................................................9
Five stages of Consumer Decision-Making...................................................................................10
Factors influencing buying behaviour...........................................................................................11
Effect of ethical concerns on consumer buying behaviour............................................................13
Gap in literature.............................................................................................................................14
Summary........................................................................................................................................15
Reference List................................................................................................................................16

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Introduction
Ethics are principles of right behaviour which direct the decisions along with activities of
a person. The society has a general set of standards and the society expects that each of the
members must adhere to ethnic morals and norms of the society. The organisations need to study
and satisfy the ethical concerns of society and the organisations also avoid developing the
advertisements and products which may lead to undesirable consumer behaviour. In marketing,
ethical consumerism is a consumer activism which based on consumer choice. Positivism buying
of the consumers refers to the ethical products and negative purchasing is associated with moral-
boycotting along with company-based purchasing. The organisations always do marketing to
convince the consumers to choose their products and it is up to the consumer which products
they would purchase from. In this literature review, mostly secondary data sources are gathered
to analyse the scholars’ perspectives on ethical consumerism and consumers’ buying behaviour.
Theoretical frameworks are used to underpin the literary concept of consumer behaviour and
industry examples are used to show the practicality of consumer behaviour.
Overview of ethical concerns about consumer buying behaviour
Ethical behaviour of the organisations refers to morally and ethically correct conduct of
the management according to the society. Ethical behaviour is correct in the eyes of law and
ethical behaviour is also based on the interests of the people which may lead to the welfare of
society. As stated by Lin et al. (2014), radical changes of economic, technological, political and
legal and cultural factors lead to bring significant changes in the consumer behaviour. Marketing
is still in need to adapt to the changes, both in terms of the application of the techniques and
methods. According to Pappas (2016), marketing is solely a business concept and the aim of the

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marketers to reach consumers with their products. The authors further stated that the major role
of the marketers to use the distribution channel to reach the customers with promotions. On the
other side, as argued by Sharma (2014), the application of the marketing techniques and
functions in both social and economic process bring value to the customers. Value of the
marketing is not just limited to the money as the organisations must be aware of the promotions
and goods and services related to this. Marketing in today is not just the exchanging of the ideas
and products which are motivated only by profitability. Different values are transferred from
organisations to the different parties with the aiming of satisfying the economic goals, wants and
needs of the organisations as well.
Horner and Swarbroke (2016) believed that consumerism triumphed in the battle of
ideology in the 20th Century which represents the rudimentary characteristics of modern nations
and society. Today, consumerism is the social movement which finds the ways to enhance the
power and rights of the consumers than the sellers and manufacturers. The consumers are aware
of the marketing ethics which are related to the moral assessment of individual marketing related
behaviour. In the article named Ethical Consumer Behaviour in Marketing, authors Ruzica
Kovac and others stated that corporate marketing behaviour is associated with consumer
behaviour as each of the organisations has its consumers or vice versa. The consumers search for
the background information and CSR activities of the organisation prior to making the purchase
from the organisations as today's customers are getting informed through the internet. The
consumer behaviour is surpassing just the cultural aspect and it has become more
multidisciplinary as it could be understood and influenced by the Theory of Planned Behaviour
Model. As opined by Montano and Kasprzyk (2015), Theory of Planned Behaviour stated hat
purchase intentions of the consumers are directly generated and motivated by their own set of

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value systems, interpersonal ethics, moral norms and interpersonal ethics. Therefore, actual
consumer behaviour of the buyers has not been charged with the same intensity of the intended
behaviour. The consumers today do not get motivated to purchase the products just by observing
the promotions. Consumers check their personal interests and calculated benefits before taking a
decision on purchasing of the products. The consumers face the dilemma of ‘prudence vs.
morality’ as the consumers now distinguish an action as ethical (Kovac-Znidersic et al. 2013).
The authors stated further that ethical consumer behaviour is associated with decision-making
and purchases as the consumption experience of the customers are affected by ethical concerns.
In the article named The Effect of Business Ethics on Buying Behaviour, by Emmi Seppanen,
the authors stated that before freely purchasing of the products, the consumers are concerned
about some of the ethical issues like human rights, well being of people, labour conditions and
environment.
Theoretical understanding of consumer buying behaviour
Howard-Sheth Model
Howard Sheth Model is a combination of psychological, social and marketing influences
on choices of the consumers into coherence sequence of the process of information. Howard
Sheth Model explains consumer behaviour on the perspective of cognitive function and it
provides an empirical depiction for outcomes of consumer behaviour (Bellini et al. 2017).
Howard-Sheth Model suggests three levels of consumers' decision-making. The first-level of
decision-making of the consumers describes extensive problem-solving. In this level, the
consumers search for information on different brands before making a purchase in the market.
The second level of consumer behaviour is limited problem solving and the consumers arrive at

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the brand preference after seeking some comparative brand information. The third level of
decision-making is about habitual response behaviour and the consumers know well about the
different brands. In this level, the consumers differentiate the characteristics of each product and
the consumers decide about purchasing the particular products they seek.
Howard Sheth Model describes four sets of variables. Input is the first variable and the
input provides three different types of stimuli in the consumers' environment. Physical brand
characteristic is the significative stimuli and verbal and visual brand characteristic is the
symbolic stimuli. Consumer's social environment provides the third type of stimuli from a
reference group, family and social class. Perceptual and Learning Constructs is the second
variable which is involved in consumers' contemplating decision. Perceptual bias can happen if
consumers distort the information which has been received from the past experience. Learning
constructs are the consumers' goals, criteria for evaluation alternatives, information of the brands
and buying intention. The output is the third variable and it comes from the learning and
perceptual variables (Mihaela 2015). This variable is associated with the attention, attitudes,
intention and brand comprehension. The fourth variable is external variable is associated with the
decision-making process and it includes the importance of consumer personality traits, the
importance of purchase, time pressure and religion.
It can be deduced that strength of Howard Sheth Model lies on four different types of
variables which are linked in working relationship to cover major aspects of purchase decision
along with effective utilisation of contribution from behavioural characteristics.
Black Box model of consumer behaviour

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The Black Box model of consumer behaviour recognises the stimuli responsible for buyer
behaviour of the customers. The stimuli may come from the promotions and advertisements of
the product which is presented to the customers by the marketers. The environment is also dealt
with the consumers’ black box. As stated by Zavyalova et al. (2018), the buyer's black box
comprises two different subcomponents; buyer decision process and buyer's characteristics. The
author further clarified that black box theory is about mental consciousness and it states that the
mind is full of outputs and inputs which are well defined. The environment factors of consumer
buying behaviour are associated with marketing stimuli which may come from product, place,
price and promotion. Environment factors of consumer buying behaviour are associated with the
demographic, socio-cultural, technological and political. Buyer responses are associated with the
buying attitudes and preferences along with purchase behaviour. Purchase behaviour of the
customers depends on what, where, when and how much the customers buy. In addition, brand
and company relationship behaviour is another factor which provides stimuli to customers. As
opined by Pasquale (2015), consumer buying behaviour is affected by personal, social and
cultural and psychological characteristics and the organisations must be aware of the fact to
design the offerings.
Cultural factors of consumer buying behaviour are related to the culture, subculture and
social class of the customers. Social factors of buying behaviour are associated with the family
and friends’ references, roles and status of the customers along with reference group. Personal
factors of the customers in consumer buying behaviour are related to the age and lifecycle stage,
economic situation, occupation of the consumers, lifestyle and personality of the consumers.
According to Zavyalova et al. (2018), psychological factors of consumer buying behaviour are

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related to motivation, perception, learning and beliefs and attitude. Therefore, it can be deduced
that these factors lead to the transformation of the stimulus into specific responses.
Figure 1: Black-box model of consumer behaviour
(Source: Zavyalova et al. 2018)
Concept of ethical consumerism
Ethically consumerism refers that customers must choose to purchase the products which
are ethically sourced (Burgoon and Fransen 2017). Ethical consumers purchase the products
which are ethically produced without harming the society and environment. Examples of ethical
consumerism can be buying free-range eggs or to boycott the products which are produced
through child labour. Some of the ethical products include fair trade goods, organic produce,
electricity renewable energy, energy-efficient light and recycled paper. The customers seek
information about the products or service before they purchase and Ethical Consumer Research

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Association publish the details in their magazine. Ethical consumerism is associated with seeking
information about the products and involves watching how the food is being prepared, how much
energy is used. Ethical consumers are inspired to purchase the products which may be produced
locally as ethical consumption is a powerful tool to bring change. Khan et al. (2016) published
the research where they showed that a third of the UK consumers believe in ethical consumption
and only 4% of the UK market is devoted to producing ethical goods and service. The customers
in recent time are aware of the different products and they search for their manufacturing and
packaging process through the internet. Today, the marketers share videos about the
manufacturing process and they publish the reports about the organisation's CSR activities so
that the customers can learn how much ethical the organisation's business process is. As argued
by Summers (2016), the whole point of ethical consumerism is that the customers ‘know’ what
they are purchasing and the customers must buy the products which are produced ethically. For
example, the clothing industry is observing pressure for high-quality products which are
produced in a way which supports human rights properly in Australia.
Ethical consumers observe many elements before purchasing the products and services
and the businesses need to respond on certain things which are more important today than just
good product or lower prices. The organisations need to look on the natural and pure ingredients,
clear information about nutrition, ethical sourcing, transparency, fair labour, honouring human
labour and fair labour, protecting the human right, sustainability and ethical marketing (Hassan
et al. 2016). Today's business needs to examine how they are evolving and meeting the
expectations of the customers and the organisations need to simultaneously respond ethical
consumerism. The customers can focus on ethical marketing and advertising and the
organisations focus on ‘giving back to the community and society’ campaign. For example,

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Apple Inc. solved the issue of workers' rights in suppliers' factories. In the year 2014, Apple Inc.
found the solution for China Labour Watch which was getting very serious for safety, human
rights and environment. Apple Inc. got a lower rating form Ethical Consumerism because Apple
impacted the environment through creating conflict by using harmful minerals and they
performed low in quantified targeted for the environmental performance.
Five ethical approaches
The first ethical approach is fair-trade as organisations take this approach to highlight the
proposals of the firm aspiring to support the local communities (Culiberg 2014). The aim of the
organisations is to improve the livelihood of marginalised and poor people in the developing
countries and fair-trade aspires to empower manufacturers and encourage forming
democratically to run the co-operation.
The second ethical approach is boycott as the customers will not purchase from any
organisations or brands if the organisations or brands are not doing the business ethically. As
pointed out by Ferrell and Fraedrich (2015), if enough companies and consumers can boycott
certain products or company; they have to change their marketing and product formulae. For
example, Nestle has been faced the issue when Indian customers stopped purchasing Nestle
Noodles due to excessive containing of unhealthy spices. The third ethical approach is selective
shopping when the customers must choose a certain brand and the customers can choose some of
the high street brands. In selective shopping, the customers can just shop from the brands they
think are correct and use the ethical process to manufacture the products. Selective shopping can
bring bigger change by confronting manager rather than avoiding the brand (Wood et al. 2015).
The fourth ethical approach is buying less as it is a way to save the planet. Buying less campaign

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shows the support to the ethical brands and the Western Countries has been showing much
concern on ethical consumerism. In Western Countries, consumption habit of the consumers is
unsustainable and it is the right way to support the buying-less campaign. The fifth ethical
approach is to buy from the local as these types of products are thought to be the core principle
of ethical shopping. Local food is eco-friendly and it is better than buying globally as less
transport fuel is spent if the people buy local. Local food is fresh and it supports the food
industry (Khare 2015).
Five stages of Consumer Decision-Making
Marketers' goal is to understand what is going on inside the mind and head of the
customers and the decision of making purchases have five different stages.
Problem recognition is the first stage when the customers develop the need that they want
to be satisfied. The consumers must feel like missing something and they need those things to
feel normal.
Searching for information is the second stage when the customers search for information
about different products which can satisfy the needs. The customers take help of the Search
Engine as it is the easy way to find the products they are looking for. The customers can search
for the information about the products from reference group also (Ryoo and Drumwright 2017).
Evaluating alternative is the third stage when the customers evaluate and find satisfaction
level from the best deals they get. This evaluation can be based on the price, quality and
reference. Customers read reviews and the customers compare the price and they choose
ultimately the one product or service which satisfies all the parameters of the customers.

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Selection stage is the decision of making a purchase of the product and the customers
take the risk to purchase the selected product. The customers may have prior experience or the
customers may succumb into the promotions of the product to give the product a try (Badgaiyan
and Verma 2015).
The final stage is the evaluation of alternative as it is associated with the post-purchase
decision of the customers. The customers judge the product based on their expectation and this
evaluation can make the customers a repeat-purchasers or just one-time customers. If the
customers like the product or service, the customers will definitely recommend the product to
near and dear ones. This evaluation of alternative improves the brand image of the organisation.
Figure 2: Five-stages of consumer decision-making process
(Source: Jin and Kim 2015)