Eco-Packaging and its Market Performance: UPC-level Sales, Brand Spillover Effects, and Curvilinearity

Abstract

The prior research has partially addressed the full impacts of eco-packaging, mainly focusing on intention or attitude in a limited context. We attempt to investigate the actual consumer behavioral pattern to the eco-packaging appeals with revealed preference data. To test the diverse impacts on various product hierarchies, the sales of frequently purchased product category was applied. The scanner panel data availability in multi-category products enables us to test (1) the eco-packaging appeal impacts on Universal Product Code level sales, (2) the eco-packaging impacts on brand spillover effect, and (3) the linear or non-linear relationship between eco-packaging appeal and sales. Our results show that eco-packaging does contribute to its individual product sales. With regard to the brand spillover effect, our results reveal rather interesting results: brand spillover effect is present when eco-packaging intensity is high in the own product category, but not when the intensity is high in other product categories even if they both carry the same umbrella brand. Lastly, we discover an inverted U-shaped relationship between eco-packaging intensity within a brand and brand-level sales. It implies that adding eco-packaging appeal to products would actually increase the whole brand sales immediately, but after a peak point, the positive association transfer is weakened. Our results highlight that it is necessary to consider that ecologically sound packaging does induce market success.

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