Eco-Labels, Green washing, and Consumer Trust: A Critical Study of Sustainable Marketing Practices

Abstract

The concept of sustainable marketing has gained significant impetus over the past few decades as the issue of environment is becoming the major factor of consumer behavior and business strategy. This paper is a critical analysis of the interaction between eco-labels, the greenwashing activities and the consumer trust in the modern sustainable market. Based on Signaling Theory, Consumer Trust Theory, and the Theory of Planned Behavior (TPB), the study builds a conceptualized framework where eco-label awareness will be viewed as an independent variable, perceived green washing as a negative moderator, and consumer trust and purchase intention as dependent results. The study employs Cronbachs Alpha reliability test, Pearson correlation, multiple regression, and moderation analysis as its methodology through the use of a quantitative survey based approach with 250 purposely sampled respondents with awareness of sustainable products. The results show that consumer trust (β = 0.612, p < 0.001) and purchase intention (β = 0.574, p < 0.001) increase significantly and positively under the influence of eco-label awareness. Importantly, the perceived greenwashing has a strong negative moderating influence in eco-label trust relationship (β = -0.341, p < 0.001), which invalidates the credibility of an eco-label as intended. These findings have significant implications on the brand managers, regulatory and consumer advocacy groups. The research paper adds to the advanced literature on ESG by shedding light on the presence of conditions in which eco-labels can be used to successfully create a trustful relationship, and the absence of transparency and third-party confirmation as the elements of the ethical marketing approach towards sustainability.