The Impact of Sustainable Advertising and its Relationship to Consumer Brand Loyalty An Empirical Study of Young Adults and their Brand Switching Behaviour on High- and Low Involvement Products BACHELOR DEGREE PROJECT THESIS WITHIN: Business Administration NUMBER OF CREDITS: 15 hp PROGRAMME OF STUDY: Marketing Management AUTHOR: Sandra Eklund Alice Jernberg Andreea-Jessica Roman JÖNKÖPING May 2020 Bachelor Thesis in Business Administration Title: The impact of sustainable advertising and its relationship to consumer brand loyalty: An empirical study on young adults and their brand switching behaviour on high- and low involvement products Authors: Sandra Eklund, Alice Jernberg, Andreea-Jessica Roman Tutor: Lucia Pizzichini Date: 2020-05-18 Key terms: Sustainable Advertisements, Green Advertisements, Consumer Behaviour, Purchase Decisions, Brand Loyalty Abstract Even though the majority of companies have realised the benefits of implementing sustainability practices into their business strategies today, the problem is that the marketing of these activities still has a negative impact on the environment. Therefore, the purpose of this research is to examine if the impact of sustainable advertisements can influence the purchase decisions of young adults who show loyalty to another brand. In order to reach this purpose, qualitative research was conducted using an abductive approach through 23 semi-structured individual interviews with consumers between the ages of 19-30. This enabled us to get an in- depth understanding of their subjective consumption behaviour in comparison to sustainable advertisements. This report draws on existing literature which states that sustainability promotions positively impact the consumer decision process and that consumers’ rarely switch from a brand they are highly loyal to. The results show that sustainable advertisements' impact on young adults is dependent on the product-involvement category. In order for sustainable advertisements to have a chance to generate a switching behaviour among young adults for high-involvement products, the message must provide clear and transparent information regarding the product, because the perception of brands tends to be more valuable. However, this is not as important for low-involvement products since sustainable messages can provoke a switching behaviour based on emotional appeals. Therefore, this research contributes to companies which seek to use sustainable marketing for high- or low-involvement products. i Table of Contents 1 Introduction .......................................................................................... 1 1.1 Background ......................................................................................................... 1 1.2 Sustainability ...................................................................................................... 2 1.3 Brand Loyalty...................................................................................................... 3 1.4 Green Advertisements ......................................................................................... 4 1.5 Problem ............................................................................................................... 4 1.6 Purpose ................................................................................................................ 5 2 Literature Review ................................................................................. 7 2.1 Collection of Data ............................................................................................... 7 2.2 Brand Loyalty...................................................................................................... 7 2.2.1 Influential Characteristics of Brands ........................................................................ 7 2.2.2 Brand Identity ........................................................................................................... 8 2.2.3 Brand Trust and Brand Effect ................................................................................... 9 2.2.4 Impact of Sustainability on Brand Loyalty ............................................................... 9 2.2.5 Characteristics of Technological Brands ................................................................ 10 2.3 Consumer Behaviour ......................................................................................... 10 2.3.1 Purchase Decisions ................................................................................................. 10 2.3.2 Consumer Awareness and Attitude ......................................................................... 11 2.3.3 Environmental Involvement.................................................................................... 11 2.3.4 Price as a Determining Factor ................................................................................. 12 2.3.5 Delivering Methods and their Impact on Consumer Decisions .............................. 13 2.3.6 Ethical Intention-behaviour Gap ............................................................................. 13 2.3.7 Consumer Behaviour within Technological Fields ................................................. 14 2.4 Green Advertising ............................................................................................. 14 2.4.1 Consumer Responses to Green Advertisements ..................................................... 14 2.4.2 Message Appeals .................................................................................................... 14 2.4.3 Perceived Benefit .................................................................................................... 15 2.4.4 Consumers' Sustainability Involvement .................................................................. 16 2.4.5 The Effect of Green Messages on Brand Loyalty ................................................... 16 2.5 Sustainability ..................................................................................................... 17 2.5.1 Sustainable Development........................................................................................ 17 2.5.2 Transparency of Sustainability ............................................................................... 18 2.5.3 Sustainable Technology .......................................................................................... 19 3 Methodology ........................................................................................ 20 3.1 Method .............................................................................................................. 20 3.2 Ethical Considerations ...................................................................................... 22 3.3 Data Collection.................................................................................................. 23 3.4 Data Analysis .................................................................................................... 24 3.5 The Interview Format ........................................................................................ 25 4 Empirical Findings ............................................................................. 27 4.1 Soda Brand ........................................................................................................ 27 4.2 Smartphone Brands ........................................................................................... 29 4.3 Consumer Behaviour ......................................................................................... 30 5 Analysis ................................................................................................ 31 5.1 Impact of Sustainability .................................................................................... 31 5.1.1 Sustainability Involvement ..................................................................................... 31 5.1.2 Sustainable Advertisements .................................................................................... 32 5.1.3 Sustainability Awareness ........................................................................................ 34 5.2 Influencing Factors of Advertisements ............................................................. 35 5.2.1 Level of Product Involvement ................................................................................ 35 ii 5.2.2 Message Appeals .................................................................................................... 37 5.2.3 Advertising Integrity ............................................................................................... 38 5.3 Brand Loyalty.................................................................................................... 39 5.3.1 Level of Loyalty ...................................................................................................... 39 5.3.2 Recommendations ................................................................................................... 40 5.3.3 Brand Trust ............................................................................................................. 41 5.3.4 Brand Awareness .................................................................................................... 42 6 Conclusion ........................................................................................... 44 7 Discussion ............................................................................................ 46 7.1 Contributions ....................................................................................................