One of the most successful cars in the US is the hybrid electric Toyota Prius. On the surface there isn’t much going for it: it has a sluggish engine, small trunk, cloth seats and it’s certainly no looker.
Oh, and it costs thousands of dollars more than a similar car from another manufacturer, such as the Honda Civic.
What it does have is a marketing campaign emphasising its fuel-saving, environmental pedigree. So people buy it to do their bit to save the planet, or at least to save fuel.
Or do they? When Prius owners were asked in a survey why they bought the car, environmental concerns came in at fifth. Fifth?
Top of the list was it, “makes a statement about me.” So the market tells us that people are prepared to pay more for an inferior product in order to display to others their environmental concern. Can this really be true?
A new study by Vladas Griskevicius at the University of Minnesota and colleagues tested this out:
“…a series of experiments showed that activating status motives led people to choose prosocial green products over more luxurious, equally priced non-green products. In line with the predicted reputational benefits of self-sacrifice, status motives increased desire for less-luxurious green products when shopping in public, but not in private. Indeed, when people considered shopping in private, status motives produced a tendency toward self-indulgence rather than self-sacrifice.” (Griskevicius et al., 2010)
People buy a Prius instead of a BMW both because it’s just as expensive (“Hey, I’ve got money!”), and because it’s a mobile billboard for the driver’s environmentalism (“I’m well off, but I’m prepared to make sacrifices, therefore I’m a good person”). This only works because of how people think others will view them. If it was cheaper, Toyota might not have sold 1.6 million of them. Same goes if their owners couldn’t be seen by others driving around in them.
The irony is that environmentalists originally thought that lower prices, tax breaks and messages about being less selfish would encourage people to go green.
They may well do, but what this study suggests is that in some circumstances the exact reverse is required: higher prices and appealing to people’s selfishness by drawing attention to the message their purchases are sending to others.