Should We Continue to Sell Green Products? A Case Study of Willingness to Pay More for Green Furniture Products

Management Department, BINUS Business School Undergraduate Program, Bina Nusantara University, Jakarta, Indonesia 11480

^* Corresponding author: hardijanto.saroso@binus.edu

Abstract

The growing global demand for environmentally friendly products necessitates an in-depth examination of the factors influencing consumers’ willingness to pay a premium. This study focuses on the furniture industry and aims to identify the key determinants that shape consumers’ willingness to pay more for environmentally friendly furniture. Data were collected from 153 Indonesian consumers interested in purchasing household furniture products. Structural Equation Modeling (SEM) analysis, utilizing smartPLS software, was employed to analyze the data and derive insights. The findings revealed that the perceived value of green products and individuals’ green attitudes significantly and positively influenced the desire to pay more for environmentally friendly furniture. Conversely, the green marketing mix did not significantly impact consumers’ willingness to pay more for such products. These results highlight the importance of communication, outreach, public policy, and education in shaping the nation and state’s positive perception and attitude towards green products. The implications of these findings are discussed in the context of promoting sustainable consumption practices and fostering a greener economy.