eLearning Sessions

After completing this chapter, you should be able to:

1. Understand that disposition is a growing industry that provides many marketing opportunities.
2. Recognize that product disposition is an increasingly important area for public policy.
3. Discuss some of the practical implications that disposition has for managers.
4. Explain the difference between voluntary and involuntary disposition.
5. Describe the social, individual and situational factors that affect disposition choice.
6. Realize how understanding disposition provides key insights into consumption behavior.

1. Disposition and the Wheel of Consumption
• What do consumers or organizations do with products that have outlived their value? This question provides a basis for developing the main ideas in this chapter. Disposal encompasses all those behaviors that consuming units undertake to divest themselves of undesired goods and services.
• Disposition is an inevitable part of the wheel of consumption and there are a variety of markets and professions devoted to managing disposition, including auction houses, demolition specialists, flea markets, and mortuaries.
• Why be interested in the general question of consumer disposition? There are several reasons. Foremost is the fact that disposition is a growth industry providing many marketing opportunities in areas ranging from "green" product design, to solid-waste management, to developing secondary markets for previously owned or leased goods. Green products are hot in many significant global markets.
• A second reason to be interested in disposition is the fact tht product disposition is an important area for policy activity. In the Triad, both the European Community and the United States have important environmental watchdog agencies that monitor and pinpoint sources of pollution. In addition, industrial and consumer product omissions, both during manufacture and use, are subject to government regulation in the developed world. For example, six European nations in the Rhine river area basin recently signed a convention banning boats from dumping any waste into the Rhine, and requiring them to pay a tax on fuel in return for free access to waste disposal stations established along the river. International Standards Organizations(ISO) 14000 environmental quality standards focus attention on the environmental effects of a product's life cycle. Like the ISO 9000 Quality Standards, these environmental standards are likely to become an important mechanism for encouraging industry self-regulation.
• Enormous public policy problems surface over such questions as: "What qualifies as 'organic' food?""Who bears responsibility for radioactive wastes?" and "What should be done about hazardous wastes?" For example, an ongoing dispute rages over the Black Triangle region on the common borders between Poland, Germany, and the Czech Republic where power-plant waste seriously polluted the environment. The only area of agreement is that most people do not want the waste products deposited anywhere close to where they live. Similar disputes have flared between some Native American tribes and their off-reservations neighbors. Some tribes want to establish solid-waste dumps on their impoverished reservations as a way to bring in desperately needed revenues. At the same time, they face strong opposition from their neighbors.
• A third reason to be interested in disposition is that it has practical implications for managers. Disposition is linked to acquisition and consumption. As a result, many opportunities for resolving consumer needs can be found at the intersection of these different phases of the wheel of consumption. Interest in environmentally responsible consumption is growing both among individual and institutional consumers. Business opportunities for backward channel members -- that is, those who link consumers back to producers -- show signs of continued development. Some channel members serve as materials brokers for discarded products; others provide centralized processing facilities.
• A fourth reason to be interested in disposition is that it provides insight into consumption behaviors. For example, while it might be unpleasant to analyze the contents of people's garbage, such an analysis can furnish valuable information about the product preferences, repeat purchase behavior, and brand loyalty. Garbage can tell us about products purchased and discarded but not consumed, and about actual as opposed to claimed, recycling behaviors.
• Three possible disposition tactics are prominent: storing or keeping the product; disposing of it temporarily; or disposing of it permanently. In this chapter, we focus primarily on the disposing and recycling disposition behaviors.
• A fourth general tactic, which we can credit to the modern environmental movement, can be added to our list. The "green" approach seeks to minimize the problem of disposition. Planned re-use and recycling of materials reduces discarded waste. Another "green" approach for minimizing the waste generated by consumption is through deconsumption, that is, consuming less. One pioneering study found that consumers in Los Angeles were willing to pay more for gasoline that was advertised as producing dramatically less air pollution. They preferred it, even in the face of a price war initiated by competing companies. In some instances, consumers may decide voluntarily to de-consume without a lot of stimulation.
• A U.S. catalog company called Real Goods offers a portfolio of long-lasting, energy-efficient light bulbs that decrease consumption both of energy and bulbs.

www.realgoods.com

• In a recent example of waste-minimizing practice, Volvo, the Swedish automaker (now part of Ford) decided to use water-based paints as an alternative to pre-painting its products with chemical solvents. These solvents emitted volatile organic compounds (VOCs) into the environment. De-consumption occurred as a side effect of the new process. It eliminated the need for expensive air-pollution control equipment. Volvo could then market its products as "greener" than those of its competitors. As shown in Good Practice 19.2, this deconsumption trend also affects the global packaging industry.

Wrapping the Globe (50.0K)

• Disposition is not so much an event as a process. This is an important distinction for a number of reasons. For groups and individuals alike, physical and emotional disposition processes often take place in stages. For disposition to lead to new production, as in recycling, marketers and governments are often faced with the problem of creating and managing what we can call a backward channel distribution. Such channels move goods in the opposite direction from traditional channels that move goods from producers to consumers.
2. Historical and Cross-Cultural Perspectives on Disposition
• Disposition issues have been with us since human beings began settling in villages, towns, and cities. From pre-historic times to as late as the periods of Classic civilization in both the new and old worlds, garbage was often left where it lay in human dwellings with layers of new flooring occasionally laid over the waste. Or, it was simply dumped out of doors and windows to settle where it might. In ancient Greece and Rome, garbage was thrown into the streets as well into the rivers flowing through the towns. The Maya of ancient Middle America used household refuse as fill in the construction of major civil and religious buildings.
• Historically and cross-culturally, there are many examples of disposition-related behaviors. The archaeological record is crowded with artifacts that display the results of recycling behavior. In ancient times, pottery was the equivalent of our containers made of glass or plastic. It was extensively recycled. Broken pottery, in the form of shards, was frequently ground and used as temper in the manufacture of new batches of pottery.
• Disposition has been a particular problem in the world's cities. In the late middle ages in Europe, the failure to deal with urban solid-waste disposal led to the Black Plague that killed a quarter of the population. Spas and summer resorts got their start in part because the wealthy wanted to escape the urban stench and fear of disease provoked by inadequate garbage recovery. While Ben Franklin was the first U.S. state to call for solid-waste disposal ordinances, it wasn't until the nineteenth century that organized waste disposal became routine in the U.S.
• Scavenging and recycling regimes in many Third World countries differ little save for the matter of scale, from those employed in the past. As in Ho Chi Minh City, Cairo, or Manila, some seventeen thousand garbage-pickers or pepenadores in Mexico City make their living from the city's refuse. They systematically pick through the garbage delivered to the capital's sprawling dumps, looking to reclaim cans, bottles, cardboard, scrap metal, broken appliances, paper, plastic, sheeting, and meat bones (these last destined for the manufacturer of bouillon cubes and glue). The pepenadores are tightly organized by a network of caciques or headmen, and are politically powerful. The pepenadore system is driven by money, by increments of marginal advantage. This is apparent is the pepenadores' pyramidal pecking order, which reserves to certain classes of garbage workers the scavenging rights to Mexico City's wealthier neighborhoods.
• This type of economy was a reality for a large number of people in the United States as recently as the turn of the century. Boston's elegant Back Bay neighborhood, once a tidal marsh, owes its existence not only to ample loads of gravel and other kinds of fill but also to the copious amounts of garbage that Bostonians dumped into the site.

• Disposition really consists of two inter-related components. First, there is a physical or spatial detachment from a possession object. Second, there is a detachment from the meanings and emotions associated with objects. We may have nostalgic longings for lost, destroyed, stolen, or abandoned possessions indicating our lack of detachment from the emotions and meanings associated with the absent item. A recent New York auction of Jackie Kennedy Onassis's belongings shows how physical detachment of the things of Ms. Kennedy is not at all the same as the detachment of the meanings. Many people bought items at the auction in order to obtain meanings associated with the American "Camelot" presidency of the early 1960's. In this way, disposition may be triggered by affective, hedonic, or situational concerns.

1. A Model of Disposition
• At the household or firm level, we can diagram the physical disposition process. See Exhibit 19.1 for a schematic drawing of the model of disposition. The physical disposition cycle starts when raw materials enter the manufacture process and then are distributed to households (or firms) that acquire, use, and dispose of them. After usage, some used up products or their residuals are returned to the environment directly in the form of litter or waste. Alternatively, they may be returned indirectly after collection as garbage and landfill or treatment (adding rubber-tire cinder to road bedding). Households can also dispose of products in ways that result in re-use of various kinds.

Model of Disposition (50.0K)

Simple re-use

• Simple re-use occurs when a product is re-sued by the consumer for its original purpose or for a different purposes. Empty jars are used for storage. Newspapers line litter pans and shelves or are used to light fires. Leftovers are fed to pets. Antique furniture may be recovered or refinished after it passes from one household to another.

Second hand re-use

• Second hand re-use of products takes place when a product is given away as a gift or through inheritance to friends, family, or even strangers or sold to another household or traded for another product. This kind of transaction is called lateral recycling. Most of us are probably familiar with boot sales and swap meets, super market bulletin boards, Internet auction sites, and newspaper-classified sections. Inter-household networks for hand-me-down baby clothing provide an interesting example of second hand re-use. Inheritance networks generally provide another example of second-hand reuse. In industrial markets, some firms enter into agreements with producers to have them re-manufacture the firm's used machine tools for re-sale back to the firm.

Second-hand trade

• Second-hand trade takes place when the ownership for the used products is first transferred to an intermediary before distribution to new users. The second-hand trade in the Less Affluent World is an important growth industry due to trade liberalization and persistent poverty. Many charitable organizations also conduct drives to collect household goods for redistribution to the needy. In this disposition process, no sale links the charitable organization to the donor. A firm called Hanna Anderson that manufactures children's clothing offers to buy it back for redistribution to needy children. In 16 years, the firm donated 16 million garments. A U.S. organization called Second Harvest collects left-over food from restaurants for redistribution to over 200 food banks. Used auto parts firms are another example of second-hand trade.

www.secondharvest.org

• In each of the first three disposition chains, products usually retain their original form and function. Thus, deposit return bottles may be re-filled with similar liquid contents for re-sale after cleaning. The 1930's and 1940's were the heyday of the returnable soft-drink bottle in the U.S. Both retailers and consumers began to reject this system because of the inconvenience of returning bottles and the practice declined in the U.S., except in a few states (e.g., New York, Michigan) where it is required by law.
• Some products may acquire additional meanings or value by virtue of their product biography - the history of their movement in and out of markets and from one consumer to another.Women often receive jewelry, china, silver plate, linens, or other consumer goods from their female "ancestors." The sentimental value acquired often "singularizes" the objects, rendering them irreplaceable in their owners' minds.

Resource Recovery

• In a fourth disposition chain, resource recovery, the product ingredients are broken down and used to manufacture new products. Resource recovery, what many think of as "recycling," takes place when the product or its parts are used as a secondary resource in the production of new products. Glass bottles or aluminum cans may be melted down and re-manufactured. Gypsum board can be ground up for use in agriculture. Plastic bottles may be melted down and spun into fiber for clothing. In many cities, non-hazardous waste such as yard clippings and sweepings or sewage sludge are composted and reused in gardens, farms, or yards. In the recycling business, governments have become involved in creating markets. For instance, some U.S. State governments have become involved in creating markets. As an example, some U.S. state governments work to link woody materials generators, processors, and end users together in order to create new markets for construction materials, animal bedding, and landscaping materials, similarly, the U.K. set a target of 40% waste content in newsprint for the year 2000, and helped set up a new plant to recycle newsprint and established a vigorous public relations campaign to encourage recycling.

Special Treatment

• Special treatment of hazardous waste it often required, for example, by incinerating it under controlled conditions and landfilling the cinder. Household composting is a simple example of a home treatment process that has become a significant activity in both the developed and developing worlds.
• In the disposition process, supply and demand is reversed. Consumers produce various kinds of waste products and producers consume these secondary resources.
2. Voluntary and Involuntary Disposition
• There is an important distinction between voluntary and involuntary disposition behaviors. We describe both methods and give examples of voluntary and involuntary disposition behaviors in Exhibits 19.2 and 19.3.

A Taxonomy of Voluntary Disposition Behaviors (50.0K)

A Taxonomy of Involuntary Disposition Behaviors (50.0K)

• People make considered decisions about disposition much in the way the theories of consumer decision making discussed in Chapter 10 describe acquisition behaviors. Thus, when the value derived from a good begins to lag behind the costs of having it around, consumers dispose of it in one way or another. Of course, the disposition process does not always have to be so rational and considered. Feelings and emotions play a strong role in disposal. Just as there are impulse purchases, there are also impulse disposals (see Consumer Chronicles 19.1).

The Old Man and His Garage (50.0K)

• In contrast to the highly deliberate forms of disposition discussed in the North American context where it is a means to achieve other ends, voluntary disposition is part of the taken-for-granted terminal systems in some cultures.
• Most likely, you can think of involuntary acquisition behaviors such as inappropriate birthday or wedding gifts you have received. Similarly, you can imagine involuntary disposition behaviors. Losing a wedding ring down a grain, getting burgled, poverty or illness compelling us to sell favored possessions; or giving up household goods in a divorce are all examples. Of course, death is the ultimate source of involuntary disposition since "you can't take it with you."
• Involuntary loss of possessions is relatively common. Divorce touches almost half of all marriages in the U.S. and is frequent in most European and African countries as well. Loss of property is commonplace for both parties to a divorce, but women suffer the most loss of property.
• A study of 16 countries found that over four percent of the citizenry became victims of one form of theft, burglary, or attempted burglary. Reactions to the loss of property accompanying burglary are relatively strong. The most intense and long-lasting reactions to burglary are found among women, the elderly, singles, and the poor. Interestingly, children's reactions to theft become increasingly harsh with age, as possessions become progressively more a part of self-concept and perceived self-efficacy. Two characteristics of the experience may account for the special severity of adult emotional responses to burglary. The whole of the personal possessions of the victims has been attacked. Thus, consistent with the notion of the extended self discussed in Chapter 7, meanings of intense personal importance congealed in one's possessions are attacked and compromised in a burglary.

• In this section of the chapter we specifically discuss discarding, selling, donation, gift giving, storing, and recycling.

1. Discard It
• When we think about disposition, probably the first possibility that comes to mind is simply throwing something away. The U.S. has been accused of being a waste-maker society, one in which people's first thought is to discard rather than reuse or recycle unwanted possessions. Indeed, Americans throw away a lot of trash, almost two kilograms a day. There are patterns to our waste making. For example, American families discard approximately 15 % of the food they buy and approximately 1%, of their garbage is composed of hazardous waste (or about 12 ounces a year). But, as we have already suggested, not everything gets tossed.
• In the U.S., consumers discard about 12 billion tons of material each year, of which about 209 million metric tons is the solid waste that comes from households and institutions, small businesses, towns and municipalities. The average per capita amount of waste produced by Americans, 1.5 to 1.9 pounds per day, has not changed much in the past 100 years.
• The more diversity and novelty there is in consumption patterns, the more people throw away as waste. Richer countries discard more than poorer ones. Consider the thousands of new consumer products that are introduced each year in North America, most of which fail in the marketplace. Thus, marketers who thrive on providing consumers with novel and diverse product offerings contribute to the discard phenomenon.
2. Sell It
• Flea markets, swap meets, garage, barn, and jumble sales (U.K.), 'antique' dealerships, and acres of second-hand car lots are as characteristic of contemporary consumer society as the shopping mall. Together, they represent a major type of household disposition behavior, selling. At swap meets, consumers get together in informal markets to buy or trade their used goods. Such selling is a key way people get rid of unwanted possessions. Selling is often occasioned by changes in family life cycle stage, geographic movements, and role transitions such as divorces. Flea markets and garage and yard sales are a primary vehicle for second-hand re-use or lateral recyclingfrom household to household. In lateral recycling, the use and form of used merchandise remains constant while the user changes. Under traditional recycling, form, use and users all change. A dramatic example of lateral recycling is the North American garage sale. Garage sales probably began in California in the early 1960's and spread across the continent from there. Between 6 and 9 million North American garage sales now generate between one and two billion dollars in sales every year. Most participants are of middle and working class backgrounds, in their twenties and thirties.
• Internet auction sites, such as eBay can be viewed as electronic fleamarkets that facilitate lateral recycling. Consumers come to these sites to sell goods that are no longer of use to them. The procedure is a bit different from a traditional flea market in that rival bids are posted over a period of time. Individuals - not corporations - use ebay to buy and sell items in more than 4,300 categories, including automobiles, collectibles, antiques, sports memorabilia, computers, toys, Beanie Babies, dolls, figures, coins, stamps, books, magazines, pottery, glass, photography, electronics, jewelry, and gemstones. Just like traditional marketplaces, electronic marketplaces strive to serve community needs such as social interaction and meeting with other users who share similar interests.
• Disposition, just like acquisition, provides a means of expressing important values. One U.S. study identified four themes or motives for garage sales. The first is "reclaiming control of one's work," and recognizes that garage sales create a sense of empowerment that middle-and working-class consumers may not have in daily life. The second is "creating a sense of social justice," as reflected in the common tendency to lower prices for the deserving. A third theme or motive is "beating the system," which refers to buyers' satisfaction with their reduced dependence upon traditional retail outlets and their ability to acquire goods inexpensively. The fourth theme, is "feeling part of a nurturing community," which reflects the communal aspects of lateral recycling as goods pass from consumers who no longer need them to those who do. For some consumers, swap meets and flea markets represent personal freedom and are viewed as a bastion of free enterprise. The festive, carnival-like atmosphere of the flea market may represent a release from the rule-governed world of normal life. Distinctions of wealth and status tend to be relaxed, expressing the North American value of equality. Some participants consider garage sales as an appropriate venue for family entertainment and an expression of togetherness.
• Both garage sales and the items sold in them reflect norms and values associated with gender. Gender-typed items tend to attract shoppers of the appropriate gender, and sellers may even direct men and women to the expected grouping of objects.
• Disposition involves both physical and emotional separation from possessions. Selling household goods is one way that consumers separate personal meanings from goods or gain separation from the part of themselves that is associated with objects that have been part of their lives. Sales of household goods can be a way of getting rid of the past, of an unattractive prior self, a divorced spouse, or a decreased family member. Because the transformation of possessions into commodities for sale may be a meaningful emotional event, sellers of household goods often engage in divestment rituals, such as cleaning, sorting, folding, arranging, and tagging them. These rituals serve to empty goods of meaning before they are passed on to others.
3. Donate It
• Giving things away is a third form of disposition. Attitudes toward the donation of goods and services to others vary widely around the world. Charity is enshrined in both Catholic and Islamic religious doctrine, and charitable giving is common in many Protestant denominations as well. Millions of people donate blood to the member organizations of the International Red Cross. Donations are the lifeblood of thousands of charitable organizations around the world, including Second Harvest discussed above. In many countries, people are encouraged to donate their body parts and to designate their eyes or other organs for re-use. Even human reproductive matter, sperm and eggs, may be donated to help redress the problem of human infertility!
• The donation decision process is unique amongst disposition decisions. Unlike the typical marketing exchange, the donation process is often a reaction to a serious or even desperate human condition. Thus, this process may tap into feelings of joy, improved self-esteem (altruism), guilt, or denial. Donation involves giving something tangible with little provision of any return. Moreover, rewards received are usually intangible or delayed.
4. Gift It
• Gift giving has been discussed in Chapter 10 as a form of consumer acquisition. Of course, gift giving can also be a mode of disposition. One form of disposition, inheritance, provides numerous business opportunities and is an important household consumer behavior. Family inheritance decisions involve gifts from older generations of family members to younger ones, and from the departed to the living. Important distinctions are made in some societies between the way immovable property (land and buildings), movable property (other tangible property including consumer goods), and even intangible assets such as specialized knowledge of various kinds, are inherited.
• Between 1995 and the year 2000, nearly $1 trillion was passed on to baby boomers in the form of bequests. This event represents "the largest inter-generational transfer of wealth in American history." If populations in the Triad countries become top heavy with older citizens as expected, inheritance issues will come increasingly to the forefront, providing new entrepreneurial opportunities for visionary consumer marketers.
• In South Asia and Africa, dowry and bride wealth constitute two contrasting forms of what we might call pre-inheritance, living bequests of household resources. In dowry, the wife's family provides important stocks of consumer goods and money to the husband's family. The custom of bride wealth works in the reverse way. The size and composition of these forms of pre-inheritance are often hotly debated because size and composition contribute to social status. In addition, the size and composition of dowry and bride wealth strongly affects the standard of living of the newly wed household. Thus, these customary transfers become the vehicle for new forms of conspicuous consumption of consumer goods. Since women often contribute to and benefit from these transfers, the size and composition of dowry and bride wealth may influence the comfort and control wives exert in their new homes as well.
5. Store It
• Storage is a basic consumer necessity. Of course, some of this function is performed by retail stores and other channel members. Nonetheless, consumers make provisions for the storage of food, valuables, and sacred objects.
• In the contemporary urban West, some trace of traditional storage behaviors can be seen in the frequent use of cellars as a place for storing food. Both individual and institutional consumers store objects in corporate, historical, and other museum collections.
• In most places around the world, the home has become our most important storehouse of consumer goods. Homes are used to store goods that act as objects of temporal stability in our lives. Time-marked goods (e.g., trophies, souvenirs, awards, religious artifacts, wedding gifts, and photos) remind us of who we once were, invite comparison with who we are now, and highlight how we have changed. In addition, many of these items we keep around us may be thought of as stimuli for an evolving network of associated memories. Not only do such memories provide an anchor to the sense of self, they may also provide us with cues for internal search behaviors when considering future consumption choices.
• In homes in the West, an attic or cellar may become a special repository for special possessions. Upper-class households may contain heirloom collections that provide symbols of family continuity. That is, the things we store in an attic or cellar may convey social affiliation meanings. At the same time, the things that we hide away in attics and basements may also play a role in differentiation and self-definition. The existence of these objects - heirloom linens, school yearbooks, yellowing photos, old dolls - are physical markers of the special beings who inhabit the house. The attic and cellar may symbolize the consumption of time. Our stored objects allow us to remember ourselves, as we were when old possessions were new. Stored objects allow us to recall former times and former selves.
• In contemporary consumer society, storing material possessions has assumed dramatic proportions and spawned numerous marketing activities devoted to providing companies and individuals with storage options. For example, there are firms that specialize in storage of legal documents and closet remodeling. In Salt Lake City, Utah, a firm called Summum has even revived the ancient Egyptian practice of preserving bodies for posterity through mummification. For a minimum of $32,000, Summum will turn you into a museum-quality corpse! And this is just one of many new options on offer from the trillion dollar global funeral business.
6. Recycle It
• Recycling has always been with us. In the last thirty years, it has become enshrined in consumer behavior and business practices as a result of a series of resource crises that hit the First World, beginning with the first oil price shock beginning in 1973. Threats of a shortage of landfill space began in the 1980's. This threat is being felt throughout the developed and developing worlds, and has also helped fuel consumer and business recycling activities.
• Aggressive environmental education in schools, science museums, even in specialized "garbage museums," and in some places in the media, has also increased consumer concern and some recycling behaviors. Consumer activists have turned the spotlight on consumer product companies whose packaging is difficult to recycle.
• In the European Community and in North America, recycling is written into national regulatory law. One EC proposal mandates that early this century, 90 percent of all packaging waste by weight must be recovered. The innovative Netherlands National Environmental Policy Plan II calls for integrated life-cycle management that will make producers responsible for whatever remains of their products after the user is finished with them. The idea is that producers are more likely to design products and packaging that can be re-used or recycled if they are responsible for disposal costs. As a result, some international firms including Body Shop International PLC, Nestle′, Texas Instruments, Very Fine Products, Inc., Volvo, and BMW have moved aggressively to recycle or to encourage employees to recycle. Of course, numerous entrepreneurs have emerged to meet the demand for recycled goods as shown in Industry Insights 19.2.

Giving Old Notes New Currency (50.0K)

• Curiously, the recycling industry is in flux. Recycling is probably the most well known and well-publicized environmental service. Technological advances constantly extend the list of materials that can be recycled, breaking new ground for recycling companies. Demand for recycled and recyclable products is strong, but consumer-recycling rates have stagnated.
• Nevertheless, interest in close-loop manufacturing, where simplified recycling is built into products from the design phase on, is developing in Scandinavia, Germany, and to a lesser extent in Japan. In Germany, for example, the so-called dual system, allows for the collection of all recyclable packaging materials for sorting and recycling. This effort is supported by a financing system, the "Green Point," run by a former Nestle′ CEO. In Europe, government regulations will tax people on their cars until they can show that they have been disposed of cleanly at an accredited disassembly plant. BMW, VW, and the PSA groups that markets Peugeot and Citroen are actively involved in the effort. Detroit automakers are also involved in closed-loop recycling, experimenting with recyclable plastic body parts, brake pads, and taillights.

• What factors influence the disposition choices of consumers, firms and organizations? Here, we suggest a number of factors, and we group them into the following categories:

1. Factors Intrinsic to the Product
• Materials, purchase price, and replacement cost influence disposition decisions. For example, the materials from which products are made influence recycling significantly. Aluminum is the easiest to recycle thanks to high prices for aluminum and aluminum ore.
• Paper recycling is increasing as is recycling of plastics. Organic materials like yard sweepings and tree trimmings are recyclable through composting, fueling a global municipal composting industry as represented in the Lubo Starscreen ad shown below. By contrast, rubber, especially vulcanized rubber used in tires, is one of the more difficult products to recycle, and markets for recycled rubber have been slow to develop.

Global Demand For Municipal Recycling Fuels a Growth Industry (50.0K)

• Both consumers and organizations consider purchase price and replacement costs in making disposition decisions. Higher costs result in delays in disposition and, when disposition occurs, selling is a common strategy. Higher-priced goods tend to enter secondary markets. Higher-priced consumer goods that have been personalized in some way are often laterally recycled through inheritance.
2. Competitive Pressures
• In business, competitive pressures play an important role in disposition. For example, new capacity for recycling fibers in the U.S. in 1994 created a supply shortage that drove prices for corrugated containers to $140 per short ton. Competition for supply will call forth new sources of recyclable materials.
• Competitive pressures also influence firms to undertake de-consumption measures or engage in special handling of waste. Companies can then employ credible "green" appeals in product differentiation and market positioning strategies. Similarly, Shell Oil claims that they have reduced their net greenhouse gas emissions at a rate that puts the company ahead of the schedule in the Kyoto (Japan) agreement on the environment.
• Sometimes, competitive pressures are formalized as self-imposed industry norms for materials handling and life cycle management. The new ISO14000 standards for environmental management are an example. The International Organizational for Standardization set out to develop ISO 14000 standards that organizations can use to improve their environmental performance over time.
• ISO 14000 consists of five families of standards, including environmental management systems (EMS), environmental auditing, environmental performance evaluation (EPE), environmental labeling, and life cycle assessment (LCA).
• EMS allows companies to define environmental goals and then monitor progress toward reaching them. Environmental audits evaluate EMS programs. EPE identify and quantify the impacts that companies have on their environments. The measurements are made against baseline levels.
• LCAs provide a means of determining what effects manufacturing processes have on the environment now and in the future. LCAs also assess environmental impacts over the life of a product from raw materials, through manufacturing, to disposition.
• Finally, environmental labeling standards will make it easier for consumers to identify and evaluate attributes of ECO-labeled products. Implementation of ISO 14000 standards should allow firms to achieve savings through waste reduction and enhanced productivity. At the same time, these standards provide assurance to consumers that a company is committed to being environmentally friendly.
• Competitive pressures also affect consumer disposition behaviors.
3. Situational Factors Extrinsic to the Product
• Situational factors play a role both at the individual and organizational level. Finances, storage, space, fashion change, use context, method of acquisition, legal considerations (e.g., the desire to avoid taxes and fines), and even downstream externalities may influence disposition behaviors. Fees and taxes drive numerous recycling efforts in Europe.
• At the organizational level, attitudes and pressures applied by various interest groups and publics, such as a community's attitudes toward recycling or waste incineration, come into play. The Rainforest Action Network and Greenpeace have successfully lobbied large retailers like IKEA, Home Depot, and Lowe's to stop selling old growth forest timber products, for example. Regulations applied by various governmental bodies also influence organizational practices. In 1999, for example, Shell companies paid US$2.83 million in fines and settlements for 306 violations of governmental environmental rules.
• A final factor is the development of markets for recycled materials. This factor is probably more important than regulations on packaging or mandates for recycling.
• In the area of "green marketing," research shows that consumers' stated commitment to environmentally responsible consumption is only loosely tied to environmentally responsible consumption behaviors.
• All sorts of product (e.g., price) and situation-related factors (e.g., inconvenience) negatively affect "green" consumption behaviors. Sometimes, consumers may not see the link between their consumption behavior and its affect on the environment. Other times, a factor such as price may influence a purchase decision more than environmental considerations.
4. Life-Status Changes
• A life-status change occurs when consumers experience a shift in their social roles (e.g., the parts they play in society). At the same time, the norms and expectations that define interactions with others may shift. Cross-culturally, the four most common life-status changes are birth, puberty, marriage, and death. Obviously these changes are linked to age, and often changes in status are marked by rites of passage. Other life-status changes are triggered by changes in work or financial status, family life cycle, migration, losses of relationships, physical changes, and inner, psychological changes. Such changes often require the deletion (as well as the addition) of symbolic material goods.
• One study conducted in the southwestern U.S. found that re-use behaviors are closely related to household developmental cycles. New households composed of young persons without children had the highest percentage of used items. When couples begin having children both rented and used items in their household inventory decline. Used items plummet to near zero as households reach the stage of older couples with older children. The percentage of used items in the household inventory begins to rise again among empty nesters.
• Just as we distinguished between voluntary and involuntary disposition, we should distinguish disposition related to voluntary and involuntary life-status changes. The implications for disposition vary between these two cases. With respect to voluntary changes, such as voluntary migration, first professional job, or marriage, people may willingly discard props that they associate with previous life stages.
• Under involuntary changes, such as those involving job loss, forced migration, retirement, death of a love one, or divorce, the reaction to (forced) disposition may be quite different.
• Deterioration in financial status is one kind of involuntary change. This situation may result in decreased consumption of leisure activities or disposal of "unnecessary" leisure products. In such cases, consumers sometimes increase certain acquisition behaviors, perhaps to maintain face or protect self-image. Such behavior is a good example of psychological reactance, a response to a threat to behavioral freedom. At the same time, involuntary life-status changes may involve cathartic, even joyful disposition of possessions symbolic of previous roles, as when divorced people get rid of their former spouses' possessions.
• Elderly people facing retirement and death encounter special disposition problems. Decisions related to the disposition of possessions often are fraught with tension. The decision process is complicated by the fact that family members may avoid any discussion related to the disposition of the older persons' possessions.
• Older consumers' possessions represent who they are and the life they have led. Possessions represent emotional connections to individuals who mean the most to them. An older person's possessions may take on value based on the length of time the person has owned them and the circumstances surrounding acquisition of belongings. In addition, possessions help owners reminisce about significant time periods and events in their lives.
• The tensions felt by aging consumers are different from ordinary consumer disposition decisions in three ways. First, the relationship between older consumers and their possessions is unique because of the retrospective dimension inherent in possessions that have been held for extended periods of time. Second, as people age, they witness many changes. Special possessions may be among the most stable things in the lives of older consumers. Third, there is inevitability in the disposition of possessions that is much more strongly felt by older consumers than their younger counterparts. Whether individuals have a disease or physical condition that will lead to death in a predictable period of time or simply have an awareness of their passage through the life cycle, older consumers become increasingly concerned about the ongoing biography their possessions will have after their own life passage comes to an end.
• Disposition of older consumers' cherished possessions presents an array of mostly untapped marketing opportunities. Products and services could be devised to record and store special possession meanings and stories. Counseling and consulting services could help families confront and process the disposition needs of older consumers and help charities and other beneficiaries respond to older consumers' desires to leave a legacy. Finally, channels could be devised to more easily facilitate lateral recycling of older consumers' special possessions.
• Serious life-threatening illness and death may be viewed as a complex array of dispossessinal events. Life-threatening illness and or impending death may stimulate a chain of voluntary (and ultimately involuntary) dispossession behaviors. Knowledge of the impending end of life sometimes stimulates a belief that material possessions are less important than other aspects of life, such as relationships with others. In turn, the relationships may be strengthened by dispossession. After death, possessions can become important symbols by which individuals wish to be remembered.

• Traditionally, marketers strive to create marketing plans so as to achieve, simultaneously, two objectives. First, following the marketing concept, they attempt to satisfy customer needs. Second, they attempt to achieve organizational goals (e.g., in terms of shareholder wealth, market share, sales levels). In his pioneering book, "Sustainable Marketing", Donald Fuller argues that a third criterion needs to be added to this set. Specially, sustainable marketingmeans that marketing plans should be constructed so that they are compatible with ecosystems. With this emphasis on sustainable marketing, organizations can find ways to reduce costs and serve the long-term well being of society. In this section, we review a group of segmentation strategies and issues that are congruent with Fuller's notion of sustainable marketing.

1. Segmentation
• Marketers can be segmented on the basis of consumers' green orientation. Specifically, green segments are consumers whose acquisition behavior is affected by pro-environmental attitudes and behaviors. A "green" orientation is a variable one. That is, a particular consumer may be green with respect to purchasing products with organic or recycled content but, at the same time, resist acts related to de-consumption.
• These segmentation profiles assume that there is a relationship between the propensity to re-use, recycle, and consider the environmental impacts of waste disposal and a green psychographic profile (see Chapter 8 for a discussion of pyschographics). At the other end of the continuum, it is probable that "brown" consumers, through disinterest, lower incomes, less education and environmental knowledge, or diminished sense of self-efficacy, are likely to be concerned less about the environmental consequences of manufacturing, packaging, and solid-waste disposal.
• There are four types of segments for environmentally responsible organizational purchasing. Socially responsible purchasing includes such judgments as considering what the product is made of (e.g., office paper from recycled postconsumer waste versus virgin matericals), or from where it comes (e.g., wood from sustainably managed forests versus unmanaged forests), or from whom it comes (e.g., companies whose other products are unobjectionable versus companies that also make objectionable products). Politically savvy policy entrepreneurs play a key role in initiating environmentally responsible buying in the organization-buying center. Successful initiation of comprehensive ERB programs involves the emergence of a group of volunteers in the organization. If organizations are to pursue ERB objectives, it is important that extrinsic rewards (i.e., monetary and career advancing) for purchasing agents be created to foster such actions.
2. Demographic and Psychographic Factors
• At the individual level, the decision-maker's psychological characteristics play a role in determining disposition decisions. As with other consumption decisions, differences in motivation, knowledge, affect, experience, and involvement play a role in explaining disposition behaviors.
• Green consumers tend to be younger, more highly educated and, to some extent, has a higher income than other consumers. Gender, political affiliation, and social class are not strongly related to green consumer behaviors. The green consumer is conscious of the implicit costs of consumption and tries to minimize them. Such awareness is at the root of the movements towards "voluntary simplicity" or the idea of "eating farther down the food chain," (e.g., minimizing the processing of food products). The "green" consumer is motivated by a concern for social well being. Such consumers tend to exhibit a relatively strong sense of personal efficacy; they think that their daily behaviors can have a positive environmental impact.
• Personal values such as altruism and the biosphericorientation, or earth-first orientation, of committed ecologists, relate to positive beliefs and attitudes toward recycling and waste reduction behaviors. But the link is relatively weak. One study conducted in Germany suggested a reason. The authors argue that different pro-environmental disposition behaviors such as re-use, waste reduction, garbage sorting, or recycling might be linked to different values and motives. Hence, to stimulate different pro-environmental disposition behaviors, marketers may have to appeal to different values.
• The "simple life" or de-consumption may be a way to relieve stress on the environment. Consumers embracing this philosophy opt for a lifestyle that requires fewer material resources to support them. Such consumers can be regarded as a psychographic market segment with specific needs to be addressed. For example, such a segment can be labeled as "True-Blue Greens." This segment engages in the following behaviors: willing to pay more for green products, cuts down on car use, uses biodegradable soaps, writes to politicians about environmental issues, and seeks alternatives to automobile transport. Thus, a portion of the population has decided that happiness in life does not necessarily come from owning more things. Rather, it comes from seeking simple, practical, sustainable solutions to life's problems.
• Governments are beginning to experiment with "consensual" or voluntary environmental policies. That is, instead of passing laws to mandate environmental policies, governments negotiate with organizations or consumer groups to make them partners or collaborators. As one example, Mattel, the world's largest toy maker, recently announced an initiative to make its plastic toys out of organically-based materials derived from edible oils and plant starches. Beginning in 2001, these toys will be widely marketed. To cite a similar initiative, McDonald's USA runs a model restaurant in Bensenville, Illinois where new engergy-reducing technologies are tested before being introduced elsewhere. The Bensenville restaurant saves energy through high-efficiency air conditioning units, automatic lights, and skylights that reduce the need for indoor lighting. Initiatives such as these are consistent with the notion of sustainable marketing.

• Disposition considerations can drive product choice decisions. At the same time, the marketing of green products can benefit from a thorough understanding of disposition attitudes and behaviors.

1. Disposition and Product Choice
• Consumers make product choices to satisfy their desires. A clean, habitable ecosystem is a legitimate need without which the consumer literally cannot survive. But in many choice situations, this need is not associated with the exchange process. Rather, the environmental benefits remain an underlying or latent factor. For this reason, ecological needs are unlikely to serve as the primary trigger for many consumer decisions. One challenge for marketing managers is to find ways to make ecological needs and concerns more salient.
• As discussed above, there are segments of green consumers who recognize that the production, marketing, and disposition of products lead to social and environmental costs (e.g., pollution). They evaluate these costs negatively, and try to minimize them through product choice purchase decisions. In the abstract, approximately two-thirds of consumers express willingness to pay more for products that are environmentally friendly. However, for many consumer segments, environmental concerns often remain in the background when they make decisions in the marketplace.
• In the 1970's, researchers found that consumers became more willing to purchase phosphate free detergents when they learned of the negative effects of phosphate pollution on water quality. In 1991, the University of Illinois found that, assuming price parity, 64.3 percent of respondents would choose paper towels labeled paper over paper towels without the label. For a plastic shampoo bottle marketed as recycled, the figure was virtually identical - 63.1 percent.
• In general, Danish consumers have very positive attitudes towards environmental problems, and they accept recycling as a fact of life.
• Government mandated schemes to introduce disposition criteria into consumer behaviors may result in negative feelings against the activity the regulation is meant to encourage. This is an example of psychological reactance. Examples of regulations might include bans on ozone-depleting chemicals in aerosol sprays or air conditioning units, deposit fees on liquid containers, or programs requiring home garbage separation for recycling.
• Reactance is common where monetary effects are felt or the regulations are perceived to be unequal. Reactance may be higher in cultures with very strong traditions of individual freedom such as the U.S. and lower in nations with a stronger collectivist orientation (e.g., some Scandinavian nations). Denmark's bottle deposit program is successful for example, although Danes complain about it, while deposit bottles have not been very successful in the U.S.
• Some people fear being labeled a "sucker" if they participate in green programs while others do not. Achieving environmental goals (e.g., reducing solid waste) depends on the participation of many consumers. But individual consumers cannot be sure that most others will cooperate. For example, people may believe that disposal fees applied to waste lubricants replaced by commercial garages will lead to illicit dumping and non-compliance by some, thereby aggravating existing disposition problems. Belief that others may not comply reduces compliance levels overall. This is an example of the classic prisoner's dilemma problem in psychology. Everyone benefits if all comply, but if one person doesn't comply his/her immediate benefits may outweigh the general good. Hence, mistrust of others may reduce the likelihood of green behaviors. Marketing communications must address issues such as psychological reactance and prisoner's dilemma concerns if firms hope to increase he responsiveness of green marketing campaigns.
• Finally, a related, but separate problem has to do with the extent to which individual consumers apply private, personal cost-benefit calculations to their consumption decisions without regard for broader impacts. To the extent that may consumers in developed economies are inclined to base their consumption decisions primarily upon private cost-benefit calculations, it seems likely that private economic incentives (i.e., price breaks on environmentally friendly products) are necessary to encourage cooperation.
2. Recycled and Green Products
• Recycled and green products represent product categories in the introduction and growth phase of the product life cycle discussed in Chapter 16. For example, in 1989 Lever Brothers launched a $20 million campaign to reduce adverse environmental impacts of its products. Canada's largest grocer, Loblaw's also introduced a line of green products in 1989. Simarily, Proctor & Gamble has introduced a host of green improvements to its products and production process.
• From 1985 to 1990, green products introductions increased at an annual rate of more than 100%. Sales of green products were estimated to total $8.8 billion in 1995. Elsewhere we have mentioned the skyrocketing sales of the organic foods in an industry with otherwise flat sales. Some other examples of green products are shown in Industry Insights 19.3. Faced with a history of price disincentives for green consumption, green marketers have been working hard to dispel the idea that recycled and organic products cost more than conventional commercial goods.

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