Giving Green a Second Thought: Modeling the Value Retention of Green Products in the Secondary Market

Journal of Business Research, 68(1), 994-1002, October 2014

9 Pages Posted: 18 Nov 2015

See all articles by Cristel Russell

Cristel Russell

American University - Kogod School of Business

Kashef Majid

University of Mary Washington

Date Written: 2014

Abstract

Demand for green products continues to grow. This research examines green products’ retention of value and whether new green brands differ from green brand extensions in their ability to retain value amidst technological innovations. Modeling of data from the used car market between 2004 and 2011 shows that hybrid (i.e., green) vehicles lose value faster than their non-hybrid counterparts. However, pure green brands (such as the Prius), whose ability to express greenness is more salient, lose value at a slower rate than green brand extensions. Compared with brand extensions, pure green brands are also less vulnerable to the threat of obsolescence from technological innovations (introduction of fully electric vehicles). Implications for the management and marketing of green product offerings to extract maximum value for firms and consumers are discussed and suggestions for future research are proposed.

Suggested Citation

Russell, Cristel and Majid, Kashef, Giving Green a Second Thought: Modeling the Value Retention of Green Products in the Secondary Market (2014). Journal of Business Research, 68(1), 994-1002, October 2014. Available at SSRN: https://ssrn.com/abstract=2691766

Cristel Russell (Contact Author)

American University - Kogod School of Business ( email )

4400 Massachusetts Avenue NW
Washington, DC 20816-8044
United States

Kashef Majid

University of Mary Washington ( email )

1301 College Avenue
Fredericksburg, VA 22401
United States

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