‘Natural’ Label Halo Effect on Consumer Buying Behavior, Purchase Intention and Willingness to Pay for Skincare Products

Abstract

Healthy skin will never go out of style, and the advancements and improvements in the cosmetics industry guarantee to provide improved products with a healthy and personal touch. However, for consumers, it is difficult to assess the quality and effectiveness of a product. Extrinsic cues like the “Natural” or “Organic” labels are used to help the consumer distinguish between alternatives. This paper analyses how the organic label biases the consumers’ buying behavior, perceived value, and finally, the consumer’s purchase decision and the price he willingly pays for the product (willingness to pay). This phenomenon is known as the natural label halo effect. It further means to reveal the connections between the effect of the ‘Natural’ label on the factors affecting buying behavior and it’s out-turn as emulated in the consumer’s perceived value. It intends to identify if those outcomes at last lead to positive buying decisions and greater willingness to pay. A quantitative study in an experimental online shopping scenario was conducted to understand the relations. Structural equation modeling (SEM) was done to test the hypothesized statements. The results show that the halo effect of the ‘Natural’ label positively influences the factors affecting consumer buying behavior and eventually improves the probability of the product being bought by the consumer and also the price the consumer is willing to pay for it through inferential beliefs on quality attributes and functional value evoked by the label. The study also reveals that natural skincare products are perceived to be more compliant with a consumer’s beliefs/attitudes relating to environmental protection and animal protection, which positively influences the propensity of a consumer towards buying the product and paying a high price for it by increasing the perceived functional and hedonic values associated with the natural cosmetic product.