Online purchasing creates opportunities to lower the life cycle carbon footprints of consumer products.

Abstract

A major barrier to transitions to environmental sustainability is that consumers lack information about the full environmental footprints of their purchases. Sellers' incentives do not support reducing the footprints unless customers have such information and are willing to act on it. We explore the potential of modern information technology to lower this barrier by enabling firms to inform customers of products' environmental footprints at the point of purchase and easily offset consumers' contributions through bundled purchases of carbon offsets. Using online stated choice experiments, we evaluated the effectiveness of several inexpensive features that firms in four industries could implement with existing online user interfaces for consumers. These examples illustrate the potential for firms to lower their overall carbon footprints while improving customer satisfaction by lowering the "soft costs" to consumers of proenvironmental choices. Opportunities such as these likely exist wherever firms possess environmentally relevant data not accessible to consumers or when transaction costs make proenvironmental action difficult.