From Going Green to Brand Building: The Impact of Green Economy Approaches on Strengthening Brand Image

Introduction

In today’s competitive environment, brands that possess unique and inimitable advantages over their competitors are more likely to succeed. Brand image is recognized as one of the most critical factors determining success in the retail industry. Retailers with a favorable brand image can not only attract more customers and increase market share but also strengthen customer loyalty and improve overall business performance. A positive brand image shapes customers' attitudes toward the brand and influences their purchasing decisions. Customers use various cues, such as the physical environment of the store, product variety, service delivery, employee interactions, and even the brand’s social and environmental initiatives, to form an overall perception of the brand (Gielens et al., 2023; Kremer et al., 2012).

The green economy has emerged as a strategic approach to achieving sustainable development and enhancing brand image. With the rapid industrialization and growing environmental concerns, organizations are increasingly encouraged to adopt sustainable practices and align their activities with environmental and social goals (Abedini Pour et al., 2023). Traditional economic models, focused solely on capitalism, have led to social inequalities, environmental degradation, and the neglect of social and ecological aspects (Wang et al., 2022). The green economy, as a modern approach, aims to integrate economic growth with environmental protection and social justice, fostering sustainable development (Khoshnava et al., 2019).

This study investigates the impact of green economy components—green policies, green investment, and green marketing—on the brand image of Etka chain stores in Isfahan, Iran. Despite the growing importance of the green economy, research in this area remains limited, particularly in developing countries like Iran. This study addresses this gap by examining how green economy practices can enhance brand image in the retail sector.

Theoretical Framework

The green economy is a modern economic model that emphasizes resource efficiency, environmental protection, and social equity. It integrates economic growth with ecological sustainability and social justice. The three key components of the green economy examined in this study are:

Green Policies: These refer to organizational strategies and actions designed to reduce the negative environmental impacts of economic activities. Examples include energy efficiency improvements, waste reduction, and the use of renewable resources.

Green Investment: This involves financial activities and investments aimed at supporting sustainable and environmentally friendly projects, such as renewable energy systems and eco-friendly product development.

Green Marketing: This entails designing and implementing marketing activities that meet customer needs while minimizing negative environmental impacts. Green marketing promotes eco-friendly products and services, fostering sustainable consumption patterns.

These components are closely linked to brand image, as they reflect a brand’s commitment to environmental responsibility and sustainability, which are increasingly valued by consumers.

Research Methodology

This study adopts a descriptive-correlational approach and is conducted through field research. The statistical population includes managers and employees of Etka chain stores in Isfahan. A simple random sampling method was used to select 119 participants, and data were collected using a researcher-made questionnaire. The questionnaire consisted of two sections: demographic variables and research-related variables, measured on a five-point Likert scale. Data analysis was performed using structural equation modeling (SEM) with the partial least squares (PLS) approach in SmartPLS software. The reliability of the questionnaire was confirmed using McDonald's Omega coefficient.

Results

The findings of the study are as follows:

Green Policies: Green policies have a significant positive impact on brand image (path coefficient: 0.445, t-value: 6.284). This indicates that implementing environmentally friendly policies can enhance the brand image of Etka chain stores.

Green Investment: Green investment also has a significant positive impact on brand image (path coefficient: 0.229, t-value: 2.814). Investments in sustainable projects contribute to improving the brand's reputation and customer trust.

Green Marketing: Green marketing significantly influences brand image (path coefficient: 0.244, t-value: 3.423). Marketing strategies that emphasize environmental responsibility can attract eco-conscious customers and strengthen brand loyalty.

The overall model demonstrates strong reliability and validity, with acceptable values for composite reliability, average variance extracted (AVE), and discriminant validity.

Discussion and Conclusion

The results align with previous studies, such as those by Gazi et al. (2024) and Zhang et al. (2022), which highlight the importance of green economy practices in enhancing brand image. Green policies, investments, and marketing not only improve environmental performance but also create a positive perception of the brand among customers. In the case of Etka chain stores, these practices can differentiate the brand in a competitive market and foster long-term customer loyalty.

Based on the findings, the following recommendations are proposed for Etka chain stores:

Green Policies: Develop and implement environmental standards for energy, water, and waste management. Use eco-labels to communicate the brand’s commitment to sustainability.

Green Investment: Invest in renewable energy projects, waste reduction initiatives, and sustainable supply chain practices. Collaborate with NGOs to support community-based environmental programs.

Green Marketing: Launch advertising campaigns that emphasize the brand's environmental responsibility. Offer incentives for customers who use reusable bags or purchase eco-friendly products.

These strategies can help Etka chain stores strengthen their brand image and gain a competitive edge in the market.

This study has several limitations. First, the use of self-reported data (questionnaires) may introduce response bias, as participants might provide socially desirable answers. Second, the findings are limited to the specific context of Etka chain stores in Isfahan and may not be generalizable to other regions or industries. Future research could address these limitations by using mixed methods and expanding the sample to include other retail chains and geographic areas.

This study demonstrates that green economy practices—green policies, green investment, and green marketing—have a significant positive impact on the brand image of Etka chain stores in Isfahan. By adopting these practices, Etka can enhance its reputation, attract environmentally conscious customers, and achieve sustainable growth. The findings contribute to the growing body of literature on the green economy and provide practical insights for retailers seeking to improve their brand image through sustainability initiatives.