The diffusion of environmental product and service innovations: Driving and inhibiting factors

About two thirds of environmental product and service innovations are consumed in small market niches. This constitutes a problem, because possible environmental benefits only occur to a limited extent. While diffusion research on environmental innovation so far has been limited to case studies with only a small number of cases or has been focused on individual sectors, the purpose of our investigation is to provide generalizable insights on driving and inhibiting factors. Based on a large sample of 130 diffusion cases, we provide cross-sector insights on key factors that are driving or hampering the diffusion of environmental innovations. We identify three clusters of factors, which form constructs at a higher level of aggregation. Market push, a favourable cost-benefit ratio and high compatibility and confidence in the innovation constitute meta-factors that help to explain why certain environmental innovations diffuse well (stars) and others remain in a small market niche (poor dogs).