Navigating label effectiveness: Insights into consumer perception and design elements for energy and eco-labels

Labels as decision cues for consumer choices

Eco-labelling or sustainability labelling has become a central instrument in European sustainable consumption policy, aimed at reducing information asymmetries by signalling verified environmental performance (European Commission, 2024; Gorton et al., 2021). Yet, growing evidence suggests that the effectiveness of labels depends less on the mere provision of information and more on how such information is designed, communicated, and embedded within consumer decision environments (White et al., 2019). The way information is displayed is especially important as recent research highlights that consumers typically make decisions under time pressure and cognitive constraints, relying on heuristic processing rather than detailed information evaluation (Oswald et al., 2022). Consequently, eco-labels function primarily as intuitive cues.

Against this background, this paper conducts a structured review of empirical studies from the past five years to derive evidence-based design implications for a new eco-label within the EU context.

Aim and research questions

The aim of this study is to identify the most important principles for designing a new eco-label that is most likely to be effective for consumer decision-making in Europe. It aims at providing a generic template for label design under ESPR regulation. For each product regulated under ESPR that will showcase a label (see also ESPR working plan, European Commission, 2025) a specific product parameter depending on the hotspot of the product will be included. Hence, the framework must contain a certain modularity and capture the idea that a varying amount of information is presented on the physical, product-specific label. This modularity also makes sense as the range of products covered by the regulation is highly heterogeneous including products like detergents, clothes or furniture.

To achieve this, the review examines which label characteristics in general may enhance consumer recognition, understanding, and engagement in complex purchasing environments. Although the ESPR label will be mandatory and comparative, findings from studies on non-comparative and voluntary labels remain valuable, as they may yield insights applicable to the design of the ESPR label. Drawing on a literature review, the research addresses the following questions:

1. Which factors increase label comprehension and recognition? This includes visual salience, colour schemes, typography, symbol clarity, standardised placement, and consistency with existing EU labelling formats.

2. Which factors enhance consumer engagement? This explores informational depth, rating systems, emotional framing, digital integration, perceived usefulness, and simplicity versus detail trade-offs.

3. How do perceptions vary across demographic groups and across Europe? This question investigates differences related to age, income, education, cultural background, and environmental attitudes, as well as differences between European countries.

4. How do multiple labels on a single product interact? This examines complementarity, redundancy, cognitive overload, and prioritisation effects within multi-label environments.

Factors to enhance label comprehension and recognition

Label comprehension and recognition are closely intertwined and can strongly influence each other. While comprehension refers to how easily a user can understand the meaning of the information presented, recognition concerns how quickly and reliably they can identify familiar elements such as symbols, layouts, or visual cues. If a label is difficult to recognise – due to unfamiliar icons, inconsistent layouts, or poor visual hierarchy – users may struggle to locate key information, which directly impairs comprehension. Conversely, even highly recognisable elements can fail if their meaning is unclear or open to interpretation.

Research shows that label comprehensibility increases when designs are simple, distinctive, and easy to process (Hay et al., 2024; Meis-Harris et al., 2021; Nakaishi & Chapman, 2024). Categorical scales, particularly alphabetical A–G formats, are widely understood and tend to outperform numerical scales in supporting quick and intuitive decision-making. Experimental studies confirm that consumers show higher willingness to pay and better comprehension when exposed to alphabetical scales (Bergener et al., 2025; Faure et al., 2021; London Economics & Ipsos, 2014). Given the inherent idea of the EU Energy Label expressing that a higher ranking will come with future energy and cost savings for the consumer this higher willingness to pay signals consumer comprehension and not general readiness to pay based on the presence of an A–G scale. However, categorical information often dominates attention, leading to the well-documented “class valuation effect,” where consumers focus on the class rating at the expense of other details (Andor et al., 2019; He et al., 2022; Kesselring, 2025). Continuous scales may mitigate this bias but are generally less intuitive for consumers and may be less understandable (London Economics & Ipsos, 2014). However, it remains unclear whether, or if so when, a rating system using a continuous scale would deter consumers from choosing an environmentally friendly product. Providing clear scale explanations, such as depicting the range of the possible classes, can improve label effectiveness, while adding the meaning of the label (i.e. energy), may improve understandability, particularly for consumers that are generally less familiar or interested in energy efficiency aspects (Elsen & Leenheer, 2022).

Colour is another important design factor influencing both understandability and recognition. Colour-coded and traffic-light systems consistently enhance recognition, comprehension, and preferences across product categories (Jürkenbeck, 2023; Kolber & Meixner, 2023; Liva et al., 2025). Colour associations guide consumer choices – for instance, green indicating environmental friendliness – and can effectively draw attention in retail settings (Bauw et al., 2024; Hay et al., 2024; Operate, 2022). Further, Bengart and Vogt (2023) compare different label options for several electricity products, finding that traffic-light labels increased the share of choices for low-emission electricity compared to text-based labels, but not compared to grayscale labels – indicating that, potentially, other colour-coded schemes that are barrier-free (e.g. the Viridis colour scale) can be similarly useful.

Additional information included in the label can be useful if the information is easy to read and understand (Meis-Harris et al., 2021) and not excessive (Nakaishi & Chapman, 2024). Textual clarifications improve evaluations of otherwise purely symbolic labels (Hartmann et al., 2025) and are often preferred by consumers, with many favouring bilingual formats (i.e. national language and English) for accessibility (Liva et al., 2025). Clear and meaningful label names further support understanding and uptake (Operate, 2022). Numerical information, however, can be confusing when units are unfamiliar (e.g. indicating biodiversity loss with “PDF”, i.e. potentially disappeared fraction of species), leading some consumers to prefer visual or icon-based data representations (Dütschke & Schneider, 2017; Hay et al., 2024). Eye-tracking evidence shows that poorly designed icons can be overlooked, though familiarity can improve users’ ability to locate and interpret them (Operate, 2022).

Factors for consumer engagement and decision making

Knowledge and awareness as well as trust in the label have been identified as relevant drivers for comprehension and effectiveness of labels (Codagnone et al., 2013; Meis-Harris et al., 2021; Nakaishi & Chapman, 2024). Label trust can be enhanced by a high degree of transparency and rigor in the label certification process (Nakaishi & Chapman, 2024) and can be influenced by trust in the institution being associated with the label (Gorton et al., 2021). In addition, positive perception of the label has been found to be related to the intention or willingness to use the label in purchasing decisions (Berden & Hung, 2025; Dihr et al., 2021). Furthermore, the certifying body can impact whether a certain label is regarded in purchasing decisions. For instance, in studies from Germany and Serbia, knowledge of third-party certification has been shown to positively influence label use (Gorton et al., 2021). In their literature review Majer et al. (2022) found evidence that governmental labels are more effective than non-governmental labels e.g. from NGOs. Further, studies point towards the role of individual consumer factors in label effectiveness. For instance, environmental attitudes as well as environmental concern have been found to be related to behaviour when buying products with the EU Ecolabel (Recio-Román et al., 2024). Studying the EU Energy Label, Guetlein et al. (2025) identified energy literacy to be related to label effectiveness: for individuals who have a higher ability to make informed and deliberate choices in the domain of household energy consumption, the EU Energy Label was more effective.

Variations across demographic groups

Research on demographic differences in eco-label perception and use shows heterogeneous and often context-dependent patterns. From the perspective of consumer heterogeneity theory, socio-demographic characteristics influence how individuals process sustainability information, yet their effects are neither universal nor uniform across product categories. Systematic reviews such as Majer et al. (2022) highlight that evidence on demographic variation remains inconsistent, suggesting that label effectiveness cannot be generalised across populations.

Some studies identify meaningful subgroup differences: Jacobs et al. (2025), using cluster analysis for a hypothetical multi-level eco-label for mobile phones, show that younger and more highly educated consumers are overrepresented in segments with strong preferences for higher eco-score ratings. This aligns with socio-psychological models of pro-environmental behaviour, which posit that environmental concern and knowledge – more prevalent among younger, educated groups – strengthen responsiveness to sustainability cues. In a Dutch sample, Berden and Hung (2025) find that intention to use the Eco-Score food label tends to decrease with age; additionally, employment status as well as income are associated with (greater) subjective knowledge of the Eco-Score (measured as an index that was formed by respondents’ answers on their perceived subjective knowledge regarding the environment, and the Eco-score ranging from ‘Not at all knowledgeable’ to ‘Extremely knowledgeable’). Furthermore, both gender and age were significantly related to objective knowledge of the label (measured through six true or false statements regarding the label). Recio-Román et al. (2024) report that eco-label purchasing behaviour is more common among older adults, women, individuals with higher education levels, and urban residents. In contrast, Taillie et al. (2024) find that eco-scores exert stronger perceptual effects on older adults and men, suggesting that responsiveness may depend on baseline sustainability awareness and pre-existing beliefs rather than demographic traits alone.

Concerning variations across European countries, some studies indicate differences; however, no clear pattern emerges. Therefore, no inferences about other labels or contexts can be drawn. In their literature review Majer et al. (2022) discussed two studies utilising data from several European countries that compare national samples: Banovic et al. (2019) and Grunert et al. (2014) reported some country differences, for instance that participants in the UK used labels most in their decision-making; in contrast, Polish participants reported using labels least (Grunert et al., 2014). Research by Nakaishi and Chapman (2024) compared label awareness across EU countries. They found, for instance, that France has a relatively high awareness of the EU Energy Label and the EU organic production logo (i.e. leaf-shaped logo), while the awareness of the EU Ecolabel and EU Energy Label is relatively low in Romania (Nakaishi & Chapman, 2024). In their study of modifications to the EU organic production logo, Hartmann et al. (2025) showed that small design changes, such as adding ‘Bio EU certified’, improved signal clarity and induced more favourable perceptions of the label. The organic label is a mandatory mark for the sale of organic products, but it is not a comparative label. However, with regard to a potential ESPR label as a mandatory mark, this finding highlights that a clarification of its meaning through additional text could be important in order to inform consumers from different socio-demographic groups within the EU about what the new label signifies – including in comparison to previous and parallel labels. Overall, existing research suggests that demographic characteristics are related to label perception, but their effects are highly context-specific and probably shaped by environmental attitudes, product familiarity, and cultural norms and possibly also by socio-economic resources. A universal demographic profile of “label-responsive consumers” therefore cannot be established.

Interactions among labels

The presence of multiple sustainability labels on a single product can influence consumer perception in both positive and negative ways, depending on the consistency, clarity, and informational load of the combined labels. Evidence shows that complementarity effects can occur when labels convey coherent information: for example, Zhu et al. (2023) find that the EU organic logo displayed alongside the Chinese organic certification increases willingness to pay in a Chinese sample, while Torres-Peña et al. (2025) report no adverse effects on comprehension when several eco-labels appear together in their study on olive oil. In such cases, multiple labels appear to strengthen perceived credibility or reinforce environmental signalling.

At the same time, other studies highlight substantial risks of cognitive overload and reduced salience. Liva et al. (2025) demonstrate that adding extra labels can diminish attention to key information, such as waste-sorting symbols, suggesting that informational competition can hinder label effectiveness. Importantly, the interaction between labels becomes particularly problematic when the underlying ratings diverge. Berden and Hung (2025) show that while the co-presence of Eco-score³ and Nutri-score can improve correct environmental assessments, conflicting signals (e.g., a poor Eco-score paired with a strong Nutri-score) reduce evaluation accuracy. A similar pattern is observed by Dorisse et al. (2025), who find that conflicting valence labels increase consumer confusion and may even depress purchase intentions.

Together, these findings suggest that the effectiveness of multi-label environments hinges on consistency and cognitive manageability. Harmonised or integrated approaches – such as composite scoring systems or differentiated scales – may mitigate confusion and help consumers navigate complex product information. For a new eco-label, careful coordination with existing EU and national labelling systems will therefore be essential to avoid conflicting cues, protect salience, and ensure that sustainability information supports rather than complicates consumer decision-making.

Summary and evaluation of findings

Focusing on the design itself, simple, intuitive designs – such as categorical A–G scales and colour-coded systems – consistently improve recognition and comprehension. However, these designs can also create biases, such as the “class valuation effect,” where consumers overlook detailed information. Trust emerges as a critical factor, influenced by perceived transparency, institutional credibility, and rigorous certification processes. Additionally, demographic diversity and cultural variability across Europe shape label perception and use – however, no universal profile of a “label-responsive consumer” could be identified. Demographic effects are inconsistent and likely mediated by environmental attitudes, product familiarity, and cultural context. A harmonised EU-wide label must therefore aim for broad accessibility rather than targeting specific consumer segments. Finally, multi-label interactions highlight that the ESPR label in particular will not operate in isolation. Consistent signals across labels reinforce credibility, while conflicting cues increase confusion and may suppress purchase intentions. Careful harmonisation with existing EU schemes in visual language, scale logic, and informational hierarchy is therefore essential. Digital tools and digital data carriers like QR codes hold promises for enhancing engagement and fostering positive perceptions of labels – provided that consumers actually use them to obtain further information about a specific product. However, their real-world usage remains currently unclear. In sum, effective (ESPR) labels should combine intuitive visual formats with modular information layers, leverage institutional credibility, ensure coherence with existing labelling systems, and be validated across diverse consumer groups to maximise inclusivity and impact.

Limitations

This study faces several limitations that should be taken into account when interpreting the findings. First, the systematic review was restricted to publications from the past five years, based on the assumption that recent research builds on earlier foundational work. While this approach ensures topical relevance, it may exclude influential older studies that possibly extended to other factors. For instance, our review identified hardly any studies including empirical evidence on how label design in detail influences purchasing decisions in a statistically sound and quantifiable manner. This may reflect a broader gap in the existing literature rather than a limitation of the search strategy alone, and underlines the need for further empirical research on the direct impact of label design on consumer purchasing behaviour – particularly in the context of mandatory comparative labels such as the one envisaged under the ESPR. Although the expert input was not restricted to the past five years and partly compensates for this limitation, it cannot fully eliminate the risk of missing important earlier evidence. Second, despite employing a systematic search strategy across multiple databases and complementing it with expert input, the review cannot guarantee full completeness. Relevant studies published in languages other than English, or embedded in grey literature not indexed by major databases, may have been overlooked. This leads to a bias towards countries in Western Europe which have a longer history of contributing to current academic research. Third, the heterogeneity of research designs, product categories, and label types across the included studies limits the comparability of results. Many findings depend strongly on specific experimental settings, cultural contexts, or product attributes, which constrains the generalisability of conclusions. It should be noted that approximately 35% of the reviewed studies focus on the EU Energy Label, which inevitably shapes the findings and conclusions of this review. The EU Energy Label may represent a special case in that higher efficiency classes translate directly into tangible monetary savings for consumers – a feature that may enhance consumer motivation to engage with the label and could therefore influence findings on comprehension and effectiveness. This may not apply to all product categories covered under the ESPR. However, given that the mandatory comparative label introduced under the ESPR is expected to follow a similar design logic to the EU energy label, insights drawn from this label are likely to be particularly relevant and transferable to the ESPR context. Fourth, evidence on demographic variation and cross-country differences remains inconsistent and sometimes thin, due to small sample sizes or limited geographic coverage in many studies. Finally, the review synthesises predominantly self-reported measures of perception and intention, which may not always translate into actual purchasing behaviour. These limitations highlight the need for further empirical and cross-national research to deepen understanding of eco-label effectiveness. Finally, the use of labels by marginalised groups or individuals with disabilities has been largely neglected.

Theoretical implications and future research

The findings emphasise the need for further exploration of heuristic decision-making and trust mechanisms in eco-label effectiveness. Future research should investigate how design elements, such as colour schemes or categorical scales, interact with cognitive biases in influencing consumer decisions. Additionally, studies could explore the role of digital tools, like QR codes, in enhancing transparency and trust. Importantly, linking perception studies with actual purchasing decisions in both online and offline store environments is crucial to understand how label design translates into real-world behavioural changes. Furthermore, it is important to investigate whether there are any interactions between factors such as the presentation environment (online–offline) and the design of the label. This would help clarify whether consumer preferences observed in controlled settings lead to sustainable choices in practice. Furthermore, research should establish the cognitive limits for processing label information, particularly in the context of increasingly complex labels. Determining the optimal balance between informativeness and simplicity could prevent cognitive overload, ensuring that labels effectively communicate sustainability criteria without overwhelming consumers. Building on our review, an open question is whether a single (aggregated) score is needed or would be helpful for the consumers in particular for an ESPR label. Future research could test when a “headline score” helps versus when separate dimension scores (or modular, product-specific “hotspot” sets) better support comprehension and trust – particularly in multi-label environments and in relation to the EU energy label. Lastly, there is a pressing need to examine the impact of cultural and demographic diversity on label effectiveness and on the comprehensibility of its elements, particularly in underrepresented EU regions, and identify common ground across groups. Longitudinal studies could assess how consumer engagement with eco-labels evolves over time, particularly in multi-label environments, to better inform the development of harmonised and adaptive labelling systems.

Practical implications for ESPR label design

Designing effective eco-labels requires careful consideration of multiple factors to balance simplicity and informativeness while addressing consumer needs and diversity. Key design principles based on this review include:

• Use intuitive formats: Implement categorical scales (e.g., A–G) and traffic-light colour schemes to ensure quick recognition and comprehension.

• Provide additional elements in a structured and standardised way: Essential information must be mandatory and consistently presented by manufacturers to ensure transparency and comparability and to avoid cognitive overload. At the same time complementary elements such as concise textual clarifications and accessible digital extensions (e.g., QR codes) should be included to enrich the information layer. These extensions should be designed as optional “deep dives” for the consumers who seek more detailed insights, thereby enhancing engagement without increasing cognitive load for those who prefer a quick overview. This could be achieved by defining a clear hierarchy of information, where core content is always visible and standardised, while supplementary content is accessible on demand through intuitive, low-friction entry points.

• Reinforce trust: Ensure transparency in certification processes and leverage credible institutional backing, such as EU governance, to strengthen consumer confidence in the label.

• Harmonise with existing labels: Coordinate with established schemes like the EU energy label to prevent conflicts and maintain consistency across sustainability labels.