AbstractMarketers often use green in marketing communications to signal sustainability, despite the lack of supportive data. This article is a report of two experiments to observe consumer reactions to advertisements that use colour to indicate the environmental friendliness. The pretest and Study 1 confirm that consumers associate green with environmental friendliness and grey with environmental unfriendliness. Thus green (grey) is more (less) effective for producing positive ad attitudes and purchase intentions. Consumer perceptions regarding colour appropriateness mediate the effects. Study 2 shows that persuasion knowledge moderates the effects: when consumers have high persuasive knowledge, green has a less positive effect; grey has a less negative effect; blue remains neutral. The study concludes that green functions as a peripheral cue signalling an eco‐friendly brand image, but the use of green may backfire when consumers are aware that green is used to bias responses.