Willingness to pay for brands: a cross‐region,cross‐category analysis

Using survey data collected in multiple locations (California and Texas in the United States and Revohot in Israel), we quantify category‐ and location‐specific variations of consumers’ willingness to pay (WTP) for brand products after controlling for consumer characteristics. We find that consumers have a similar qualitative assessment of brand value in different product categories across different locations. That is, consumers have a stronger preference and higher WTP for brands in consumer electronics, followed by clothing and then processed food, and the lowest in fresh produce. Furthermore, we simulate price premiums and market shares of brands relative to generic products in different categories. Simulation results suggest that brands in fresh produce have the highest price premium but lowest market share. Despite the similarities, the magnitude of WTP for brands as well as the simulated price premium and the corresponding market share in the same product category are location variant. The similarities and dissimilarities suggest validity of having global brand strategies adapted to local conditions, that is, the so‐called “thinking globally and acting locally” strategy.     

The influence of African swine fever information on consumers’ preference of pork attributes and pork purchase

This paper uses a randomized survey instrument to study the impact of African Swine Fever (ASF) information on Chinese consumers’ preference for pork attributes and purchases during the recent peak of the ASF pandemic in 2019. We study consumers’ preference for pork attributes including brand, meat texture and taste, quality safety assurance, and traceability under different information treatments. Results show that the willingness to pay (WTP) for quality safety assurance is the highest, followed by brands and traceability systems, and the WTP is lowest for good taste. We show that providing detailed ASF information substantially changes consumer preference by altering the relative importance of pork attributes and price sensitivity, which enables consumers to focus more on safety-related attributes while paying less attention to price and taste attributes. Furthermore, we find that a higher belief in the future of ASF occurrence reduces the frequency of purchases marginally but does not significantly influence for amount per purchase and the total purchase amount.     

Consumer Quality Perception in Traditional Food: Parmigiano Reggiano Cheese

Abstract

The paper aims to classify the quality cues and attributes of grated Parmigiano Reggiano cheese, an Italian traditional food cheese, exploring if they affect consumers’ quality perceptions and expectations. Analysis is based on a questionnaire administered in hypermarkets where grated Parmigiano Reggiano is sold. A factor analysis, using varimax rotation, and a cluster analysis, were performed, using the Stata 12 software package. The clusters used were: geographical origin and packaging (cluster 1); price, brand and quality certification (cluster 2); all sensory attributes (cluster 3); and a combination of sensory attributes with price, brand, and quality certification (cluster 4). This is the first study to examine the quality cues and attributes affecting quality perception and expectations of cheese for grated Parmigiano Reggiano from a consumer perspective. It is also the first to classify cheese attributes following a quality approach, encompassing previously studied sensory and other attributes.     

Shaping Halal Into a Brand? Factors Affecting Consumers’ Halal Brand Purchase Intention

The authors’ aim was to find the possible positive relationships among branding constructs (brand image, brand perceived quality, brand satisfaction, brand trust, and brand loyalty) to explain consumer purchasing behavior toward halal brands. The authors proposed and empirically tested a conceptual model consisting of variables such as brand image, brand perceived quality, brand satisfaction, brand trust, and brand loyalty. A sample of 324 international Muslim respondents in China was gathered through the use of convenience and snowball sampling methods, and the hypotheses were tested by performing structural equation modeling. The empirical results show that the brand image of a halal milk brand is found to directly and positively affect consumer brand perceived quality, brand satisfaction, brand trust, and brand loyalty except for consumer brand purchase intention. This study suggests that companies dealing with halal brands should invest more resources to increase brand perceived quality, brand satisfaction, brand trust, and brand loyalty because these factors are positively associated with customers’ brand purchase intention.     

The Effect of Extrinsic Product Attributes of Pineapple Juice on Consumer Intention to Purchase

This study aimed to investigate the extent to which consumer information concerning several attributes of the pineapple juice packaging, including the manufacturing process, influenced the consumer intention to purchase. It is suggested that high-pressure technology retains nutrients as vitamins and keeps sensory attributes closer to those of fresh foods. These advantages meet the increasing consumer demand for healthy products and a more differentiated food assortment. However, the benefits provided by these products are not always communicated to consumers. Although information about the technology (high-pressure) had been positively considered by consumers when fruit juice consumption was taken into account, fewer studies have focused on this aspect. The effect of 5 attributes of the package (information on manufacturing process, product definition, production information, price, and brand name) on the pineapple juice consumer intention to purchase was investigated by 96 fruit juice consumers. Information about technology (high-pressure) positively contributed to the consumer pineapple juice intention to purchase and showed to be essential when it is applied on pineapple juice production, being a useful approach when adequately communicated to consumers.     

Green Consumerism and Ecolabelling: A Strategic Behavioural Model

The ethos of “green” marketing is to affect tastes and perceptions so that those individuals for whom the attribute of environmental‐friendliness is significant can signal this preference by choosing the “green” alternative. This paper presents a strategic behavioural model of interactions between two agents, a firm and consumer, under conditions of incomplete information. The outcome of the model is that, unless some restrictive and (arguably) unrealistic conditions apply, some proportion of “green” marketing campaigns will be misleading; “green” marketing is not restricted to “green” products, and “green” consumers only adapt their purchasing habits some of the time. Ecolabelling schemes can be used as a means of ameliorating this inefficiency in information‐transfer. Whether state intervention to make ecolabelling mandatory for “green” products is welfare‐improving depends on the balance between the deadweight losses from the process and the gains in terms of facilitating the expression of “green” preferences.     

You get what you pay for: the link between price and food safety in Kenya

The lack of a reliably safe food supply in developing countries imposes both health and economic costs. Food safety is one of several dimensions of food quality that are typically unobservable at the time of purchase. Branding can overcome this information problem by allowing firms to build reputations based on the quality of their products. If a reputation for food safety is valued directly by consumers, or if food safety is correlated with other valued attributes, firms producing safer food should be able to use their brand equity to charge higher prices. In addition, firms with stronger brand equity have stronger incentives to meet food safety standards in order to maintain that equity. Using data from more than 900 maize flour samples representing 23 distinct brands in eastern and central Kenya, we explore the relationship between price and contamination with aflatoxin. Aflatoxin is a fungal toxin common in maize, groundnuts, and other crops around the world. We find a strong negative correlation between price and contamination at the brand level, consistent with the hypothesized positive relationship between brand equity and food quality.     

Marketing Olive Oil Products in the Tunisian Local Market: The Importance of Quality Attributes and Consumers' Behavior

This article is, to the best of our knowledge, the first investigation of Tunisian olive oil consumer behavior by the use of the conjoint analysis technique. The conjoint experiment was based on carefully selected olive oil attributes: type, taste, color, packaging, region of origin, and price. The results have important implications to improve the marketing of olive oil in the local market by focusing on key preferred attributes. Consumers were found to prefer more extra-virgin, followed by virgin olive oil, to pomace oil. They also showed higher preference for green colored olive oil with strong flavored taste. Contrary to a common belief in Tunisia, the region of origin attribute did not show significant effect on consumers’ purchasing decisions. The results show also that Tunisian olive oil consumers are price sensitive and therefore any price strategy to introduce bottled products should take into account consumers’ preferences for bulk purchase.     

Understanding Heterogeneous Consumer Preferences in Chinese Milk Markets: A Latent Class Approach

We examine heterogeneous consumer preferences in Chinese milk markets. Using a discrete choice experiment, we examine how the brand, quality certification, traceability label and price influence consumers' milk choices. We identify four consumer segments using a latent class model: price conscious (9.8%), balanced thinking (19.8%), health conscious (57.5%), and environment conscious (12.9%) consumers. These four segments have distinct preferences: price conscious consumers prefer green certification; balanced thinking consumers have the highest willingness to pay for traceability labels; health conscious consumers have strong brand awareness; and environment conscious consumers prefer organic certification and traceability labels and use price as a quality signal. Such diversity of consumer preference can be explained by four psychological factors: price consciousness, food safety concerns, health consciousness and environmental concerns.     

Decision Process for Adoption of Innovative Products in the European Seafood Market: The Importance of Supply and Demand Factors

This study proposes a new approach with two-dimensional point of view to test predicting factors that are influencing European trader decisions for the adoption of innovative seafood products in the distributor channels. A combination of two main predicting factors for adoption is investigated in the “supply factors” (4Ps: product, promotion, place, and price) and the “five innovation demand factors” (5IDs: relative advantage, compatibility, complexity, trialability, and observability). The findings indicate that 4Ps and 5IDs have a significant effect as controlling variables in the decision-making process for innovation adoption. This fact shows a strategic function and illustrates that supply–demand factors have a pressure effect on the innovation adoption process in the market. The results are important both for satisfying consumer expectations and for industrial innovation strategies.     

The Value of Brand and Convenience Attributes in Highly Processed Food Products

Researchers have long sought to better understand consumer preferences for various packaged foods and their attributes. Beyond price and taste, brand names, convenience, and increasingly diet‐health‐related cues are regarded as key attributes in attracting consumer demand. This paper applies a hedonic pricing model to a large panel of consumer packaged food products to estimate monetary value of brand, convenience, and other quality attributes in processed meat and seafood products using 2000–06 Nielsen aggregate weekly scanner data. We find evidence of consumer preferences for perceived “natural” and health attributes over products with higher degrees of processing. The results further indicate that the process of adding value to food products is intricate and dependent on multiple other indicators of product quality, not least health. As such, frozen natural chicken and seafood products may be considered by certain consumers as substitutes for fresh meat and seafood. This finding may carry further implications for the pricing and marketing of lower‐value products. Les chercheurs tentent depuis longtemps de mieux comprendre les préférences des consommateurs pour divers aliments emballés et leurs attributs. Outre le prix et le goût, la marque, l’aspect pratique et les logos santé sont considérés comme d’importants attributs pour accroître la demande des consommateurs. Dans le présent article, à l’aide de données scanographiques agrégées hebdomadaires obtenues auprès de Nielsen pour la période de 2000 à 2006, nous avons appliqué un modèle hédonistique des prix à un large éventail de produits alimentaires de consommation courante pour estimer la valeur monétaire de la marque, de l’aspect pratique et d’autres attributs de qualité dans le cas de produits de viande et de la mer transformés. Les résultats indiquent que les consommateurs ont une préférence pour les produits dits « naturels » et « santé» par rapport aux produits hautement transformés. Les résultats indiquent également que le processus d’ajout de valeur aux produits alimentaires est complexe et tributaire de nombreux autres indicateurs de qualité, y compris la santé. Certains consommateurs considèrent même les produits de la mer et le poulet naturel surgelés comme des substituts de viande et de produits de la mer frais. Cette observation peut avoir des incidences sur l’établissement des prix et la commercialisation de produits de faible valeur.     

Are Local and Organic Claims Complements or Substitutes? A Consumer Preferences Study for Eggs

This paper provides an analysis of consumer preferences for product claims, specifically about origin and production methods. In particular, it addresses two important questions: i) whether consumers are willing to pay a premium for food products carrying these claims; and ii) whether local and organic claims are complements or substitutes. A choice experiment designed to estimate two‐way interactions was undertaken in Spain for eggs. The findings show first, that consumers are willing to pay a positive premium price for an enhanced method of production (that of barn, free‐range and/or organic instead of cage produced eggs) as well as for the proximity of production (local, regional and national over imported). Second, the findings show that consumer preferences for the claims are heterogeneous with two consumer segments being identified: “origin preference”, the larger segment, and the “production method preference”. Results show that organic and local claims were complements for the larger first segment but that free‐range and local/regional claims were substitutes for the second smaller segment. These results provide the marketing chains with insights applicable for pricing strategies.     

Product Differentiation with Credence Attributes and Private Labels: The Case of Whitefish in UK Supermarkets

The retail market for seafood is dynamic with substantial competition both amongst retailers and between private labels and national brands. New product attributes are added in attempts to differentiate products and to attract consumers. Credence attributes, in particular those related to eco‐labels and fishing method, have become more common. But little is known about how these and other credence attributes are valued in the retail market. In addition, little is known about price differences between private labels. To estimate the value of these attributes, weekly in‐store observations of selected frozen whitefish products were conducted in seven UK retail chains in the city of Glasgow. An estimated hedonic model shows a substantial price premium for fishing method (line‐caught), a premium for both home (Scottish) and non‐home country of origin (Icelandic) and a premium for the Marine Stewardship Council eco‐label. An uncertified eco‐label owned by a large seafood manufacturer leads to reduced price. The study also reveals substantial price differences between private labels for whitefish. The results contribute new insights regarding opportunities for differentiation by credence attributes which may lead to more sustainable and effective resource use along the value chain for frozen whitefish.     

Is It Worth Getting Labeled? The Case of MSC-Certified Seafood

Research has examined consumers’ attitudes toward ecolabels, but there is a lack of research examining whether niche ecolabels give a competitive advantage in consumer markets. The authors aim to fill this gap by exploring the four conditions of market success (evidence of price premiums, market share, access to retailers, and elasticities) established in the literature. Three varieties of MSC-certified fish are studied. Differences are observed across the three varieties that lead to the following conclusions: MSC-labeled products do not systematically sell at a premium; price has an inelastic effect on the demand of certified national brands, but increased distribution has a very elastic effect on demand; and MSC-labeled products do not experience seasonal effects. The consumer market is responding favorably to the label, but ecolabeled fish is in an introductory stage. Price premiums vary; the retailer’s brand is playing a prominent role.     

Consumers’ Trust in Food Quality and Willingness to Pay More for National Parks’ Brands: Preliminary Evidence From Italy

In Italy, national parks allow the use of their brand logo and name on the labels of food products produced by firms located within the national parks. However, no empirical research has yet investigated the impact of national park brands on consumers’ attitudes and behaviors. Hence, this empirical study explores the factors that influence consumer trust in food quality and their willingness to pay premium prices for the national park brands. Results from a survey involving a sample of 227 Italian consumers suggest that women and younger consumers trust more and are more willing to pay for national park brands. The origin of food products associated with national parks, naturalness of foods, food quality certifications and branding, and the environment in which the packaged foods originate influence consumer confidence and buying behavior. Implications for food marketers and policymakers are discussed.     

Energy‐milk price transmission at the product brand level

This article estimates the pass‐through rates between diesel fuel and retail milk prices at the product brand level. Using a random coefficient logit demand model and taking the direct and indirect impacts of energy prices, this research identifies changes in pass‐through rates before and after the great recession in 2008. Empirical results show that diesel prices significantly impacted the retail prices of milk products and are an important determinant of food price inflation. Pass‐through rates are estimated to range from 0.16 to approximately 0.60 through 2008 with an average of 0.22 for the whole period. Statistical tests indicate that pass‐through rates before June 2008 were significantly higher than after June 2008 when they dropped significantly to 0.04 to 0.17. Interestingly, private label brands have the lowest pass‐through rates, implying that compared to manufacturer brands, private label prices are more insulated from diesel price shocks.     

福建乌龙茶的品牌忠诚影响因素实证研究——以福州消费者为例

以福州消费者问卷调查数据为基础,利用结构方程模型对福建乌龙茶的品牌忠诚影响因素进行计量分析研究。结果表明:福建乌龙茶的感官品质、价格合理性、购买便利性、广告,以及"消费者对自我形象的态度、对风险厌恶程度"都对福建乌龙茶的品牌忠诚具有极显著的正向影响;"消费者对相关群体的重视程度"呈显著的负向影响,而"消费者对时间的重视程度"没有显著的影响。并在此基础上,提出相应的对策。