Factors Influencing Consumers’ Willingness to Pay for Organic Fruits and Vegetables: Empirical Evidence from a Consumer Survey in India

Numerous consumers confronted with increasing environmental problems, food safety issues, and augmentative health problems increasingly desire to have healthier and more natural foods grown in an eco-friendly manner. Hitherto organic foods only partly benefit from this increasing market environment, and their market share stays rather low despite high growth rates. This article aims to investigate consumers’ willingness to pay (WTP) for organic fruits and vegetables and relevant factors affecting consumers WTP. The contingent valuation method was selected to estimate WTP. Empirical data was drawn from a 250-consumer survey conducted in Bangalore during February 2013. A binomial logistic regression model was applied to obtain the value of WTP and determine the factors influencing it. The results indicated that about 90% of the consumers were willing to pay a premium price ranging between 5% to more than 100% in order to acquire better-quality fruits and vegetables; factors such as family income, size of the family, gender, and other opinion variables such as chemical residue in conventional foods, trust on retailers, taste, and environmental concerns significantly influence consumers’ WTP. More than 87% of the consumers indicated that high price, lack of availability, narrow range, and irregular supply are the major barriers for them to buy these products. The results provide useful evidence to pertinent governmental agencies in terms of assisting in the design of policies for the promotion of organic food production and marketing and reaching the target public. Furthermore, firms involved in the organic foods business may also see benefits when drawing information in order to calibrate marketing strategies.     

Two-Stage Determinants of the Organic Food Retailing Landscape: The Case of Manhattan,New York

Retail sales of organic food products have been increasing faster than any other category of food and have penetrated mainstream retail grocery outlets. The majority of the literature on organic markets explores the socioeconomic characteristics of consumers, linking these traits to the probability of buying organic food, and it suggests that access to organic food is an important but overlooked factor in such studies. More recently, research focusing on food retailer marketing strategies for organic food finds that traditional strategies such as price promotions are largely unsuccessful with increasing sales for the organic food consumer. This article focuses on the retailer decision to offer organic food for sale. We model the decision as a two-stage process, where the retailer’s first decision is whether to sell organic food, and the second decision determines how many different organic products to offer for sale. In doing so, by using data collected in stores, we assess the organic food retail landscape in Manhattan, NY. We find that the decision to offer organic food for sale depends on the neighborhood socioeconomic characteristics, and the amount of organic food offered for sale depends on the size of the store.     

深圳市蔬菜农药残留分析

[目的]分析2007年深圳市超市、农贸市场中蔬菜有机磷、有机氯、拟除虫菊酯类农药残留情况,对比2006年的监测情况,找出农药使用的变化规律,为政府部门有针对性的监管蔬菜质量提供科学数据。[方法]2007年1到12月每个月共选取深圳市6个区中的30家超市、28家农贸市场,在每个超市、农贸市场中抽取蔬菜样品10个。采用农药快速检测方法结合气相色谱和气质联用法测定其中的24种农药残留。[结果]2007年共检测各种蔬菜样品6551份,蔬菜农药检出率与超标率为5.31%和2.99%,分别比2006年下降1.93%和1.24%。[结论]2007年的蔬菜农药残留比2006年有明显下降;引起蔬菜农药超标的主要原因是有机磷农药残留;高毒农药的使用有所下降,菊酯类农药引起的超标情况有所上升,应有针对性的加强监督管理。     

Media influences on consumption trends: Effects of the film Food,Inc. on organic food sales in the U.S.

In this paper, we empirically investigate the effect of Food, Inc. – an influential documentary film on the US food industry – on organic food sales. We use a novel dataset of Google search volume to measure the influence of the film. Organic food sales are measured using store-level data for three categories in 33 major US markets. For two out of the three studied categories – yogurt and peanut butter – we find that areas with more Google searches for the film experienced a greater increase in the share of organic sales subsequent to the film's release. The effect of the film is more pronounced for the yogurt category, which is closer to the farm and more relevant to animal welfare — one of the key issues featured in the film. The effects are economically significant: ceteris paribus, a one standard deviation increase in our Google search stock measure translates into a 0.66% increase in organic market share for the yogurt and a 0.15% increase for the peanut butter category. In addition, we provide a measure of the decay of the film's effect by deriving the 90% duration interval of the focal search stock variable. We find that, for both categories, the film's effect on organic shares faded within six months.     

Beyond organic: consumer interest in new labelling schemes in the Central Coast of California

Producers are interested in developing labelling schemes that go ‘beyond organic’ to address ethical criteria not included the US Department of Agriculture organic standards. However, consumer interests in labels that are not as widely available as organic in the market are poorly understood. This study reports results of focus‐group research and a survey of 1000 households in the Central Coast region of California to determine which standards consumers are most interested in supporting through their purchases. The results indicate that standards for the humane treatment of animals have the highest level of support, followed by a standard for local origin, and for a living wage for workers involved in producing food. Logistic regression analysis suggests that humane is more likely to be chosen by women, European‐Americans, younger people and frequent organic purchasers. Locally grown was preferred by older people and households with children. A living wage for workers involved in food production was selected more often by Latinos. Although a characterization of trends is not possible due to a cross‐sectional design, the results suggest some potential directions for producers in this region who are willing to supply unmet consumer demands for ethical criteria. There are three basic directions that new and emerging labels may take with respect to US national organic standards: (1) separate from organic; (2) institutionally separate, but tightly integrated with organic; and (3) intended to supplant organic. The success of each of these strategies will depend on how much trust consumers continue to place in government oversight of organic food. The study results also suggest that the movement for a more sustainable food system would benefit from devoting more attention to issues of animal rights and social justice.     

Health motive and the purchase of organic food: A meta‐analytic review

There are many empirically determined influential factors known to control the organic food purchase behaviour. Of these known factors‐ health, product quality and concern for natural environmental degradation are seen as the major motives behind the organic food purchase. We, therefore, attempted to investigate the most prominent reason(s) for buying organic food, using the meta‐analyses of studies published during the last 25 years as our basis for conviction. Multilevel meta‐analyses was applied to the studies in review, in order to find the major reason(s) for the purchase of organic grocery, milk, fruits and vegetables. Although the three motivational factors mentioned above have been echoed throughout the history of organic food purchase research, the health factor has always topped the priority chart. The study in its overall empirical scale contributes to managerial implications and sets an agenda for future research.     

National Demand for Fresh Organic and Conventional Vegetables: Scanner Data Evidence

Using AC Nielsen scanner data on U.S. household consumption of selected fresh vegetables from 1999 to 2003, this study provides an overview of the organic fresh vegetable market by investigating market shares and price premiums of selected organic fresh vegetables and estimating the interrelationship between consumer demand for organic and conventional fresh vegetables. The linear Almost Ideal Demand System was found to fit the data best among alternative demand models. Expenditure, own, and cross price elasticities were computed for both organic and conventional vegetables based on the best fitting model.     

Pasture-Raised Milk: The Market for a Differentiated Product

Pasture-raised (PR) milk is a specialty product that could feasibly be produced by economically challenged dairy farms. Our goal was to profile the milk market using an internet survey to identify potential future consumers of PR milk. There were 611 U.S. respondents that were divided into three categories as types of milk consumers: those who only purchased conventional milk in the past year (CONV), those who only purchased non-conventional milk (such as organic, PR, or natural milk) in the past year (NONCONV), and those who purchased both conventional and non-conventional milk in the past year (MIXED). MIXED and NONCONV agreed or strongly agreed with PR milk benefits substantially more than CONV. PR milk was also valued by NONCONV and MIXED in purchasing intentions, but not nearly as much as organic milk. In addition, CONV valued PR milk in purchasing intentions more than organic milk. Results suggest that PR milk can be successfully positioned to appeal to MIXED and perhaps some CONV, potentially increasing sales or market share.     

Changes in food provision in Russian households experiencing perestroika

The purpose of this article is to describe how households in Novgorod the Great, Russia, deal with food provision in everyday life. The study focuses on changes experienced in food provision and consumption in Russian society, in order to illustrate how households respond to the transformation towards a market economy. The study reflects women's perspective on food provision. Students from Novgorod the Great visited 105 households and asked the women in the household to answer a questionnaire. Results from the study show that in order to cope with changes in society related to economic reforms, Russian households had changed both their food consumption and food production patterns. There was no big difference between urban and rural households. Nearly all of the households were self‐sufficient in the provision of vegetables and potatoes. Many households had a ‘dacha’ (plot), where they produced most of what they needed. Among the changes experienced during recent years (i.e. during the end of the 1990s), a decade after perestroika was initiated, households mentioned the rise in food prices and the decrease of income. Households reported that they consumed less fruit and/or meat. Some households also mentioned that the quality of nourishment had decreased, thereby indicating lower general quality, lower nutrition value, or less healthy foodstuffs.     

Is an Increase in Organic Consumption Accompanied by A Healthier Diet? A Comparison of Changes in Eating Habits among Danish Consumers

Several studies have shown that consumers with a high organic consumption often have dietary habits that include more fruit and vegetables but less red meat. This paper takes a novel approach by investigating whether changes in consumption of organics and improvements in dietary habits also are related. The results show that many consumers seem to improve their diet while increasing the organic consumption. Further, the study suggests that some households already have a relatively healthy diet in terms of fruit, vegetables, and meat consumption, when they start buying organic food. When organic consumption reaches a certain level, further increases in organic consumption are more likely to take place at the same time as dietary habits are improved. References to health and climate considerations seem to be the most important motivations for reducing meat consumption, while higher availability of organics is the most important reason for increasing organic consumption.     

New Product Introduction and Seasonality Effect in Food Products Retailing

ABSTRACT

This study aims to measure the effects of market demand and seasonality on new product introduction. Major factors contributing the variability of market demand and seasonality of new products have been discussed in reference to timing of introducing new products, variability of consumer preferences, retail sales, and product promotion. The study is based on 243 new products in selected self-service stores in Mexico, which belong to major food products sectors for the reference period 2002–2006. Results of the study reveal that market demand and seasonality factors are most important for the timing of new product introductions, as such conditions determine success of the new products in a given market.     

Which little piggy goes to market? Characteristics of US farmers' market shoppers

The growth in farmers' markets in the US has raised questions about whether they are a niche market or appeal to a broader population. Using a simple, random sample of US food shoppers, this study uses a test of means to examine whether there are differences in characteristics between those who shop at farmers' markets and those who do not. A key finding was that there was no significant difference in the level of food expenditures between shoppers and non‐shoppers. In addition, a probit model was used to examine the marginal effects of attitudinal, behavioural and demographic variables on the probability of shopping at a farmers' market. The probability was significantly increased by the following: enjoyment and frequency of cooking, being female and the presence of another adult in the household. Income did not significantly influence the probability of shopping at a farmers' market. However, the probability of shopping at a farmers' market was significantly reduced if respondents perceived that cost was the most important characteristic of food. These characteristics imply limited appeal of farmers' markets currently to convenience‐oriented, single‐person, and single‐parent households.     

Learning to export from neighbors

This paper studies how learning from neighboring firms affects new exporters' performance. We develop a statistical decision model in which a firm updates its prior belief about demand in a foreign market based on several factors, including the number of neighbors currently selling there, the level and heterogeneity of their export sales, and the firm's own prior knowledge about the market. A positive signal about demand inferred from neighbors' export performance raises the firm's probability of entry and initial sales in the market but, conditional on survival, lowers its post-entry growth. These learning effects are stronger when there are more neighbors to learn from or when the firm is less familiar with the market. We find supporting evidence for the main predictions of the model from transaction-level data for all Chinese exporters over the 2000-2006 period. Our findings are robust to controlling for firms' supply shocks, countries' demand shocks, and city-country fixed effects.     

A Balancing Act: Disproportionate Sampling of Organic Foods

When exploring decision making in food marketing, particular events are often unequally represented in the data. Concerns over bias can confuse public policy or strategy interpretation if samples are unbalanced. This occurs when researching organic food marketing. A small share of the market (～4%) and of product innovations (～7%) are organic. Caution is advised when predicting trends based on this disproportionately small sample of organic products. This study demonstrates that there is little statistical difference, and even a net gain in predictive power, when using a balanced sample to test factors that influence a firm’s decision to market organic food. Marginal probabilities for the smaller, balanced sample are biased by a constant factor. Thus ex post adjustment is easy and recommended to enhance predictive power.     

Food waste in the retail sector: A survey-based evidence from Central and Eastern Europe

This paper explores the issue of food waste in the Lithuanian retail sector. A questionnaire survey was designed in order to collect the relevant data from both the largest retail chains with stores around the country and companies with small-scale stores in rural areas. The present case is interesting as the literature on Central and Eastern European countries is scarce in the sense of the quantification of food waste. In this paper, the amounts of food waste among different food product categories are discussed and then extrapolated to approximate food waste in retail trade for Lithuania by using sales revenue as a key parameter. The results suggest that food waste in the Lithuanian retail sector amounts to 36.4 thousand tonnes or 13.0 kg per capita per year. Fruits and vegetables account for more than a half (63%), whereas meat (products) come next representing some 9% of food waste. Therefore, these products can be considered as the major targets for valorisation schemes and other measures aimed at mitigation of food waste.     

Health and environmental consciousness,costs of behaviour and the purchase of organic food

This paper examines environmental and health consciousness, as well as behavioural costs and their effects on the purchase of organic products. The consumption of organic products is regarded as an investment in individual health. The low‐cost hypothesis takes environmental attitudes and behavioural costs into account and is applied to organic food consumption. The survey conducted in three German cities in 2006 using self‐administered questionnaires (n = 521) does not investigate willingness to pay but rather self‐reported behaviour. The results of the regressions using the Heckman correction show that income does not affect the regularity of organic food consumption but that it does influence individual expenditure on organic food. Furthermore, there is an inverted u‐shaped relation between age and the purchase of organic products. Although health consciousness has a stronger association with organic food consumption than does environmental concern, the interaction between behavioural costs and health or environmental consciousness shows no effect. Thus, the low‐cost hypothesis is not supported.     

The Post-entry Performance of Cohorts of Export Starters in German Manufacturing Industries☆

This paper investigates four cohorts of firms from German manufacturing industries that started to export between 1998 and 2002, and follows them for five years after the start. Export starters are a rare species and small in Germany. Around 30–40% of those starters studied became continuous exporters. The share of total exports contributed by export starters of a cohort is tiny in the start year, and it remains so over the years that follow. Contrary to the market selection hypothesis, there is no evidence that productivity in the start year is systematically related to survival in the export market. There is no evidence of a negative impact of a smaller firm size in the start year on the chance of surviving in the export market. Starting with a higher share of exports in total sales, however, tends to increase the probability of continuing to export.     

The relationship between in-store marketing and observed sales for organic versus fair trade products

To stimulate sales of sustainable products, such as organic and fair trade products, retailers need to know whether their in-store instruments effectively enhance market shares. This study uses sales data and a multilevel modeling approach to explain the market shares of sustainable products according to shelf layout factors, price level, price promotions, and consumer demographics. It argues that the effect of these variables differs between organic versus fair trade products, as buying motives might differ, organic buyers tend to be more loyal, and price is a more informative signal of quality for organic products. Results show that the number of facings has a positive relationship with the market share of fair trade brands, but not with the market share of organic brands. The same holds for the price difference with the leading brand, which is important for fair trade brands but not for organic brands. In contrast, an arrangement of the product category by brand is associated with higher market share for organic brands but not for fair trade brands. Additionally, placement at eye level and clustering of items benefits both types of sustainable brands, whereas they appear to be not very sensitive to price promotions. Finally, higher sales of sustainable products are found in areas where the customer base is older and has a higher education level.     

Consumers’ Grouping of Organic and Conventional Food Products—Implications for the Marketing of Organics

A detailed account of the way consumers choose to group different varieties of organic and conventional food produce might have practical implications in terms of improved space management in supermarkets and better targeted promotions of organic products. The results presented here were obtained in a case study using a web-based questionnaire and 849 Danish consumers. The consumers were asked to group the contents of a virtual basket of organic and non-organic fruits and vegetables into two smaller baskets. A significant share of the consumers grouped the food products according to whether or not they were organic. These consumers were found to have significantly higher levels of confidence in the benefits of organic produce, to state significantly higher levels of organic consumption and higher willingness to pay for organoleptic attributes of fresh milk, than consumers who placed fruits in one basket and vegetables in the other.     

Organic Food at the Point of Purchase: Understanding Inconsistency in Consumer Choice Patterns

The organic food category, while still small in terms of world food production, has continued to grow in many markets in the developed world. This article focuses on understanding the barriers and facilitators to purchasing organic food at the final hurdle: the point of purchase (POP). A qualitative study has identified seven factors that influence buyer behavior at the POP, and these are consumer intention to purchase organic food when entering the retail outlet; habit; availability; false assumptions; visibility and access of organic food; visual and olfactory cues; and price. These can often be the final hurdle to consumers choosing (or not) organic food at the POP.