Academic journal article Journal of Agricultural and Applied Economics

Characteristics of Organic Food Shoppers

Academic journal article Journal of Agricultural and Applied Economics

Characteristics of Organic Food Shoppers

Article excerpt

Data from a national survey of food shoppers are analyzed by probit and ordered probit models that incorporate elements of Lancaster's product attribute model and Weinstein's precaution adoption process. The models are used to investigate the characteristics of organic and nonorganic food shoppers. Where one shops, food beliefs, and food knowledge have the largest significant impact on the probability that shoppers buy organic food. Among the demographic characteristics, only the lack of religious affiliation, higher education, and youth are significant explanatory variables.

Key Words: consumer decision making, consumer profiles, organic food, product attributes

JEL Classifications: C25, D12, M31

Global sales of organic foods are estimated to be growing at 10% to 20% annually. They were SUS23 billion in 2002 (Wilier and Yussefi) and estimated at SUS29-31 billion in 2005 (Kortbech-Olesen). Researchers attribute the growing demand for organic products to concerns about the environment, health, genetically modified (GM) foods, and the recent series of highly publicized food scares (Davies, Titterington, and Cochrane; Dimitri and Greene; Tregear, Dent, and McGregor; Wilier and Yussefi).

This is despite the fact that organic food premiums range from 50% to 75% (Wilier and Yussefi). Brown and Sperow estimated the cost of an all-organic diet using the USDA's Thrifty Food Plan would increase food expenditures by 49% for a family of four. Price differences between individual organic and conventional foods ranged from -74% to 450%.

Given that organic food sales are growing rapidly despite the generally higher cost, the purpose of this paper is to identify who are organic shoppers and what characteristics are associated with their organic food demand. This will help in predicting how big the market for organic food eventually will be. Organic shoppers are subdivided into those who buy organic foods occasionally and those who buy organic foods every shopping trip. This is to identify whether there are substantial differences in these two groups.

Lancaster's product attribute model and Weinstein's precaution adoption process are used to formulate a hybrid model to examine the factors related to organic food shoppers. Weinstein's precaution adoption process provides insights into the process of behavior change. Using cost-benefit analysis as a foundation, he views the adoption of new behavior as a dynamic process that incorporates competing life demands and cues to action. The hybrid models are estimated by probit and ordered probit analysis using data from a 2003 U.S. consumer survey.

Background

Given that organic food is generally more costly, some researchers have found that organic food demand is linked with higher income (Davies, Titterington, and Cochrane; Tregear, Dent, and McGregor; Wilier and Yussefi). However, Goldman and Clancy and Storstad and Bjorkhaug found no relationship. Zepeda, Chang, and Leviten-Reid found high cost to be a barrier to organic food purchases but that it was not necessarily related to income. Turnbull and Lockie et al. found that the lack of availability of organic foods, their high cost, and high search costs or inconvenience were major obstacles to organic food demand. Neither Goldman and Clancy or Thompson and Kidwell found price to be a deterrent to buying organic, however, the latter found that store choice was the main factor in organics purchase, with health food stores and food cooperatives generally having a greater variety and concentration of organic foods than conventional grocery stores. Chang and Zepeda also found the lack of availability to be a major barrier to purchasing organic foods.

Several researchers found that concerns about personal health, the environment, and animal welfare are associated with organic food purchases (Chang and Zepeda; Davies, Titterington, and Cochrane; Dimitri and Greene; Storstad and Bjørkhaug; Swanson and Lewis; Thompson; Tregear, Dent, and McGregor; Zepeda, Chang, and LevitenReid). …

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