Agriculture Reference
In-Depth Information
9. Conclusion
In this chapter the complexity of human decision-making with respect to purchasing organic
food has been outlined. It has been demonstrated that enhancing the diffusion of organic
food in the market is more complex than just lowering the absolute price for organic food.
Even if high prices for organically produced food have been repeatedly identified as a major
barrier in the purchase process (e.g., Chinnici et al., 2002), the price of a product is only one
determinant of a purchase decision. To understand the role the price can or cannot play in
the decision it has to be differentiated between the absolute and the relative price. If only the
absolute price is evaluated it is difficult for a consumer to decide, if a product is too
expensive to be purchased or not. The absolute price can only be evaluated against the
available budget which poses an upper limit to the expenses that can be made or a very
abstract scale of what appears to be a high price within the category of food. Therefore,
customers usually determine more accurately if a product is expensive or not based on
relating its price to a reference price, in case of organic food to a similar conventionally
produced product (Soler et al., 2002). This relative price should then have much more
relevance for purchase decisions than absolute prices as long as the absolute price does not
overstretch the budget and the product is outside the range of the affordable. This argument
can be underlined by looking at studies analysing the impact of increases or decreases of the
absolute price level of a product category compared to changes in the relative pricing
structure within a category. Whereas for many products at least moderate increases of the
absolute price level often have no effect on the quantity of product purchases - an effect
referred to as price inelasticity - changes of the relative price structure does, for example
during promotional campaigns (Bolton, 1989). However, even if we accept that within the
boundaries of the available budget the relative price may be more important than the
absolute the presented framework model suggests that the price is only one of many
determinants of purchasing organic food or not. Availability and visibility are often at least
as important, especially in societies with a high average income level that spend a rather low
proportion on food purchases and especially for non-committed buyers. Moral or health
protective motivations are relevant, though not directly impacting purchase behaviour. A
motivation to buy organic is fragile and can easily be forgotten or deactivated by other
motivations on the way into the supermarket.
The framework model presented in the previous section offers various potential levers to
impact the market share of organic products. The various motivations to consider organic
food have been presented, possible barriers have been identified and the aspect of
communicating with the customer via labels has been analysed. Given that the most
potential growth sections for organic food lie in the supermarket and not the speciality store
(Sahota, 2007), some recommendations based on the model will be presented in this section:
to be purchased by a customer in a supermarket organic food has to be available and visible
when the decision is made. Shelf placement of and space occupied by organic food plays a
crucial role. As long as the price premium is not too extensive the premium is no
insurmountable barrier. On the contrary, it also carries the message of high quality food.
With respect to food labels visibility, tangibility and trust to the administering authority are
the important aspects. Only if all of these things are in place in the supermarket motivations
to protect nature, animals, one's health or producers have the chance to become translated
into behaviour. An important additional condition is, that the consumer perceives the
contribution made by this particular purchase relevant for solving the moral or health
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