IDEAS home Printed from https://ideas.repec.org/p/ags/rutdps/36736.html
   My bibliography  Save this paper

Empirically Evaluating Consumer Characteristics and Satisfaction with Organic Products

Author

Listed:
  • Govindasamy, Ramu
  • DeCongelio, Marc
  • Italia, John
  • Barbour, Bruce
  • Anderson, Karen

Abstract

Organic production has been practiced in the U.S. since the late 1940s. The distinction between organic and conventional produce is that organic produce is grown with a maximum of five percent synthetic pesticide residues and no prohibited USDA substance can be used on the land three years prior to producing organic produce. No genetic engineering is to be used on the crops, and no antibiotics are to be used on the livestock (USDA, 2001). Organic produce is sold at a premium above the price for conventional produce due to the increased production costs associated with following these rules. Price premiums vary greatly among different organic products and retail facilities. Consumers of these comparatively higher priced items traditionally have been the more affluent, educated members of the younger generation who have felt the need to pay more for organic produce mainly based on the better quality and the absence of pesticide residues. Estimated sales of organic produce in 2001 range between $5.5 and $6.5 billion dollars, as compared with $2.1 billion in 1995 or $3.3 billion in 1998 (Dimitri and Richman, 2000). The organic produce market has grown rapidly since the late 1980s when the media publicized the dangers of pesticide residues. However, the even quicker growth in the late 1990s may be attributed to the relatively stronger economy. The purpose of this study is to document a profile of the typical organic consumer in the northeastern U.S., specifically for the purpose of this study in New Jersey, New York, and Pennsylvania. Specifically, the objectives are to determine consumer characteristics such as: • The demographic statistics of organic purchasers, including income level, education level, household size, etc. • The perception of organic produce compared to conventional produce in terms of prices, variety, and quality. • Consumer willingness to pay for organic compared to conventional produce. vi The majority of consumers, 64 percent, purchased mostly conventional produce and some organic produce when choosing their fresh produce. Tomatoes were the most commonly purchased vegetables among organic produce, bought by 25% of the respondents. Also, organic farmers in the same area reported growing tomatoes more than any other organic crop (Govindasamy et al., 2000). Organic lettuce was purchased by more than a fifth of respondents. Organic carrots, apples and broccoli were organic products that were purchased by more than 10 percent of respondents. The demographic characteristics of organic produce buyers include the following: • Smaller sized households, • Households with less children, • Households that spend more in general on produce monthly, • Households in the suburbs, as compared to urban or rural areas, • Female shoppers, • Younger shoppers, • More educated shoppers, • Higher income households, and • Non-married households. Five econometric models were formulated to: • Document the characteristics of consumers who bought organic produce at least once in the past. • Document the characteristics of consumers who bought organic produce frequently. • Document the characteristics of consumers who thought that organic produce is of a higher quality than conventional produce. • Document the characteristics of consumers who are willing to pay 10 percent or more for organic produce than conventional produce. • Document the characteristics of consumers who are willing to pay 20 percent or more for organic produce than conventional produce. vii The logit framework is used in this analysis because its asymptotic characteristic constrains the predicted probabilities to a range of zero to one. The estimation method is the maximum likelihood estimation (MLE). Hence, given certain organic consumer characteristics, the probability that the consumer has bought organic produce at least once in the past is found. Similar explanations exist for the other four models. The five models are estimated using information obtained from the consumers’ questionnaire located in Appendix I at the end of this report. Almost half of the respondents had purchased organic produce at least once in the past. Consumers who are willing to switch supermarkets to buy organic and who are ready to buy additional organic if it were more readily available had purchased organic produce at least once in the past. They also frequently purchase organic apples, organic carrots or organic spinach, and feel that organic is priced higher than conventional produce. These consumers also live in Pennsylvania (as compared to living in New Jersey or New York), in the suburbs, have attended at least some college, shop according to the availability of fresh produce, are married, are under 50 years of age, and have fewer than four people living in their household. About ten percent of the respondents had purchased organic produce on a frequent basis. These respondents are most likely to be consumers who are willing to switch supermarkets to buy organic produce and are ready to buy additional organic produce if it were more readily available. They also frequently purchase organic apples or organic spinach and believe that organic produce is not priced higher than conventional produce. They have likely heard or read news reports about IPM, visit farmer’s markets less frequently, and are female. Almost one-third of the respondents feel that organic produce is of a higher quality than conventional produce. These respondents are most likely to be consumers that are willing to switch supermarkets to buy organic produce and are ready to buy additional organic produce if it were more readily available. These consumers also frequently purchase organic carrots or organic spinach and feel that organic produce is priced viii higher and has more variety than conventional produce. They are more likely to live in Pennsylvania, grow their own fruits or vegetables and visit farmer’s markets less frequently. They also have fewer than three children, are under 50 years of age, are not married, and are female. Almost one-quarter of the respondents stated that they would be willing to pay a premium of 10 percent or more for organic produce than conventional produce. These respondents are most likely to be consumers that grow their own fruits or vegetables, are willing to switch supermarkets to buy organic produce and are ready to buy additional organic produce if it were more readily available. They also frequently purchase organic carrots and believe that organic produce is priced higher than conventional produce but that it does not have more variety than conventional produce. They also are not greatly affected by price when purchasing fresh produce, feel that residues from pesticides and herbicides are a serious hazard and frequently shop according to the availability of fresh produce. Additionally, these consumers have fewer than three children in their household and are under 50 years of age. Almost ten percent of the respondents stated that they would be willing to pay a premium of 20 percent or more for organic produce than conventional produce. These respondents are most likely to be consumers that are willing to switch supermarkets to buy organic produce and are ready to buy additional organic produce if it were more readily available. They frequently purchase organic produce carrots, are not greatly affected by price when purchasing fresh produce, and shop according to the availability of fresh produce. These consumers are not married and are under 50 years of age.

Suggested Citation

  • Govindasamy, Ramu & DeCongelio, Marc & Italia, John & Barbour, Bruce & Anderson, Karen, 2001. "Empirically Evaluating Consumer Characteristics and Satisfaction with Organic Products," P Series 36736, Rutgers University, Department of Agricultural, Food and Resource Economics.
  • Handle: RePEc:ags:rutdps:36736
    DOI: 10.22004/ag.econ.36736
    as

    Download full text from publisher

    File URL: https://ageconsearch.umn.edu/record/36736/files/pa010101.pdf
    Download Restriction: no

    File URL: https://libkey.io/10.22004/ag.econ.36736?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Govindasamy, Ramu & Nayga, Rodolfo M., 1997. "Determinants of Farmer-to-Consumer Direct Market Visits by Type of Facility: A Logit Analysis," Agricultural and Resource Economics Review, Cambridge University Press, vol. 26(1), pages 31-38, April.
    2. Ireland, Polly E. & Falk, Constance L., 1990. "Organic Food Adoption Decisions By New Mexico Groceries," Journal of Food Distribution Research, Food Distribution Research Society, vol. 21(3), pages 1-10, September.
    3. Senauer, Benjamin, 1989. "Food Safety: A Growing Concern," Staff Papers 13532, University of Minnesota, Department of Applied Economics.
    4. Groff, Andrew J. & Kreider, Craig Robert & Toensmeyer, Ulrich C., 1993. "Analysis Of The Delaware Market For Organically Grown Produce," Journal of Food Distribution Research, Food Distribution Research Society, vol. 24(1), pages 1-9, February.
    5. Govindasamy, Ramu & Italia, John & DeCongelio, Marc & Anderson, Karen & Barbour, Bruce, 2000. "Empirically Evaluating Grower Characteristics and Satisfaction with Organic Production," P Series 36738, Rutgers University, Department of Agricultural, Food and Resource Economics.
    6. Byrne, Patrick J. & Toensmeyer, Ulrich C. & German, Carl L. & Muller, H. Reed, 1991. "Analysis Of Consumer Attitudes Toward Organic Produce Purchase Likelihood," Journal of Food Distribution Research, Food Distribution Research Society, vol. 22(2), pages 1-14, June.
    7. Byrne, Patrick J. & Toensmeyer, Ulrich C. & German, Carl L. & Muller, H. Reed, 1992. "Evaluation Of Consumer Attitudes Towards Organic Produce In Delaware And The Delmarva Region," Journal of Food Distribution Research, Food Distribution Research Society, vol. 23(1), pages 1-16, February.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Shuzzler, Alice & Govindasamy, Ramu & Adelaja, Adesoji O., 2003. "A Comparative Evaluation Of Organic Produce Consumers In New Jersey To New York And Pennsylvania," Journal of Food Distribution Research, Food Distribution Research Society, vol. 34(1), pages 1-10, March.
    2. Kathryn Boys & David Willis & Carlos Carpio, 2014. "Consumer willingness to pay for organic and locally grown produce on Dominica: insights into the potential for an “Organic Island”," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 16(3), pages 595-617, June.
    3. Dettmann, Rachael L., 2008. "Organic Produce: Who's Eating it? A Demographic Profile of Organic Produce Consumers," 2008 Annual Meeting, July 27-29, 2008, Orlando, Florida 6446, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    4. Wang, Qingbin & Sun, Junjie, 2003. "Consumer Preference And Demand For Organic Food: Evidence From A Vermont Survey," 2003 Annual meeting, July 27-30, Montreal, Canada 22080, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    5. Rodríguez, Elsa Mirta M. & Lacaze, María Victoria & Lupín, Beatriz, 2007. "Willingness to pay for organic food in Argentina: evidence from a consumer survey," Nülan. Deposited Documents 1300, Universidad Nacional de Mar del Plata, Facultad de Ciencias Económicas y Sociales, Centro de Documentación.
    6. Curtis, Kynda R. & Yeager, Irvin & Black, Brent & Drost, Daniel & Ward, Ruby, 2014. "Market and Pricing Potential for Extended Season Fresh Produce Sales: An Intermountain West Example," Journal of Food Distribution Research, Food Distribution Research Society, vol. 45(2), pages 1-20, July.
    7. GwanSeon Kim & Jun Ho Seok & Tyler B. Mark, 2018. "New Market Opportunities and Consumer Heterogeneity in the U.S. Organic Food Market," Sustainability, MDPI, vol. 10(9), pages 1-17, September.
    8. Song Lian, 2017. "What Motivates Consumers to Purchase Organic Food in Malaysia?," Asian Social Science, Canadian Center of Science and Education, vol. 13(9), pages 100-100, September.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Rodríguez, Elsa Mirta M. & Lacaze, María Victoria & Lupín, Beatriz, 2007. "Willingness to pay for organic food in Argentina: evidence from a consumer survey," Nülan. Deposited Documents 1300, Universidad Nacional de Mar del Plata, Facultad de Ciencias Económicas y Sociales, Centro de Documentación.
    2. Idda, Lorenzo & Madau, Fabio A. & Pulina, Pietro, 2008. "The Motivational Profile of Organic Food Consumers: a Survey of Specialized Stores Customers in Italy," 2008 International Congress, August 26-29, 2008, Ghent, Belgium 43946, European Association of Agricultural Economists.
    3. Ngobo, Paul-Valentin & Jean, Sylvie, 2012. "Does store image influence demand for organic store brands?," Journal of Retailing and Consumer Services, Elsevier, vol. 19(6), pages 621-628.
    4. Kezis, Alan S. & Gwebu, Thula & Peavey, Stephanie R. & Cheng, Hsiang-Tai, 1998. "A Study Of Consumers At A Small Farmers' Market In Maine: Results From A 1995 Survey," Journal of Food Distribution Research, Food Distribution Research Society, vol. 29(1), pages 1-9, February.
    5. John M. Polimeni & Raluca I. Iorgulescu & Lucian Liviu Albu & Andrei Ionica, 2022. "Romanian Farmers’ Markets: Understanding the Environmental Attitudes of Farmers as an Instrument for Bioeconomy Development," Sustainability, MDPI, vol. 14(18), pages 1-20, September.
    6. Kozloff, Keith & Runge, C. Ford, 1991. "International Trade In The Food Sector And Environmental Quality, Health, And Safety: A Survey Of Policy Issues," Staff Papers 13325, University of Minnesota, Department of Applied Economics.
    7. Chang, Yunhee & Adams, Rachel & Carithers, Teresa C. & Ruetzler, Tanya, 2014. "Do Grocery Store Personnel's Perceptions, Attitudes, and Knowledge Determine Availability of Organic Food Products?," Journal of Food Distribution Research, Food Distribution Research Society, vol. 45(2), pages 1-25, July.
    8. Detre, Joshua D. & Mark, Tyler B. & Clark, Benjamin M., 2010. "Understanding Why College-Educated Millennials Shop at Farmers Markets: An Analysis of Students at Louisiana State University," Journal of Food Distribution Research, Food Distribution Research Society, vol. 41(3), pages 1-11, November.
    9. Carpio, Carlos E. & Wohlgenant, Michael K., 2006. "A Structural Econometric Model of Consumer Demand at Pick-Your-Own Fruit Operations," 2006 Annual meeting, July 23-26, Long Beach, CA 21372, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    10. Ramona Robinson & Chery Smith, 2003. "Associations between self-reported health conscious consumerism, body-mass index, and attitudes about sustainably produced foods," Agriculture and Human Values, Springer;The Agriculture, Food, & Human Values Society (AFHVS), vol. 20(2), pages 177-187, June.
    11. Lu, Qiang Steven & Miller, Rohan, 2019. "How Social Media Communications Combine with Customer Loyalty Management to Boost Green Retail Sales," Journal of Interactive Marketing, Elsevier, vol. 46(C), pages 87-100.
    12. Francisco José Torres-Ruiz & Manuela Vega-Zamora & Manuel Parras-Rosa, 2018. "False Barriers in the Purchase of Organic Foods. The Case of Extra Virgin Olive Oil in Spain," Sustainability, MDPI, vol. 10(2), pages 1-14, February.
    13. Rana, Jyoti & Paul, Justin, 2017. "Consumer behavior and purchase intention for organic food: A review and research agenda," Journal of Retailing and Consumer Services, Elsevier, vol. 38(C), pages 157-165.
    14. Wier, Mette & O'Doherty Jensen, Katherine & Andersen, Laura Mørch & Millock, Katrin, 2008. "The character of demand in mature organic food markets: Great Britain and Denmark compared," Food Policy, Elsevier, vol. 33(5), pages 406-421, October.
    15. Jerop, Rebecca, 2012. "Consumer Willingness to Pay for Dairy Goat Milk in Siaya County, Kenya," Research Theses 243449, Collaborative Masters Program in Agricultural and Applied Economics.
    16. GwanSeon Kim & Jun Ho Seok & Tyler B. Mark, 2018. "New Market Opportunities and Consumer Heterogeneity in the U.S. Organic Food Market," Sustainability, MDPI, vol. 10(9), pages 1-17, September.
    17. Hans Ruediger Kaufmann & Mohammad Fateh Ali Khan Panni & Yianna Orphanidou, 2012. "Factors Affecting Consumers’ Green Purchasing Behavior: An Integrated Conceptual Framework," The AMFITEATRU ECONOMIC journal, Academy of Economic Studies - Bucharest, Romania, vol. 14(31), pages 50-69, February.
    18. Rodríguez, Elsa Mirta M. & Lupín, Beatriz & Lacaze, María Victoria, 2005. "Las percepciones de los consumidores de alimentos diferenciados," Nülan. Deposited Documents 1295, Universidad Nacional de Mar del Plata, Facultad de Ciencias Económicas y Sociales, Centro de Documentación.
    19. Abello, Francisco J. & Palma, Marco A. & Anderson, David P. & Waller, Mark W., 2012. "Evaluating the Factors Influecing the Number of Visits to Farmers' Markets," 2012 Annual Meeting, February 4-7, 2012, Birmingham, Alabama 119786, Southern Agricultural Economics Association.
    20. Byrne, Patrick J. & Toensmeyer, Ulrich C. & German, Carl L. & Muller, H. Reed, 1991. "Analysis Of Consumer Attitudes Toward Organic Produce Purchase Likelihood," Journal of Food Distribution Research, Food Distribution Research Society, vol. 22(2), pages 1-14, June.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ags:rutdps:36736. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: AgEcon Search (email available below). General contact details of provider: https://edirc.repec.org/data/darutus.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.