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Shopping For Meat: Empirical Demand Estimation For Natural Beef Across Store Choices

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Author Info

  • Thilmany, Dawn D.
  • Grannis, Jennifer L.
  • Sparling, Edward

Abstract

Conventional supermarkets concentrate on capturing the largest pool of consumers to generate profits from the industry's low margins. Selling to the largest pool of customers means that marketing, promotion, stocking and service decisions are based on the tastes and preferences of an average consumer. Innovators in the grocery industry, recognizing a shift in consumer tastes and preferences, are changing the industry to attract smaller segments of consumers. The theory presented here demonstrates a method to understand the value of product diversification and a model of the gains from providing products that may not have broad appeal to the average customer base. The increase in retail returns through this approach of developing in-store niches lies not in increased single-item purchases of any one consumer, but through the increased number of items purchased (a larger bundle) by an individual on a single shopping trip.

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Bibliographic Info

Paper provided by Western Agricultural Economics Association in its series 2001 Annual Meeting, July 8-11, 2001, Logan, Utah with number 36157.

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Date of creation: 2001
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Handle: RePEc:ags:waealo:36157

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Web page: http://waeaonline.org/
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Related research

Keywords: Demand and Price Analysis; Food Consumption/Nutrition/Food Safety;

References

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  1. Richman, Nessa J., 2000. "The Growing Natural Foods Market: Opportunities And Obstacles For Mass Market Supermarkets," Working Papers 14317, University of Minnesota, The Food Industry Center.
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Cited by:
  1. Evans, Jason R. & D'Souza, Gerard E. & Collins, Alan R. & Brown, Cheryl & Sperow, Mark, 2011. "Determining Consumer Perceptions of and Willingness to Pay for Appalachian Grass-Fed Beef: An Experimental Economics Approach," Agricultural and Resource Economics Review, Northeastern Agricultural and Resource Economics Association, vol. 40(2), August.
  2. Widenhorn, Andreas & Salhofer, Klaus, 2012. "Price sensitivity within and across retail formats," Congress Papers 124108, Italian Association of Agricultural and Applied Economics (AIEAA).
  3. Lusk, Jayson L. & Cevallos, Edgar, 2004. "Factors Influencing Demand for a Producer-Owned Beef Retail Outlet," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 36(01), April.

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