Local and/or organic: A study on consumer preferences for organic food and food from different origins

Summary

The purpose of this paper is to get a deeper insight into consumer preferences for different food products varying in their places of origin (i.e. local, Germany, neighbouring country, non-EU country) and production practices (i.e. organic vs. non-organic). Therefore, consumer surveys combined with choice experiments were conducted with 641 consumers in eight supermarkets in different parts of Germany. Multinomial and mixed logit models were estimated to draw conclusions on the preference structure of consumers with regard to four different food products, i.e. apples, butter, flour, and steaks. Results indicate that consumers prefer locally produced food over organic products. However, conclusions should not be generalized since preferences vary for different product types. While the coefficient of the attribute price is quite small relative to the other coefficients for steak, the price coefficient is greater in the models for butter and flour compared to the other coefficients in these models. Looking at the willingness-to-pay estimates for ‘organic’ and 'local’, the information that food was produced locally resulted in higher willingness-to-pay (WTP)estimates than the information that a product was organic for all four products. Even though consumers have similar associations with local and organic food products, they have varying preferences for both product quality indications and do not seem to face a trade-off between local and organic food products. As preferences for origin attributes and organic production vary between different food products,market actors should design marketing activities accordingly.
So far, the experiment was only carried out in German supermarkets and included four different food products.
Further research in other food outlets, in other countries and for more products would allow for more general results.