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Drivers of and Barriers to Organic Purchase Behavior
Abstract: Using a cost–benefit approach, this study is the first to jointly investigatesupply-side factors and consumer characteristics that drive or hinder organic purchases. With scanner data that track actual purchase behavior in 28 product categories, the authors find that organic products are less popular in vice categories and categories with high promotional intensity and more popular in fresh vs. processed categories. Biospheric values that reflect a person’s concern for the environment and animal welfare increase organic purchases. Quality and health motives drive organic purchases only in certain categories, in particular categories with a low promotional intensity. Egoism and price consciousness act as barriers to organic purchases.
Keywords: organic consumption, sustainability, food retailing
In recent decades, organic food has developed impressively, from a neglected niche market to the food market mainstream. Advocates of organic food include celebrities and politicians alike; President Barack Obama even earmarked $50 million to promote organic farming (The Week 2009). Yet despite this strong interest from the public, policy makers, and companies, attention to sustainability and organic topics in academic marketing literature has been relatively scarce (Mick 2008). This limited attention is especially surprising considering the intriguingdiscrepancy between consumers’ sustainable intentions and opinions and their actual buying behaviors. In Europe, market shares for organic food in 2012 ranged between around 2% in France and the Netherlands and 7.6% in Denmark; in the United States, they reached 4.3% (Willer and Lernoud 2014). In this study, we focus on organic food and organic purchase behavior as particular forms of sustainable products and sustainable consumption behavior, which may also include green energy consumption, recycling, etc. (e.g., Gleim et al. 2013). Our definition of organic food reflects the array of requirements for production and packaging labeling of organic food that regulators have developed in Western countries (see Guilabert and Wood 2013). Previous research in multiple disciplines, including marketing and consumer research, environmental psychology, sociology, and agricultural economics, has tried to explain purchase rates for organic products but offers mixed and inconclusive results, as well as some important limitations (see Appendix A).
First, few studies examine actual purchase behavior using behavioral data; instead, they rely on self-reported behavior or purchase intentions (e.g.,Thøgersen 2011). These measures rarely are effective proxies for actual organic purchase behavior due to socially desirable response biases (Sun and Morwitz 2010).Second, prior research studies consumer characteristics, such as proenvironmental beliefs and attitudes and health motivation, and supply-side factors, such as price, availability and category characteristics,in isolation. For example, Bezawada and Pauwels (2013) focus on supply-side variables but do not consider the effects of theoretically relevant individual-level variables, whereas Steg, Dreijerink and Abrahamse (2005) only consider consumer-level variables. Yet omitting either type of factor might lead to biased conclusions (Steenkamp and Gielens 2003). Studying both consumer- and supply-side variables also offers a means to examine their interplay as well, given that certain consumer characteristics may be particularly relevant in certain categories.
Third, the majority of existing research offers only a few explanatory variables that relate closely to organic purchase behavior, such as proenvironmental values, beliefs, and attitudes. In particular, the impact of supply-side factors on organic purchase behavior is due to limited and conflicting empirical evidencestill unclear. Interestingly, Ngobo (2011) offers rather counterintuitive results, indicating that shoppers are less likely to purchase organic items at lower prices or when they find a wider distribution of products; possibly because Ngobo’s (2011) model excludes attitudes and values and may therefore be not complete.
Fourth, empirical evidence about the extent to which self-oriented motivations, such as health motivation, drive or impede organic consumption is mixed and inconclusive. Some authors claim that self-oriented motivations drive organic consumption (e.g., Schifferstein and Oude Ophuis 1998); others posit that buying organic food is only motivated by other-oriented attitudes and values (Thøgersen 2011). General self-oriented consumer attitudes or psychographics, such as price and quality consciousness, have not been investigated.
Therefore, this study seeks to investigate which supply-side factors and which self- and other-oriented consumer attitudes and values drive versus hinder organic purchases, building on a large database of actual purchase behavior by 1,246 consumers in 28 product categories. Our comprehensive framework includes multiple, theoretically relevant variables, including supply-side drivers of and barriers to organic consumption, such as the vice nature of a category or high prices, and other- and self-oriented consumer attitudes and values that may drive or impede organic purchases (Steg, Dreijerink, and Abrahamse 2005; Stern, Dietz, and Kalof 1993).
The first contribution of this study is that it, to the best of our knowledge, is the first that simultaneously investigates the effect of demand-side consumer-level variables and supply-side variables on actual organic purchase behavior. In doing so we contribute to the existing literature in marketing and retailing and specifically also add to the recent studies of Ngobo (2011) and Bezawada and Pauwels (2013) (see Table 1 for a comparison). Second, we also study the interplay between consumer values and attitudes and supply-side variables by including interaction effects. Beyond that, weexplore the presence of non-linear effects (e.g., van Doorn, Verhoef and Bijmolt 2007) and investigate whether consumer attitudes mediate the effect of sociodemographics. Third, we provide empirical insights on whether organic purchase behavior is mainly driven by self-oriented or other-oriented motives (e.g, Thøgersen2011).
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CONCEPTUAL FRAMEWORK
We adopt a cost–benefit approach in our conceptual framework (see Figure 1), following previous studies that seek to explain organic purchase behavior (Bezawada and Pauwels 2013) and studies of consumer behavior in retailing (e.g., Ailawadi, Neslin, and Gedenk 2001). Perceived benefits of organic food include health, nutritional value, animal welfare, and environmental protection (e.g., Paul and Rana 2012). These benefits can be more other- or more self-oriented (Thøgersen and Crompton 2009). The costs of consuming organic products include difficulties obtaining the products, high prices, or specific quality risks (e.g., Bezawada and Pauwels 2013; Gleim et al. 2013). In our conceptual model, we do not directly observe the perceived benefits and costs, but we assume that the independent variables we study affect them, which in turn drive consumer behavior. For example, the potential health benefits of organic products may be more salient to a health-conscious consumer.
We consider two groups of variables that might affect cost–benefit perceptions of organic food and thereby drive organic purchase behavior: (1) supply-side or category-level variablesand (2)demand-side or consumer-level variables(e.g., Steenkamp and Gielens 2003). We considerthreecategory-level variables that may impact the perceived costs and benefits of choosing an organic option (van Doorn and Verhoef 2011; Bezawada and Pauwels 2013): (1) vice vs. virtue products, (2) promotional intensity within a category, and (3) whether products in a category are fresh or processed. Furthermore, we include price and availability as two important variables directly affecting the perceived costs of choosing an organic product. Previous literature has presented conflicting evidence, with Bezawada and Pauwels (2013) finding negative price elasticities and a positive effect of the availability of organic options and Ngobo (2011) finding the opposite. In line with standard micro-economic theory we expect a negative effect of price and assume that availability positively affects the purchase of organic products (Ataman, Mela, and van Heerde 2008). We do not put forward specific hypotheses on these two variables, as these effects are rather obvious.
At the consumer level, multiple types of variables have been included as determinants of organic product consumption, such as values (e.g., Steg, Dreijerink, and Abrahamse 2005), psychographic variables (Pino, Peluso, and Guido 2012; Verhoef 2005), beliefs about the benefits of organic products (i.e., health benefits, product quality;Schifferstein and Oude Ophuis 1998; van Doorn and Verhoef 2011), and sociodemographics (Thompson 1998). Our focus is on the impact of consumer values and psychographic variables, which should influence the perceived benefits and costs of organic products (Ailawadi, Neslin, and Gedenk 2001).
We distinguish other- and self-oriented values and attitudes; these should influence the salience of other-focused benefits, such as a better environment, and self-oriented benefits, such as healthiness and taste, and costs. We include biosphericvalues that reflect a person’s concern for the environment and animal welfareand altruistic values as other-oriented values that should drive other-focused benefits. Health motivation and quality consciousness relate to specific self-oriented benefits (Schifferstein and Oude Ophuis 1998;Vermeir and Verbeke 2006). Egoism (Steg, Dreijerink, and Abrahamse 2005) and price consciousness (Ailawadi, Neslin, and Gedenk 2001; Ailawadi, Pauwels, and Steenkamp 2008) increase the perceived costs of organic products and thus may impede organic purchases.
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We acknowledge that different supply-side factors may be more (or less) important for different consumers depending on the benefits they seek from organic products. We therefore explore the interplay between supply-side factors and biospheric values, health motivation and quality consciousness. Lastly, we also control for the effect of sociodemographics.
HYPOTHESES
Supply-Side Drivers and Barriers
Virtue versus Vice Categories. Virtue and vice products usually are conceptualized in relation to each other, as relative virtues and relative vices. Relative vices (or “wants”; i.e., chocolate, wine, beer) provide an immediate pleasurable experience but contribute to negative long-term outcomes, such as weight gain and alcoholism. Relative virtues (“shoulds”; i.e., yogurt, vegetables, fruit) are less gratifying and appealing in the shortterm but have fewer negative long-term consequences(Wertenbroch 1998). Extensive research shows that a vice versus virtue nature affects consumers’ responses to products, assortments, and packages (Hui, Bradlow, and Fader 2009).
Theoretical rationales about the effect of vice or virtue on consumers’ preferences for purchasing organic suggest opposing effects. One view proposes a compensatory relationship between items that are wholesome and good for consumers with things that are exciting and fun, such that stimuli and activities can be classified as wholesome or fun, but not both (Kivetz and Simonson 2002). Adding a wholesomeness claim to a vice product thus might lead consumers to suspect reduced enjoyment and pleasure (Raghunathan, Walker, and Hoyer2006), such that consumers might be more reluctant to purchase organic in vice rather than in virtue categories.
Another view proposes that an organic label can provide a guilt-reducing complement to vice food. The consumption of vice products is usually associated with feelings of guilt that require special justifications (Khan and Dhar 2006). Consumers can reduce their guilt by linking a vice product to a good cause (Strahilevitz and Meyers 1998), in which case consumers likely choose organic offerings in vice rather than in virtue categories. However, Verhoef (2005) indicates that the effect of guilt on organic purchase behavior is limited.
Because quality and taste are the dominant motives for food choice (Vermeir and Verbeke 2006), potential negative taste inferences should lead tolower perceived benefits of organic vice food, such that consumers are less likely to purchase organic options in vice categories. This prediction matches empirical evidence that shows that consumers are less responsive to promotions of organic vice food (Bezawada and Pauwels 2013) and findings of decreased consumer willingness to pay for organic vice products (van Doorn and Verhoef 2011).
H1:Consumers are less likely to purchase organic productsin vice than in virtue categories.
Promotional intensity. We include promotional intensity as a second supply-side variable, defined as the extent to which brands within a category compete using extensive price promotions (Steenkamp, van Heerde and Geyskens 2010). If price promotions in a category are frequent, product alternatives come to seem interchangeable or as commodities with low perceived differentiation, so consumer decision making relies predominantly on price (Mela, Gupta, and Jedidi 1998). In contrast, organic products usually include a price premium, so in categories with greater promotional intensity, the perceived costs of organic products will increase and induce consumers to buy fewer organic products. We hypothesize:
H2:The promotional intensity of a product category negatively affects the purchase of organic products.
Freshness.Important benefits of purchasing organic are more natural and environmental-friendly production methods, for instance using fewer pesticides and fertilizers and refraining from preventively treating livestock with medication. Organic end products therefore should not contain residues of these chemicals(Bourn and Prescott 2002); this product benefit should be particularlysalient for products that do not undergo much processing potentially altering residue levels. We therefore hypothesize:
H3:Consumers are more likely to purchase organic products in fresh than in processed categories.
Other-Oriented Consumer Characteristics
Biospheric and Altruistic Values. A person’s values determine the extent to which she or he weighs individual interests, such as money and convenience, against collective interests, such as a better environment or animal welfare. Sustainable behavior researchers often distinguish three general values: egoistic, altruistic, and biospheric (Steg, Dreijerink, and Abrahamse 2005). The first implies that people try to maximize their own individual outcomes, whereas collective values might focus on the welfare of other people (altruistic) or the natural environment (biospheric) (Schultz 2001; Stern, Dietz, and Kalof 1993). Biospheric (or ecospheric) values are defined as a value orientation that reflects concern with nonhuman species or the biosphere (Steg, Dreijerink and Abramse 2005 p. 416; Stern, Dietz and Kalof 1993). Consumers with high biospheric values consider environmental benefits and animal welfareimportant, other-oriented benefits of organic products and should be more likely to behave sustainably. We expect consumers with strong biospheric values to be more likely to purchase organic products.
H4:Biospheric values have a positive effect on the purchase of organic products.
The influence of altruism is less clear. An altruistic value orientation implies that the person assigns more value to concerns beyond his or her immediate own interest, such as the welfare of other people. Purchasing organic could be associated with higher other-oriented benefits for altruistic persons. From a theoretical standpoint, a positive relationship seems likely between altruistic values and sustainable attitudes and behavior (Steg, Dreijerink, and Abrahamse 2005), though empirical evidence often fails to confirm such a significant relation (Nordlund and Garvill 2002; Schultz 2001). An explanation may be that altruism focuses on the well-being of other (known) people, rather than the welfare of society as a whole (Kogut and Rigov 2007). Despite unclear empirical evidence, we adopt the dominant theoretical suggestion of a positive effect of altruism on sustainable behavior.
H5:Altruistic values have a positive effect on the purchase of organic products.
Self-Oriented Consumer Characteristics
Health motivation. Health motivation is “consumers’ goal-directed arousal to engage in preventive health behaviors” (Moorman and Matulich 1993, p. 210). Evidence about the health benefits of organic food is inconsistent; the U.S. Department of Agriculture stresses that organic label requirements do not imply that organic foods are healthier (Guilabert and Wood 2013). Still, organic food is often perceived as healthier than conventionally produced food, because of its smaller scale and more natural production methods with fewer pesticides and fertilizers(Guilabert and Wood 2013); health-conscious consumers in particular should value the health benefits of organic products and therefore be more likely to buy them. Yet Thøgersen (2011) questions whether consumers purchase organic for health reasons and attributes the positive relation found in previous research to consumers justifying the higher costs of organic purchases by post hoc rationalizations about their healthiness. Pino, Peluso, and Guido (2012) also do not find a significant relationship between health motivation and organic buying intentions. Despite these inconsistent findings, we follow our initial reasoning that health-conscious consumers value the (self-oriented) health benefits of organic food and hypothesize:
H6:Health motivation has a positive effect on the purchase of organic products.
Quality consciousness. Quality consciousness is defined as the extent to which a consumerprefers high quality products rather than compromising on quality and buying at a low price (e.g., Ailawadi,Neslin and Gedenk 2001). A presumed primary reason that consumers purchase organic is their belief that organic food offers higher quality and tastes better (Paul and Rana 2012; Vermeir and Verbeke 2006). These self-oriented benefits should make buying organic particularly appealing for quality-consciousconsumers. Yet recent empirical evidence has created some doubt about consumers’ positive quality connotations toward sustainable products, mainly for specific product categories (Luchs et al. 2010; van Doorn and Verhoef 2011). Still we expect that organic products are appealing to quality-conscious consumers and hypothesize:
H7:Quality consciousness has a positive effect on the purchase of organic products.
Egoistic values. Consumers with strong egoistic values place their own interests above collective interests and therefore should have a lower propensity to display sustainable behavior (Steg, Dreijerink, and Abrahamse 2005). For egoistic customers, the costs of purchasing organic products might be very relevant, whilethey should not attach value to other-oriented benefits. This effect has not received unequivocal empirical support either though (Stern, Dietz, and Kalof1993). Still, from a theoretical perspective we hypothesize: