Does every consumer care? A study on the effect of publicity about farm animal welfare on consumers’ WTP and evaluations of standard and organic meat products.

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Does every consumer care?

A study on the effect of publicity about farm animal

welfare on consumers’ WTP and evaluations of standard

and organic meat products.

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Does every consumer care?

A study on the effect of publicity about farm animal

welfare on consumers’ WTP and evaluations of standard

and organic meat products.

Master Thesis

University of Groningen

Faculty Economics & Business

Department Marketing Management

August 29

th

_{, 2012}

Author:

Julie Gaworski

Am Kielortplatz 5

22850 Norderstedt

Germany

(+49)160 555 2660

Supervisors:

Student Number 1939262

Prof. Dr. Laurens M. Sloot (1

st

)

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Management summary

Over the past years, consumers have grown increasingly aware of farm animal welfare practices in the meat industry. Especially publicity about questionable business practices of meat supplying companies has alerted consumers. However, research on the effect of publicized corporate ethical misconduct in the retail environment is scarce as most literature has focused on the subject of product harm crises. Aiming to close the gap in literature, this paper analyses the effect of positive and negative publicity about farm animal welfare practices of meat suppliers on consumer evaluations and WTP for meat products. Moreover, it is determined how consumer prior knowledge about animal welfare practices, as well as individual ethical ideologies, moderate the effect of publicity messages.

Results provide evidence for the presence of strong consumer inferences regarding organic meat products. The latter were always rated more favorably by respondents, regardless the valence or target subject of the publicity message. The strength of consumer mindsets regarding organic products was also detected in relation to spillover, as no negative spillover effects from publicity about a standard meat supplier were found. In general, rather than the much cited negativity effect, the unexpectedness of a publicity message evoked extreme reactions among respondents. Especially negative information about an organic meat supplier and positive information about a standard meat supplier generated substantial differences in evaluations and WTP for organic and standard meat products.

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Preface

“Compassion is the basis of all morality.”

Arthur Schopenhauer, German philosopher (1788 - 1860)

I have always been interested in the subject of farm animal welfare. After extensive research for this master thesis in form of numerous documentaries, news reports and legislative regulations about farm animal welfare even I, a highly knowledgeable consumer, was surprised in light of the (albeit) gruesome way we treat animals raised for consumption. Reviewing the feedback of many survey participants, I can safely conclude that most of them felt the same way. While this thesis attempts to find an answer to the question as to why most people do not change their consumption habits after learning about questionable farm animal welfare practices, the phenomenon is far from being fully explored.

Not consuming animal products, I have often been labeled a sentimentalist or even as radical by people following more conventional diets, which has never failed to surprise me. Virtually everybody agrees that it is important how animals are treated and that limited meat consumption will both reduce animal suffering and one’s ecological footprint. However, those who decide to act in line with this knowledge are usually considered extremists. Hoping that society’s acceptance and adoption of alternative consumption habits will increase in the upcoming centuries, I have yet to thank a few people who have supported me during this research.

First and foremost I would like to thank my parents and my sister for their endless support. Secondly, I owe thanks to Kai, who has never failed to encourage me when I thought I could not go through with my thesis.

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List of tables

Table 1: Characteristics of publicity and advertising, adapted from Balasubramanian (1994) ... 12

Table 2: Taxonomy of Ethical Ideologies by Forsyth (1980) ... 20

Table 3: Experimental conditions... 23

Table 4: Descriptive results ... 32

Table 5: Results RM-ANOVA... 35

Table 6: Spillover of negative and positive publicity... 38

List of figures

Figure 1: Conceptual model ... 22

Figure 2: Overview of variables used in this research... 31

Figure 3: Consumer product evaluations after publicity... 36

Figure 4: Consumer WTP after publicity... 36

Figure 5: Consumer trust after publicity ... 37

Figure 6: Consumer knowledge, product evaluations organic, publicity organic ... 40

Figure 7: Consumer knowledge, product evaluations standard, publicity organic ... 41

Figure 8: Consumer knowledge, trust organic, publicity organic ... 41

Figure 9: Consumer knowledge, trust standard, publicity organic ... 42

Figure 10: Consumer idealism, WTP standard, publicity organic... 43

Figure 11: Consumer idealism, trust standard, publicity standard... 44

Figure 12: Consumer relativism, WTP standard, publicity standard ... 45

Figure 13: Consumer relativism, WTP organic, publicity standard ... 45

Figure 14: Consumer absolutism, WTP standard meat, publicity standard... 46

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1 Introduction

Over the past years, German consumers have reacted increasingly sensitive to negative publicity with regard to animal welfare in modern food production. A phenomenon, which became very apparent during the “Wiesenhof” scandal in 2011. After public television had broadcasted a documentary about scandalous animal welfare practices (AWP) at the country’s biggest poultry producer “Wiesenhof”, consumers reported that they were appalled and planned to boycott the company’s products. Apart from a severely damaged image, the producer had to face substantial financial losses as several big retail chains in Germany and Switzerland temporarily stopped selling the company’s poultry meat and banned it from their product assortment. In an interview following the scandal, “Wiesenhof’s” founder stated that the incident had not only hurt his company, but also affected the image of the whole poultry factory farming industry (Süddeutsche Zeitung 2011).

The publicized scandal described above illustrates the growing importance of animal welfare in today’s society. While up to the present day, there is no universally accepted definition of the term “farm animal welfare”, literature in the field of agricultural economics usually refers to it as “the treatment of animals during farm operations” (Dentoni et al. 2011). At present every stakeholder along the meat value chain, from supplier to retailer, is confronted with this issue and is obliged to adapt business practices to new national or international regulations (Dentoni et al. 2011). Exemplarily, the ban of battery cages for hens in January 2012, as well as the planned introduction of an EU-wide animal welfare label for meat products, place pressure on the industry (European Commission 2007; 2009). While these changes aim to ensure that minimum farm animal welfare standards are met, several mandatory or voluntary labeling schemes by retailers or non-governmental organizations surpass norms set by legislation and encourage farmers to meet much higher standards. Hence, consumers in a retail environment are generally provided with the opportunity to choose between two types of products with regard to farm animal welfare. Those, originating from suppliers operating under higher than average farm animal welfare standards and those produced under welfare conditions that solely meet the minimal requirements, which are often perceived to be relatively low by consumers. Whereas the former products are mostly certified organic and sold at premium prices, the latter are conventional or standard products allocated in a much cheaper price range.

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product attribute, the level of farm animal welfare is not detectable prior or post consumption. For this reason consumers’ attitudes and behaviors are heavily influenced by information provided by the media (Tonsor and Olynk 2011). It follows that news reports about AWP in the meat industry can, depending on their valence, have detrimental or highly beneficial effects on consumers’ perceptions of the brand in question. Especially negative information might provoke a severe decrease in product sales, as consumers have become increasingly critical whilst evaluating product alternatives, aiming to detect the slightest differences in quality, even more so when confronted with large assortment sizes (Bertini et al. 2012).

Numerous studies have shown that often not only the brand under critique is affected by news reports. Sales of brand extensions, complete product categories and even whole industries can be dampened as consumers’ risk perceptions increase and trust issues arise (Roehm and Tybout 2006). The Wiesenhof scandal mentioned at the beginning of this chapter provides an example of this mechanism. Similarly, a longitudinal study carried out in the US by Tonsor and Olynk (2011) found that animal welfare information provided by media sources between 1982 and 2008, has dampened national pork and poultry demand. Although their findings offered valuable insights, the authors did not distinguish effects of negative and positive information, as all media coverage was aggregated into a single index. Hence, no conclusion about the differing effect of information valence on meat products was made. Marketing research literature has likewise focused almost singularly on impacts of negative media coverage about product harm crises, not fully exploring the effect of positive publicity. This leaves room for further analyses on the differing effect of positive as well as negative information on consumers. In addition, performance related rather than ethical news content has been the focal point of most studies (e.g. Van Heerde et al. 2007). Consequently, this study will concentrate on the subject of farm animal welfare and determine how consumers react to negative as well as positive publicity about meat suppliers.

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exceed the industry average will be determined. To the author’s knowledge no prior study has yet explored how negative information about a product which is usually connected to positive characteristics in consumers’ minds, versus positive information about a product connected to inferior characteristics will change consumer evaluations and willingness to pay (WTP) of these offerings. Bearing in mind that information targeting a certain product has also known to affect other products in the same category, the author will investigate how consumers’ perceptions of standard and organic meat offerings change, when confronted with news about the respective other product.

Having identified several growth drivers of organic meat sales, market shares of these products remain marginal albeit various reports on farm AWP in the media. One of the reasons for this circumstance lays in the fact that organic meat products are usually sold at premium prices, generally representing a purchasing barrier to many consumers. However, previous research has found that individual consumer characteristics also play an important role regarding reactions to ethically questionable corporate practices. Detert et al. (2008), show that the ability to morally disengage from harm done to others is highly dependent on the level of empathy inherent to a person. This leads to the assumption that consumers’ moral beliefs might moderate the perceived necessity to buy animal welfare friendly products. Previous studies aiming to determine the influence of consumer ethics on consumption behavior generally used self-reported ethical item scales, not fully accounting for social desirability bias. Consequently, this paper will strive to surpass these shortcomings by using an alternative scale, which allows for a more sophisticated approach rather than a simple classification of high and low ethicality. As it is furthermore known that expert consumers evaluate information provided about product alternatives differently than less knowledgeable individuals, this study will additionally include the moderating effect of consumer knowledge about farm AWP on WTP and consumer evaluations of different meat offerings.

As a result the following problem statement can be formulated:

“How does negative and positive publicity about farm AWP of organic and standard meat suppliers influence consumers’ WTP and evaluations of organic and standard meat products, when taking into account their moral ideology and knowledge about this topic?”

1) How will effects of positive and negative publicity differ?

2) How will effects of publicity differ, depending on whether information targets the focal product as opposed to a different product?

3) How will consumers’ reactions to publicity differ depending on their individual characteristics?

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2 Literature review

2.1 Consumer evaluations and WTP for food products

Perceived product characteristics

Consumers’ favorability of product or brand evaluations is usually based on a variety of aspects, while quality is one of the focal attributes determining purchase decisions of organic meat. According to Van Doorn and Verhoef (2011) “the perceived level of product quality is an overall evaluative judgment of a food item and a key dimension in food choice”. The term quality in relation to food encompasses product characteristics such as appearance or freshness, which facilitate the evaluation of alternatives and the decision making process for consumers (Van Doorn and Verhoef 2011). Moreover it is often inferred that organic food is healthier and tastes better than conventional food, due to aspects like lower usage of pesticides and antibiotics, restrictions on the ingredients of feedstuff, or smaller production plants. Consequently, consumers might likewise infer that happy animals are healthy animals and therefore produce better outcome. Mistreated animals under bad rearing conditions might on the other hand be in danger of developing diseases. As consumers’ perceptions of health risks are also closely connected to food choice, products which are perceived as health hazards are generally dismissed (temporarily or completely) or replaced by “healthier” alternatives (Pennings et al. 2002; Heiman and Lowengart 2011). Heiman and Lowengart (2008) even found that perceived health hazards in one product subcategory, increased the importance of health related attributes in substitute categories. This effect is not only prevalent in crises involving performance failures of products. Dahlén and Lange (2006) also observed lower product quality ratings by consumers who had been exposed to information concerning corporate ethical misconduct. Apart from perceived quality, there has been research suggesting that perceived (Makens 1965) and even actual taste (Litt and Shiv 2012) is similarly influenced by extrinsic product information. Consequently, the author will determine how information valence influences consumer product evaluations concerning perceived quality, healthfulness or taste of an organic or standard meat offering.

Brand trust

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Willingness to pay

Research about the impact of social product features on consumers’ WTP has not always led to coinciding results. While Auger et al. (2008) found that consumers’ purchase intention significantly increased when products had social features (e.g. a soap bar produced without animal testing), other studies showed that albeit altruism plays a role in the decision making process, consumers’ concern for attributes based on self-interest are equally, if not more important. Exemplarily, healthiness is considered one of the main reasons for organic meat purchases, serving as a justification for premium product prices in this segment (Herpen et al. 2011). However, it is important to note that organic meat prices and demand have an inverted U-shaped relationship, meaning that price premiums should not exceed a certain level (Ngobo 2011). Bearing this finding in mind, the researcher will determine whether different publicity messages impact consumers’ WTP for the products mentioned in the message, as well as other products in the same category.

2.2 Publicity

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industries as a whole, if the information is highly negative (Bhattacharya and Shen 2003; Gao et al. 2011). Table 1 summarizes the primary differences between both communication methods.

Publicity Advertising

Not paid for

→ Disadvantage: message content and format not controlled by sponsor

Paid for

→ Advantage: message content and format

controlled by sponsor Sponsor not identified

→ Advantage: perceived source (i.e. media) appears credible

Sponsor identified

→ Disadvantage: perceived source (i.e. sponsor) viewed with skepticism

Table 1: Characteristics of publicity and advertising, adapted from Balasubramanian (1994)

2.2.1 Publicity valence

Negative information

The frequency of persuasive messages is rapidly increasing in the everyday lives of consumers and can contain positive as well as negative information. There is overall consensus among researchers that people are influenced more by negative information than positive appeals when evaluating a target, due to the so-called “negativity effect” (Ito et al. 1998; Rozin and Royzman 2001). This effect is attributed to the higher perceived novelty and diagnosticity or usefulness of negative information (Ahluwalia 2002). For instance, when consumers are exposed to negative information about a certain product attribute, they are able to categorize this product as low in quality. Positive information on the other hand will be less useful in making quality inferences, as positive or neutral features are commonly inherent in all low, average or high quality products (Herr et al. 1991). Moreover, Cacioppo et al. (1997) found evidence of an extremity bias in information processing, suggesting that it is a basic operating parameter of a person’s evaluative system. They showed that at comparable increases of input, the negative evaluative system had a tendency to respond with higher levels of output than the positive system. Hence, consumers should attribute higher importance to negative information during their decision making process than to positive information.

Apart from the extremity bias, there is evidence of an attention bias in literature (Smith et al. 2006). Studies in this domain show that participants voluntarily allocate a significantly higher amount of time to the processing of negative, rather than positive stimuli (e.g. Fiske 1980). The latter two concepts also provide an explanation as to why the media prefers reporting bad news more frequently and vividly than positive news and companies in turn are more likely to receive negative rather than positive press. Moreover, negative information usually contains novel and unknown facts, attracting more attention and eliciting more surprise reactions than (expected) positive information, which increases its salience (Ahluwalia et al. 2001).

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boycott (Klein et al. 2004; Lindenmeier et al. 2012). On the other hand, Einwiller et al. (2006) argue that the extent to which negative information will change consumer perceptions of a target is largely dependent on its level of severity. While extremely negative publicity information results in negative associations among all consumers, moderately negative information has only small effects on consumers who strongly identify with the company. Ein-Gar et al. (2012) even found evidence of a „blemishing effect“, showing that including weakly negative information to an otherwise positive message can have positive effects on consumer evaluations of the target, as they regard the message to be more authentic and credible.

Positive information

While in other areas of research, such as Word of Mouth, the dissemination of positive information is more common, research examining the effects of positive publicity is scarce (East et al. 2008). This does not mean that negative information overpowers the effect of positive information as a rule, especially if the information is only moderately negative. People are confronted with favorable stimuli more often than with negative stimuli and the similarity of positive information in general is higher than of negative information, which facilitates message processing (Unkelbach et al. 2008). Likewise, the “Pollyanna effect” or positivity bias, suggests that people are quicker to form positive impressions of unknown objects than negative impressions (Boucher and Osgood 1969). Hence, generating positive judgments requires less effort and is faster than the generation of negative judgments (Herr et al. 2012). Moreover, authors have found opposing results concerning the influence of information valence on perceived truthfulness of a message. Hilbig (2009) states that people perceive negative information to be more truthful than positive information and attributes this finding to the fact that higher evaluation efforts increase the persuasiveness of a message. On the other hand, researchers such as Koch and Forgas (2012) argue that there is evidence of a “truth effect”. According to them, information which is easy to process, or fluent, is more likely to be regarded as true than information which is disfluent. The processing fluency of an individual is determined by factors such as prior exposure to similar information, message complexity and visual clarity of the information (Unkelbach et al. 2011). Concluding from the discussion above, it is assumed that positive and negative information will both steer consumer evaluations in the respective directions. Therefore, the author hypothesizes:

H1: Negative and positive publicity about AWP of an organic (standard) meat supplier, will steer consumer WTP and evaluations of organic (standard) meat products in the respective directions.

2.2.2 Moderators of publicity

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are more prone to change their attitude or even exhibit attitude ambivalence toward the brand than highly committed consumers (Ahluwalia et al. 2000). Furthermore, when confronted with positive publicity, highly committed consumers generalize the information to other, similar brand attributes, while consumers with low commitment only generalize from negative information (Ahluwalia et al. 2001). Similar studies show that the negativity bias can be counteracted when consumers are loyal to the brand or hold a highly certain brand attitude. With respect to the latter moderator, Pullig et al. (2006) demonstrated that prior attitude certainty positively biases the elaboration process in a way that consumers defend the brand by counter-arguing the negative information. Furthermore Dawar and Lei (2009) showed that the severity of negative publicity depends on how relevant the message is perceived to be. In other words: if consumers perceive that the message concerns key benefit associations of the publicity target, they will regard the problem as highly relevant which will result in unfavorable evaluations.

2.2.3 Value versus performance related publicity

Research exploring the effects of negative publicity on consumer responses, makes a distinction between events arising due to product and technical failures, or events concerning a company’s ethics and principles (Pullig et al. 2006). Most studies have focused on information regarding company performance, such as the inability to meet promised quality standards or the occurrence of product recalls due to potentially harmful characteristics (Dawar and Pillutla 2000). However, in the past few decades, consumers are also giving increasing consideration to ethical and environmental aspects of products and business processes, for example severe environmental pollution, child labor or farm animal welfare. Wojciszke et al. (1993) suggest that value and performance related information will be weighted differently in that the former is perceived as more diagnostic and less forgivable. This assumption is grounded on the fact that not every person is equally skilled and therefore performance failures are expected, but on the other hand every person is expected to comply with certain societal norms (Votolato and Unnava 2006). While Word of Mouth literature has analyzed the impact of both: product and value related information, studies in the field of marketing exploring informational effects of a company’s ethical misbehavior in a retail context are scarce. As a result, the researcher aims to close this gap in literature.

2.3 Spillover of publicity

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Whether it concerned the existence of spillovers from one product to another within a brand family and a single product category (Lei et al. 2008), spillover effects to competitor products within the same (Janakiraman et al. 2009; Roehm and Tybout 2006; Dahlén and Lange 2006) and other categories (Janakiraman et al. 2006) or to brand alliance partners (Votolato and Unnava 2006), all studies highlight the importance of underlying moderators which influence spillover effects. The most important moderators will be described hereafter.

2.3.1 Moderators of spillover

Target similarity and differentiation

The effects of spillover have also been researched extensively in the domain of brand extensions and umbrella branding (Balachander and Ghose 2003; Erdem and Sun 2002; Pina et al. 2012). Erdem (1998) showed that quality perceptions of products sold in various categories under the same brand name will be influenced by the experiences consumers make through purchases in any of the categories. A focal aspect of studies about brand extensions is that quality perceptions will spill over, if the parent brand and the extension are thought to fit. This concept can also be found in publicity spillover, where the occurrence of spillovers to competitors is more likely when the publicity target and the competitor are seen as similar with respect to the scandal attribute (Janakiraman et al. 2009; Roehm and Tybout 2006). Similarly, Roehm and Tybout (2006) find that spillovers of negative information to entire categories only occur, when the scandal attribute is perceived as being typical for and closely related to the product category. On the other hand, while brands which are similar to the scandalized brand are viewed equally negative, brands which are dissimilar are evaluated more positively and can potentially gain from the crisis (Dahlén and Lange 2006). This finding is also supported by Heiman and Lowengardt (2011; 2008) whose studies show that buying decisions of frequently bought foods are dependent on information. Highly negative information contradicting prior beliefs caused consumers to base their choice process on a broader set of attributes than only taste or convenience. Consumers showed increased involvement in the scandalized category and therefore spent more time and effort on evaluating alternatives.

While most of these studies focused on spillover effects of negative information, findings on the influence of positive information or even counterintuitive messages on consumers are scarce. Especially with regard to highly counterintuitive news, the lack of theoretical literature presented a barrier to accurately hypothesizing the direction of an effect. Consequently, it is stated that:

H2: Negative and positive publicity about AWP of organic or standard meat suppliers, differentially affect consumer WTP and evaluations of organic and standard meat products.

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perceive to produce unethical goods, but will not necessarily reward companies they perceive to sell ethical products. This judgment process can be transferred to the current research topic, as consumers confronted with information about negative AWP in the meat industry, might generalize that all farm animals suffer and might not distinguish between different meat offerings. It follows that:

H3a: Negative (compared to positive) publicity about AWP of organic or standard meat suppliers, will result in higher spillover to WTP and evaluations of organic and standard meat products.

According to Janakiraman et al. (2006), unexpected changes in the marketing mix of a product can affect consumers’ overall spending levels in all other product categories at a retailer. They found that negative changes in product quality decreased overall purchase levels more than positive changes increased them. The importance of product quality was also detected by Zhao et al. (2011). They stated that in times of publicity induced uncertainty, consumers’ sensitivity to price sank while the importance of quality attributes rose. Especially risk-averse consumers were more inclined to choose product alternatives which were priced higher than the publicity target product, as the higher price served as an indicator for higher quality. Due to the fact that organic products are priced higher than standard food products, consumers might likewise conclude that this is connected with higher quality and assume that it is a product alternative carrying less risk. Hence, the following hypothesis is proposed:

H3b: Negative (compared to positive) publicity about AWP of a standard meat supplier positively affects WTP and evaluations of organic meat products.

However, the extent to which consumers are able to detect product differences and classify products according to their quality is highly dependent on consumer characteristics such as prior category experience, or product expertise. These consumer characteristics will be described next.

Consumer characteristics

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2.3.2. Consumer knowledge

Traditionally knowledge has been characterized as the familiarity and expertise inherent to consumers with regard to product attributes or a product category (Cordell 1997). While those who have less knowledge focus more on extrinsic cues like a product’s price and make more comparisons among alternatives, those with more knowledge tend to consider intrinsic cues such as the level of harmful attributes in a product, or contextual factors accounting for negative product performance (Rao and Monroe 1988; Monga and John 2008). In addition, highly knowledgeable consumers have better abilities to logically analyze information and therefore process messages selectively, to the extent that they sometimes disregard useful information (Hong and Sternthal 2010). Expert consumers are moreover able to attribute information which is inconsistent with their category knowledge to different sublevels of that category (Sujan 1985; Cowley and Mitchell 2003). Hence, when confronted with negative information on AWP of a standard meat supplier or with positive information on AWP of an organic meat supplier, they will attribute this information to the corresponding categories and also take into account contextual factors which might mitigate the effect of publicity. For example, these consumers could argue that products obtained under minimal animal welfare standards are connected to lower prices, which are beneficial for the consumer and a trade-off that should not be disregarded. Consumers with low levels of category knowledge might on the other hand not be able to clearly differentiate product alternatives within the category and attribute the negative or positive publicity to the entire category, as they perceive it to be diagnostic. As a result:

H4a: Lower levels of consumer knowledge about AWP in the meat industry amplify the effect of publicity, whereas higher levels of knowledge inhibit the effect of publicity.

Prior literature has often differentiated between two categories: subjective and objective knowledge (Park et al. 1994; Mägi and Julander 2005; Moorman et al. 2004). Subjective knowledge is referred to as what consumers believe they know, while objective knowledge describes an individual’s actual level of knowledge on a certain topic (Brucks 1985). Some studies have pointed out the similarities of the two concepts, as subjective knowledge is at least partly founded on objective knowledge, being gathered from i.e. mass media sources. On the other hand, correlation levels between the two knowledge types vary between 0.3 and 0.6 and are unlikely to be similar when consumers are suffering from self-deception or false expertise (Carlson et al. 2009; Klerck and Sweeney 2007). This might also hold true for perceptions of farm animal welfare, as advertising and positive publicity about organic meat suppliers suggest happy animals and negative publicity about AWP of standard meat suppliers portraying the contrary, have varying influences on consumers. It is therefore suspected that the correlation of the two constructs will be relatively low.

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knowledge are able to process and use new information with greater ease and consider more attributes when evaluating a product or its alternatives, increasing the likelihood of defection to other brands (Capraro et al. 2003). On the other hand, high subjective knowledge is related to stronger attitudes toward a product and is connected to higher confidence in one’s own expertise, whereas this effect was not found for objective knowledge (Alba and Hutchinson 2000). If the latter aspect holds true, people high in subjective knowledge might counter-argue or defy information which does not correspond with their prior beliefs to a higher extent than people high in objective knowledge. Consequently:

H4b: Levels of consumer subjective and objective knowledge about AWP in the meat industry

differentially moderate the effect of publicity on WTP and evaluations of organic and standard meat products.

2.3.3. Consumer’s ethical ideology

Notably, recent research suggests that consumers display differing reactions to a company’s morally questionable practices. While some consumers regard punishment as an adequate tool for firms promoting unethical goods (Klein et al. 2004), others show a much higher tolerance and might react with willful ignorance (Ehrich and Irwin 2005). Brunk and Blümelhuber (2011) suggest that high personal gains might lead to consumer indifference with regard to unethical corporate behavior. Individual ethical norms are then traded for potential personal gains such as cheaper products. However, potential personal losses or risks will increase consumers’ perceived severity of the immoral conduct.

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highly relativistic give more weight to the circumstances of the situation than the ethical principle which has been violated when judging others (Forsyth 1992). Studies have shown that relativistic consumers show higher levels of skepticism and are less likely to disagree with an ethically questionable situation, making sometimes decisions without regarding the impact on others (Karande et al. 2002). Idealism on the other hand describes the extent to which a person believes, a desirable outcome can be achieved by making the right decision in an ethically problematic situation. Idealistic individuals believe that harming others is always avoidable and would prefer not to choose between the lesser of two evils, ultimately leading to negative consequences for others (Dubinsky et al. 2004). Furthermore these people act according to values, which are strongly related to altruism and show a sense of optimism in evaluating moral issues (Singhapakdi et al. 1999). In the context of the present study it can be assumed that idealistic consumers will perceive negative information on AWP as highly ethically questionable and will condemn these products more than relativistic consumers. The latter might be less affected as they might focus more on the outcome (lower priced produce) which entails personal gains. Positive information about AWP might likewise evoke more positive evaluations among consumers with an idealistic point of view, as it corresponds to their moral philosophy. Hence:

H5a: Lower levels of idealism inhibit the effect of publicity on WTP and evaluations of organic and standard meat products, whereas higher levels of idealism amplify the effect of publicity.

H5b: Lower levels of relativism amplify the effect of publicity on WTP and evaluations of organic and standard meat products, whereas higher levels of relativism inhibit the effect of publicity.

It is important to note that individuals can show high or low scores on either dimension or both, as the two ethical ideologies are conceptually independent. Forsyth (1980) classified people according to their levels of idealism or relativism, thereby determining four different ethical types: situationists, absolutists, subjectivists and exceptionists.

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doing the right thing will not always prevent negative consequences or behaviors. Exceptionists believe that moral rules are a useful tool to guide behavior, but that exceptions to moral principles should be permitted and not condemned. Being rather pessimistic about the fact that positive outcomes inevitably result from moral behavior, they welcome exceptions of universal ethical rules. Moreover, their perceived morality of certain actions is also dependent on whether total utility or self-interest is maximized by the results (Forsyth and Pope 1984). A summary of these four ethical ideology positions can be found in table 2.

Idealism Relativism

High Low

High Situationists: Rejects moral rules; advocates individualistic analysis of each act in each situation; relativistic.

Absolutists: Assumes that the best possible outcome can always be achieved by following universal moral rules.

Low Subjectivist: Appraisals based on personal values and perspective rather than universal moral principles; relativistic.

Exceptionists: Moral absolutes guide judgments but pragmatically open to exceptions to these standards; utilitarian.

Table 2: Taxonomy of Ethical Ideologies by Forsyth (1980)

Deriving from Forsyth’s model, it becomes evident that individuals who score high on absolutism will be most appalled by negative AWP in the food chain, as they perceive moral norms to be universal and applicable in every situation of daily life. These individuals might also infer that if more people buy more organic products, animal suffering in the whole food chain will be forced to change as supply is dictated by demand. Hence, the author proposes:

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2.4 Conceptual model

In summary the following hypotheses have been formulated: