The Influence of Food Labels on the Consumers’ Purchase
Intentions of Food Products
Author: Asna Warsha Mohan
Address: Baart de la Faillestraat 34B 9713JG, Groningen
Telephone number: 0637243393
E-mail address: a.w.mohan@student.rug.nl Student number: 2098008
Study program: MSc Marketing
Course: Master Thesis
Date: June 20, 2013
First supervisor: Dr. J.W. Bolderdijk Second supervisor: Dr. J. van Doorn
University of Groningen Faculty of Economics and Business
Marketing Management
Where and How food is produced…does it matter?
Asna Warsha Mohan University of Groningen Faculty of Economics and Business
Supervisors Dr. Bolderdijk and Dr. Van Doorn June 2013
Abstract
This study addresses the influence of food labels, which include the product origin and the production method, on the perceived food quality as well as the perceived pro-social product benefits and ultimately the consumer purchase intentions of food products. Pro-social product benefits pertain to pro-social behavior and reflect the perceptions that a product purchase might help the society. With the use of an experiment we tested our research hypotheses. The results indicated that the food labels with the product origin indeed has an effect on the perceived food quality; respondents who were presented with food products which were labeled as local, responded more positively than those who saw a non-locally labeled food product. They also perceived food products labeled as local to contribute to a better environment compared to non-locally labeled food products, which has to travel longer distances to reach their plates and thus negatively impacts the environment by producing more gas emissions. These social benefits and quality perceptions positively impacted the purchase intentions of the consumer. Our research also showed that organically labeled food products positively affected the perceived food quality and pro-social product benefits. In the case of non-organic labeled foods, it does not matter for the consumers if food is locally produced or not locally produced, because in both cases they have low perceptions of pro-social product benefits.
Preface
After finishing my Bachelor’s degree in Economics at the Anton de Kom University of Suriname, I missed a more theoretical approach to my study. I wanted to get more involved in the marketing branch. I believed at that point that I was not ready to start my career yet. Therefore, I chose to follow an additional study to fulfill my needs and decided to pursue this need at the University of Groningen.
This thesis is the final step in completing my MSc Marketing program at the University of Groningen. A period I look back at with great satisfaction, learning a great amount of academic skills and enjoying the student life in Groningen while making new friends.
I am proud of this Master thesis that is in front of you. This thesis could not have been established without the help and support from others. Therefore, I would like to take the opportunity to my supervisors Dr. Bolderdijk and Dr. Van Doorn that gave me the guidance and valuable feedback. Furthermore, I would like to thank my loved ones for their support during the process of writing my Master thesis.
Table of Content
Preface
1. Introduction 5
1.1 Background Study 5
1.2 Problem Definition 6
1.3 Academic and Managerial relevance 7
1.4 Structure Thesis 8 2. Theoretical Framework 9 2.1 Literature Review 9 2.1.1 Product Origin 9 2.1.2 Production Method 10 2.1.3 Perceived Quality 10
2.1.4 Pro-Social Product Benefits 11
2.1.5 Consumer Purchase Intentions 11
2.1.6 Gaps Identified 12
2.2 Conceptual Model 12
2.3 Hypotheses Development 13
3. Methodology 18
3.1 Experimental Design 18
3.2 Data collection method 18
3.2.1 The survey 19
3.2.2 Participants 19
3.2.3 Procedure 20
3.3 Products developed for researched 20
3.3.1 Manipulation of the independent variables 20
3.4 Measurement 21 3.5 Plan of analysis 22 3.5.1 Reliability analysis 22 3.5.2 Manipulation Check 23 3.5.3 Model development 24 4. Results 25 4.1 Descriptive statistics 25 4.2 Hypotheses Testing 25 4.3 Mediation analysis 29 4.4 Hypotheses Evaluation 31 Conclusion 32
Limitations and Future Research 33
Recommendations 33
Reference list 35
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1.
Introduction
This chapter contains an introduction of the thesis. Firstly it will provide background information on the problem definition. Secondly, the research question will be defined. Next, the academic and managerial relevance will be outlined. This chapter finalizes with a structure of the thesis.
1.1 Background of the study
Over the past decades food consumption has radically evolved. The increase in food consumption can be explained by the growing world population, resulting in more consumers (Szirmai, 2005). An increased production and consumption causes serious earth destruction in terms of air, land and water pollution, biodiversity, and climate change. Until several decades ago most people ate food that came from local sources. However, a combination of developments, including advances in food processing technology, economies of scale in the food industry, and relatively cheap transportation has created a situation today where much of the food we eat travels thousands of miles before ending up on our plates.
How food is grown, stored, transported and processed can all influence how it impacts climate change and the environment. Research has shown that the food transport is a major source of greenhouse emissions (Ericksen, 2007). Greenhouse gases are emitted through the burning of fossil fuels and affect air quality and global climate change (Lang and Heasman, 2004). Food that is not locally produced and imported from abroad undergoes many transformations and travels long distances before it reaches retail markets. Since food that is imported from abroad and has to be transported all those miles in ships, trains, trucks, and planes, attention to food miles links up with broader concerns about the emissions of carbon dioxide and other greenhouse gases from fossil fuel-based transport. For instance, research has shown that imports by airplane have a substantial impact on global warming pollution (Xuereb, 2005). Eating locally grown food therefore helps in the fight against global warming and other pollutants. This means that food is not traveling long distances by trains, planes, trucks and ships which all consume energy and spew pollution that contributes to global warming and unhealthy air quality.
6 towards environmental welfare and effect consumers’ choice when buying food products (Kalafatis et al, 1999). As organic farming uses fewer artificial fertilizers and pesticides it is believed to do less harm to the environment (Cornelissen et al, 2008; Gore, 2006). But what if organic food products are not locally produced and have to travel long distances to reach the consumer? Will the perception of “environmentally friendly” still hold? Since organic food is marketed and labeled as “environmentally friendly”, it is of interest to examine if the consumer is aware of the negative environmental impact when their food products have to travel long distances to reach them. Moreover, we want to find out if the consumer perceives the environmental benefits when food is labeled as locally produced and if these benefits affect their ultimate food choice.
1.2 Problem Definition
Prior literature has only partially explored consumer’s perceptions of the impact of food production methods on the environment. These studies have focused on environmental impacts up to the farm gate, but have not assessed the additional environmental effects of transporting food and if this affects the food choice of the consumer. We want to find out if the consumer perceives the environmental benefits when food is locally produced and if these benefits affect their food choice. Furthermore, since organic food is marketed as environmentally friendly it is of interest to examine if the consumer is aware of the negative environmental impact when their food products has to travel long distances to reach them.
7 Consumers can find information about the production method and product origin on the food labels. Food labels carry information that helps consumers make food choices. A label lists additives, ingredients and nutrition information such as fat and protein content. Food labels can help people with food allergies, and may also make nutrition and health claims. Also to be found on food labels are the product origin (local vs. non-local) and the production method (organic vs. non-organic).
Our research builds on the assumption that purchasing of food products depends on both the perception of quality as well as the perceived pro-social benefits of food products. Therefore, the overall objective of the present study is to examine the effects of the food labels, in particular the effects of the food production method together with the origin of the product on the consumers’ perceived quality and social benefits and the eventually subsequent purchase intentions.
“Do the product origin and production method on the food labels determine the consumer’s purchase intentions of food products?”
During this study the following research questions will be analyzed:
1. To what extent are (a) perceived food quality and (b) pro-social benefits affected when local vs. non-local food labels are used?
2. To what extent are (a) perceived food quality and (b) pro-social benefits affected when organic vs. non-organic food labels are used?
3. To what extent does the (a) perceived food quality and (b) pro-social benefits impact the consumers’ purchase intentions?
4. To what extent are (a) the perceived food quality and (b) the perceived pro-social benefits affected, when the product origin together with the type of production method is included on the food label?
1.3 Academic and Managerial relevance
8 air pollution when consumers consume more locally produced foods. Marketers can use the results of this study to their advantage to develop strategies to stimulate local food sales and thus food sales that contribute to a better environment. Local food sales also support local farmers and the local economy. Furthermore, by understanding the perception of the consumer with regard to the pro-social product benefits, the marketer can develop communication strategies to educate and promote their food products at the same time to the consumer while enhancing the purchase intentions of food products which contributes to a better environment.
1.4 Structure of the thesis
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2.
Theoretical Framework
In this chapter the theoretical framework will be presented in which firstly most of the relevant literature for this research will be discussed in order to find out what is already known about the different variables that that will be used in this thesis. In the second part, the conceptual model will be presented based on the gaps and related opportunities from prior research. In the last part, theoretical models are used in order to present the hypotheses derived from the conceptual model.
2.1 Literature Review 2.1.1 Product Origin
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2.1.2 Production Method
Organic foods are distinguished from non-organic foods by the methods used in their production and processing (Lohr, 2001). Organic rules prohibit the use of synthetic fertilizers pesticides, growth regulators, and livestock feed additives and require long term soil management and emphasis on animal welfare (Honkanen et al, 2006, Lohr, 2001). Certain activities such as use of genetically modified stock, application of sewage sludge to organic acreage, and food irradiation are also prohibited (Lohr, 2001). To be certified organic, a farm processing facility must be inspected by a credible private organization to verify that all requirements of the certifying body are met. Conventional or non-organic foods would not meet organic standards, if subjected to the certification criteria. Research has shown organic food products to be healthier than non-organic food products. For instance, studies on health effects of pesticide exposure such as the one by Kamel and Hoppin (2004) reveals that chronic pesticide exposure is associated with a broad range of symptoms such as headache, fatigue, weakness, nausea, dizziness, difficulty in breathing, insomnia, confusion and lack of concentration.
Previous findings indicate several reasons why consumers purchase organic food products. Organically grown food products are considered to be healthy and environmentally friendly because of the use of less damaging pesticides (Magnusson et al, 2001; Thompson and Kidwell, 1998). Alarmed by increasing obesity rates and discussions about food safety, many consumers desire less processed, healthier, natural foods (Magnusson et al, 2003). Furthermore, ethical movements are becoming widespread in developed countries towards animal health and welfare on farms and effect consumers’ choice when buying milk and meat products (Kalafatis et al, 1999).
2.1.3 Perceived food quality
11 various activities that occur along the supply chain. For example preservation methods such as refrigeration, chlorination and electrolyzed water treatments aim to reduce the nutritional losses and to increase the shelf-life of fresh vegetables (Alzamora, Tapia, & Lopez-Malo, 2000). However, storage can reduce vegetable quality due to spoilage and nutritional losses (Goldberg, 2003). Another determinant of quality is process quality which covers the way the food product has been produced e.g. without pesticides, without growth inhibition or food products that are manufactured in a natural way i.e. without the use of advanced technology (Brunso et al, 2005). In sum, there are two determinants of food quality. The first determinant is the locality of food production, whether food is locally produced/ labeled or not. The second determinant of food quality is the production method; if food is organically produced/ labeled or not. Food that is organically produced is of higher quality compared to food that is not organically produced due to the natural production methods.
2.1.4 Pro-Social product benefits
Ethical motives of consumers such as contributing to a better environment are one of the reasons consumers purchase organic food products. However, many consumers often weigh their own benefits compared to social importance. Pro-social product benefits reflect perceptions that a food product purchase may help society and thus capture the social dimension of food choice (Folkes and Kamins, 1999). Consumers that want to contribute to environmental well-being should therefore base their food choice on the product benefits. Food that travels shorter distances to reach the consumer’s plate contributes to a better environment compared to food that has to travel longer distances which negatively affects the environmental well-being due to the gas emissions. Thus far it is not known whether consumers who are concerned about the environment make a distinction between food products that are labeled as organic-local and food products that are labeled as organic- non local, as consumers relate organic with “environmentally friendly”.
2.1.5 Consumer purchase intention
12 influence a behavior. They are indications of how hard people are willing to try or how much of an effort they are planning to exert, in order to perform the behavior. The immediate antecedent of behavior is the intention to perform behavior. As a general rule, the stronger the intention to engage in behavior, the more likely should be its performance (Ajzen, 1991).
2.1.6 Gaps identified
The concept of “food miles” is used to describe the distance food travels from the location where it is grown to the location where it is ultimately consumed. Food miles and the resulting pollution increase substantially when we consider food products imported from halfway around the world. In developed nations like ours, food is traveling farther to reach consumers and international food trade is increasing rapidly. Therefore, local food supply systems can lead to potential social and environmental benefits (Marsden et al, 2000; Cowell and Parkinson 2003). An opportunity exists to reduce our contribution to global climate change and air pollution when consumers consume more locally produced foods. However, there has no research yet done if consumers are aware of the environmental impact when food has to travel long distances and if consumers are aware how their food choice can also contribute to this environmental phenomena. Consumers may mistakenly associate “organic” with “environmental friendly” when food is not locally produced but shipped in or flown in from abroad. Therefore it is interesting for us to find out to what extent consumers are aware of the impact of the CO2 emissions and pollutions on the environment when food has to travel long distances and if this impact affects their perceptions of food and their purchase intentions.
Furthermore we want to examine if consumers are troubled by the long distances food has to travel from farm to table when their food is not locally produced, and therefore extend our analysis on the perception of food quality. In our modern age of food preservatives and additives, genetically altered crops and E. coli outbreaks, people are increasingly concerned about the quality and cleanliness of the foods they eat. Previous studies indicated that consumers prefer organically grown food above conventional food, but will this preference still hold if the food is not locally produced? As organic labeled food products are considered to be healthy and safe, we want to extend our analysis if this perception still holds if organic food is imported from abroad.
2.2 Conceptual model
13 vs. conventional) but also the product origin (local vs. non-local) of the food label might affect the consumers’ perceptions of food products. We predict that food products labeled as local will positively affect the perceptions of food quality compared to food products that are not labeled as local. This perception will in turn positively affect the consumers purchase intentions of food products. Furthermore, because food products that are labeled as local have to travel shorter distances we expect this to lead to higher perceptions of pro-social product benefits which in turn will lead to higher food purchase intentions. We expect organically labeled food products to lead to higher perceptions of quality and pro-social benefits which in turn will positively affect the consumer purchase intentions. Our particular interest lies in the interaction effects of the food labels, which include the product origin and the production method, on the perceived food quality and the perceived pro-social benefits. This effect will be outlined in the following section.
Figure 1: Conceptual Model
2.3 Hypotheses Development
Local vs. Non Local food labels
In the literature on perceived quality of food products, the product origin on the food label is acknowledged to signal quality to the consumers (Steenkamp, 1990; Steenkamp and Van Trijp, 1996; Becker, 1999; Peterson and Jolibert, 1995). Since food items are low involvement products, it is likely that consumers use the origin of the product as a heuristic or rule of thumb that help them easily reach quality judgments (Chen & Chaiken, 1999). As the product origin is used as a cue to signal quality we expect that the product origin will also influence the perceptions of quality besides other cues that consumers use to infer product quality such as the product appearance, shape and size (Olson, 1977). Previous findings indicated that consumers judged locally produced food to be of higher quality, particularly in terms of freshness as the food had to travel less distance (Chambers et al, 2007; Naspetti and Zanoli, 2009; Kezis et al, 1984; Wolf, 1997; Wolf et al, 2005; Keeling-Bond et al, 2009; Adelaja et al,
Consumer Purchase Intensions of Food
Products
Perceived Food Product Benefits
Perceived Food Quality
Perceived Pro-Social Benefits
Food labels
Product Origin
Local vs. Non-Local
Production Method
14 1990; Feagen et al, 2004). Consumers consider locally grown food, such as fruits and vegetables, to be fresher and more flavorful because farmers pick their produce when they are ripe and usually deliver them to the market on the same day. On the contrary, non-locally grown produce must be picked early to prevent spoilage, to survive the long distance travel and to allow for ripening times sitting on the shelf (Govindasamy et al, 2002). In line with these previous findings we also predict that locally labeled food products will positively influence the quality perception.
H1a: Food products labeled as local will lead to higher quality perceptions than food products labeled as non-local.
As stated earlier, the other related dimension of food choice appears in our conceptual model as pro-social product benefits. Local foods do not generate the same pollution and waste the same energy as non-local foods that are trucked, shipped, or flown in from far away (Jones et al 2008; Pretty et al, 2005). Food that is produced locally requires less fuel for its transport, resulting in less air pollution and less need for oil development, and thus, could be considered more environmentally friendly (Brown, 2003). Therefore we argue locally produced food products to positively influence the perceived pro-social product benefits.
H1b: Food products labeled as local will lead to higher perceptions of pro-social benefits than food products labeled as non-local.
Organic vs. Non-Organic food labels
15 However, there is contrasting empirical evidence on the perception on quality attributes of the taste and freshness of organic food. Some studies reported that consumers perceive no difference in the taste of organic food versus non-organic food (Jolly and Norris, 1991; Sparling et al, 1992), while other studies report a better taste for organic produce (Estes et al, 1994; The Parker, 1996). Furthermore, unsatisfactory quality is cited as one of the main reasons not to purchase organic foods (Bourn and Prescott, 2002). These differences in findings support the need for more research into the relationship between the perceived quality and the consumer purchase intentions of organic food. Still, from a theoretical perspective a positive effect of organically produced food on perceived quality is most likely.
H2a: Food products labeled as organic will lead to higher quality perceptions than food products labeled as non-organic.
An ethical motive, such as contributing to a better environment is a frequently cited reason for consumers to buy organic food (Magnusson et al, 2003). Organically grown produce is considered to be environmentally friendly because of the use of less damaging pesticides and artificial fertilizers (Magnusson et al, 2001; Thompson and Kidwell, 1998). Previous research has shown that consumers perceive organic produce as more environmental friendly, because of more natural growing methods (Schifferstein and OudOphuis, 1998; McEachern and McClean, 2002). Harris et al. (2000) found evidence that people concerned about the environment were likely to purchase organic food products. In line with these findings we can predict that organically labeled food products will have a positive influence the perceived pro-social product benefits.
H2b: Food products labeled as organic will lead to higher perceptions of pro-social benefits than food products labeled as non-organic.
Consumer purchase intentions of food products
16 H3a: The perceived food quality will lead to higher consumer purchase intentions of food products.
As food has to travel shorter distances compared to non-locally produced foods and therefore generates less fuel and pollution we argue that this perception of pro-social benefit will positively affect the consumer purchase intentions. Furthermore, consumers believe that purchasing organic food helps the environment more than non-organic food (Padel and Foster, 2005; Zanoli and Naspetti, 2008). Magnusson et al (2003) have found a significant relationship between pro-social product benefits and consumer purchase intention of organically produced foods. Consumers stated that environmental consequences will be influenced by their choice of organic foods. Those having a strong purchase intention stated that it was more important that the environmental consequences would result from their choice of organic foods (Magnusson et al, 2003). These results are in accordance with findings from another recent Swedish study (Grankvist& Biel, 2001) that found a positive and moderately strong correlation between the purchase frequency of organic foods and the perceived importance of environmental consequences as a purchase criterion.
H3b: Pro-social product benefits will lead to higher consumer purchase intentions of food products.
Interaction effects of food labels: Product origin and Production method
17 and quality reduction when food is stored along the supply chain. Therefore we expect non- locally labeled food products to weaken the relationship between organic produce and the perceived quality.
H4: The positive effect of organic labels on perceived food quality will diminish when food products are non-locally produced.
As previously described, organically grown produce is considered to be environmentally friendly because of the use of less damaging pesticides (Magnusson et al, 2001; Thompson and Kidwell, 1998) and therefore positively affects the perception of the pro-social product benefits. However, the production method of food not only contributes to environmental welfare, but also the transportation of food. Consumers may mistakenly believe that non-locally produced organic food has a smaller ecological footprint, because organic is associated with “good”, i.e. environmentally friendly. The further the food products are transported, the more fossil fuels are burned and the greater the adverse impact on the environment.
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3.
Methodology
This chapter gives an overview of the research method that is used in this study. The first part comprises the type of experimental design and how data is collected. The second part describes the measurement of the variables and the plan of analysis.
3.1 Experimental Design
The purpose of this research is to examine whether the product origin and production method influences the consumer purchase intentions and how the perceived quality and pro-social benefits mediate this relationship. To be able to conduct this research we set up an experiment. This experiment employed a 2 (product origin: local vs. non-local) x 2 (product practice: organic vs. non-organic) between-subjects design. This means that the experiment contains four different conditions that will be tested. We used the same food products under four different conditions.
Organic labeled Non-Organic labeled Local labeled Condition 1 Condition 2
Non-Local labeled Condition 3 Condition 4
Table 1 Experimental research design
The research design results in the following four conditions:
Condition 1: Local and Organic labeled food
Condition 2: Local and Non-Organic labeled food
Condition 3: Non-Local and Organic labeled food
Condition 4: Non-Local and Non-Organic labeled food
3.2 Data collection method
pre-19 test mentioned not knowing how to rate the statements that measure the perceived quality with regard to potatoes because this food product first has to be cooked or baked and everybody can put in their own salt and spices and give it their own taste. For this reason potatoes were replaced by grapes.
The official survey was electronically distributed through the software Qualtrics by using the convenience sampling method. Next to this, the snowball sampling was used where respondents were asked to forward the link of the survey to their family members and acquaintances. For the convenience sampling only 12 random people were selected through the email address book of the researcher. These 12 people were asked to forward the link of the survey to their acquaintances and family members. A number of 91 respondents filled out the survey online and the remaining 77 respondents filled out the survey on paper. The link to the survey was set up via Qualtrics from the 3rd of May until the 10th Of May. The online link of the survey was closed on May the 10th 2013, at 15.00pm. In order to reach more respondents the researcher randomly approached people at the Paddepoel shopping centre and the Central train station in Groningen, the Netherlands, to fill out the printed survey. The survey can be found in Appendix A.
3.2.1 The survey
The survey is structured. This means that it is prepared and the questions are asked in a pre-arranged order, which enhances the reliability (Malhotra, 2004). All of the questions were fixed-alternative and thus the Likert scale was applied. The Likert scale is a balanced scale. This means that the number of favorable and unfavorable categories is equal. These kinds of questions are simple to administer and produce reliable data with minimal variability in the answers (Malhotra, 2004).
3.2.2 Participants
20 out the questionnaire on paper. The link to the online survey was electronically distributed using the convenience sampling method as well as the snowball sampling method.
3.2.3 Procedure
The subjects are going to be told that this research is about reviewing three food products that their supermarket is planning on introducing but first needs their opinion about these food products. Nothing is said about the actual topic of this study. Every respondent will be only subjected to a single condition and will be randomly assigned. Depending on the condition, participants saw exclusively organic-local, non-organic-local, organic-non local, non organic- non local food labels. The between-subjects design will be used for conducting this experiment. The term "between-subjects" reflects the fact that comparisons are between different groups of subjects (Malhotra, 2007). This between-subjects design has the advantage that very little contamination occurs because the respondent cannot guess the purpose of the experiment beforehand and respond accordingly (Malhotra, 2007).
3.3 Products developed for researched
The food products to be used in the experiment are apples, tomatoes and grapes. These products are chosen because they are consumed on a regular basis by Dutch consumers. In general people like their fruits to be fresh and of high nutritional value when they consume them. Apples to be found in Dutch supermarkets are locally produced and those which are not locally produced may come from countries such as Brazil. The country that is used on the food labels for this research is Brazil for the apples, because we are interested if consumers consider buying fruit that comes all the way from South America and therefore has a long travel distance. The country that is used on the food labels for the grapes is India and for the tomatoes is Spain.
3.3.1 Manipulation of the independent variables
21 tomatoes and grapes in all four scenarios. The following picture is an example of the food product apples that is presented to the consumer with the condition organic-local.
3.4 Measurement
Table 2 shows all scale items in the survey. All items were scored on a 7-point Likert scale ranging from 1 (Strongly disagree) to 7 (Strongly agree). This ordinal data is interpreted as interval data, which enables the usage of analytical techniques such as regression analysis (Malhotra, 2007). As can be seen from table 2 we will measure the variables perceived quality with a number of 5 statements, pro-social product benefits with 3 statements and the consumer purchase intentions of food products with 4 statements.
Constructs Source
Perceived Food Quality I think these apples taste good I think these apples are fresh I think these apples look good
I think these apples have a high nutritional value I think these apples are healthy
Own Construct
Perceived Pro-Social Product Benefits
By purchasing these apples I contribute to reducing CO2 emissions By purchasing these apples I contribute to the mitigation of climate change
By purchasing these apples I contribute to improving the environment
Own Construct
22 Consumer Purchase Intentions of food products
I would buy these apples if they were sold in my supermarket It is very likely that I would buy these apples in the near future I am not planning on buying these apples
I would buy these apples if I encountered them in my supermarket
Own Construct
Table 2 Constructs
3.5 Plan of analysis
When analyzing the data we will work with the average scores across the three food products. We chose to work with the average scores of three food products (apples, tomatoes and grapes) because this gives us a more reliable outcome than when we only provided the respondent with one food product. The data will be analyzed with the use of SPSS (Statistical Package for the Social Sciences), a statistical computer program. The following analysis will be performed:
The coefficient alpha or Cronbach’s alpha will be used to measure the internal consistency reliability of the scales.
ANOVA testing will be performed to measure the effect of the independent variables (production method and product origin) on the mediating variables (perceived quality and pro-social benefits).
Multiple regression analysis will be used to estimate the relationship between the mediating variables and the consumer purchase intentions of food products.
In order to determine the presence of full or partial mediation in our model we will look at the significance levels of the direct effects as well as the indirect effects. We will make use of the Preacher and Hayes (2008) Multiple Mediation (INDIRECT) analysis that is also performed with the use of SPSS
3.5.1 Reliability analysis
23 because they are higher than 0.6. All items are therefore included in this research. The following cronbach alpha’s are calculated across all three food products. So the first item is the Perceived Quality of food (apples, tomatoes and grapes). The same goes for the second and third item, namely Pro-Social Product benefits and the Consumer purchase intentions of food products.
Table 3 Cronbach Alpha’s for the construct
3.5.2 Manipulation Check
A Manipulation check is a measure used to determine whether or not the manipulation of the independent variables has had its intended effect on the participants. The statements included to perform the manipulation check are: By purchasing these apples I support the local economy and By purchasing these apples I support local producers. See table 4 for the manipulation check. We performed the manipulation check by looking at the descriptive data. We firstly recoded the Likert scale. For the scenarios with locally produced products this means: incorrectly identified on the Likert scale: 1-3 and correctly identified on the Likert scale 5-7. For the scenarios with non-locally produced products this means: incorrectly identified on the Likert scale 5-7 and correctly identified on the Likert scale 1-3.Where the score 4 (neither agree nor disagree; n=22) is not taken into account. Based on table 4 we can conclude that the manipulation succeeded as the participants did pick up on the difference between the conditions. We deleted the cases which were incorrectly identified. In total 168 respondents filled out the questionnaire. Furthermore, there were 164 respondents in total that answered the statements correctly. For the convenience and to get a round number for each condition we randomly took out 4 responses in order to get 40 responses per scenario.
Table 4 Manipulation Check
Constructs Cronbach´s Alpha
Perceived Food Quality α = 0,88
Perceived Pro-Social Product Benefits α = 0,93 Consumer Purchase Intentions of Food products α = 0,89
Correctly Identified
Incorrectly Identified
Total
Local scenario Count 83 14 97
Percentage 85.5% 14.5% 100%
Non-Local scenario Count 81 17 98
Percentage 82.6% 17.4% 100%
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3.5.3 Model Development
In order to provide a clear understanding of the analyses we will use in this research we split the model into two parts. Visually this can be seen below.
Part I
To be able to test the effects of the main and interaction effects of the independent variables (IV1 and IV2) on the mediators (M1 and M2), will use the one-way ANOVA test in SPSS. The data of every condition has been labeled, based on the product origin (local/non-local label) and production method (organic/non-organic label). The products that are locally produced are labeled 1 and the products that are non-locally produced are labeled 0. Furthermore, organically produce is labeled as 1 and non-organic produce is labeled 0.
Part II
In order to test the strength of the effects of the mediators (M1 and M2) on the dependent variable (DV), we performed multiple regression analysis. The following equation is estimated in order to test for these effects:
where is a constant, is the coefficient vector for perceived quality and is the coefficient vector for pro-social product benefits.
Product Origin
Local vs. Non-Local label
Production Method
Organic vs. Non-Organic label
Perceived Food Quality IV1
IV2
M1 Perceived Pro-Social Product
Benefits M2
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4.
Results
This chapter describes the results of this research. In the first part some descriptive results will be outlined. In the second part the hypotheses are tested by executing several analyses. The last part of this chapter outlines the extent of the mediating effects.
4.1 Descriptive statistics
A total of 160 respondents are included in this research. Before analyzing the data, the missing values should be checked. There were no missing values found in this study. This study was also conducted by using the data collection
program Qualtrics and also printed out on paper. Due to the accessibility of Qualtrics, the study was conducted through different provinces of The Netherlands. Overall respondents from different provinces participated. The majority of these respondents (46%) are from Groningen. A visual representation can be seen Appendix B. General demographics of the sample is presented in table 5. The majority of the sample was female (61%). The distribution between ages is set out in table 5 as well. Moreover, 73 % of the respondents identified themselves as the person who does the grocery shopping.
4.2 Hypotheses Testing
This section deals with the testing of the hypotheses. The confidence interval is set at 95%, i.e. in order to be significant the condition p < 0.05 had to be fulfilled.
Hypothesis 1a proposed that foods will be assumed to be of a higher quality when they are labeled as local instead of non-local. A one-way ANOVA test is conducted in order to determine the impact of the food labels on the food quality perceptions of the consumer. The results show that foods that are
% Nr Gender Male 39 98 Female 61 62 Age 7.50 12 25-34 20 32 35-44 29.37 47 45-54 26.87 43 55-65 13.76 22 2.50 4 Education Primary 2.50 4 MBO 26.87 43 HBO 32.50 52 WO 38.13 61 Food shopping Me 73.10 116 Partner 22.50 36 Parents 2.50 4 Others 1.90 4 Table 5 Demographics Product Origin Production Method Mean SD Non-Organic 4.52 1.12 Non-Local Organic 5.00 0.90 Total 4.76 1.04 Non-Organic 5.16 0.82 Local Organic 5.47 0.79 Total 5.32 0.82 Non-Organic 4.84 1.03 Total Organic 5.24 0.87 Total 5.04 0.97
26 labeled as local will lead to higher perceptions of food quality (M = 5.32, SD = 0.82) than foods that are labeled as non-local (M = 4.76, SD = 1.05). Furthermore, the test shows that there is a significant difference of the perceived food quality between locally labeled food products and non-locally labeled food products: F(1,16)= 13.93, p < 0.05, so this hypothesis can be supported. See table 6 for an overview.
Hypothesis 1b proposed that foods labeled as local will lead to higher perceptions of pro-social benefits than foods labeled as non-local. A one-way ANOVA test is conducted in order to determine the impact of the food labels on the pro-social product benefits. The results show that locally labeled foods will lead to higher perceptions of pro-social product benefits (M = 3.85, SD = 1.43) than non-locally labeled foods (M
=3.06, SD = 1.39). Furthermore, the test shows that there is a significant difference of the perceived pro-social product benefits between locally labeled foods and non-locally labeled foods: F(1,16)= 12,44, p < 0.05, so this hypothesis can be supported. See the table 7 for an overview.
Hypothesis 2a proposed that foods labeled as organic will lead to higher food quality perceptions than foods which are not organically labeled. A one-way ANOVA test is conducted in order to determine the impact of the food labels on the quality perceptions of the consumer. The results show that organically labeled foods will lead to higher perceptions of food quality (M =5.24, SD =0.87) than non-organically labeled foods (M =4.84, SD = 1.03). Furthermore, the test shows that there is a significant difference of the perceived food quality between organically labeled foods and non-organically labeled foods: F(1,16)= 6.70, p < 0.05, so this hypothesis can also be supported. See table 6.
Hypothesis 2b proposed that foods labeled as organic will lead to higher perceptions of pro-social product benefits than foods which are not organically labeled. A one-way ANOVA test is conducted in order to determine the impact of the food labels on the perceptions of the pro-social product benefits of the consumer. The results show that organically labeled foods will lead to higher perceptions of pro-social product benefits (M = 3.87, SD = 1.56) than
non-Product Origin Production Method Mean SD Non-Organic 2.86 1.18 Non-Local Organic 3.26 1.56 Total 3.06 1.39 Non-Organic 3.23 1.25 Local Organic 4.47 1.33 Total 3.85 1.43 Non-Organic 3.04 1.22 Total Organic 3.87 1.56 Total 3.46 1.46
Table 7 Perceived Pro-Social product benefits local vs.
27 organically labeled foods (M =3.04, SD = 1.22). Furthermore, the test shows that there is a significant difference of the perceived pro-social product benefits between organically labeled foods and non-organically labeled foods: F(1,16)= 13.81, p< 0.05, so this hypothesis can be supported.
Hypothesis 3a proposed that the perceived food quality will lead to higher consumer purchase intentions of food products. Regression analysis (as described above under “Part II”) is conducted in order to determine the impact of the perceived food quality on the consumer purchase intentions of food products. The regression model was significant, R2adjusted =0.17, F(1,16)= 68.14, p < 0.05. The (0.73) for perceived food quality is also larger than 0. The coefficient has a positive expected effect. Therefore the hypothesis is supported at the 0.05 level of significance.
Hypothesis 3b proposed that the perceptions of pro-social product benefits will lead to higher consumer purchase intentions of food products. Regression analysis (as described above under “Part II”) is conducted in order to determine the impact of the perceived of pro-social product benefits on the consumer purchase intentions of food products. The regression model was significant, R2adjusted =0.14, F(1,16)= 10.89; p < 0.05. The (0.23) is also larger than 0. The coefficient has a positive expected effect. Therefore the hypothesis is supported at the 0.05 level of significance.
28 Hypotheses 5 proposed that non- locally produced foods weaken the effect of organic produce on the perceived social benefits. When we look at appendix c we can see that both main effects proved to be significant (p < 0 .05). The interaction effect proved to be significant: F(1,16)=3.39, p < 0.05). In the case of non-organic foods, it does not matter for the consumers if food is locally produced or not locally produced, because in both cases they have low perceptions of pro-social product benefits (Mlocal= 3.23, Mnon-local=2.86). However, in the case of organically produced foods; the product origin does make a difference for the perceived pro-social benefits. People perceived higher pro-social product benefits in the case of locally produced organic foods (M=4.47) compared to non-locally produced organic foods (M=3.26). See appendix D for an overview. Therefore we support this hypothesis.
0 1 2 3 4 5 6 Organic Non-Organic Non-Local Local
Effect labels Product Origin and Production Method on Perceived Food Quality
Effect labels Product Origin and Production Method on Pro-Social product benefits 0 1 2 3 4 5
Non Organic Organic
Non Local Local
Graph 2 Product origin and production Method on pro-social benefits
29
4.3 Mediation analysis
Mediation analysis is needed to determine whether or not mediators are present when looking at the relationship between two variables X and Y. Mediators are variables that act as an in-between step when looking at the effect on X on Y, where X causes the mediator M and M is actually the cause of Y. If X is no longer significant when M is controlled, the findings support full mediation. If X is still significant (i.e. both X and M both significantly predict Y), the finding supports partial mediation. As we have 2 mediators in our model we first start of testing if both mediators perceived food quality and perceived pro-social product benefits function as mediators between IV1 (product origin: local vs. non-local food label) and the DV (consumer purchase intentions of food products). We graphically are testing the following relationships: t-value p-value Perceived Quality 3.73 .00 Pro-Social Benefits 3.52 .00 t-value p-value Product Origin 3.54 .00
Because both the a-paths and b-paths were significant, mediation analysis was tested using the bootstrap method (Preacher and Hayes, 2004). In the present study the 95% confidence interval of the indirect effects was obtained with 5000 bootstrap re-samples (Preacher and Hayes, 2005). Results of the mediating analysis confirmed the mediating role of the perceived
t-value p-value Perceived Quality 6.93 .00 Pro-Social Benefits 2.91 .00 t-value p-value Product Origin 1.62 .10 Product Origin
Local vs. Non-Local food label
Perceived Food Quality
Perceived Pro-Social Product Benefits Consumer Purchase Intensions of Food Products a1 b1 c’ a2 b2
Direct effects of Mediators on DV (b paths) IV to Mediators (a paths)
30 food quality and pro-social benefits in the relation between the product origin and the consumer purchase intentions of food products. As can be seen the c’ is not significant (p >0.05). We therefore suggest that both mediators are good mediators in our model. In other words, perceived food quality and pro-social benefits do completely mediate the relationship between the product origin and the consumer purchase intentions of food products. In other words, people were more likely to buy local instead of non-local products because these products were believed to be of higher quality and believed to contribute to social benefits.
In order to see if the a-b paths are really significant we can look at the confidence intervals. In order to know of the indirect effect is significant or not, one has to look if the value zero (0) is included in the total values of the confidence interval. The indirect effect will be not significant is the value 0 is included in the confidence interval. When we look at the output that is found in appendix E we see that the lower bound is above zero (0.19) and the upper bound is also positive (0.66). We can therefore say with certainty that our indirect effect is indeed significant.
Now we are going to use the same procedure to test if perceived quality and pro-social product benefits do mediate the relationship between the production method and the consumer purchase intentions of food products. Graphically we are testing the following relationships:
Total effect IV on DV (c path) Direct effect IV on DV (c’)
t-value p-value Perceived Quality 6.93 .00 Pro-Social Benefits 2.87 .03 t-value p-value Perceived Quality 2.58 .01 Pro-Social Benefits 3.71 .00 t-value p-value Product Origin -3.18 .00 t-value p-value Product Origin -.85 .39 Production Method Organic vs. Non-Organic label
Perceived Food Quality
Perceived Pro-Social Product Benefits Consumer Purchase Intensions of Food Products a1 b1 c’ a2 b2
31 In the above case we expect partial mediation because the c’ path is significant at the .05 level. In this case we suggest the mediators to partially mediate the relationship between the production method and the consumer purchase intentions of food products. In other words, the production method alone, if a food product is organically produced or not, impacts the purchase intention of the consumer. The results indicated that the direct effect of production method on the purchase intention of food became significant (p <0 .05) when controlling for the perceived food quality and pros-social benefits, thus suggesting partial mediation. Partial mediation maintains that the mediating variables, perceived food quality and perceived pro-social product benefits, account for some, but not all, of the relationship between the independent variable, production method (organically labeled vs. non –organically labeled) and dependent variable (consumer purchase intention of food products). This partial mediation implies that there is not only a significant relationship between the perceived food quality and perceived pro-social product benefits and the consumer purchase intention of food products, but also some direct relationship between the type of food label (organic labeled food vs. non-organic labeled food) and the consumer purchase intention of food products.
4.4 Hypotheses Evaluation
Several hypotheses derived from the theoretical analysis in chapter 2 are supported based on the results. Table 8 gives an overview of the conclusions of the results for each hypothesis.
Hypothesis Result
H1a: Food products labeled as local will lead to higher quality perceptions than food products labeled as non-local.
Supported
H1b: Food products labeled as local will lead to higher perceptions of pro-social benefits than food products labeled as non-local.
Supported
H2a: Food products labeled as organic will lead to higher quality perceptions than food products labeled as non-organic.
Supported
H2b: Food products labeled as organic will lead to higher perceptions of pro-social benefits than food products labeled as non-organic.
Supported
H3a: The perceived food quality will lead to higher consumer purchase intentions of food products.
Supported
H3b: Pro-social product benefits will lead to higher consumer purchase intentions of food products.
Supported
H4: The positive effect of organic labels on perceived food quality will diminish when food products are non-locally produced.
Not Supported
H5: The positive effect of organic labels on perceived pro-social product benefits will diminish when food products are non-locally produced.
Supported
32
Conclusion
The main objective was to examine the effect of food labels, in particular the product origin and the production method, on the perceived food quality and perceived pro-social product benefits, and the eventually subsequent purchase intentions of food. Data was extracted from an experiment among 160 respondents. An opportunity exists to reduce the contribution to global climate change and air pollution when consumers consume more locally produced foods. This research reveals that food products which were labeled as local did positively affect the perceived food quality and pro-social benefits. The majority of respondents that were presented with a locally produced food item rated the perceptions of quality and social benefits higher compared to non-locally produced food products. They indicated that by buying locally produced foods they were contributing to environmental well-being. Furthermore, the respondents also indicated that they perceived the food quality of organic food to be higher compared to the respondents that were presented with the non-organic food items. The same positive effect holds for the perceptions of pro-social product benefits. The findings also indicated that perceived food quality as well as pro-social benefits does positively affect the consumer purchase intentions of food. All these findings fit with our expectations in our hypotheses.
33 The second interaction effect proved to be significant. In this case we expected that consumers would perceive less pro-social product benefits of organic food products when these were labeled as non-local due to the travel distance and negative impact of the CO2 emissions on the environment. The locality of the food product is influential for the perceptions of pro-social benefits within the organic food category. Consumers perceive more social benefits when organic food products are labeled as local compared to those that are not labeled as local. This means that when marketers want to promote environmental welfare by selling their products they should do this with organic food products that are locally produced. This can help not only help the environment by reducing gas emissions but also will consumers eat organic food products which is healthier and saver than conventional food.
Limitations and Future Research
As with any empirical work, this thesis has a number of limitations that present opportunities for future research. First, we rely on stated expressions of food purchase intentions and not on actual purchase data. This might be a problem because people may state something but in real life act differently. By working with actual purchase data the data would be reliable compared to the purchase intentions data. A second limitation is that we only examine the product origin and production method on the perceived quality and pro-social benefits. Other factors like the price should also be taken into account as the price often functions as a quality indicator and is one of the most important factors that consumers take into account while shopping besides the service and assortment. A third limitation is the fact that we only tested the aforementioned relationships with three products that are in the fruit-vegetable food category. Others products should also be taken into account while testing for the effects, as research of Van Doorn and Verhoef (2011) showed that organic claims have a positive effect on pro-social benefits when it concerns the vice condition (i.e. more enjoyable on the short term, but detrimental effects on the long term).The fourth limitation concerns the generalizability of the results. As the data was collected only amongst Dutch consumers it is not possible to generalize the results across other countries. Moreover, the sample used in this thesis is unevenly distributed within categories such as age, education and even gender.
Recommendations
35
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40
Appendix
Appendix A The Survey
Geachte heer/ mevrouw,
Mijn naam is Asna Mohan en ik studeer Marketing aan de Rijksuniversiteit Groningen. Ter afsluiting van mijn Master opleiding schrijf ik mijn scriptie. In dit kader vraag ik vriendelijk naar uw medewerking aan mijn onderzoek door een aantal vragen te beantwoorden die betrekking hebben op het evalueren van voedselproducten.
Stelt u zich voor dat uw supermarkt overweegt haar assortiment uit te breiden met een nieuw soort appels, tomaten en druiven. Alvorens de supermarkt deze producten introduceert wil zij deze producten laten evalueren door haar consumenten. Indien u besluit deel te nemen aan mijn onderzoek krijgt u een aantal plaatjes van deze nieuwe producten te zien, waarna u uw mening over deze producten kunt geven.
Het beantwoorden van de vragen duurt ongeveer 5 minuten. De gegevens van deze vragenlijst zullen anoniem worden verwerkt. Uw mening is belangrijk voor mijn onderzoek. U kunt het onderzoek op elk gewenst moment beëindigen.
