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Ethical food labels in consumer preferences

Ethical food labels in consumer preferences PurposeSince fairtrade labels are upcoming market instruments, the purpose of this paper is to identify and quantify consumers’ willingness to pay for fairtrade coffee products and tea. Thereby, this paper contributes to the discussion in favour of a non-private regulation of ethical food labels (FLs). Moreover, the paper provides information about the consumer behaviour of the German buying public.Design/methodology/approachThe empirical analysis is based on homescan panel data of 13,000 representative German households, which includes actual purchase data of ground coffee, single-serve coffee, espresso, and tea for a five-year sample period from 2004 to 2008. As a methodological approach, the hedonic technique is used to model coffee and tea prices as a function of time, store, and product characteristics.FindingsRegarding the variables of interest branding a product leads to an average price premium of 22.1 per cent, while the organic FL achieves an average price premium of 34.3 per cent. The highest average price premium of 43.1 per cent is ceteris paribus paid for fairtrade labels. In the case of fairtrade labels, tea products earn the highest implicit prices with 74.0 per cent, followed by ground coffee (54.9 per cent), espresso (24.7 per cent), and single-serve coffee (18.9 per cent).Originality/valueThe present analysis supplements the discussions around the willingness to pay for fairtrade certified products by the German buying public, a product differentiation between coffee products and the introduction of labelled tea. As the data set includes daily purchases, it allows analysis of consumer behaviour on a disaggregated level, given detailed information on prices, stores, origins, FLs, and so on. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png British Food Journal Emerald Publishing

Ethical food labels in consumer preferences

British Food Journal , Volume 119 (8): 14 – Aug 7, 2017

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Publisher
Emerald Publishing
Copyright
Copyright © Emerald Group Publishing Limited
ISSN
0007-070X
DOI
10.1108/BFJ-10-2016-0515
Publisher site
See Article on Publisher Site

Abstract

PurposeSince fairtrade labels are upcoming market instruments, the purpose of this paper is to identify and quantify consumers’ willingness to pay for fairtrade coffee products and tea. Thereby, this paper contributes to the discussion in favour of a non-private regulation of ethical food labels (FLs). Moreover, the paper provides information about the consumer behaviour of the German buying public.Design/methodology/approachThe empirical analysis is based on homescan panel data of 13,000 representative German households, which includes actual purchase data of ground coffee, single-serve coffee, espresso, and tea for a five-year sample period from 2004 to 2008. As a methodological approach, the hedonic technique is used to model coffee and tea prices as a function of time, store, and product characteristics.FindingsRegarding the variables of interest branding a product leads to an average price premium of 22.1 per cent, while the organic FL achieves an average price premium of 34.3 per cent. The highest average price premium of 43.1 per cent is ceteris paribus paid for fairtrade labels. In the case of fairtrade labels, tea products earn the highest implicit prices with 74.0 per cent, followed by ground coffee (54.9 per cent), espresso (24.7 per cent), and single-serve coffee (18.9 per cent).Originality/valueThe present analysis supplements the discussions around the willingness to pay for fairtrade certified products by the German buying public, a product differentiation between coffee products and the introduction of labelled tea. As the data set includes daily purchases, it allows analysis of consumer behaviour on a disaggregated level, given detailed information on prices, stores, origins, FLs, and so on.

Journal

British Food JournalEmerald Publishing

Published: Aug 7, 2017

References