TY - CHAP

T1 - Consumer Preferences and Their Willingness to Pay for Local Products (by Means of Consumer Ethnocentrism)

T2 - An Abstract

AU - Hasanzade, Vüsal

AU - Elshiewy, Ossama

AU - Toporowski, Waldemar

PY - 2022/1/1

Y1 - 2022/1/1

N2 - Consumers are increasingly willing to opt for locally produced alternatives to counteract the downsides resulting from food that often travels all around the world. Along with the increased demand for local products, there is also an increased demand for greater transparency on the consumer side. Due to a lack of a standardized definition of the term ‘local’ (Meyerding et al. 2019), however, there is little known about consumer perception, preferences and their respective willingness to pay for local product attributes. While research suggests that both the geographical and the social proximity need to be taken into account when defining local products (Eriksen 2013), the majority of existing research solely focuses on one aspect. However, all these approaches make it difficult to assess the relative importance of different local product attributes that fit the expectations of consumers and drive their choice behavior. This study aims to fill this research gap by using a choice-based conjoint analysis. Results indicate that ‘fair prices for farmers’ is of particularly high importance for respondents’ choice behavior when it comes to consuming local dairy products (b = 1.118***, WTP =.98 EUR), followed by the distance to where the dairy good is being produced. The part-worth utility for the detailed distance information decreases with increasing radius of product origin and place of purchase, while dairy products which are produced within 100 km from the place of purchase are still favored (b ranging from 1.046*** to.254**, WTP ranging from.92 to.22 EUR). ‘Securing jobs in the area’ (b =.76***, WTP =.67 EUR) and ‘the financial support of local producers’ (b =.779***, WTP =.68 EUR) seem to be further drivers for local product purchase. Results of a linear regression, when taking consumer characteristics into account to explain the individual-level attribute importance, indicate that regardless of the consumer characteristics the majority of consumers seem to be very interested in local product features. Local ethnocentric consumers, however, place a high importance in product origin declaration in general (b =.524***) and in information about the farm (b =.115***). The results show that consumers are indeed willing to pay higher prices for local products, as long as the dairy product correspondents to their understanding of local, while providing important insights for food marketers and policy makers to increase market shares for environmentally friendly local products.

AB - Consumers are increasingly willing to opt for locally produced alternatives to counteract the downsides resulting from food that often travels all around the world. Along with the increased demand for local products, there is also an increased demand for greater transparency on the consumer side. Due to a lack of a standardized definition of the term ‘local’ (Meyerding et al. 2019), however, there is little known about consumer perception, preferences and their respective willingness to pay for local product attributes. While research suggests that both the geographical and the social proximity need to be taken into account when defining local products (Eriksen 2013), the majority of existing research solely focuses on one aspect. However, all these approaches make it difficult to assess the relative importance of different local product attributes that fit the expectations of consumers and drive their choice behavior. This study aims to fill this research gap by using a choice-based conjoint analysis. Results indicate that ‘fair prices for farmers’ is of particularly high importance for respondents’ choice behavior when it comes to consuming local dairy products (b = 1.118***, WTP =.98 EUR), followed by the distance to where the dairy good is being produced. The part-worth utility for the detailed distance information decreases with increasing radius of product origin and place of purchase, while dairy products which are produced within 100 km from the place of purchase are still favored (b ranging from 1.046*** to.254**, WTP ranging from.92 to.22 EUR). ‘Securing jobs in the area’ (b =.76***, WTP =.67 EUR) and ‘the financial support of local producers’ (b =.779***, WTP =.68 EUR) seem to be further drivers for local product purchase. Results of a linear regression, when taking consumer characteristics into account to explain the individual-level attribute importance, indicate that regardless of the consumer characteristics the majority of consumers seem to be very interested in local product features. Local ethnocentric consumers, however, place a high importance in product origin declaration in general (b =.524***) and in information about the farm (b =.115***). The results show that consumers are indeed willing to pay higher prices for local products, as long as the dairy product correspondents to their understanding of local, while providing important insights for food marketers and policy makers to increase market shares for environmentally friendly local products.

KW - Consumer choice

KW - Local consumerism

KW - Preference

KW - Willingness to pay

KW - Management studies

UR - http://www.scopus.com/inward/record.url?scp=85127963514&partnerID=8YFLogxK

UR - https://www.mendeley.com/catalogue/89c68eba-9ca3-3bab-a52e-455cda312558/

U2 - 10.1007/978-3-030-89883-0_72

DO - 10.1007/978-3-030-89883-0_72

M3 - Published abstract in conference proceedings

AN - SCOPUS:85127963514

SN - 978-3-030-89882-3

T3 - Developments in Marketing Science: Proceedings of the Academy of Marketing Science

SP - 255

EP - 256

BT - Developments in Marketing Science

A2 - Pantoja, Felipe

A2 - Wu, Shuang

PB - Springer Nature

CY - Cham

ER -