Household demand analysis of organic and conventional fluid milk in the United States based on the 2004 Nielsen Homescan panel

Alviola, Pedro A.; Capps, Oral

doi:10.1002/agr.20227

Cited by 61 publications

(63 citation statements)

References 13 publications

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“…The impact of income is higher on OB milk than on OPL milk. These findings are in line with results of prior studies for the United States (e.g., Alviola & Capps, ; Dettmann & Dimitri, ; Zhang, Huang, Lin, & Epperson, ) and for Germany (Jonas & Roosen, ).…”

Section: Resultssupporting

confidence: 92%

“…Dhar and Foltz () who applied a quadratic AIDS (Q‐AIDS) found own‐price elasticities for conventional and organic milk to be −1.0 and −1.4, respectively. Alviola and Capps () presented own‐price elasticity estimates of −0.87 for conventional milk and of −2.0 for organic milk. Choi and Wohlgenant () analyzed the U.S. milk market at a disaggregated level.…”

Section: Literature Reviewmentioning

confidence: 99%

“…The typical finding of studies investigating consumer response to organic milk pricing is that organic milk demand is considerably more elastic than conventional milk demand (see, e.g., Alviola & Capps, ; Dhar & Foltz, ; Glaser & Thompson, ; Jonas & Roosen, ). However, these studies were conducted mainly in the United States and in earlier stages of the organic milk market.…”

Section: Introductionmentioning

confidence: 99%

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The Organic Milk Market in Germany Is Maturing: A Demand System Analysis of Organic and Conventional Fresh Milk Segmented by Consumer Groups

Schröck¹

2012

Agribusiness

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Literature provides evidence of a highly price-elastic demand for organic food. However, most of the studies were conducted several years ago. In the meantime the organic market has matured. Consequently, results in literature need to be reviewed. This study specifically addresses own-price elasticity estimates for organic and conventional milk. The analysis is based on a household panel dataset of 20,000 German households. A two-step estimation procedure is applied. First, a probit regression examines which household characteristics affect the probability of buying organic milk. Second, a linear approximated almost ideal demand system provides detailed demand elasticity estimates. By using up-to-date data, distinguishing between different consumer groups, incorporating sociodemographic information and relying on a considerably large sample size this study is both an update and a refinement of previous research. In contrast to previous studies, econometric results suggest that demand for organic milk is absolutely price-inelastic in Germany. However, price responsiveness differs substantially between milk types and consumer groups.Given this background, the objective of this study is to update and to extend the analysis of household demand for organic and conventional milk, and to compare the German with the U.S. organic milk market. Combining actual purchase and demographic data and applying a two-step demand system approach, this study identifies and quantifies the factors determining the demand for organic and conventional fresh milk. It contributes to the body of literature by providing estimates of price and expenditure elasticities in a maturing organic food market. Additionally, econometric analyses are conducted not only for the whole population, but also for several consumer groups.The article is organized as follows: Section 2 surveys in detail the literature currently available on the demand for organic milk. In Section 3, the conceptual model is presented. Section 4 introduces the data, the GfK Homescan Panel. Section 5 covers the econometric evidence and provides interpretations of the results. Finally, conclusions are given in Section 6. LITERATURE REVIEWMost studies focusing on organic food consumption analyzed attitudes regarding organic food rather than actual purchase decisions. Using survey data or experimental methods, these studies typically determined the willingness to pay (see e.g.has provided evidence of a considerable discrepancy between consumer attitudes towards organic food and their actual purchasing behavior (e.g., Frykblom, 1997; Roddy, Cowan, & Hutchinson, 1999). This divergence suggests the use of real purchase data rather than survey data to characterize organic consumer behavior.There are two strands of organic food research using real purchase data. The first one examines the organic consumer profile with respect to sociodemographic characteristics, attitudes, and cultural norms. The second one analyzes consumer purchasing behavior-especially their responsiveness to changes in...

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Section: Resultssupporting

confidence: 92%

Section: Literature Reviewmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

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The Organic Milk Market in Germany Is Maturing: A Demand System Analysis of Organic and Conventional Fresh Milk Segmented by Consumer Groups

Schröck¹

2012

Agribusiness

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“…This information, along with the date of purchase, is linked with demographic details of the household and the household purchasing history. j Outside the wine sector, Homescan data have also been used to estimate brand level price elasticities and price response elasticities (Cotterill, 1994), change in household purchasing habits due to business cycle fluctuation (Cotti et al, 2014), the influence of selected demographic variables associated with purchase of organic milk (Alviola and Capps, 2010), the effect of taxes on sales (Harding et al, 2012) and the causes of price difference across households (Abe and Shiotani, 2014).…”

Section: Discussionmentioning

confidence: 99%

Who likes it “sparkling”? An empirical analysis of Prosecco consumers’ profile

2015

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The purpose of the study is to understand the profile (if any) of the typical Prosecco wine consumer, for both Controlled Denomination of Origin (CDO) and Controlled and Guaranteed Denomination of Origin (CGDO) types, with a twofold objective. First, the study aims at contributing to the economics literature dealing with opening the "black box of preferences" and understanding consumers' behavior. Second, more practically, the study aims to advise producers on the design of more targeted industrial strategies and policies. Using Homescan data collected from large-scale retail trade transactions in the period 2009-2011, we adopt a probit model and test a set of simple relationships between the probability that Prosecco (in both Geographical Indications) is purchased and selected consumers' socio-economic characteristics and product attributes. The results allow us to draft a profile of the typical consumer of Prosecco. The Prosecco CDO consumer lives in the North of Italy, is wealthy, relatively young, lives in a small (2-3 people) household and reacts to price changes. In addition to the latter feature, the typical Prosecco CGDO consumer has a preference for selected brands and extra-dry wine taste. Marginal effects are computed and predict that a 1% increase in Prosecco CDO price will decrease the probability that a consumer purchases the product by 0.36%. In addition, a 1% increase in Prosecco CGDO price will decrease the probability that a consumer purchases the product by 0.26%. The different sensitivity to price changes is corroborated by the fact that Prosecco CGDO consumers express a preference for the product characteristics (brand and taste) and might be more "loyal to the product" than Prosecco CDO purchasers. Further research will broaden the scale of analysis and adopt multinomial probit models in order to simultaneously assess the profile of different consumers for other types of sparkling wines, including Champagne and Franciacorta.

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“…Less numerous are the papers in which the profile is obtained using actual sales data (e.g. Prasad et al, 2008;Zhang et al, 2008;Alviola and Capps, 2010;Brouhle and Khanna, 2012). Previous studies have found that there is a gap between attitudes and purchase (Kim and Damhorst, 1998;Carrigan andAtalla, 2001, Nicholls andLee, 2006;De Pelsmacker and Janssens, 2007).…”

Section: Introductionmentioning

confidence: 99%

Who is behind the sustainable purchase? The sustainable consumer profile in grocery shopping in Spain

Carrero

Redondo

Fabra

2016

Int J Consumer Studies

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Studies of sustainable consumer profiles are mainly label‐specific and focus on Organic or Fair Trade labels. As a result, when the sustainable consumer is defined, there is a sense that only one profile exists. If each label has a different positioning strategy and has different requirements, the buyers of these products may also be different. Through the use of consumer panel data, this paper aims to deepen the understanding of the household demographic profiles of consumers of sustainable brands in order to discover if there is a single sustainable consumer profile or whether there is diversity associated with different labels. This study reveals profile differences and these provide better understanding of the complexities of sustainable consumption. It reveals that the profiles of sustainable buyers are not the same across all labels and this should be taken into account by awarding institutions when designing and evaluating their positioning strategies.

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Household demand analysis of organic and conventional fluid milk in the United States based on the 2004 Nielsen Homescan panel

Cited by 61 publications

References 13 publications

The Organic Milk Market in Germany Is Maturing: A Demand System Analysis of Organic and Conventional Fresh Milk Segmented by Consumer Groups

The Organic Milk Market in Germany Is Maturing: A Demand System Analysis of Organic and Conventional Fresh Milk Segmented by Consumer Groups

Who likes it “sparkling”? An empirical analysis of Prosecco consumers’ profile

Who is behind the sustainable purchase? The sustainable consumer profile in grocery shopping in Spain

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