Competitive advantage in food and agri-business industries 9781845446055, 9781845446048

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08/09/2005

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ISBN 1-84544-604-6

ISSN 0007-070X

Volume 107 Number 8 2005

British Food Journal An international multi-disciplinary journal for the dissemination of food-related research Competitive advantage in food and agri-business industries Guest Editors: Morven McEachern and Claire Seaman

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British Food Journal

ISSN 0007-070X Volume 107 Number 8 2005

Competitive advantage in food and agri-business industries Guest Editors Morven McEachern and Claire Seaman

Access this journal online __________________________ 539 Editorial advisory board ___________________________ 540 A new approach to elicit consumers’ willingness to purchase genetically modified apples Elsa Kassardjian, Joanna Gamble, Anne Gunson and Sara R. Jaeger__________________________________________________

541

Food industry awareness of consumers’ plant food beliefs Emma Lea, Anthony Worsley and David Crawford ____________________

556

Consumer perceptions of meat production: enhancing the competitiveness of British agriculture by understanding communication with the consumer Morven G. McEachern and Claire Seaman ___________________________

572

Development and empirical test of a grocery retail instore logistics model Herbert Kotzab and Christoph Teller________________________________

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CONTENTS

CONTENTS continued

Exploring the gap between attitudes and behaviour: understanding why consumers buy or do not buy organic food Susanne Padel and Carolyn Foster _________________________________

606

The development of the European market for organic products: insights from a Delphi study Susanne Padel and Peter Midmore _________________________________

626

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British Food Journal Vol. 107 No. 8, 2005 p. 540 # Emerald Group Publishing Limited 0007-070X

EDITORIAL ADVISORY BOARD Paul Allen Lewes, East Sussex, UK Professor Tony Andrews Bramley, Nr Basingstoke, UK Mary Barasi Head of Centre, Nutrition and Dietetics, School of Health and Social Sciences, UWIC, Cardiff, UK Dr Alan Beardsworth Lecturer in Sociology, Loughborough University, Loughborough, UK Dr Michael Bourlakis School of Agriculture, Food and Rural Development, University of Newcastle upon Tyne, Newcastle upon Tyne, UK Dr Roger Cook Programme Development Group, Wellington, New Zealand Professor Leo Paul Dana Management Department, University of Canterbury, Christchurch, New Zealand Dr Ruth Fairchild School of Applied Sciences, UWIC, Cardiff, UK Professor Christina Fjellstro¨m Department of Domestic Sciences, Uppsala University, Uppsala, Sweden Professor Lynn Frewer Marketing and Consumer Behaviour Group, Social Sciences Department, University of Wageningen, The Netherlands Susan Gregory Research Fellow, Research Unit in Health, Behaviour and Change, University of Edinburgh Medical School, Edinburgh, UK Cathy Hart Senior Lecturer in Retailing and Operations Management, Loughborough University, Loughborough, UK Dr Adam Lindgreen Faculty of Technology Management, Eindhoven University of Technology, Eindhoven, The Netherlands Dr Ingela Marklinder Department of Domestic Sciences, Uppsala University, Uppsala, Sweden

Professor Alberto Mattiacci Universita` degli Studi di Siena, Siena, Italy Barry Michaels The Michaels Group, Palatka, Florida, USA Professor Bevan Moseley Blandford House, Reading, UK Dr Yasmine Motarjemi Food Safety Manager, Nestec Ltd, Vevey, Switzerland Dr Martin Palmer Head, Industry Consulting, Meat and Livestock Commission, Milton Keynes, UK Stephen Ridge Associate Director Quality Assurance, Somerfield Stores Ltd, Bristol, UK Terry Robinson Teesside Business School, University of Teesside, Middlesborough, UK Claire Seaman Faculty of Business and Enterprise, Queen Margaret University College, Edinburgh, UK Dr Andrew Smith Nottingham University Business School, Nottingham, UK Richard Sprenger Highfield Publications, Sprotborough, Doncaster, UK Professor Claudio Vignali ‘‘Arnold Ziff’’ Chair in Retail Marketing Management Tourism, Hospitality & Events School, Leeds Metropolitan University, Leeds, UK Professor Alex Von Holy Roosevelt Park, Gauteng, South Africa Professor Tihomir Vranesevic Graduate School of Economics and Business, University of Zagreb, Croatia Professor Verner Wheelock Verner Wheelock Associates, Broughton Hall Business Park, Skipton, UK Dr Stephen Wu Head, Division of Health & Applied Sciences, School of Professional and Continuing Education, University of Hong Kong, Hong Kong

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The current issue and full text archive of this journal is available at www.emeraldinsight.com/0007-070X.htm

A new approach to elicit consumers’ willingness to purchase genetically modified apples

A willingness to purchase GM apples 541

Elsa Kassardjian, Joanna Gamble and Anne Gunson HortResearch, Auckland, New Zealand, and

Sara R. Jaeger The University of Auckland, Auckland, New Zealand Abstract Purpose – The goal of this research was to try a new methodology to elicit consumers’ willingness to pay for genetically modified (GM) food. Design/methodology/approach – Even though experimental auctions have been used for several years, they do not provide qualitative information on consumers’ reasoning behind their purchase behaviours. To provide further illumination in this regard, a thought-listing technique and a questionnaire were added. Findings – A majority of the consumers involved in this study were ready to pay for the GM food offered. The benefit provided by the GM product did not seem to be the major purchase criterion and sensory assessment appeared to be important. The use of different methodologies on the same sample of participants revealed that there was a gap between purchasing intentions and behaviours, and that a key to efficiently assessing public perception and purchase behaviours is the precision of the context. Research limitations implications – The absence of discrimination between the different benefits offered, might come from the limited size of the samples or from the nature of the benefits offered. Future research should consider larger samples and more diversified products. Practical implications – This study has concrete methodology applications. If one would like to conduct a market study, for instance, on a specific GM product, a general survey on biotechnology will not provide relevant answers. Originality/value – The implementation of experimental auctions with psychometric tools, created an original and suitable protocol for accessing consumers’ willingness to pay as well as their justifications. Keywords Fruits, Food products, Genetic modification, Costs, Customer satisfaction, New Zealand Paper type Research paper

Introduction The year 2003 has been a turning-point for New Zealand regarding genetically modified (GM) organisms. Based on the Royal Commission’s report on GM, the Government announced that the five years moratorium on the commercial release of The authors would like to thank Renee Fehsenfeld, a research assistant at the University of Auckland, Department of Marketing, for the work done in the data coding and Rogerio Pereira for his friendly and helpful advice. This research was funded by the Foundation for Research Science and Technology (contract number C06X0216 – Consumer Impacts of Horticultural Genomics).

British Food Journal Vol. 107 No. 8, 2005 pp. 541-555 q Emerald Group Publishing Limited 0007-070X DOI 10.1108/00070700510610968

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GM organisms, as well as on certain field trials, would be lifted at the end of October 2003. A poll conducted in New Zealand just before the moratorium’s lifting (Taylor, 2003) indicated that almost 70 per cent of the New Zealanders interviewed did not want the moratorium to be lifted and did not want GM products in New Zealand. According to Noussair et al. (2004) if a majority of consumers are unwilling to buy GM products, as suggested by the polls, banning these products would probably be the best option. However, it has long been observed that correlations between intentions and behaviours are low (Wicker, 1969). From the point of view of the companies developing GM products, the second generation of these products will be more acceptable due to direct benefits to consumers. The question of the influence of direct benefits to consumer is key to public acceptance of GM products. Some studies have found that consumers’ acceptance for GM food is greater when the food presented a direct benefit to them, rather than a benefit to the farmers (Brown and Ping, 2001; Zhong et al., 2002). Many studies (mainly surveys, focus groups or choice experiments such as contingent valuations) have assessed whether knowledge of the nature of the benefit associated to a GM product would have an impact on people’s purchasing or consumption intentions for this product. Fortin and Renton (2003), for instance, showed that attitudes toward a brand of GM bread were not more positive with a direct benefit to consumers (increased shelf life). But as the authors wrote, it is questionable whether longevity is an appropriate benefit for a GM product. The goal of the present research is to try an innovative methodology to study purchase behaviour for specific GM products presenting different benefits, in the New Zealand context. This main goal can be achieved by answering four specific research questions: RQ1. Are people ready to pay for GM products, and how much? RQ2. Does the nature of the benefit influence people’s willingness to pay (WTP) when different products are presented simultaneously? RQ3. What is going through people’s minds while they are deciding how much to pay for a GM product? RQ4. Do people’s opinions of GM have an impact on their WTP for GM products?

Methodology Several studies have already tackled the willingness to buy GM products, assessing the influence of different factors (the price, the quantity of GM ingredient in the final product or the benefit provided). Most of these studies (e.g. Deliza et al., 1999; Frewer et al., 1997; Gamble et al., 2000) used survey methodology focusing on purchase intentions only. Others (Noussair et al., 2004; Lusk et al., 2003; Rousu et al., 2004) applied experimental auction techniques, providing real estimates of WTP for a GM product. Experimental auctions use real products, real money, and at the end of the process, winners actually have to pay for the product they purchased. These auctions are therefore an appropriate methodology to answer RQ1 and RQ2.

Experimental auctions Jaeger et al. (2004) provides a description of the many different types of experimental auctions. The current study used the fifth highest price protocol. In such an auction, participants submit bids for a product and the four highest bidders win the auction. The amount they then have to pay corresponds to the fifth highest bid, called the market price. In this type of auction, Noussair et al. (2003) show that it is always the best strategy for bidders to bid exactly the price they consider the product is worth, independently of the bidding strategies of the other bidders. This was clearly demonstrated to the participants in this study, through the use of examples and in training. Six auction sessions were run for this study. In three sessions, two products were provided in order to answer RQ2. Frewer et al. (1996) have shown that benefits to health and to the environment may represent more acceptable benefits than others (e.g. reduced costs), a finding confirmed by Mucci and Hough (2004). The two types of GM apples provided were therefore: apples presenting a benefit to the environment (hereafter referred to as E apples) and apples presenting a benefit to health (hereafter referred to as H apples). The E apples were described as GM apples with a foreign gene coming from another apple. Gamble and Gunson (2002) have indeed shown that acceptance of GM products is greater if the source of the gene is from the same type of product. These E apples were developed to be resistant to pests, eliminating the need for any chemical sprays. The H apples were also described as GM apples with a gene from another apple, containing the same amount of polyphenolics as five conventional fresh apples. Polyphenolics are antioxidants that can control undesirable allergic immune reactions like hives. In the three other auction sessions, people bid for one product only. This has been done in order to assess if the context (two products to bid on or only one) could influence participants’ WTP. As GM products with environmental benefits are of greater interest to the organisation the authors work for, E apples were provided in these three sessions. In all the experimental auctions, participants were initially given two ordinary apples. They were then offered the opportunity to exchange their ordinary apples for two GM apples (two E and two H apples in three sessions; two E apples in three other sessions). Then, participants submitted bids, reflecting the amount of money they would pay to exchange their ordinary apples for the GM ones. Participants were asked to submit five consecutive bids. After every bidding round, the market price was written on a white board so this information was available to everybody and could be used in the next round. Only one repetition was randomly chosen as binding. This has been done in order to eliminate the likelihood of consumers reducing their bids to buy more than one product. Their bidding strategy is therefore still demand-revealing. Roosen et al. (1998) have provided evidence that participants treat each repetition of the market as if it was binding despite knowing only one bidding round would be determined randomly. Predictions about how much money people are willing to pay for a GM product are important, but a more interesting question is probably that of why people are ready (or not) to pay. This question has still not been addressed in the experimental auctions literature and this is why a thought-listing technique has been added.

A willingness to purchase GM apples 543

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Thought-listing technique According to Cacioppo et al. (1999), the thought-listing technique is particularly useful when one has no clear predetermined ideas about the cognitive dimensions involved in a process. The most common methodology is to provide a paper with empty boxes so that participants can write one thought per box. There are several success factors for the thought-listing technique: . precision of the explanation; . honesty; and . immediacy of the answers. Participants received clear explanations about what was expected from them: We are interested in everything that is going through your mind about the auction you are going to take part in. Please list these thoughts, whether they are about yourself, the situation, and/or others; whether they are positive, neutral and/or negative.

Respondents were assured of their anonymity through the use of numerical codes. Therefore, they should have reported their thoughts honestly. People’s memory for thoughts, feelings and events is imperfect. Biases can be introduced in a delayed thought-listing technique. Because of this, participants were requested to repeat the thought-listing after every bidding round. Content analysis (Owen, 1984) was used to identify the main themes in the data collected. Two scientists independently coded the thought-listing data, and any discrepancies in the codifications were resolved by discussion. Questionnaire People’s WTP for GM products might be influenced by their opinions about GM and therefore by the factors influencing opinions (feelings, values, thoughts, knowledge). Among these factors, knowledge has been particularly studied and even if the link between opinion and knowledge is acknowledged, the nature of this link is not yet clarified (Kassardjian, 2002). Earlier studies have shown some inconsistent findings regarding the relationship between opinions of biotechnology and knowledge. Some have found that people with a higher knowledge of biology are more favourable to GM and biotechnology (e.g. Frewer, 1998). Other studies have found no such associations (e.g. Priest, 2000). A potential reason for these contradictory results, given by House et al. (2004), lies in the manner in which knowledge is measured. They recommended that researchers measure the type of knowledge appropriate to the study, including a mix between objective knowledge (what people know) and subjective knowledge (what they think they know). This is precisely what Gaskell et al. (2003) did with the “engagement model”. Here, they assessed people’s engagement with biotechnology based on objective knowledge, subjective knowledge, as well as what they called “reported and intended behaviour”. This model has been developed for a comprehensive study in 15 countries (the Eurobarometer), and is used in the present study, to assess the impact of engagement on WTP. The fourth research question can therefore be stated: RQ4. Do people’s opinions of GM and their engagement with biotechnology, have an impact on their WTP for GM products?

Questionnaires were designed to provide information on participants’ opinions of GM and their level of engagement with biotechnology. Opinions were assessed through one question presented in the Appendix, Figure A1. Participants were asked to indicate their agreement/disagreement with presence of GM food in New Zealand supermarkets, by circling the number that best corresponded to how they felt on a seven-point scale. Answers 1, 2, 3 were considered as unfavourable and answers 5, 6, 7 as favourable, 4 being the “neutral – don’t care” position. The questions developed by Gaskell et al. (2003) for the Eurobarometer (see the Appendix, Figure A2) were used in order to assess engagement with biotechnology. Following Gaskell et al. (2003), a score was given to each participant, for each of the three groups of questions (reported and intended behaviours; awareness of biotechnology; knowledge of biology and genetics). The sum of participants’ scores varied between 7 and 16 (on a total range from zero to 16). Participants were then split in two groups. The 11 participants with scores of 7, 8 and 9 were considered as the least engaged, and the 12 participants with scores of 15 and 16, as the most engaged (only the most and least engaged participants were taken into account as the greatest differences were expected to be between these two extremes). These thresholds were arbitrary but allowed comparisons. The following protocol details how the experimental auctions, thought-listings and questionnaires were combined. Protocol The experimental protocol had seven main steps: (1) Participants were recruited by an agency. They had to both purchase and eat “Braeburn” apples at least once a week, to ensure they were interested in the product. After a brief explanation on the whole process, participants signed a consent form. (2) Participants were then given NZ$40 (equivalent to approximately e20) for the experiment and an ID number to remain anonymous. They were told that they could use the money to purchase some apples during the auctions, or keep the $40. (3) “Genetic modification” was defined and the experimental auctions as well as the thought-listing technique were explained. (4) Training was carried out using chocolate bars instead of apples, to ensure the process was well understood. As described earlier, participants had to submit five consecutive bids. After each bidding round, participants received feedback on the market price and wrote down their thoughts on the corresponding form. At the end of the five bidding rounds, one was randomly chosen as binding and the four winners (four highest bidders) had to pay the market price (fifth highest price) for the product (the chocolate bar). (5) The procedure was repeated with apples. The process was the same as the one described in step 4. In those sessions with two products (E and H apples), only one product was for sale (randomly determined at the end of each bidding round), despite the fact that bidding was for both products. (6) Participants filled in their questionnaires.

A willingness to purchase GM apples 545

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(7) A debriefing session and informal discussion were organised to answer questions, as participants were not allowed to talk during the auctions. Participants were also told that the apples proposed were not actually GM and therefore that no one would have to pay for the exchange. A total of 82 participants took part in the study. The demographic information is given in Table I. Hypotheses RQ1 Based on Taylor’s poll Taylor (2003), which revealed that 70 per cent of New Zealanders did not want GM products, a strong rejection of these products could be expected, and therefore many $0 bids (revealing that participants do not want to pay to exchange conventional apples for GM ones): H1. $0 bids < 70 per cent of all bids. RQ2 A KRC survey KRC Research (2003) revealed that 58 per cent of Europeans would be more likely to accept GM crops if they reduced allergic reactions (comparable to the H apples of this study) against 51 per cent for GM crops requiring fewer pesticides (comparable to the E apples of this study). Similarly, according to Lusk et al. (2003), a health benefit would be more acceptable than an environmental benefit. A greater WTP for the H apples than for the E apples can therefore be expected: H2. WTPH

apples

. WTPE apples

RQ3 This was a general question. The thought-listing data provide qualitative information to assist with the other research questions. RQ4 The first expectation regarding the influence of opinion on WTP was that participants favourable to GM would be less likely to bid $0:

Table I. Participants’ demographic information

Gender Females Males Age 18-25 26-35 36-45 46-55 56-65

E apples only (n ¼ 44) N %

E and H apples (n ¼ 38) N %

28 16

63.6 36.4

25 13

65.8 34.2

53 29

7 8 14 8 7

15.9 18.2 31.8 18.2 15.9

3 9 9 8 9

7.9 23.7 23.7 21.0 23.7

10 17 23 16 16

Total (n ¼ 82)

H3a. $0bidsfavourable , $0bidsother. The second expectation was that these participants would have greater WTP than the others:

A willingness to purchase GM apples

H3b. WTPfavourable . WTPother. The converse hypotheses were made for participants unfavourable to GM: H3c. $0bidsfavourable . $0bidsother. H3d. WTPfavourable , WTPother. Gaskell et al. (2003) found that the most engaged people were more favourably inclined than the others. Given H3b and H3d, expectations are: H4a. WTPmost

engaged

. WTPother.

H4b. WTPleast

engaged

, WTPother.

Results and discussion A majority of participants ready to pay for the GM apples Although only 24 per cent of the participants agreed in their questionnaires with the presence of GM food in New Zealand supermarkets, only 25 (30 per cent) bid $0 in all five rounds (they did not want to pay to exchange their ordinary apples for GM ones). For the H apples, this was the case for 12 of the 38 participants (32 per cent). This is far fewer than the 70 per cent rejection indicated in the poll results (Taylor, 2003). H1 is therefore rejected. Moreover, explicit concern about GM was the justification given by only half (52 per cent) of those participants bidding $0 in all five rounds. Many (28 per cent) did not justify their $0 bids. Others explained their $0 bids by the fact that they wanted to keep their money (10 per cent) (e.g. “Need the money so that’s that”) or that they were happy with the conventional apples they were initially given (10 per cent) (e.g. “I might want to swap if what I’ve got didn’t look so good”). A majority of participants in this study were ready to pay for the GM apples. This finding demonstrates that there is likely to be a difference between poll or survey results and experimental auction results. As Noussair et al. (2004) wrote, surveys place respondents in the role of citizens, who make judgments from society’s point of view, whereas experimental auctions specifically reveal consumers’ reactions. It is therefore crucial to choose the most appropriate methodological tool for the research question. No clear influence of the benefit provided Figure 1 presents the WTP for the five bidding rounds in the auctions where both E and H apples were presented. No bidding round was excluded from the analysis as is traditionally done in the experimental auctions literature. In fact, thoughts revealed that participants’ attention varied during the process: some were interested in the first rounds and expressed boredom at the end (e.g. “I am bored with having to do another two bids”, thought written after the 3rd bidding round), whereas others started to get involved in the last rounds (e.g. “A bit lost here”, thought written after the 2nd bidding round; the same participant wrote “Well, I made it in this round” after the 4th bidding round).

547

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Figure 1. Histograms of WTP over five bidding rounds

Figure 2. Scatter plot of E against H WTP

According to Figure 1, the bids for the E apples tended to be greater than for the H apples. Nevertheless, no significant difference between WTPE and WTPH was found (Wilcoxon Rank-Sum: U ¼ 1663.0, p ¼ 0.195). H2 is therefore rejected. This relationship between WTPE and WTPH is illustrated in Figure 2 (r ¼ 0.911). One point can correspond to more than one participant since several participants can have the same WTP for the E and the H apples. The only significant difference found between the E and H apples lies in the nature of the thoughts associated with these products. Participants wrote significantly more positive thoughts about E apples than H apples (X2 ¼ 7.5, df ¼ 1, p ¼ 0.05) probably

because some people were more dubious towards the stated health benefits (e.g. “I don’t really believe ‘health benefits’”). Using a survey methodology, Koivisto Hursti et al. (2002)) had previously failed to demonstrate any effects of tangible benefits on Swedish consumers acceptance of GM tomatoes. Interestingly, there was a significant difference between the WTP for the E apples in the sessions where this product was the only one, and the WTP for the same apples, when they were proposed together with H apples (Wilcoxon Rank-Sum: U ¼ 16234.5, p , 0.001): WTPE (E; H) . WTPE (E only).

A willingness to purchase GM apples 549

Participants might have wanted to express a slight preference for the E apples. Opinion, engagement and WTP are linked Link between opinion and WTP. In order to assess any potential influence of participants’ opinions of GM on their WTP, the first step was to determine which participants were favourably inclined to GM and which ones were unfavourably inclined to GM. This could be done in two different ways, using either the questionnaires (see the Appendix, Figure A1 for the question dedicated to participants’ opinion of GM food) (n ¼ 80), or the thought-listing (56 participants wrote thoughts about GM). For example “GM sounds like a good idea. GM better than pesticides” was considered as a favourable thought whereas “Freaky GM apples” was classified as unfavourable. Two researchers independently classed participants into the favourable or unfavourable categories, based on the thoughts they had written. Table II summarises these classifications. Consistent with expectations (H3a), there was a significant difference in the distribution of the $0 bids between favourably inclined participants and the remaining sample: $0bidsfavourable , $0bidsother. This difference was found using both methods of classification (questionnaires and thoughts). The difference was nevertheless greater with the thoughts classification. Participants considered as favourably inclined according to their thoughts had significantly less $0 bids than the ones considered as favourable based on their questionnaires (X2 ¼ 6.75, df ¼ 1, p ¼ 0.05). Moreover, the bids of the first ones (thoughts classification), were significantly higher than the bids of the second ones (questionnaire classification) (Wilcoxon Rank Sum: U ¼ 269, p ¼ 0.009). Thus, thoughts appeared to be better indicators of people’s opinions of GM products than the answers to a single question. This finding reinforces previous

Questionnaire classification (n ¼ 80) Thoughts classification (n ¼ 56)

Favourable N %

Unfavourable N %

Neither – nor/don’t care N %

20 15

38 29

22 12

25.0 26.8

47.5 51.8

27.5 21.4

Table II. Summary of the two classifications

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ones (e.g. Hunt et al., 2003), suggesting that a key to understanding public perception (and therefore to determining a particular GM product’s market opportunity and potential sale price) is the precision of the context. Thoughts were linked to the specific products, whereas the question was very general. Moreover, in this study where participants could really buy a GM product, they probably had to focus more carefully on what they thought of the GM product, whereas the questionnaire in this study (and surveys in general) did not have any binding consequences. In the following, favourably or unfavourably inclined participants, will refer to the thoughts classification. Consistent with H3b, there was a significant difference between the WTP of favourably inclined participants and the others, but for the E apples only (Wilcoxon Rank-Sum: U ¼ 7555.5, p , 0.001) (probably due to the small number in the H apples condition): WTPfavourable

E

. WTPother E.

Conversely, unfavourably inclined participants were found to be more likely to bid $0 (X2 ¼ 37.96, df ¼ 1, p ¼ 0.05) and to bid lower amounts of money for both E (Wilcoxon Rank Sum: U ¼ 13223, p , 0.001) and H apples (Wilcoxon Rank Sum: U ¼ 2375, p , 0.001). H3c and H3d are therefore proven correct: $0bidsunfavourable . $0bidsother. WTPunfavourable , WTPother. Link between engagement and WTP. Consistent with the findings of Gaskell et al. (2003), there was significantly more people expressing favourable thoughts towards GM food among the participants most engaged with biotechnology than in the remaining participants (see Table III) (X2 ¼ 5.14, df ¼ 1, p ¼ 0.05). There is as well a significant difference between the amount of money the most engaged participants are willing to pay and the amount others are willing to pay for the E apples only (Wilcoxon Rank-Sum: U ¼ 6936.0, p , 0.001) (H4a is confirmed for the E apples): WTPmost

engaged E

. WTPother E.

Conversely, among the least engaged participants, no one was favourable to GM food (see Table IV) and they expressed significantly more unfavourable thoughts than the other participants (X2 ¼ 7.76, df ¼ 1, p ¼ 0.05).

Table III. Opinions expressed by the most engaged participants against the others

Most engaged Other

Favourable (%)

Unfavourable (%)

Other (neither-not/not thoughts on GM) (%)

41.7 (5 participants out of 12) 14.3 (10 participants out of 70)

16.6 (2 participants out of 12) 38.6 (27 participants out of 70)

41.7 (5 participants out of 12) 47.1 (33 participants out of 70)

These least engaged participants gave lower bids for H apples only (Wilcoxon Rank-Sum: U ¼ 1193.0, p , 0.001). H4b is correct for these H apples: WTPleast engaged H , WTP other H. A need to “interact” with the products Of the participants, 43 per cent spontaneously wrote in their thoughts that they wanted to try the GM apples. Of the participants, 21 per cent were simply curious as to whether the genetic modification had altered or improved the sensory qualities of the apples (smell, appearance, texture, taste). These participants’ WTP was significantly greater than the WTP of the remaining participants (E apples: Wilcoxon Rank-Sum: U ¼ 10687.5, p ¼ 0.001/H apples: Wilcoxon Rank-Sum: U ¼ 2460.0, p ¼ 0.012). Some 16 per cent of the participants were so curious that they explicitly justified their WTP by a wish to try the GM apples. Interestingly, four of these 13 participants expressed unfavourable thoughts towards GM products, but curiosity was more important. Once again, these participants’ WTP was significantly greater than the others’ WTP (E apples: Wilcoxon Rank-Sum: U ¼ 7011.5, p , 0.001/H apples: Wilcoxon Rank-Sum: U ¼ 1797.5, p ¼ 0.002). Finally, 6 per cent of the sample expressed frustration at being unable to taste the apples and therefore bid $0 (e.g. “Will it affect taste? Why would I pay for something I haven’t tried? They should offer test samples”). Since even unfavourably inclined people bid positive amounts of money because they wanted to try the GM products, curiosity could be used to attract consumers in the first place, just as for any other new product. Nevertheless, long-term success will depend on the specific attributes of the product itself (benefit associated and sensory qualities). Indeed, while participants were expected to mainly focus on the GM aspect of the apples proposed, many thoughts were related to questions regarding the sensory qualities of the products (smell, taste, appearance, texture). This finding suggests that GM apples may be assessed on the same criteria as conventional apples. Grunert et al. (2004) have found that a positive sensory experience with a GM food decreased negative attitudes towards genetic modification in food production.

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Recommendations and conclusions Although the thoughts revealed that some people were more dubious regarding the health benefit, no significant difference was found between the bids made for the E apples against the H ones. The benefit scenarios could probably have been pre-tested by providing a list of benefits and asking participants to classify them according to

Least engaged Other

Favourable (%)

Unfavourable (%)

Other (neither-not/not thoughts on GM) (%)

0 (0 participants out of 11) 21.1 (15 participants out of 71)

72.7 (8 participants out of 11) 29.6 (21 participants out of 71)

27.3 (3 participants out of 11) 49.3 (35 participants out of 71)

Table IV. Opinions expressed by the least engaged participants against the others

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their preferences. More than two products and more than one scenario per type of benefit could have been provided as well. In the present study, there was only had one type of apple presenting a benefit to the environment and one presenting a benefit to health. When presented with another product, the WTP for E apples was greater than when these E apples were the only ones presented. This finding reinforces the need in future work on the influence of benefits on WTP, to present different products simultaneously and carefully select these products. A total of 28 per cent of the participants biding $0 in all five rounds, did not explain their $0 bids. It would be interesting in future work to set up, in parallel, another experimental auction with thought-listing. Participants could receive GM apples at the beginning, and be offered the opportunity to pay to exchange their GM apples for conventional ones. Crossing the results of these two types of experimental protocols would allow clarification of the motivations (curiosity, rejection of GM, willingness to keep the money). A major interest of this work lies in the combination of the methodological tools used. As Marks et al. (2003) write: In the absence of direct market evidence, experimental auction market methods are arguably the more promising approach for predicting actual consumer behaviour. [. . .] That said, such studies (survey and choice experimental evidence) can yield important information about individual consumer attitudes and usefully combine such information with demographic, socio-economic and psychometric information.

The implementing of experimental auctions with a thought-listing technique created an original and suitable protocol for accessing participants’ WTP as well as their justifications. Another innovative contribution was to provide two GM products with different benefits simultaneously. The experimental situation created for this study was close to a purchase environment where consumers have to choose.

References Brown, J.L. and Ping, Y. (2001), “Comparison of consumer reaction to information about two genetically engineered soybeans that differ in consumer benefit”, Journal of International Food and Agribusiness Marketing, Vol. 13 No. 1, pp. 7-25. Cacioppo, J.T., Von Hippel, W. and Ernst, J.M. (1999), “Mapping cognitive structures and processes through verbal content, the thought-listing technique”, Journal of Consulting and Clinical Psychology, Vol. 65 No. 6, pp. 928-40. Deliza, R., Rosenthal, A., Hedderley, D., MacFie, H.J.H. and Frewer, L.J. (1999), “The importance of brand, product information and manufacturing process in the development of novel environmentally-friendly vegetable oils”, Journal of International Food and Agribusiness, Vol. 10 No. 3, pp. 67-78. Fortin, D.R. and Renton, M.S. (2003), “Consumer acceptance of GM foods in New Zealand”, British Food Journal, Vol. 105 Nos 1/2, pp. 42-58. Frewer, L.J. (1998), “Public perceptions of genetically modified foods”, Pesticide Outlook, Vol. 9 No. 5, pp. 11-15.

Frewer, L.J., Howard, C. and Shepherd, R. (1996), “The influence of realistic product exposure on attitudes towards genetic engineering of food”, Food Quality and Preference, Vol. 7 No. 1, pp. 61-7. Frewer, L.J., Howard, C., Hedderley, D. and Shepherd, R. (1997), “Consumer attitudes towards different food processing technologies used in cheese production – the influence of consumer benefit”, Food Quality and Preference, Vol. 8 No. 4, pp. 271-80. Gamble, J. and Gunson, A. (2002), “The New Zealand public’s attitudes regarding genetically modified food: May and October 2001 – full report”, HortResearch client report 11994, HortResearch, Auckland. Gamble, J., Muggleston, S., Hedderley, D. and Parminter, T. (2000), “Genetic engineering: the public’s point of view”, HortResearch client report 2000/249, HortResearch, Auckland. Gaskell, G., Allum, N. and Stares, S. (2003), Europeans and Biotechlogy in 2002, report to the EC Directorate General for Research from the project Life Sciences in European Society QLG7-CT-1999-00286, 69 pp. available at: http://europa.eu.int/comm/public_opinion/ archives/eb/ebs_177_en.pdf Grunert, K.G., Bech-Larsen, T., Lahteenmaki, L., Ueland, O. and Astrom, A. (2004), “Attitudes towards the use of GMOs in food production and their impact on buying intention: the role of positive sensory experience”, Agribusiness, Vol. 20 No. 1, pp. 95-107. House, L.O., Lusk, J.L., Jaeger, S.R., Traill, W.B., Moore, M., Valli, C., Morrow, B. and Yee, W.M.S. (2004), “Objective and subjective knowledge: impacts on consumer demand for genetically modified foods in the United States and the European Union”, AgBioforum, Vol. 7 No. 3, pp. 113-23. Hunt, L.M., Fairweather, J.R. and Coyle, F.J. (2003), Public understandings of biotechlogy in New Zealand: Factors affecting acceptability rankings of five selected biotechlogies, AERU Department Research Report 266, Lincoln University, 139 pp., available at: www.lincoln. ac.nz/aeru/publish/aeru266.htm Jaeger, S.R., Lusk, J.L., House, L.O., Valli, C., Moore, M., Morrow, B. and Traill, W.B. (2004), “The use of n-hypothetical experimental markets for measuring the acceptance of genetically modified foods”, Food Quality and Preference, Vol. 15 Nos 7/8, pp. 701-14. Kassardjian, E. (2002), “Appropriation de concepts en situation d’e´ducation n formelle; cas d’une exposition scientifique sur les OGM”, PhD thesis, University Claude Bernard Lyon. Koivisto Hursti, U.K., Magnusson, M.K. and Algers, A. (2002), “Swedish consumers’ opinions about gene technology”, British Food Journal, Vol. 104 No. 11, pp. 860-73. KRC Research (2003), “European views on agricultural biotechlogy: an overview of public opinion”, KRC Research report, 16 pp., available at: http://abeurope.dynamicweb.dk/ images/files/Public_opinion_overview_on_biotechlogy.pdf Lusk, J.L., House, L.O., Valli, C., Jaeger, S.R., Moore, M., Morrow, B. and Traill, W.B. (2003), “Effect of information about benefits on biotechlogy consumer acceptance of genetically modified food: evidence from experimental auctions in the United States, England and France”, research funded by USDA – IFAFS grant no. 52100-9620, 35 pp., available at: www.agecon.purdue.edu/staff/jlusk/info%20paper%20ERAE%20sub%203.pdf Marks, L., Kalaitzandonakes, N. and Vickner, S. (2003), “Evaluating consumer response to GM foods: some methodological considerations”, Current Agriculture Food and Resource Issues, Vol. 4 No. 1, pp. 80-94. Mucci, A. and Hough, G. (2004), “Perceptions of genetically modified foods by consumers in Argentina”, Food Quality and Preference, Vol. 15 No. 1, pp. 43-51.

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Noussair, C., Robin, S. and Ruffieux, B. (2003), “A comparison of hedonic rating and demand-revealing auctions”, Food Quality and Preference, Vol. 54 No. 1, pp. 393-402. Noussair, C., Robin, S. and Ruffieux, B. (2004), “Do consumers really refuse to buy genetically modified food?”, The Ecomic Journal, Vol. 114 No. 492, pp. 102-20. Owen, W.F. (1984), “Interpretive themes in relational communication”, Quarterly Journal of Speech, Vol. 70 No. 2, pp. 274-87. Priest, S.H. (2000), “US public opinion divided over biotechlogy?”, Nature Biotechlogy, Vol. 18 No. 9, pp. 939-42. Roosen, J., Hennessy, D.A., Fox, J.A. and Schreiber, A. (1998), “Consumers’ valuation of insecticide use restrictions: an application to apples”, Journal of Agricultural and Resource Ecomics, Vol. 23 No. 2, pp. 367-84. Rousu, M., Huffman, W.E., Shogren, J.F. and Tegene, A. (2004), “Are United States consumers tolerant of genetically modified foods?”, Review of Agricultural Ecomics, Vol. 26 No. 1, pp. 19-31. Taylor, K. (2003), “GM debate: Government says it is too late to change direction”, New Zealand Herald, available at: www.nzherald.co.nz/storydisplay.cfm?thesection ¼ news& thesubsection ¼ &storyID ¼ 3519791&reportID ¼ 53009 Wicker, A.W. (1969), “Attitudes versus actions: the relationship of verbal and overt behavioural responses to attitude objects”, Journal of Social Issues, Vol. 25 No. 4, pp. 41-78. Zhong, F., Marchant, M.A., Ding, Y. and Lu, K. (2002), “GM foods: a Nanjing case study of Chinese consumers’ awareness and potential attitudes”, AgBioforum, Vol. 5 No. 4, pp. 136-44. Appendix

Figure A1. Question focused on participants’ opinion

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Figure A2. Questions focused on reported and intended behaviours (questions 32, 33, 34); on awareness of biotechnology (question 35); on knowledge of biology and genetics (question 36)

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Food industry awareness of consumers’ plant food beliefs Emma Lea, Anthony Worsley and David Crawford

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Centre for Physical Activity and Nutrition Research, School of Exercise and Nutrition Sciences, Deakin University, Burwood, Australia Abstract Purpose – The aims of this study were to examine farmers’ and food processors’ alignment with consumers’ views about plant foods and their intentions to produce plant foods. Design/methodology/approach – Data on plant food beliefs were collected from mail surveys of farmers, food processing businesses and random population samples of adults in Victoria, Australia. Findings – There were strong differences between consumers’ beliefs and farmers’ and food processors’ perceptions of consumers’ beliefs. For example, a higher proportion of farmers and processors believed that consumers would eat more plant foods if more convenience-oriented plant-based meals were available than consumers themselves agreed. Farmers appeared to be more aware of or aligned with consumers’ beliefs than were processors. One- and two-thirds of farmers and processors respectively were planning to grow or process more plant foods, which bodes well for the availability of plant and plant-based foods. Research limitations/implications – Study limitations include the small food industry sample sizes and possible response bias, although analysis suggests the latter was low. Future research could survey a larger sample of food industry representatives, including those from other sectors (e.g. retailers). Practical implications – Education of consumers and industry groups on plant foods and better lines of communication from consumer to processor to farmer, are required. Originality/value – To the authors’ knowledge, this is the first study to examine farmers’ and food processors’ awareness of consumers’ beliefs about plant foods. This issue is important for those involved with the production and marketing of plant foods or with food, farming and health policy. Keywords Plant products, Food products, Consumer behaviour, Food industry, Australia Paper type Research paper

Introduction Plant food (fruits, vegetables, grains, legumes, nuts and seeds) consumption is low in developed countries (Stables et al., 2002; Lang et al., 2003; Victorian Government Department of Human Services, 2003). However, consumption of plant foods and foods based on them has important health benefits such as disease prevention (World Cancer Research Fund & American Institute for Cancer Research, 1997; Messina, 1999; Bazzano et al., 2002; Montonen et al., 2003). For example, the consumption of fruits and

British Food Journal Vol. 107 No. 8, 2005 pp. 556-571 q Emerald Group Publishing Limited 0007-070X DOI 10.1108/00070700510610977

The project was supported by the Australian Research Council (DP0209041). EJL is supported by an ARC Postdoctoral Fellowship. DC is supported by a National Health and Medical Research Council/National Heart Foundation Career Development Award. The authors wish to thank the survey participants and, for comments on an earlier version of this manuscript, members of the Rural Social Research Group (Tasmanian Institute of Agricultural Research/University of Tasmania).

vegetables has been shown to decrease the prevalence of type 2 diabetes, cardiovascular disease and obesity (Bazzano et al., 2002; Gundgaard et al., 2003). A number of factors have been found to lie behind consumers’ inadequate consumption of plant foods, including their perceived expense, poor quality, taste, availability, time required to prepare, lack of preparation knowledge or skills, and lack of knowledge about the quantity that should be eaten (Balch et al., 1997; Cohen et al., 1998; Cox et al., 1998; Stubenitsky and Mela, 2000; Lea et al., 2005a). In addition to the personal barriers to the consumption of plant foods, it is likely that the types of food provided by the food industry and the marketing of these foods play an important role in influencing the consumption levels of plant foods (Nestle, 2002; Glanz and Hoelscher, 2004; Glanz and Yaroch, 2004). For example, television advertising of energy dense, micronutrient poor foods influences the choice of these kinds of foods, when foods such as fruits and vegetables could be consumed instead (Dalmeny, 2003; Morton et al., 2005). In addition, food-processing companies focus on the development of value-added products rather than on the promotion of fresh fruits and vegetables, as it is easier to add value to, and therefore derive profit from, such foods (Nestle, 2002). Despite the influence of the food industry on food choice, however, little research has been conducted on food industry intentions to produce plant foods. Furthermore, another aspect that is likely to be important in food industry considerations of the types of foods they produce and the marketing of these foods is their understanding of consumer beliefs about plant foods and related issues. For example, if the managing director of a food processing company believes (perhaps as a result of market research) that consumers desire more (or less) of a certain type of product, such as low sugar, high fibre breakfast bars or organic fruit juices, they will presumably be inclined to alter the composition of their products accordingly. The aim of this exploratory study was to examine farmers’ and food processors’ alignment with consumers’ beliefs about plant foods and their intentions to produce plant foods. Method Data were collected from food industry and consumer surveys. These were a survey of farmers (Study 1), a survey of food processors (Study 2), and two consumer surveys, one of which was concerned with food habits (Study 3) and the other with consumer perceptions of food and the environment (Study 4). Only two items from the latter survey, both on organic food, are reported in this paper. Descriptions of the four studies are provided below, followed by a description of data analyses. Ethical approval for the project was obtained from the Deakin University Human Research Ethics Committee and informed consent was obtained from each participant. Study 1: farmer survey Procedure. According to data from the Bureau of Statistics, there were 33,212 farms in the Australian state of Victoria in 2003 (Australian Bureau of Statistics, 2004). A total of 200 farmers were selected from the business telephone directory for Victoria. This provided the most appropriate sampling frame, as there is no publicly available consolidated listing of farmers in Victoria. Due to the focus of the survey on plant foods, half of the farmers were randomly selected from those listed under plant food categories, such as “Vegetable Growers”, “Apple and Pear Growers”, and “Wheat Farmers”. The remainder were

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randomly selected from those listed under the heading of “Farmers”. The sample was restricted to those who farmed in regions where plant foods were likely to be grown. A questionnaire was mailed to the sample in November 2003, with a cover letter and reply-paid envelope. Questionnaire design and administration was based on Dillman’s (2000) recommended methods. Two follow-up mail outs and a telephone reminder were made to non-respondents. The questionnaire. A literature search (Biemans and Harmsen, 1995; Grunert et al., 1996; Singhapakdi et al., 1996; Grunert et al., 1997; Harmsen et al., 2000) and structured interviews with farming and food industry representatives (Lea, 2003) were conducted to help formulate the initial questionnaire, which was then piloted among a small sample of farmers. Placed prominently on the cover sheet were examples of plant foods and plant-based foods and meals. Examples of plant foods included “grains – wheat, rice, oats, barley”, “vegetables – carrots, potatoes, broccoli (e.g. frozen, fresh)”, “legumes – lentils, split peas, chickpeas, green peas, soybeans”, with similar examples given for fruits, nuts, and seeds. Examples provided of plant-based foods (foods made from plants) included “lentil soup”, “pasta”, “baked beans”, “peanut butter”, and “bread”. Examples of plant-based meals included “vegetable and almond stir fry topped with a small amount of chicken or tofu served with rice”, “vegetable lasagne topped with some cheese”, and “the traditional “meat and three veg” adapted to have more vegetables, minimal meat and possibly some legumes”. The questionnaire contained items on difficulties with growing, distributing and promoting plant foods and farm values as well as the following key sections for this paper: . Beliefs about Australian consumers (15 items), such as “Australians generally think that plant foods and plant-based foods are not tasty”, measured on a five-point scale ranging from strongly agree to strongly disagree (the relevant items are listed in Table I). . Growing practices and plans (five items), such as use of organic techniques, and plans to grow more plant foods and more varieties of plant foods in the next two years. . Background information (six items), including farm size, demographic information. Participant characteristics. A total of 69 farmers returned a completed questionnaire, giving a 44 percent response rate after taking into account questionnaires that were unable to be delivered and those delivered to people for whom the questionnaire was not relevant (e.g. no longer involved in farming). Three-quarters (77 per cent) of participants were male. Mean age was 50 years, with age ranging between 26 and 78. Mean farm size was 829 hectares (median 168 hectares), with size ranging between two and 6,000 hectares. Of the participants, 77 per cent were exclusively involved with growing plant foods, especially fruit and vegetables. Although there are no publicly available data on the characteristics of Victorian farmers with which to compare study participants, early and late responders to the questionnaire were compared in order to examine the possibility of bias introduced by non-responders. There were no statistically significant differences for background items, production practices and plans, and beliefs about consumers between farmers who responded to the questionnaire immediately after the initial mailing or after one

Directly comparable items e Australians would eat more plant foods if minimally processed plant foods were readily available (e.g. pre-cut vegetables) Australians would eat more plant foods if more “convenience” plant-based meals were available (e.g. takeaways, frozen meals) Australians usually buy plant foods from a supermarket as it is the most convenient Australians generally believe that fruits and vegetables sold at supermarkets are not as good quality or as fresh as those sold elsewhere (e.g. market) Australians generally believe that fruits and vegetables are expensive Australians generally do not have enough information on how to prepare plant-based meals (e.g. recipes) Australians generally prefer to eat fruits and vegetables that are in season Australians generally prefer to eat plant foods that are produced locally (i.e. preferably within their state) Australians generally believe it is important that agriculture and the food industry are environmentally sustainable Australians generally think organic foods (i.e. grown without synthetic chemicals) have more vitamins and minerals than conventional foods Indirectly comparable items g Australians generally see few benefits associated with eating lots of plant/plant-based foodsh Plant foods are healthier than animal foods (e.g. meat, milk) 35

38

7 27

24 34 10 21 11

25

16

46

43

91 54

52 34 81 53 82

58

32

Farmers % agree % unsure

27

69

71

54

67

38

38

48

87

65

42

27

25

27

27

19

31

35

29

13

27

35

Processors % agree % unsure

NS 52

51

90

*

NS

60

90

22

54

49

NS

NS

NS

NS

NS

64

16

*

NS

18

NS ** ** **

**

NS

**

**

NS ** ** **

NS **

*

**

**

NS

NS **

NS * **

NS

9 33f

30

26

6

16

13

20

10

15

(continued)

NS

**

**

**

**

18

**

pd

pc

pb

Consumers % agree % unsure

NS

pa

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Table I. Percent of farmers, food processors and consumers in agreement with statements (or their equivalent in the consumer questionnaires) on plant and plant-based foods

Table I. 27

34

15

57

79

31

79

17

23

15

*

NS

*

pa

31 17f 76

37

40

48

6 3 15 34 14

5

92

92 95 77 25 27

9 10

88 86

Consumers % agree % unsure pb

pc

pd

Notes: a Comparisons between farmers and food processors; b Comparisons between farmers and consumers; c Comparisons between food processors and consumers; d Comparisons between all groups (farmers, food processors, consumers); e Items are worded as they appeared in the processor and farmer questionnaires. For these items, an equivalent item was included in one of the consumer questionnaires. For example, for the first item, the equivalent item in the food habits consumer questionnaire was: “I would eat more plant foods if minimally processed plant foods (e.g. pre-cut vegetables) were readily available”; f Consumer item from the food and environment questionnaire. All other consumer items in this table are from the food habits survey; g For these items (present in the processor and farmer questionnaires), equivalent items were not included in either of the consumer questionnaires. However, a range of related items from the consumer questionnaires are presented here; h Also, see taste-related consumer questionnaire items below; i See the above health-related items (i.e. “Plant foods are healthier than animal foods (eg meat, milk)”; “Nuts and seeds are healthy in moderation”; “It is better to get vitamins and minerals from plant foods than to take supplements (eg multivitamin tablets)”). Farmers n ¼ 69; Food processors n ¼ 48; Consumers (food habits survey) n ¼ 415; Consumers (food and environment survey) n ¼ 223 * p , 0.05, * * p , 0.001, NS not significant

7

93

Processors % agree % unsure

560

Nuts and seeds are healthy in moderation It is better to get vitamins and minerals from plant foods than to take supplements (eg multivitamin tablets) Fruit is a convenient snack food Australians generally think that plant/plant-based foods are healthyi Australians generally think that plant foods and plant-based foods are not tasty I enjoy eating fruit I enjoy eating vegetables I enjoy eating legumes (beans, peas) I prefer animal foods (eg meat, milk) to plant foods Vegetables need their flavour enhanced to be tasty (e.g. salt) Eating a plant-based diet helps me to have a tasty diet Australians generally would prefer to buy organic plant foods if they were no more expensive than conventional plant foods I prefer to eat organic plant foods (i.e. grown without artificial chemicals) I would buy more organic food if it were less expensive

Farmers % agree % unsure

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reminder and those who required two to four reminders. Therefore, it is unlikely that response bias was high. Study 2: food processor survey Procedure. As there is no publicly available consolidated listing of food-processing businesses in Victoria, 200 Victorian food-processing businesses were selected from the online Yellow Pages business telephone directory www.yellowpages.com.au) and the online Kompass Australia business directory (www.kompass.com.au). Half of the sample was selected from each of these sources. The businesses selected from the Kompass directory were all of those listed as having a Victorian address under the categories most pertinent to the survey’s focus on plant foods, such as “Pulses and legumes”, “Bread, cakes and pastry”, and “Fruit and vegetables, processed”. The half of the sample selected from the telephone directory was randomly selected from those listed under “Food Products – Manufacturers and Processors”. This resulted in the inclusion of approximately half of the listings under this category in Victoria. A questionnaire was mailed to the sample in March 2004, addressed to the managing director of each business, together with a cover letter and reply-paid envelope. Questionnaire design and administration, including follow-up reminders, followed that for the farmers’ survey described above. The questionnaire. The questionnaire was devised in the same way as the farmers’ questionnaire, including interviews with food processing representatives (Lea, 2003) and piloting among a small sample of processors. The questionnaire contained the same descriptions of plant foods, plant-based foods and meals as the questionnaire for farmers. Items were included on difficulties with processing, distributing and promoting plant/plant-based foods and company values in addition to the following key sections: . Beliefs about Australian consumers (15 items), identical to those in the farmers’ questionnaire (the relevant items are listed in Table I). . Production practices and plans (five items) such as use of organic ingredients, and plans to produce more plant-based foods and to process new varieties of plant foods in the next two years. . Background information (eight items), including annual turnover, demographic information. Participant characteristics. Representatives from 48 food-processing businesses returned a completed questionnaire. After taking into account questionnaires that were unable to be delivered and those delivered to people for whom the questionnaire was not relevant (e.g. no longer in business), the response rate was 31 per cent. Three-quarters of participants were male. Mean age was 47 years, with the range being between 24 and 72. The mean number of company employees was 126 (median 29), ranging between three and 2,000. The mean annual business turnover was AU$63 million, although the median was lower at AU$3 million (range of between AU$100 thousand and AU$750 million). Businesses were involved with producing a range of plant-based foods, particularly condiments, seasonings, sweeteners and stocks (22 per cent), grain-based foods such as tortillas, bread and pastries (22 per cent), and potato and other vegetable-based foods (16 per cent). These businesses tended to specialise in these particular categories of foods. In contrast, a further quarter (27 per cent) of

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businesses tended to produce a range of foods. These included roasted nuts and dried fruit and vegetables, or a range of frozen and canned foods, or cereals and dairy-based foods. Although there are no publicly available data on the characteristics of Victorian food processors with which to compare study participants, early and late responders to the questionnaire were compared, as was done for farmer participants. There were no statistically significant differences between early and late responders. Therefore, it is unlikely that response bias was high. Study 3: consumer survey – food habits Procedure. A total of 1,000 people were randomly selected from the Victorian population via the software package Australia on Disc (May 2003 version, Dependable Database Data Pty Ltd), which contains a comprehensive list of residences from the telephone directory. A questionnaire, cover letter and reply-paid envelope were mailed to each individual in February 2004, preceded a few days earlier by a letter informing each person that a questionnaire would be soon be delivered. Administration of follow-up reminders followed that of the food industry surveys. The questionnaire. The questionnaire consisted of eight pages of questions and a cover sheet. Placed prominently on the cover sheet were the same examples of plant foods, plant-based foods and meals as those provided in the food industry questionnaires. The questionnaire was devised from a review of the literature (Schwartz, 1992; Cox et al., 1998; Kearney and McElhone, 1999; Povey et al., 1999; Marks et al., 2001; Rutishauser et al., 2001; Ma et al., 2002; Lea and Worsley, 2003), the findings of ten consumer focus groups about plant foods (Lea et al., 2005a), and a pilot among a small sample of consumers. The sections of the questionnaire that are relevant to this paper are: . Beliefs about plant foods and plant-based meals (32 items), including “I enjoy eating fruit” and “Fruits and vegetables are expensive” (the relevant items are listed in Table I). Response options ranged between strongly disagree and strongly agree on a five-point scale. . Perceived benefits of eating a plant-based diet (24 items), of which the following item was used in this study: “Eating a plant-based diet helps me to have a tasty diet”. Response options ranged between strongly disagree and strongly agree on a five-point scale. . Demographics (14 items), including sex, age, and highest education level. Participant characteristics. The response rate was 51 per cent (n ¼ 415), after taking into account those who could not be contacted. One-fifth of the sample (19 percent, n ¼ 187) could not be contacted because their addresses were incomplete or had changed since the sampling frame was compiled, or they could not be contacted by telephone, or were deceased. Socio-demographic characteristics of the respondents and the general Victorian population from Census data (Australian Bureau of Statistics, 2002) are listed in Table II. Compared with the Census data, the main biases were over-representation of women, those aged 45 years and over, and those with a non-school qualification.

Sex Female Male Age b 20-24 years/16-24 years 25-44 years 45-64 years 65 þ years Country of birth: Australia Other country Employment status c Employed full-time Employed part-time Unemployed Marital status: Marriedd Widowed/divorced Education status e Non-school qualification #Year 12 school education only

Food habits survey respondents (%)

Food and environment survey respondents (%)

2001 censusa (%)

59.4 40.6

52.3 47.7

50.9 49.1

0.7 31.9 43.1 24.2

3.3 34.4 42.3 20.0

6.8/12.3 30.4 22.8 12.7

78.1 21.9

74.3 25.7

71.1 28.9

31.5 17.8 2.0

33.6 16.4 3.2

29.4 14.4 3.3

75.2 15.0

68.0 19.6

51.6 13.1

55.3 44.8

62.6 37.3

34.8 65.2

Notes: a Data could only be included in this table where Census items were directly comparable to questionnaire items; b No minimum age prerequisite was specified for participation in the survey, but as the survey was addressed to a person listed in the phone directory it was expected that younger people (particularly under-18s) would be less likely to participate. No-one under 20 participated in the food habits survey, and no-one under 16 in the food and environment survey. Separate Census percentages are provided for the 20-24 year age group and the 16-24 year age group; c The survey percentages for “employed full-time” and “employed part-time” exclude those self-employed, as there was a separate category for the latter, comprising 9.5 percent of the food habits sample and 8.2 percent of the food and environment sample. However, the Census data included the self-employed with full-time or part-time employed. Therefore, the survey “employed full-time” and “employed part-time” categories are an underestimate. Also note that in both the Census and the questionnaires “unemployed” does not include students and those not looking for work, such as retired people. Census percentages refer to those aged 15 and over; d In the surveys, “married” includes “living together”, whereas in the Census, it does not. Therefore, the survey figures are an overestimate; e In the surveys, this was defined as a technical or trade certificate or a university or tertiary qualification. In the Census, this was a postgraduate degree, graduate diploma, graduate certificate, bachelor degree, advanced diploma, diploma or certificate

Study 4: consumer survey – food and environment Procedure. A total of 500 individuals were randomly selected from the Victorian population by using the software package Australia on Disc, as for the food habits survey described above. A questionnaire, cover letter and reply-paid envelope were mailed to each person in the sample in February 2004. Survey administration followed that of the food habits consumer survey. The questionnaire. The questionnaire consisted of six pages of questions. It was formulated from a literature review (Schwartz, 1992; Magnusson and Hursti, 2002;

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Table II. The demographic characteristics of the random population food habits survey respondents (n ¼ 415) and food and environment survey respondents (n ¼ 223) compared with the Victorian population as a whole, as obtained from the 2001 Census

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Magnusson et al., 2003), from focus groups about plant foods (Lea et al., 2005a), and by a pilot survey. The questionnaire included sections on beliefs about genetically modified foods, environmental beliefs and behaviours, and personal values. The sections pertinent to this paper are outlined below: . Beliefs about organic foods (12 items). A definition of organic food was provided at the beginning of this section, which was adapted from the definition provided by the National Standard for Organic and Biodynamic Produce (www.ofa.org. au): “Organic food means food produced by specific practices that aim to take care of the environment and soil. Artificial chemicals – including pesticides and fertilizers – and genetic modification are not allowed.” The two items in this section relevant to this paper are “I would buy more organic food if it was less expensive” and “Organic foods have more vitamins and minerals than conventional foods”. Apart from the demographic items, these were the only items used from the food and environment questionnaire in this paper. Response options ranged between strongly disagree and strongly agree on a five-point scale. . Demographics (13 items), including sex, age, and highest education level. Participant characteristics. In total, 223 completed questionnaires were received, giving a response rate of 58 percent after taking into account questionnaires that were unable to be delivered. The demographic characteristics of participants are provided in Table II. The main biases in comparison to Census data were over-representation of those aged 45 years and above and those with a non-school qualification. Data analysis. All statistical analyses were conducted with SPSS for Windows statistical software (version 11.5). Farmer and food processor response frequencies to the items on beliefs about Australian consumers were calculated. Cross-tabulations (including Pearson’s chi-squared test of statistical significance) were performed to compare the responses of farmers with those of food processors. Response categories were combined (agree with strongly agree and disagree with strongly disagree) to ensure adequate cell size. However, it should be noted that the tests of significance for farmers and food processors were based on relatively small numbers. Frequencies of consumers’ beliefs about plant foods were also assessed. Some of these beliefs were directly comparable with food industry items on Australian consumer beliefs. For example, for the item “Australians generally do not have enough information on how to prepare plant-based meals (e.g. recipes)” in the food industry questionnaires, there was an equivalent item in the food habits consumer questionnaire: “I lack information/recipes on how to cook plant-based meals”. Where items were directly comparable, cross-tabulations were performed to compare the responses of food industry and consumer groups. Where items were not directly comparable, frequencies only are presented, with qualitative judgements made of similarities or differences between food industry and consumer responses. Finally, frequencies of food industry responses to the section on production practices and plans were assessed. Results Consumers’ beliefs about plant foods Consumers tended to agree that plant foods are healthy and enjoyable to eat, although over half thought fruits and vegetables are expensive (Table II). They reported that

they usually purchased plant foods from supermarkets, although half were concerned with product quality. Consumers preferred in-season, locally produced plant foods and were in favour of organic food (particularly if the price was to decrease) and the environmental sustainability of food production. They tended to disagree that they would eat more plant foods if more convenience-oriented plant foods were available and that they needed more information on the preparation of plant-based meals.

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565 Industry’s awareness of consumer views Farmers and food processors tended to hold the view that consumers buy plant foods from a supermarket (despite some quality concerns) and believe plant and plant-based foods to be healthy and, to a lesser extent, tasty (Table II). They were more likely to agree than disagree that consumers would eat more plant foods if more convenience-oriented products were available and that consumers thought fruits and vegetables were expensive. They thought consumers preferred in-season fruits and vegetables and, to a lesser extent, locally produced plant foods. Approximately equal numbers agreed, disagreed or were uncertain about whether consumers have enough information on how to prepare plant-based meals. Finally, they believed consumers have positive attitudes towards organic foods and would like food production to be environmentally sustainable. In general, farmers and food processors held similar beliefs about consumers (Table II). However, a statistically significant difference was present for four of the 14 items. Processors were more likely than farmers to agree that consumers would increase their consumption of plant foods if more convenience-oriented plant-based meals were available. Processors were also more likely than farmers to agree that Australians would prefer organic plant foods if they were no more expensive than conventional foods. Food processors were less likely to agree that consumers believe it is important that the food industry is environmentally sustainable and more were uncertain about this statement. They were also less likely to agree that consumers think that plant and plant-based foods are healthy. Generally, differences between food industry and consumers were stronger than those between processors and farmers (Table II). There were significant differences between farmers and consumers and between processors and consumers for six and eight of the ten comparable items respectively. Thus, farmers appear to be more aware of consumers’ beliefs than are processors. Consumers were less likely than both industry groups to agree that they would eat more plant foods if there was increased availability of minimally processed plant foods or convenience-oriented plant-based meals. They were also less likely to agree that they buy plant foods from a supermarket for reasons of convenience. Agreement levels that fruits and vegetables are expensive were similar for farmers and consumers (just over half of the respondents), whereas processors were less likely to agree. Fewer consumers agreed that they needed more information on how to prepare plant-based meals than both food industry groups thought they did, although one-third of industry respondents were unsure about this. Responses to the statement on preference for in-season fruit and vegetables were similar for farmers and consumers (over 80 percent agreement), whereas food processor agreement was lower. In contrast, processors were more in tune with consumers stated preference for locally produced plant foods than were farmers, although this was not highly significant. The environmental sustainability of agriculture and the food industry was more important to consumers than both food industry groups believed, with the vast majority of consumers being in agreement.

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Finally, farmers were more accurate than processors on consumers’ beliefs about organic foods having more vitamins and minerals than conventional foods (not highly significant). Although items presented in the second half of Table I are not directly comparable, it appears that the majority of consumers agree that plant foods are healthy and farmers and food processors are aware of this. However, food industry groups possibly underestimate the proportion of consumers who believe that plant foods are tasty. Food processors may be more aware of consumers’ beliefs with regard to organic food and expense than are farmers; around three-quarters of consumers agreed that they would buy more organic foods if they were less expensive, with a similar percentage of processors agreeing that Australians would prefer to buy organic plant foods if they were no more expensive than conventional plant foods. Food industry intentions with regard to plant foods and organic foods Of the farmer participants, 29 per cent were planning to grow more plant foods for human consumption over the next two years, particularly wheat, barley, potatoes, lentils, citrus, stone and soft fruits, and canola. A total of 18 per cent were planning to start growing new varieties of plant foods, particularly fruit. Over two-thirds of food processor participants (68 per cent) stated that their company was planning to increase production of plant-based foods over the next two years, particularly vegetable-, grainand fruit-based foods such as fruit juices and marinated vegetables. Around one-fifth of processor participants (21 per cent) stated that their company was planning to start processing new varieties of plant or plant-based foods, particularly vegetables, legumes, fruits, grains, herbs, and seeds. Of the farmer participants, 6 per cent were involved in using organic methods of production. Five respondents stated that they were considering using organic methods in the future for at least some of their produce. This represented 17 per cent of those who answered this question, although only 7 per cent of the total number of respondents (as the proportion who did not answer this question was high). Over one-third (39 per cent) reported that they used integrated pest management or other (non-organic) methods associated with decreased use of synthetic chemicals. Almost one-third of processors (30 per cent) were using at least some organic ingredients. Of the respondents, seven stated that their business was considering using at least some organic ingredients in the future. This represented 26 percent of those who answered this question, although only 15 per cent of the total number of respondents (as the proportion who did not answer this question was high). One-fifth (19 per cent) were using ingredients that had been grown using integrated pest management or other (non-organic) methods associated with decreased use of synthetic chemicals, although, predictably for those involved with processing rather than growing, 62 per cent of the participants were unsure about whether they were or not. Discussion This study found that industry awareness of Australian consumers’ beliefs about plant foods is in many cases inaccurate. There is therefore a need for better lines of communication from consumer to processor to farmer. Farmers appear to have a greater awareness of or alignment with consumer views than do food processors. This is somewhat surprising, given that processing companies are more likely than farmers

to conduct market research and therefore may be expected to be more in tune with consumers’ beliefs. It is possible that farmers are closer to consumers in their personal beliefs than are processors, and therefore may have a greater understanding of consumers’ beliefs in general. Nonetheless, in considering the findings presented here, it is important to recognise the study limitations, particularly the small sample sizes of the food industry groups and the possibility of response bias of the food industry and consumer groups. For example, there were some age, sex and education differences between consumer participants and the population as a whole, which may have affected level of agreement with belief items. However, an analysis of demographic differences in beliefs showed that university education only affected one belief item (with lower agreement that fruits and vegetables are expensive) and, although age and sex differences were more common, these did not appear to influence the overall findings (data available from the authors). In addition, late responders to the farmer and processor questionnaires were similar to early responders, suggesting that response bias was not high. Future research could survey a larger sample of food industry representatives. It would also be useful for future studies to examine these issues among other food industry sectors, including retailers and food service. Surveying a number of people with various roles within a specific processing business would also be interesting, as it is possible that managing directors may have different opinions and knowledge to marketing managers, for example. One of the most important findings to emerge from this study was the low agreement of consumers that they would eat more plant foods if there was increased availability of minimally processed plant foods or convenience-oriented plant-based meals (less than a fifth agreed) and the discrepancy with food industry views about consumers. This may indicate that there are important barriers to increasing plant food consumption for consumers other than convenience-related ones, but that this may not be recognised by the food industry. Other barriers, such as expense and lack of knowledge about the quantity that should be eaten are known to be potential barriers (Balch et al., 1997; Cohen et al., 1998; Cox et al., 1998; Stubenitsky and Mela, 2000; Lea et al., 2005a). Consumers in this study tended to have positive beliefs with regard to enjoyment and taste of eating plant foods (vegetables, fruits, legumes). They also tended to believe that plant foods are healthy. However, plant food consumption among Australians is known to be low (Victorian Government Department of Human Services, 2003), and indeed, this was found to be the case for the food habit survey participants (Lea et al., 2005b). Thus, it is apparent that for consumers the benefits do not outweigh the barriers to increasing consumption of plant foods. Nonetheless, consumers’ current beliefs provide a positive starting point for appropriate dietary communications and changes to the food environment (e.g. in terms of marketing and availability of foods). For example, in the USA, the “1 per cent or less” campaign used the Theory of Reasoned Action to guide advertising and public relations about the benefits of low-fat milk and thus to successfully motivate people to drink low-fat milk (Reger et al., 1999; Booth-Butterfield and Reger, 2004). The Theory of Reasoned Action posits that attitudes (i.e. beliefs and evaluations of those beliefs) and subjective norms (i.e. perceived group pressure) determine behavioural intentions, which in turn influences behaviour (Fishbein and Ajzen, 1975; Olson and Zanna, 1993). A similar technique could be used to increase motivation to consume plant foods.

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The findings presented here suggest that there is scope for the food industry to increase the promotion of plant foods. The surveys showed that approximately one- and two-thirds of farmers and processors respectively were planning to grow or process more plant foods over the next two years and one-fifth were planning to experiment with new varieties of plant foods. This bodes well for the availability of plant and plant-based foods. However, although sufficient supplies of plant and plant-based foods are required before adequate consumption of these foods can be achieved, increased supply does not necessarily mean that consumption will increase. On the other hand, food industry intentions to increase production may mean that demand is increasing. It should be noted that processed plant-based foods are not necessarily healthy, for example if refined as opposed to unrefined grains are used or added sugar levels are high. Future research could examine the intention of processors to improve the healthiness of products. Indeed, the healthiness of products has been found to be a mid- rather than highly-ranked company value by food processors (Lea, 2005). A higher proportion of processors than farmers indicated that they were involved with organic foods. This is likely to be related to the higher proportion of processors who believed that consumers would prefer organic plant foods if they were no more expensive than conventional plant foods. However, even among processors, use of organic ingredients was low, being used in less than one-third of businesses. This contrasts with the consumer findings, where the majority indicated that they would buy more organic food if it was less expensive and believed that agriculture and the food industry should be environmentally sustainable. Given these findings, the food industry, including farmers and processors, may need to become more heavily involved with organics, particularly organic plant foods (Helms, 2004). In order to do so, government policy needs to support the marketing, research, and development of organic agriculture and efforts need to be made to decrease the cost of organic compared to conventional foods, such as via government subsidies to organic farmers. In Denmark, for example, government policy is supportive of organic agriculture and farmers receive financial aid to assist in conversion to organic (Fibiger Nørfelt, 2000). An alternative to changing policies to increase organic food consumption could be to educate the public about the externalities of food production, which result in cheaper food at the expense of the environment (Pretty et al., 2000; Waltner-Toews and Lang, 2000). Such education would require the participation of advocacy groups, particularly consumer, public health and environmental groups. Friends of the Earth are one such group who promote organic, locally grown food and support the price of food reflecting the true cost (i.e. the internalisation of environmental costs) (Friends of the Earth Brisbane, 2002; Friends of the Earth Europe, 2002). Consumer education and information is also required with regard to seasonality and origin or growing location of plant foods. This could include education about expanding “food miles” (i.e. distance food travels to the consumer) (Lang et al., 2001; Jones, 2002) and the practice of importing fresh produce from other states or overseas when it is not in season in the local area. This could be done by partnerships with primary and secondary educators, universities, the cultural sector (e.g. museums), farmers’ organizations, and regional development branches of State and Federal government. The results indicate that consumers prefer to eat locally produced, in-season produce. However, often not enough information is provided at the retail level to enable consumers to be able to do

so. Policy advocacy is needed to ensure that consumers’ views are not ignored and that they are able to act on their beliefs. In conclusion, education of both consumers and industry groups on plant foods and related issues is required. It would be beneficial if stronger links between consumers, processors and farmers could be built, in order to increase knowledge of consumers’ beliefs and behaviours and understanding of food production (e.g. environmental) and health issues. Advocacy groups could help to raise awareness of the health and other benefits of plant foods not only among the general population but also in government and industry circles. References Australian Bureau of Statistics (2002), 2001 Census Basic Community Profile and Snapshot: Victoria, Australian Bureau of Statistics, Canberra. Australian Bureau of Statistics (2004), Agricultural Commodities, Australia, 2002-2003 (7121.0), Australian Bureau of Statistics, Canberra, available at: www.abs.gov.au Balch, G.I., Loughrey, K., Weinberg, L., Lurie, D. and Eisner, E. (1997), “Probing consumer benefits and barriers for the national 5-a-day campaign: focus group findings”, Journal of Nutrition Education, Vol. 29, pp. 178-83. Bazza, L.A., He, J., Ogden, L.G., Loria, C.M., Vupputuri, S., Myers, L. and Whelton, P.K. (2002), “Fruit and vegetable intake and risk of cardiovascular disease in US adults: the first National Health and Nutrition Examination Survey Epidemiologic Follow-up Study”, American Journal of Clinical Nutrition, Vol. 76, pp. 93-9. Biemans, W.G. and Harmsen, H. (1995), “Overcoming the barriers to market-oriented product development”, Journal of Marketing Practice: Applied Marketing Science, Vol. 1 No. 2, pp. 7-25. Booth-Butterfield, S. and Reger, B. (2004), “The message changes belief and the rest is theory: the 1 percent or less milk campaign and reasoned action”, Preventive Medicine, Vol. 39, pp. 581-8. Cohen, N.L., Stoddard, A.M., Sarouhkhanians, S. and Sorensen, G. (1998), “Barriers toward fruit and vegetable consumption in a multiethnic worksite population”, Journal of Nutrition Education, Vol. 30, pp. 381-6. Cox, D.N., Anderson, A.S., Lean, M.E.J. and Mela, D.J. (1998), “UK consumer attitudes, beliefs and barriers to increasing fruit and vegetable consumption”, Public Health Nutrition, Vol. 1 No. 1, pp. 61-8. Dalmeny, K. (2003), “Food marketing: the role of advertising in child health”, Consumer Policy Review, Vol. 13 No. 1, pp. 2-7. Dillman, D.A. (2000), Mail and Internet Surveys: The Tailored Design Method, J. Wiley, New York, NY. Fibiger Nørfelt, T. (2000) in Graf, S. and Willer, H. (Eds), Organic Agriculture in Europe. Results of the Internet Project, Stiftung O¨kologie and Landbau, Bad Du¨rkheim, pp. 57-69. Fishbein, M. and Ajzen, I. (1975), Belief, Attitude, Intention, and Behavior: An Introduction to Theory and Research, Addison-Wesley, Reading, MA. Friends of the Earth Brisbane (2002), Towards a Community Supported Agriculture, Friends of the Earth, Brisbane. Friends of the Earth Europe (2002), How to Eat Sustainably – Food for Thought, AH, Copenhagen. Glanz, K. and Hoelscher, D. (2004), “Increasing fruit and vegetable intake by changing environments, policy and pricing: restaurant-based research, strategies, and recommendations”, Preventive Medicine, Vol. 39 No. 2, pp. S88-S93.

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Marks, G.C., Webb, K., Rutishauser, I. and Riley, M. (2001), Monitoring Food Habits in the Australian Population Using Short Questions, Commonwealth Department of Health and Aged Care, Canberra. Messina, M.J. (1999), “Legumes and soybeans: overview of their nutritional profiles and health effects”, American Journal of Clinical Nutrition, Vol. 70 No. 3, pp. S439-50. Montonen, J., Knekt, P., Ja¨rvinen, R., Aromaa, A. and Reunanen, A. (2003), “Whole-grain and fiber intake and the incidence of type 2 diabetes”, American Journal of Clinical Nutrition, Vol. 77 No. 3, pp. 622-9. Morton, H., Stanton, R., Zuppa, J. and Mehta, K. (2005), “Food advertising and broadcasting legislation – a case of system failure?”, Nutrition and Dietetics, Vol. 62 No. 1, pp. 26-32. Nestle, M. (2002), Food Politics: How the Food Industry Influences Nutrition and Health, University of California Press, Berkeley, CA. Olson, J.M. and Zanna, M.P. (1993), “Attitudes and attitude change”, Annual Review of Psychology, Vol. 44, pp. 117-54. Povey, R., Conner, M., Sparks, P., James, R. and Shepherd, R. (1999), “A critical examination of the application of the transtheoretical model’s stages of change to dietary behaviours”, Health Education Research, Vol. 14 No. 5, pp. 641-51. Pretty, J.N., Brett, C., Gee, D., Hine, R.E., Mason, C.F., Morison, J.I.L., Raven, H., Rayment, M.D. and van der Bijl, G. (2000), “An assessment of the total external costs of UK agriculture”, Agricultural Systems, Vol. 65 No. 2, pp. 113-36. Reger, B., Wootan, M.G. and Booth-Butterfield, S. (1999), “Using mass media to promote healthy eating: a community-based demonstration project”, Preventive Medicine, Vol. 29 No. 4, pp. 414-21. Rutishauser, I., Webb, K., Abraham, B. and Allsopp, R. (2001), Evaluation of Short Dietary Questions from the 1995 National Nutrition Survey, Commonwealth Department of Health and Aged Care, Canberra. Schwartz, S.H. (1992), “Universals in the content and structure of values: theoretical advances and empirical tests in 20 countries”, Advances in Experimental Social Psychology, Vol. 25 No. 1, pp. 1-65. Singhapakdi, A., Vitell, S.J., Rallapalli, K.C. and Kraft, K.L. (1996), “The perceived role of ethics and social responsibility: a scale development”, Journal of Business Ethics, Vol. 15, pp. 1131-40. Stables, G.J., Subar, A.F., Patterson, B.H., Dodd, K., Heimendinger, J., Van Duyn, M.A.S. and Nebeling, L. (2002), “Changes in vegetable and fruit consumption and awareness among US adults: results of the 1991 and 1997 5 A Day for Better Health Program surveys”, Journal of the American Dietetic Association, Vol. 102 No. 6, pp. 809-17. Stubenitsky, K. and Mela, D.J. (2000), “UK consumer perceptions of starchy foods”, British Journal of Nutrition, Vol. 83 No. 3, pp. 277-85. Victorian Government Department of Human Services (2003), Victorian Population Health Survey 2002: Selected Findings, Victorian Government Department of Human Services, Melbourne. Waltner-Toews, D. and Lang, T. (2000), “A new conceptual base for food and agricultural policy: the emerging model of links between agriculture, food, health environment and society”, Global Change and Human Health, Vol. 1 No. 2, pp. 116-30. World Cancer Research Fund and American Institute for Cancer Research (1997), Food, Nutrition and the Prevention of Cancer: A Global Perspective, American Institute for Cancer Research, Washington, DC.

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Consumer perceptions of meat production Enhancing the competitiveness of British agriculture by understanding communication with the consumer Morven G. McEachern The University of Salford, Salford, UK, and

Claire Seaman Queen Margaret University College, Edinburgh, UK Abstract Purpose – To identify factors that could influence consumer perceptions relating to meat production and areas where further development would be of assistance to British agriculture. Design/methodology/approach – Qualitative semi-structured interviews of a quota sample of Scottish meat purchasing consumers. Findings – Results indicate that consumer views on meat production vary widely and that while there are some differences between rural and urban consumers the differences are rarely simple. Views were expressed on a variety of factors including livestock producers, agricultural production, certification and traceability. Relatively few consumers were routinely concerned with assurance labels. Consequently, knowledge of underpinning standards was limited. Primary sources of meat were the major supermarket groups with a distinct bias towards older consumers among those who preferred to shop in small butchers shops. Attitudes towards producers were mainly positive but some consumers remained sceptical about producer behaviour during hard times. Research limitations/implications – While more research would clearly be required to consider a broader spectrum of UK consumers, these current data indicate that consumer understanding of food information and indeed their interest and credibility of the current systems is a subject that would benefit from much wider research. The practical implications for the development of Government policy and for the idividual producers are substantial and would benefit from considerable clarification. Originality/value – Prior research concerning meat production and the views of consumers is limited. Theses findings have implications for future sector-based communications to consumers, in that equal emphasis should be given to both rural and urban consumers. More collaborative communications measures must be implemented to ensure consumer awareness/understanding of underpinning assurance label standards and bring about loyal purchase preferences for British produce. Keywords Agriculture, Consumer behaviour, Marketing, Meat, United Kingdom Paper type Research paper

British Food Journal Vol. 107 No. 8, 2005 pp. 572-593 q Emerald Group Publishing Limited 0007-070X DOI 10.1108/00070700510610986

Introduction The importance of adopting a customer-based orientation (i.e. as opposed to a market-based one), is well attested throughout the marketing literature (see for example, De Wit and Meyer, 2004; Lambin, 2000; Slater and Narver, 1995), with many citing the inherent value to be gained from satisfying customer requirements. Unlike

many other market sectors, the agri-food supply chain has only recently been forced to become more market oriented (McEachern and Warnaby, 2005; McInerney, 2002), with many producers simply content to remain “price-takers” rather than “price-makers”. From a marketing perspective, producers’ resistance towards the adoption of marketing principles appears counterproductive as they are now losing market competitiveness in today’s global marketplace. A key feature of a market orientation is the acquisition of knowledge about customers (Doyle, 2000; Drucker, 1982). Therefore, in order to develop and sustain long-term consumer loyalty, producers and agencies acting on behalf of producers must accurately identify consumer needs, concerns and understanding of the food production environment to ensure future market competitiveness. Few studies to date have evaluated exactly what the general public expect from the UK agricultural sector (Hall et al., 2004; Hellerstein et al., 2002). Consequently, as consumer expenditure on meat and meat products constitute the largest single sector of the food market (ONS, 2004), this paper focuses on the fresh meat supply chain and explores consumer perceptions of livestock producers and production practices. The paper concludes by discussing the research implications for both agricultural policy and future marketing communication mechanisms between producers and consumers. The changing marketplace Over the last two decades, there have been a significant number of events affecting the British meat supply chain, e.g. Bovine Spongiform Encephalopathy (BSE), the Escherichia coli 0157 outbreak in Wishaw, Scotland and Foot and Mouth Disease (FMD). These events along with increased pesticide applications and the intensification of agriculture have been a contributing factor to consumers expressing negative concerns towards British Agriculture (McInerney, 2002). These concerns have been expressed through campaigns, boycotts and/or voting with their purse, as a means of changing the way British farmers produce food (Loureiro et al., 2002; Blandford and Fulponi, 1999; Layton and Bonney, 1999; Roberts, 1999). The UK government has also recognised that developments in the agri-food industry are lagging behind changes in consumer lifestyles and their purchasing habits (Cabinet Office, 2002). Therefore, to appease some of these concerns and help ensure greater transparency and communication of product traceability, safety and production methods used, a number of assurance logos have been implemented by producer-led groups[1]. Although such measures are regarded as being mainly consumer driven, they simultaneously enable producers to achieve a market advantage over their competitors (Grankvist et al., 2004; Nilsson et al., 2004). Assurance schemes per se, not only offer the opportunity to facilitate more rigorous welfare standards without legal intervention, but also help to improve rural structures, reduce environmental pollution and improve overall food quality (WSPA, 1995). Bougherara and Grolleau (2004), add that such labelling schemes can potentially convert consumer awareness of credence attributes (e.g. production processes), into consumption changes. However, despite these market developments, a significant issue for the agri-food sector is that consumers have little knowledge of what these logos/symbols (e.g. The Little Red Tractor), are actually attempting to communicate (McEachern and Warnaby, 2004). The competitiveness of the UK’s agri-food sector may be threatened further by the ten new member states entering the European Union (EU) in May, 2004, particularly

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for UK poultry and beef sectors. Overall, the accession of the new states has resulted in a rise of the number of producers by over 50 per cent; an increasing area devoted to agricultural production by 38 million hectares; and an increase in agricultural production by 10-20 per cent for most commodities (MLC, 2004). Consequently, country-of-origin information and promotion are crucial to enable informed purchase decisions to be made by consumers (Barham, 2002; Dopico, 2002). Moreover, place of purchase is one factor that has a significant role in communicating safety and quality, thus reducing consumer risk and increasing consumer trust (Glitsch, 2000). Cowan (2004, p. 34), suggests that manufacturers and retailers must place more emphasis on building consumer trust. However, one obstacle often cited by producers as a barrier to closer supply-chain relationships is their “adversarial” relationship with retailers (see for example, Hingley, 2005). This may impact on collaborative measures being implemented to build greater consumer knowledge and trust in British food. One area that was initially considered by The Curry Report (2002), in an attempt to improve both food traceability and consumer trust in farming methods, was the possibility of Farm Licensing and Certification of Competences for producers. However, disparities were noted among relevant stakeholder groups For example, the National Farmer’s Union (2001), perceived this route as unnecessary as producers were already monitored by assurance scheme inspections. In contrast, the RSPCA (2001), pointed to a growing public feeling that the agricultural industry escapes many of the checks required by other businesses, for example, a dog breeder with two or three bitches requires a licence but a producer with 100 cows/500 ewes does not. The Food Commission (2002), concurs with the RSPCA, adding that a similar strategy is already present in France. Although no explanation was offered, The Curry Report (2002), decided not to include this as a recommendation in its final Report to the Policy Commission on the Future of Farming and Food, thus, it may be worth identifying consumer attitudes towards such a measure and if would increase consumer trust in the agri-food supply chain. A recommendation that was included in the final report was that producers should welcome the notion of consumer access to their farms. The justification for this was that there is no better way of helping the food chain “reconnect” with consumers, build up a direct relationship with a consumer and earning his or her trust (The Curry Report, 2002, p. 98). Based on the literature, an additional suggestion designed to enhance relationships between producers and consumers, is for producers to engage more in direct selling relationships such as farm-shops and farmers markets (Tregear and Ness, 2005; Weatherell et al., 2003). Indeed, the popularity of direct-sales is demonstrated by the growth in the number of farmers markets, increasing from only 14 in 1997 to over 500 in 2004 (Holden, 2004). Doubts may be raised however, as to the customer profile and their underpinning reasons for visiting such outlets. For example, La Trobe (2001), concludes that 66 per cent of consumers visited a farmers market for mainly novelty reasons. Moreover, Szmigin et al. (2003), and Youngs (2001), suggest that predominantly older/retired consumers use farm shops/markets. In spite of the above recommendations and their intended role of improving supply-chain relationships, a common justification provided by producers regarding allegations of information asymmetry between food producers and consumers (see Duffy et al., 2003), is that the general public are ignorant of the processes involved in getting a product from “farm to fork” (Webster, 2001), and that their opinions are often unstable (see for example, Hall et al., 2004). Miles et al. (2004), conclude that many

consumer concerns relating to food risk (e.g. hormones, antibiotics, GM), are often associated with a lack of information. Consequently, a set of rules surrounding the design of packaging/labelling (i.e. truthfulness, sincerity, comprehensiveness, legitimacy), are proposed by Underwood and Ozanne (1998), claiming that if adopted, producers should benefit from reduced consumer cynicism and greater potential to enhance buyer-seller relationships. Arguably, it could be proposed that consumers do not need to completely understand the production processes involved in getting a product from “farm to fork” but simply that they be assured: of the safety of the product; about the environmental and ethical standards underpinning the product; and of any societal benefits achieved in distributing, retailing and marketing such a product. Indeed, significant market success has been obtained regarding producer-consumer links and Fair Trade Coffee/Tea without producers having to explicitly educate consumers about the processes involved in the production of coffee/tea (Raynolds, 2002). Overall, today’s changing marketplace presents significant challenges to UK livestock producers. Unless UK agriculture can build strong and loyal relationships with British consumers, it is predicted that industry competitiveness will decline further. This paper contends that there may also be situational differences (i.e. location), affecting consumer attitudes and perceptions towards British agriculture (see McEachern and Schroder, 2002). Consequently, this research explores both rural and urban consumers’ expectations and their vision for a symmetric-informational, agricultural sector in the twenty-first century. Methodology This primary data collection is concerned with exploring and identifying the salient beliefs and central attitudes of both rural and urban consumers towards the UK agricultural supply chain. The means adopted to achieve this research aim is the in-depth interview. The qualitative interview is widely accepted as one of the most widely applied forms of social inquiry, particularly given its ability to explore and gain in-depth information (Holstein and Gubrium, 2002; Krueger, 1994). Specific to the in-depth interview, Ajzen and Fishbein (1980), suggest that the first five to nine beliefs should elicit the most “salient” beliefs and facilitate sufficient insight about why an individual holds a certain attitude towards an object. They also recommend that they should be elicited using a “free-response format”. This is achieved by the adoption of a semi-structured interview (rather than structured), which also helps to minimise researcher bias (Wright and Crimp, 2000; Bryman, 1988). Although this primary research focuses solely on Scottish consumers, meat purchase behaviour in Scotland is identified as being representative in terms of both consumption (i.e. av. Kg meat/consumed per head), and expenditure (i.e. total amount spent on meat per head), trends found across the rest of the UK (Keynote, 2003). To aid identification of any variations between rural and urban purchase decisions, only respondents from the City of Edinburgh and Argyll & Bute were targeted (n ¼ 41). Both areas of Scotland were selected for convenience purposes since the researchers had access to respondents in both council districts. Respondent selection was dependent on two factors; permanence of residency (no part-time residents such as tourists, weekend residents were permitted), and regularity of meat purchases (all respondents must consume fresh meat on a regular basis). The validity of the selected

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rural and urban areas is supported by the Register General’s classifications, which are calculated according to population density at postcode level (Jamieson, 2000). The sampling method adopted at this stage was based on a quota sample of households, stratified by age and location. This was deemed acceptable, as broad population inferences are not required at this stage (Punch, 1998). Since over 90 per cent of females throughout the UK population take responsibility for household shopping and 80 per cent of females are responsible for household purchase decisions (Fuller, 1999; Leatherhead Food Research, 2002), the sample was directed only at female purchasers of fresh meats. Using regional age breakdowns provided by Argyll & Bute and Edinburgh City Councils, the urban sample was recruited using a Queen Margaret University College (QMUC), in-house database; and the rural respondents were selected using a snowballing technique. Despite the reputed statistical limitations of quota sampling (Malhotra and Birks, 2000), this sampling method provided considerable advantages in terms of speed, flexibility and costs. Interviews took place throughout March and April in 2000, lasting between 60-90 minutes per participant. Due to the extensive distance between households in the Argyll and Bute area, the interviews were restricted to a 50-mile radius in the Mid Argyll region. Interviews were mainly held in the participant’s home, but some older respondents chose to be interviewed at QMUC. An advantage of conducting the majority of interviews in the home was that it helped relax respondents and encouraged more spontaneous conversation (Wright and Crimp, 2000). Interview data were studied and analysed after each interview, helping to ensure whether perspectives were recurring and identifying whether the data saturation point had been reached (Gray, 2004; Silverman, 2002, 2002a). A total of 30 respondents took part, with 15 originating from Argyll & Bute and 15 from Edinburgh. A Marks & Spencer gift voucher for £5.00 was offered as a gesture of thanks for participating. At the end of each in-depth interview, all respondents completed a brief demographic questionnaire. This helped provide relevant social, educational and economic information to support and cross-reference interview findings. The final interview plan used for the qualitative study can be found in the Appendix, Figure A1. Data analysis was interpretive and iterative, using pattern coding and analysis to identify emergent themes (Huberman and Miles, 1994). Verification of the interview data was also achieved by using QSR NUD.IST (i.e. Numerical Unstructured Data for Indexing, Searching and Theorising), Version 4. This enabled the data to be coded and organised into “discrete chunks”, thus facilitating an in-depth exploration of the data (Malhotra and Birks, 2000, p. 203). The rationale underpinning the analysis tools applied to the interview data is that both the “patterning” and “chunking” of this data is reflective of good research practice (Holstein and Gubrium, 2002; Silverman, 2002a, 2002b). Limitations of this research are acknowledged particularly regarding the snowball sampling method used in the rural location, as it does not facilitate a statistically representative sample. However, it may be counter-argued that in an area without a sampling frame detailing meat purchasing consumers, age and permanence of residency, it would be almost impossible to ensure statistical representativeness. For a research method to be viewed as reliable and valid, it must “consistently measure what it set out to measure” (Gray, 2004, p. 219). In this study, external reliability is achieved via the semi-structured nature of the interview. This ensures that the same questions

are asked to each respondent and that minimal departure from the question plan takes place by the researcher (Bryman, 2004). In addition, reliability of the qualitative data is ensured via good quality recordings and its transcription (Pera¨kyla¨, 2002). The validity of this research is verified by basing the question plan on areas drawn from the literature and/or from the pilot data and relating the question content directly to the research objective (Gray, 2004). Similarly, concerning external validity of the semi-structured interviews, the degree to which findings can be generalised across populations is problematic, particularly given the small sample involved (Bryman, 2004, 1988).

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Results and discussion Table I illustrates the demographic breakdown (e.g. life-stage, social grades and education), of all respondents. Most respondents were married or co-habiting with their partner. In order to accurately identify socio-economic grades, both the respondent’s occupation and (if applicable), their partner’s occupation were documented. As a result, individuals from social grade A to D were included. Several respondents possessed at Respondent number 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30

Lifestage

Social grade

Location

OF YF EN OF OF EN EN EN OF YF EN EN YF EN YF PF PF EN YF YF PF OF EN OF EN OF EN EN EN OF

C2 C2 C2 B/C1 D D C2 A/B B C1 A/B B/C1 A/B B A/B C1 C1 B C1 B C2 B/C1 C1 C1 C1 A/B D D C2 A/B

R R R R R R R R R R R R R R R U U U U U U U U U U U U U U U

Education C & G certificate C&G None Degree SVQ None C&G Degree P/G diploma None Degree Diploma Certificate degree Degree Certificate diploma Certificate Degree Degree None Certificate diploma Degree C & G degree None C & G certificate HNC None None Diploma None None Degree

Note: PF = Pre-family; OF = Older family; YF = Young family; EN = Empty nesters

Table I. Rural and urban respondent profiles

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least one form of qualification. Some differences were identified between respondents who had a qualification at FE level (i.e. City & Guilds, National Vocational Qualification), and a qualification at HE level (i.e. Degree; Post-Graduate Diploma). Slight differences in respondent profiles did emerge between rural and urban consumers. For example, the rural consumer was marginally more likely to be: married or co-habiting; have children; be of a higher socio-economic status: and possess a qualification either at HE or FE level. Many urban respondents had connections with agriculture (e.g. family or friends in farming). Conversely, some rural respondents did not have any connections with farming or agriculture. However, most rural respondents currently lived on a farm or had previously lived on, or were brought up on a farm. When asking respondents if they thought location had a bearing on knowledge of food production, the general belief held was that the rural person knew more about food issues and how food was produced, for example: . Rural respondents: I think women from the countryside know more about food and how it is produced – so many women in the city are also working, therefore they don’t have the time to find out lots about their food and how it is produced (R3). I would say that people from the country know much more about their food and how it is produced – the city person wouldn’t have a clue (R8). .

Urban respondents: I would guess that the rural consumer knew more about how our food was produced, whereas the city consumer just learns about their food from the packet or what the supermarket communicates to them (U2). I would say rural consumers know more about food and more about the production side – people who have lived in the town all their life just think it appears in a nice polythene packet (U5).

Some urban respondents perceived rural knowledge as being higher during childhood but not adulthood, and that such knowledge may be equal if urban people worked in the food sector or grew up on a farm. Another perception was that knowledge of food issues and production depended on factors such as being well read, therefore, independent of location: . Rural respondents: I would think with TV and the documentaries that are on nowadays that the people in the city would know just as much about food and how it was produced (R7); Although we are used to seeing farm animals around us, I don’t think that gives us a better understanding (R15). .

Urban respondents: I do have a general knowledge of how our food is produced, and I suppose it depends on how well read you are (U9). I don’t think people from the country know any more than people from the city about food and how it’s produced, although maybe people from the city have a kind of romanticism about the country (U12).

Fresh meat purchase behaviour Regarding the types of meat purchased, most rural and urban respondents commented that they had never tried organic or free-range meats. Reasons given for this were that they were considered too expensive, or that locally produced meats were just as good, for example: . Rural respondents: These meats are all locally produced in Kintyre and I don’t know when I tasted better quality meat – they are not certified as being organic but it should be as I don’t believe you can get more organic (R12). I wouldn’t buy organic meat – I don’t think it is worth the money (R11). I would say that our local meat is organic – what I mean by that is that the animals are not kept inside or fed anything dodgy (R13). .

Urban respondents: I haven’t tried any organic meats, don’t see the need to I’m quite happy to eat what I have always bought (U9). I haven’t tried free-range or organic meats because they are too expensive (U14). I haven’t tried organic meats because its more expensive (U10). The organic lamb looks far better quality in the shops but its just far too expensive (U7).

Rural and urban cross-tabulations showed that urban respondents were more likely to purchase organic meats and rural respondents were more likely to purchase free-range meats. Respondents who had tried organic and free-range meats mainly held the attitude that taste differences did not appear to warrant the added cost. The favoured place of purchase for most of the respondents was the grocery multiple retailer. Reasons for this were that it was considered cheaper; easier to determine whether meat was Scottish and to find out more about how the meat was produced; and that it was regarded as being more convenient. . Rural respondents: The only benefit from buying the meats from a supermarket with these labels on it is that they’re cheaper (R2). The Co-op tend to sell Scottish meat rather than imported meats (R11). I used to buy all my meat from the local butcher but now I buy it from the supermarket where I know much more about it (R15). .

Urban respondents: I usually go to the supermarket basically down to convenience (U1). I shop at Asda because its near to where I live (U2). I used to get my meat from the butcher but not anymore, I go to Safeway so I can do all my shopping in the one place (U14).

Despite the rural location of respondents, frequent out-shopping trips to city based supermarket outlets took place. Some respondents (mainly rural), who shopped in supermarkets, commented that they prefer to buy meat in Marks & Spencer because they considered it to be of higher quality. Similarly, respondents who shopped mainly at the supermarket for convenience also stated that they occasionally purchased fresh

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meat from a butcher due to perceptions of higher quality. Very few respondents however, solely purchased meat from a butcher. Age was an influencing factor in the profile of respondents who frequently shopped at a butcher, with most being aged over 50. Reason for purchasing fresh meats at a butcher was that the meat was considered to be of better quality and therefore, more presentable to guests. The fact that you could see the meat better and that it wasn’t shrink-wrapped were also mentioned: . Rural respondents: I think there is a big difference between the butchers meat and the supermarkets meat – the butchers meat is streets ahead (R7). I am quite happy with the standard of my butcher and in some cases that is maybe more expensive than the supermarket but I think it is worth it (R10). The meat we get in is usually butchered here and I think it’s possibly better than what I get from the Co-op as it’s not wrapped up in polythene all day (R11). .

Urban respondents: If all were equal I’d probably use the butcher more because I think the meat looks fresher and nicer (U15). You get a better choice at the butcher and the meat is nice and pink, not artificial pink (U5). Occasionally I go to the local butcher if someone is coming to dinner (U12). Tend to buy it at the butchers rather than the supermarket – you can’t always see what you want at the supermarket (U9).

Some respondents (mainly rural), also purchased fresh meat from a local farmer/farm shop, and a few rural respondents purchased all their fresh meat requirements from local farmers. The unanimous reason for this was perceptions about the improved taste. A significant environmental influence on using local farm shops was respondents’ connections with agriculture, with the majority of respondents who used such outlets, either currently living on or previously lived on a farm. Examples included: . Rural respondents: I would say there is a big difference between the meat I get locally and the meat you get from a supermarket (R13). There’s a dealer who I bought some Jura beef from – it was reared on the hill which is as organic as you can get and the taste of that compared to the local butcher even was massive (R9). .

Urban respondents: I definitely think there is a better taste of meat when you get it fresh from a farm shop (U8). I have tried fresh lamb from a local farm – it tastes better, cooks quicker and it’s better quality (U3).

Respondents’ selection of fresh meats was mainly based on price, eating quality, colour and origin of the meat. The least important characteristics were brand name, sell-by-date, the assurance label and animal welfare. For rural consumers, the main selection criteria were the anticipated eating quality of the meat, the origin of the meat and the colour. Urban consumers selection criteria were price, low fat or extra lean

status of the meat, and equally the origin and the colour of the meat. Animal welfare as an unprompted selection criterion for beef, lamb, pork and chicken, did not appear to be considered strongly at the point of purchase by either urban or rural respondents. A significant demographic difference identified among respondents was that the respondents who expressed a preference for some fat on fresh meats were older (i.e. aged over 50). The majority of respondents did their meat shopping on their own and made the final decisions regarding meat type. Children appeared to have the strongest influence on the few respondents who were influenced by other family members when shopping for meat. However, a greater normative influence impacted on the place of purchase, with respondents choosing to purchase their meat from a butcher if dinner guests were coming. Reference groups for consumers shared little consensus. Most respondents placed their trust in information from their supermarket or local butcher, but no significant socio-economic trends were identified. Consumers use and understanding of fresh meat labelling mechanisms The general consensus among respondents was that they never read the labels on fresh meats. Only a minority of urban and rural respondents always read and sometimes read the labels before purchase respectively, for example: . Rural respondents: I do look at the labels but only to see where it comes from (R10). You look at the piece of meat and then you buy it without looking at any label (R9). .

Urban respondents: In the supermarket I tend not to look at the packet labels so much (U6). I do look to see where the product comes from (U14).

Of the urban respondents who always read meat labels prior to purchase, most had agricultural connections, but this behaviour was to ascertain the country-of-origin and depended on where they were shopping (i.e. in a different outlet from normal). Interpretations of assurance labels were also established. Some rural respondents stated that these labels meant nothing, and some urban respondents did not know what they meant. Some associated such labels with auditing, animal welfare and country of origin, and some held the belief that they indicated high eating quality. Respondents who felt that assurance labels stood for “nothing”, were identified as being rural, over 50 years old, of social grade A/B and possessed qualifications at further education (i.e. FE), level. Some of the respondents who didn’t know what assurance labels stood for, including those who lived on farms and were current members of an assurance scheme, stated that the reason for not knowing was due to the fact that no information had been made available to them. Respondents who stated that assurance labels meant that animals, farms and shops were audited more rigorously, were identified as being older (i.e. over 50). Of those who stated that assurance labels meant that the meat originated from welfare-friendly systems of production, respondents were identified as being younger (i.e. all aged between 30-39), and possessing qualifications at higher education (i.e. HE), level. Although the consensus was weak, respondents who stated that assurance labels meant the meat was of a high eating quality did not have any agricultural connections or a

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qualification. No significant socio-economic influences were identified between the respondents who stated that assurance labels meant that the meat was of British or Scottish origin. One additional subject area that rural respondents appeared to be more knowledgeable of was the association between high welfare and low stress at slaughter and the subsequent correlations with high meat eating quality. As a result of never having previously seen any information on assurance labels, respondents appeared insecure about their knowledge of underpinning standards. The respondents who were more confident in their knowledge of such schemes’ had seen relevant information. Demographic correlations showed that these respondents were all working, aged in their 30s, had no agricultural connections and possessed a qualification at FE level. Despite some respondents not having seen such information, several actively sought information in connection with food issues. Those who sought information were more likely to be aged over 50, have agricultural connections, possess a qualification at FE level and be working. The most common source of information was the media, with most stating the television as their preferred source. Some rural respondents expressed a preference for newspapers and some described their main source of information as the supermarket and/or the butcher. Consumer concerns relating to meat production When specifically directing the discussion towards beliefs and attitudes towards meat production, several respondents voiced concern about animal welfare. Many however, expressed concern only for veal (mainly urban), and broiler chicken production (all rural). One positive correlation that was identified between attitudes held and demographic profiles, was that concerned respondents were more likely to possess a qualification at FE level. Examples of viewpoints include: . Rural respondents: I always think about how the different meats may have been produced in terms of animal welfare (R14). I often think of calves that are reared for veal – how they are tied up, can’t move and then killed (R5). I often think about how our meat is produced especially chickens crammed together – it gives me nightmares (R7). .

Urban respondents: I do think about how meat is produced when I buy it again because I was brought up next to a farm where the chickens were pulled up and necks strung in front of you (U8). I believe that animals should have a good life before they end up on the dinner table (U12). I don’t eat veal I would never eat veal because I can’t abide the thought of the process to make the meat (U6).

Generally, respondents did not want to think about animal welfare, as it put them off eating meat. Respondents without animal welfare concerns were identified as having more agricultural connections and possessing qualifications at HE level, for example: . Rural respondents: I thoroughly enjoy eating meat so I don’t think about these things much cause it would put me off (R3).

I love paˆte´ foie de gras and it’s a very cruel thing the way that is produced but then again we eat other meat – what is the difference? (R8). I don’t think about the system of production used for the animals, when I buy meat – you more or less just grab what you want and hurry on to the next thing on your list (R12). I don’t think animal welfare is particularly important, as all animals in this country are properly cared for (R11). .

Urban respondents: Occasionally I might think about these things, but not enough to put me off meat altogether (U2). I tend not to think about the background of how my meat got on the shelf, because if you thought too much about where your meat came from you would stop eating it (U4). It’s not an big item on my agenda – I’m not a great animal lover either (U9). I don’t think about the production aspects when I’m buying meat but I’m well aware of it with my father being a butcher (U7).

Despite the majority of assurance labels promoting national or regional origins, many urban respondents had no preference as to which country their meat originated from. These respondents were more likely to be of lower social grades C2/D. One inaccurate attitude held by an urban respondent was that all meat sold in UK supermarkets was British and not sourced from other parts of Europe or international markets, for example: . Rural respondents: I don’t trust the labels of origin there is too many meats classed as Scottish and has come from somewhere else (R8). It doesn’t concern me really where the meat comes from (R13). The country of origin is not that important to me, I buy New Zealand lamb when I can’t get British lamb (R6). I don’t think we have lots of foreign meat in our supermarkets, if I thought we did I’d pay more attention to the label (R1). .

Urban respondents: I like the idea that meat be local or a British product – I’m not always thinking of where it comes from when I buy it (U6). The country of origin doesn’t bother me – I wouldn’t even look at that on the label – I’ve got no idea where my meat comes from (U2). I would like to think that all our meat comes from the UK (U3). I don’t look at the label to see where the meat comes from – I suppose my eyes do see things like Scottish beef or New Zealand lamb but it doesn’t affect what I buy (U10).

Several rural respondents were concerned about where their meat came from, expressing a primary preference for Scottish meat, but if not available opting for British meat. Those concerned about the country of origin were more likely to have agricultural connections, for example: . Rural respondents: If the label said that the meat was from another country then no I wouldn’t buy it, whether it looked good or not (R11). I do try to buy Scottish meat if I can, if not I will buy British meat (R3).

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.

Urban respondents: I’ve always preferred Scottish beef because you know how its produced, because most of our cattle are out on grass (U5); I usually try and buy Scottish – it’s nothing to do with what system each country has, I think it’s nice to support your own industry (U9).

In relation to animal transport, several respondents expressed concern. Rural respondents mainly expressed apprehension in relation to live animal exports, compared to transport around the UK. Of the respondents who expressed general concern, most were rural, aged over 50 and possessed no qualifications. An incorrect assumption made by an urban respondent was that she assumed fresh meat with a Scottish assurance label was butchered only in Scotland. Examples of all viewpoints include: . Rural respondents: I think the way they pack the animals too tight in these lorries is terrible (R9). I don’t agree with moving animals around the country, not when you are going to kill them at the end of it (R6). I think its bad enough for the animal to be transported from the farm to the slaughterhouse, without transporting it to another country (R7). Animal transport to me is pretty cruel especially when you see them on TV going abroad (R8). .

Urban respondents: I don’t agree with cross-country live animal transport – I prefer the idea of local markets (U6). I don’t really know that much about animal transport, but what I have seen if it is true that animals are as much crammed in and not getting water like the TV says, then I think its wrong (U3). I think as long as they are fed and watered during the journey its ok, also we are much safer in this country, but I don’t think its well checked in other parts of the world (U7). I’d always assume fresh meat that had a Scottish label on it, then it hadn’t travelled that far (U14).

Unconcerned respondents, were more likely to be of a lower social grade and more likely to possess qualifications at FE level, for example: . Rural respondents: I think that the rules and regulations that we have in this country for animal transport are the highest anywhere in the world (R5). I have to agree with it (i.e. transporting animals), as we couldn’t survive without transporting them (R11). .

Urban respondents: I’ve seen bits in the news and papers about animal transport and I think people are just doing their job (U4). At the end of the day you are going to be eating an animal that has been fattened and slaughter so I don’t think you can have a conscience about whether it has been moved around a lot (U9).

General concern was expressed for all farm animals in relation to animal housing, with a minority voicing concern for poultry only. Those concerned about poultry housing were again more likely to have agricultural connections. One inaccurate assumption made by some concerned respondents was that they suspected that intensive animal production systems were prevalent only in the rest of the UK and not Scotland. Examples of viewpoints included: . Rural respondents: I don’t think intensive housing is acceptable (R12). I must admit when I think about pigs I like to see them on straw or outside (R11). I don’t really approve of the cages for chickens (R10). Intensive farming only happens in England not Scotland (R5). .

Urban respondents: I’m not a great believer in keeping animals in cages or tethers – I just think animals are meant to roam free (U3). I think there is a lot of cruelty in things like battery farming – these systems are just money making, I don’t approve of them at all (U13). It crosses my mind sometimes with battery chickens and how they are reared – funnily enough it doesn’t cross my mind so much with pigs (U14). I don’t find the picture of housed production systems acceptable at all (U6).

Of those unconcerned about animal housing, most were of social grade C and D. However, a number of attitude-behaviour inconsistencies arose between unconcerned respondents. For example, some respondents stated that they would be concerned about intensive animal housing, but felt that free-range or outdoor produced meats were too expensive. One inaccurate viewpoint held by an urban respondent was that she perceived all fresh chicken sold in the UK as being free-range. Examples of viewpoints include: . Rural respondents: I think the UK legislation is quite strict as far as these systems go – we’ve travelled quite a bit around Europe and their animal welfare is far worse than ours (R8). You don’t really see a lot of pictures about the pigs being tied up – I know it happens but it wouldn’t affect me buying it (R2). I don’t bother with stalls/tethers/farrowing crates – cause if we don’t allow it – it will only result in more costs for our farmers and they will just produce these animals where it is allowed and the supermarket will import it (R1). .

Urban respondents: I just assume that all my chicken is reared free-range (U7). I don’t have any preference for outdoor reared meat or free-range at all – it would just be down to whatever meat looked best and the price (U2). Free-range chicken costs a fortune – I don’t think it’s the best way to keep your animals but they have to come up with a better system to give the same amount of chicken for a lower price (U5). I would hate to think my meat came from these sorts of animals – I know my chicken does unfortunately (U6).

Throughout the discussion of attitudes towards animal welfare related topics, attention was also drawn to specific aspects of animal welfare legislation. For example,

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one urban respondent was aware of the stalls and tether ban for pigs reared in the UK, but many assumed that stalls and tethers were still widely used in the UK. Similarly, an urban respondent was aware that the veal crate was prohibited in the UK, but not throughout the rest of Europe. Both urban respondents were identified as having no agricultural connections. The practice of feeding antibiotics to enhance animal growth was of concern to most respondents, however, some felt enough testing was carried out to ensure no residues were found in meat. No significant trends were identified between any respondents and their demographic profiles. Examples of viewpoints held include: . Rural respondents: I would definitely want to avoid eating meat from animals that had been given antibiotics, but I wouldn’t know which labels told me that(R8). I think too many antibiotics are being used in food production today (R12). I think there are too many antibiotics used in both animals and humans – I would certainly like to know that my meat had no antibiotic residues in it (R11). .

Urban respondents: I’m not happy with the increased use of antibiotics and prophylactics treatments”(U6). I’m totally against antibiotics being used in food – I would want to buy meat that had not been given antibiotics but where does it say that on any of the labels? (U1). I think a label saying no hormones, antibiotics would just put peoples minds at rest – that would be more useful than any of these labels (U12).

Several respondents were concerned about the practice of feeding genetically modified (GM), ingredients to farm animals. These respondents were identified as being more likely to have agricultural connections. No significant trends were identified for unconcerned respondents. Viewpoints held include: . Rural respondents: I wouldn’t want to buy meat from animals that were given GM feedstuffs”(R3). I think the government need to look at the consequences of GM food more before they allow it to be imported (R8). Animals that have been fed with GM crops should definitely be labelled as such” (R14). .

Urban respondents: I have reservations about GM – I think it does present some advantages but at the same time I wouldn’t say I approved of it (U2). I would prefer to buy meat that was GM free – maybe its my age but I think meat that has been treated with anything really shouldn’t be there (U3). I have to say I don’t know all the ins and outs at the moment, but the little I do know I’m very anti GM – I’ve heard Iceland have been really good in banning GM stuff (U14).

Consumer attitudes towards UK meat producers Several respondents (mainly rural), expressed positive attitudes towards farm management and stockmanship in the UK. The only significant demographic trend identified was that they were more likely to possess qualifications at FE level, for example:

.

Rural respondents: I don’t know that many farmers, but I think they are in it cause they love it not for the money (R5). I think farmers do their best for the animals – the majority of farmers in the UK are doing a good job (R7).

.

Urban respondents: I would think on the whole farmers are trustworthy because they have to do it properly to make a living (U3). I’m sure the majority of farmers can be trusted (U6).

Some respondents felt that there were good and bad farmers in the UK as in any occupation and some urban respondents felt that they did not know enough farmers to comment. Respondents who expressed negative doubts towards farm management and stockmanship in the UK, were identified as being more likely to have agricultural connections and possess qualifications at HE level, for example: . Rural respondents: I don’t know if we can trust the farmer, because if it wasn’t for the fact that they used mammalian bonemeal (i.e. MBM), and fed it back to the cattle and poultry – would we have the problems with meat today?”(R12). I’m not too sure (i.e. about trusting farmers), – I mean BSE started somewhere (R6). .

Urban respondents: I wouldn’t trust farmers at all – I don’t think they pay much attention to anyone else (U1). I think they do moan and groan an awful lot and on the whole I think they are pretty well off – I would imagine that if there were shortcuts to be taken then farmers would take them just like most people (U15).

Attitudes towards Farm Licensing in the UK were equally mixed among rural and urban respondents. Respondents who felt positively about it believed that such a policy would help eradicate poorer producers from the industry. Those against the idea (mainly rural consumers living on farms), believed that it wouldn’t work in practice. Examples of views held included: . Rural respondents: Now that they are not getting much money for the meat, I think some would be trying to do it on the cheap. To get round that, I think licensing of farmers would be a good idea (R2). I think the idea of licensing is a good idea and if it helps shift out the poorer ones then all the better (R8). Licensing would only end up being another pen-pushing exercise – so no I don’t agree with that (R10). I don’t think licensing would work . . . that would just work out as jobs for the boys. If you look at breeding with dogs . . . it doesn’t seem to stop them being negligent (R11). .

Urban respondents: I do think that the farmer’s licence could be a good thing in getting the bad farmers out of farming (U3).

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Mixed views were also expressed towards producer certification of competences. Some respondents voiced reservations about the need for certification of producers who had been born into farming. Another viewpoint proposed was that certification should only be required for producers in the event of being found to be “incompetent”. However, several respondents perceived that farming like most other industries were experiencing significant change and should therefore be trained/examined accordingly, for example: . Rural respondents: I think anyone in charge of animals should be qualified . . . I think being born into farming is a different thing . . . so I don’t think people like that have to be qualified (R9). I think the farmer is qualified enough if the farm is passed down through the generations (R6). Farmers should be qualified only if they are completely new to it (R14). I don’t think there is any need for farmers to be qualified . . . only if they are found to be incompetent (R8). I don’t think qualifications would improve things at all . . . we’ve got good and bad people from all occupations regardless of qualifications (R11). .

Urban respondents: Ideally it would be better . . . but farmers like to work under their own rules . . . if they decide to cover something up then they will (U1). I think farmers should have some form of training even those who have been handed down the farm (U12). Qualifications for farmers would be a good thing – the more information that farmers gain can only be a good thing for the food industry (U14). I don’t think there is a need for formal qualifications – I tend to trust farmers (U9).

Respondents perceptions of a more accessible agricultural sector were generally favourable but many added that they themselves wouldn’t visit the farm. It was also felt by many that restrictions to access would be needed to make such a policy workable. Another advantage noted from greater public access was that it might help to maintain farm standards. . Rural respondents: An open-gate policy is probably a good idea but I probably wouldn’t want to go and see it myself (R1). I think an open-gate policy would only work if you had certain open days throughout the year (R4). I wouldn’t like to see consumers being able to walk round farms anytime they fancied – but I think a one-off visit would be good (R15). What might work is if farmers were to have an open day and everyone could come on the same day – that wouldn’t be bad for the farmer (R11). I think an open-gate policy might keep farmers on their toes more (R6). .

Urban respondents: I don’t think I’d like to go and visit the farm where my meat comes from but I think the offer should be there for others to go and see them if they want to (U8).

I think it would be quite interesting to visit the farm where your meat came from and see for yourself how the animals are treated (U10). You would have to agree it with the farmer beforehand – this kind of thing would give city people a better idea of what went on in farms (U12). I don’t see any harm in the idea – I don’t think we would visit the farm . . . but we would definitely say when we passed it Oh there’s that farm where our meat comes from (U14). I think it’s a good idea for all farms – make them tighten up their act (U7).

Several respondents (mainly rural), didn’t feel so positive towards the idea and felt that it wouldn’t be realistic. In addition, another viewpoint held was that seeing the animals might put them off eating meat, for example: . Rural respondents: I wouldn’t want to go and visit the farm where my meat came from (R7). I wouldn’t be interested in visiting the farm where my meat came from as it would put me off eating my meat (R8). I don’t agree with the open-gate policy – farmers can’t be bothered dealing with the public, that’s not why they are in it (R10). .

Urban respondents: I think the open-gate policy could be difficult because they are busy folks (U5).

Conclusions A clear trend emerges from this research, whereby consumers appear to have some concerns regarding food safety, animal welfare and meat purchasing. A key issue, however, remains the extent to which this impacts on meat purchasing behaviour, which is likely to be at least partially linked to consumer awareness and understanding of the various food registration, labelling and information systems that are currently in use in the UK. While more research would clearly be required to consider a broader spectrum of UK consumers, these current data indicate that consumer understanding of the food information and indeed their interest and the credibility of the current systems is a subject that would benefit from much wider research. Note 1. Note that Government primarily fund producer-led groups such as Quality Meat Scotland (QMS) and The English Beef & Lamb Executive (EBLEX). References Ajzen, I. and Fishbein, M. (1980), Understanding Attitudes and Predicting Social Behavior, Prentice-Hall International, Englewood Cliffs, NJ. Barham, E. (2002), “Towards a theory of values based labelling”, Agriculture and Human Values, Vol. 19 No. 4, pp. 349-60. Blandford, D. and Fulponi, L. (1999), “Emerging public concerns in agriculture: domestic policies and international trade commitments”, European Review of Agricultural Economics, Vol. 26 No. 3, pp. 409-24.

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Bougherara, D. and Grolleau, G. (2004), “Could eco-labelling mitigate market failures? An analysis applied to agrofood products”, working paper, CESAER. UMR INRA-ENESAD, Dijon, March. Bryman, A. (1988), Quantity and Quality in Social Research, Unwin Hyman, London. Bryman, A. (2004), Social Research Methods, 2nd ed., Oxford University Press, New York, NY. Cabinet Office (2002), “Farming and food: a sustainable future”, Report of the Policy Commission on the Future of Farming and Food, HMSO, London. Cowan, A. (2004), “The Saturday essay – transparency builds trust”, The Grocer, 11 September. (The) Curry Report (2002), Farming and Food: A Sustainable Future, Report of the Policy Commission on the Future of Farming and Food, HMSO, London. De Wit, B. and Meyer, R. (2004), Strategy: Process, Content, Context: An International Perspective, Thomson Learning, London. Dopico, D.C. (2002), “Analysis of brand equity supplied by apellations of origin: an empirical application for beef”, Journal of International Food & Agribusiness Marketing, Vol. 14 No. 3, pp. 21-34. Doyle, P. (2000), Value-based Marketing: Marketing Strategies for Corporate Growth and Shareholder Value, John Wiley & Sons, Chichester. Drucker, P.F. (1982), The Practice of Management, William Heinemann, London. Duffy, R., Fearne, A. and Healing, V. (2003), “Bridging the rural-urban information gap”, Stage 1 Report: Information Audit, Imperial College, London. (The) Food Commission (2002), “Permission to farm”, The Food Magazine, Vol. 56, January/March. Fuller, K. (1999), “Meal occasions: how are we eating?” Proceedings of The Changing Consumer, Institute of Grocery Distribution, Watford. Glitsch, K. (2000), “Consumer perceptions of fresh meat quality: cross-national comparison”, British Food Journal, Vol. 102 No. 3, pp. 177-94. Grankvist, G., Dahlstrand, U. and Biel, A. (2004), “The impact of environmental labelling on consumer preference: negative vs. positive labels”, Journal of Consumer Policy, Vol. 27 No. 2, pp. 213-30. Gray, D.E. (2004), Doing Research in the Real World, Sage Publications, London. Hall, C., McVittie, A. and Moran, D. (2004), “What does the public want from agriculture and the countryside? A review of evidence and methods”, Journal of Rural Studies, Vol. 20 No. 2, pp. 211-25. Hellerstein, D., Nickerson, C., Cooper, J., Feather, A.P., Gadsby, D., Mullarkey, D., Tegene, A. and Barnard, C. (2002), Farmland protection and the role of public preferences for rural amenities, Report 815, Usda Economic Research Service, Washington, DC, November, available at: www.ers.usda.gov/publications/aer815 Hingley, M.K. (2005), “Power imbalance in UK agri-food supply channels: learning to live with the supermarkets?”, Journal of Marketing Management, Vol. 21 Nos 1/2, pp. 63-88. Holden, P. (2004), The Organic Food and Farming Report, Soil Association Publications, Bristol. Holstein, J.A. and Gubrium, J.F. (2002), “Active interviewing”, in Silverman, D. (Ed.), Qualitative Research: Theory, Method and Practice, Sage Publications, London. Huberman, M.M. and Miles, B. (1994), “Data management and analysis methods”, in Denzin, M.K. and Lincoln, Y.S. (Eds), Handbook of Qualitative Research, Sage Publications, Thousand Oaks, CA. .

Jamieson, P. (2000), Personal communication, General Register Office for Scotland, Edinburgh, 3 February. Keynote (2003), “Meat and meat products”. Market Intelligence Report, Keynote, London. Krueger, R.A. (1994), Focus Groups: A Practical Guide for Applied Research, Sage Publications, London. La Trobe, H. (2001), “Farmer’s markets: consuming local rural produce”, International Journal of Consumer Studies, Vol. 25 No. 3, pp. 181-92. Lambin, J.J. (2000), Market-Driven Management – Strategic and Operational Marketing, Macmillan Business, Basingstoke. Layton, R. and Bonney, R. (1999), “The consumer, the citizen and animal welfare”, Farm Animal Welfare – Who Writes the Rules? Occasional Publication 23, British Society of Animal Science, Edinburgh, pp. 39-41. Leatherhead Food Research Association (2002), Leatherhead Food Research Association Food for Women: Commercial Challenges and Future Directions, Leatherhead Food Research Association, Surrey. Loureiro, M.L., McCluskey, J.J. and Mittelhammer, R.C. (2002), “Will consumers pay a premium for eco-labelled apples?”, Journal of Consumer Affairs, Vol. 36 No. 2, pp. 203-19. Malhotra, N.K. and Birks, D.F. (2000), Marketing Research: An Applied Approach, European ed., Pearson Education, Harlow. McEachern, M.G. and Schroder, M.J.A. (2002), “The role of livestock production ethics in consumer values towards meat”, Journal of Agricultural & Environmental Ethics, Vol. 15 No. 2, pp. 221-37. McEachern, M.G. and Warnaby, G. (2004), “Retail quality assurance labels as a strategic marketing communication mechanism for fresh meat”, International Review of Retail, Distribution and Consumer Research, Vol. 14 No. 2, pp. 255-71. McEachern, M.G. and Warnaby, G. (2005), “Improving customer orientation within the fresh meat supply chain: a focus on assurance schemes”, Journal of Marketing Management, Vol. 21 Nos 1/2, pp. 89-115. McInerney, J. (2002), “Re-orienting UK agriculture”, Farm Management, Vol. 11 No. 4, pp. 217-31. Miles, S., Brennan, M., Kuznesof, S., Ness, M., Ritson, C. and Frewer, L.J. (2004), “Public wary about specific food safety issues”, British Food Journal, Vol. 106 No. 1, pp. 9-22. MLC (2004), “The livestock and meat sectors of the ten new member states”, Economics Bulletin, Vol. 9, October. National Farmer’s Union (2001), “Licensing scheme gets an airing, Farmer’s Guardian. Nilsson, H., Tuncer, B. and Thidell, A. (2004), “The use of eco-labelling like initiatives on food products to promote quality assurance – is there enough credibility?”, Journal of Cleaner Production, Vol. 12 No. 5, pp. 517-27. ONS (2004), Expenditure and Food Survey, HMSO, London. Pera¨kyla¨, A. (2002), “Reliability and validity in research based on tapes and transcripts”, in Silverman, D. (Ed.), Qualitative Research: Theory, Method and Practice, Sage Publications, London. Punch, K.F. (1998), Introduction to Social Research: Quantitative and Qualitative Approaches, Sage Publications, London. Raynolds, L.T. (2002), “Consumer/producer links in fair trade coffee networks”, Sociologia Ruralis, Vol. 42 No. 4, pp. 404-24.

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Appendix

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Figure A1.

The Emerald Research Register for this journal is available at www.emeraldinsight.com/researchregister

The current issue and full text archive of this journal is available at www.emeraldinsight.com/0007-070X.htm

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Herbert Kotzab Department of Operations Management, Copenhagen Business School, Frederiksberg, Denmark, and

Christoph Teller Department for Retailing and Marketing, Vienna University of Economics and Business Administration, Vienna, Austria Abstract Purpose – The purpose of this paper is to introduce a model of instore logistics for retail stores. Design/methodology/approach – The model attempted to give a picture of all logistics processes that are carried out within a retail outlet from an incoming dock to the check out. The model has afterwards been empirically validated by analyzing the instore logistics processes of dairy products in 200 stores in the Austrian grocery retail sector. Findings – The findings of the survey show typical problem areas within store operations and identify the impact of instore logistics as a key factor impacting on the success of retail business. Originality/value – The paper continues the work of Raman, DeHoratius and Ton in 2001, and Cachon, also in 2001 and the findings contribute to close the execution gap in retail operations. Keywords Supply chain management, Distribution management, Distribution channels and markets, Dairy products, Austria Paper type Research paper

British Food Journal Vol. 107 No. 8, 2005 pp. 594-605 q Emerald Group Publishing Limited 0007-070X DOI 10.1108/00070700510610995

Introduction We try in our paper to look at logistics activities that occur within a retail store. We call this phenomenon “instore logistics” and consider it as a part of retail logistics that has become an important issue for practitioners and researchers especially when focusing on the “last mile” problem within an e-commerce context (Kopczak, 2001). Our suggestion of “instore logistics” is a “hot topic” due to the dominance of store-based retailing (Levy and Weitz, 2004). The analysis of the flow of goods within a self service retail outlet from a supply chain perspective can be of two reasons quite “appealing” (Liebmann and Zentes, 2001): (1) the availability of products in the shelves is an important key performance indicator for the purchasing transaction; and (2) inventory carrying and handling costs as well as costs for human resources are at that level of a supply chain relatively intense. The authors would like to thank the anonymous reviewers and Professor Griffith for their valuable comments that helped to improve the paper.

Nevertheless, Pal and Byrom (2003) recognize the variables “stock in the outlet”, “space” (¼ the size of the sales area of a store), “system” (¼ replenishment operations), “standards” (of service, e.g. shelf availability, special order facilities, opening hours) and “staff” as essential drivers for the shoppers’ benefit. Raman, DeHoratius and Ton (2001) have proven in two cases that operational mediocrity is due to a lack of knowledge on the real availability in the store and out-of-stock-situations at the point of sale (POS). The industrial initiative of Efficient Consumer Response Europe (ECRE) presented in 2003 additional sources for poor excellence in a retail outlet such as erroneous order management by store managers and deficient shelf filling activities (ECRE, 2003). We summarize the existing discussion as the combination of certain production factors such as staff, store size, assortment, etc. that explain the existence of different types of retail store, lead to specific outputs that might be sub-optimal measured in non-availability of products ( ¼ out of stock). These issues are also of importance as the majority of retailers operate with very low margins (Cachon, 2001; Theis, 1999). Although the consequences are evident, it seems that the academic and practical discussion avoids the discussion of operational issues within a retail store, such as instore logistics, which we consider as a “black-box”-understanding of retail operations. This is therefore surprising as Raman et al. (2001) recognized “execution” as the missing link in retail operations. We further develop this idea by proposing a model of instore logistics as an additional piece of retail operations on a store level. The purpose of our paper is two-fold. First, we are going to develop a generic model of instore logistics consisting of specific product flow processes that can be applied in any store format. We have then in a second step empirically validated our model suggestion based on 202 face-to-face interviews with store managers representing different store types of a leading retail chain within the Austrian grocery industry. There we looked at the flow activities related with a specific product category ( ¼ dairy products). The analysis will show that our model can be used to analyze instore logistics’ specific flow activities independent from the store format. Supply chain management in a retailing context A supply chain is defined as the sum of “. . . all activities associated with the flow and transformation of goods from raw materials stage (extraction), through the end user, as well as the associated information flows“ (Handfield and Nichols, 1999). The scope of a supply chain is to “span the entire set of organizations from procurement of material and product components to delivery of the completed product for the final customer (Schary and Skjøtt-Larsen, 1995). Both definitions include the existence of intermediaries in a supply chain in order to fulfil the ultimate goal of supply chain management – integration of business processes in order to satisfy end-user satisfaction (Cooper et al., 1997). Intermediaries such as retailers represent today more than 10 percent of GDP (USA: 15.1 per cent, GB: 11.7 per cent, Germany: 10.4 per cent of GDP). Retailing companies belong to the most important employers (USA: 23.6 per cent; GB: 17.1 per cent; Germany: 15.1 per cent of total employment) in many leading economies (Fisher and Raman, 2001; OECD, 2004). Today’s retailers have to perform on an extra-ordinary level by combining different decisions regarding location, assortment, selection of target markets, negotiations with suppliers, motivation of staff and other typical marketing mix decisions, such as pricing and merchandising

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and all is done in a very competitive and global environment (Levy and Weitz, 2004; Fernie, 1992; Fernie, 1999; Azuma and Fernie, 2001). Since the 1990s we could observe an increasing importance of retail logistics, which was recognized to generate competitive advantages by increasing product availability at lower costs (e.g. Pache´, 1998; Fernie et al., 2000; Bourlakis and Bourlakis, 2001). Sparks (1999) also points out that logistics and supply chain management (SCM) can be seen as important retail activities since they are very much concerned with product availability. And supply chain operations play a more and more significant role in a practical retailing context (e.g. Fernie et al., 2000; Sparks, 1999; Pache´, 1998). Poor execution of logistics at the retail outlet level can lead to unsatisfying results as Raman et al. (2001), Fisher and Raman (2001) or Cachon (2001) have shown. Fearne and Hughes (2000) have demonstrated how supply strategies improve the competitiveness of British fresh food industry. Especially the upcoming of vertical partnerships between retailers and manufacturers in form of superior logistics strategies such as ECR or category management are suggested as success factors for the industry (e.g. Fearne, 1998; Fearne and Hughes, 2000). But we made out a research deficit when it comes to the analysis of logistics processes that occur in the final stage of a transformation channel like a supply chain, that is a retail outlet. Developing a model of grocery retail instore logistics Instore logistics focuses on all flow processes within outlets of store-based retailing. The outlet itself represents a transition/exchange location as products are exchanged against payment. Therefore, availability plays a major role for such retailing activities as no product available means no purchasing transaction. The outlet as a logistical point of destination is clearly determined with the spatial borders of the store. Our concept of instore logistics does not recognize the flow of goods and information to the outlet and from the outlet. Instore logistics’ central objects are the products as purchased by end users (¼ primary packaging, end-user packaging units) and relevant information (e.g. order information). Consumers as logistical objects are not included in our notions. Based on these assumptions we characterize instore logistics as presented below (Toporowski, 1996; Kotzab, 2000; Schnedlitz and Teller, 1999): (1) Point of destination: point of sale – shelves. (2) Point of delivery: incoming dock of the retail outlet. (3) Objects: single stock keeping units and related information. (4) Tasks: . transportation; . inventory carrying and shelf management; . handling, picking/packing; . labelling; and . order management/replenishment The ultimate goal of instore logistics is efficiency, which means to offer the quantities of items as requested by end-users at lowest costs possible.

As self-service has gained major importance in many fields of retailing, we concentrate our notions on instore logistics in self-service grocery outlets. There, the particularities for instore logistics can be seen in logistical frictions between staff and end users as consumers fulfil certain logistical activities within a store. The trigger for replenishment processes is initiated either by store employees or automatically by retail merchandise information systems. We perceive instore logistics like any other logistics system consisting of specific subsystems (¼ processes), which we tried to conceptualize as outlined in Figure 1. We consciously build our model on a generic level in order to apply it in heterogeneous store format settings. In addition, we focused first on physical flows of products and not so much on the related information flows. We believe that information technology (IT)-systems such as electronic point of sale (EPOS) connections with material or distribution resource planning systems (MRP/DRP) or the applications of radiofrequency identification (RFID) can be seen as a fundamental element of our model.

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Figure 1. Instore logistics processes

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Our presentations follow the typical systems thinking and sequential process linking in logistics: (1) Delivery/receipt. Products are delivered either from a retailer’s distribution centre (DC) or from a DC of a logistics service provider/vendor to the receiving area of a store. Store employees take over and control the delivery. (2) Transport I. Incoming goods are either transported directly to the shelves (storage II) or to a specific temporary storage area (storage I). (3) Storage I. Additional inventory besides the stock in the shelves is stocked up in the back store area. Tertiary packaging ( ¼ roll container/cages, pallets) is broken up to smaller units. (4) Transport II. This transport activity refers to the transport from the back store area to the shelves. (5) Handling/storage II. This stage refers to all activities that are needed to prepare shelve filling such as break bulk of transportation units to end user units, shelve filling and merchandise presentation. This process includes also inventory control in order to generate re-ordering and replenishment. (6) Processing of transaction. These activities refer to the exchange processes when end-users finally pay for their purchase. The dispatch of the products leads to replenishment activities and should ideally lead to automated re-ordering. (7) Re-order. By controlling permanently all flows of products (incoming/outgoing) and the inventory management, orders might go to headquarters or to a vendor. (8) Disposal/recycling. This includes either the removal of packaging material or the recycling of damaged/broken merchandise. It also generates information for order management. This step as well contains the re-channelling of packaging and transportation units. All these processes are depending on (stochastic) end user demand and the replenishment processes of the preceding echelons of the supply chain. We can also determine other influencing factors such as the characteristics of the logistics objects (e.g. weight, size, quantity, value, perishableness, etc.), logistical dimensions (e.g. spatial and timely differences), as well as logistical relevant determination factors of retail stores (e.g. location). In order to validate our assumptions, we tested our model in a specific real life setting. We assumed thereby differences of grocery instore logistics processes for a specific product within different types of retail stores. Presentation and discussion of selected results of the empirical study – the case of Austrian dairy products Research design and execution We used a grocery setting as self-service outlets with large assortments, high turnover are the dominating store types in grocery retailing. We tested our notions of “grocery retail instore logistics” within the product line of dairy products, which is according to Raman et al. (2001) “an example of such a low-price but high-stock-out cost item with specific logistical requirements such as temperature, pressure, perishableness and high turnover. This category includes according to ACNielsen (2004b) the following items:

the white pallet (e.g. fresh milk, whole milk, curd cheese, yogurt and cream), the coloured pallet (e.g. fruit yogurt, curdled milk with fruit, milk mix drinks, fresh desserts), the yellow pallet (hard cheese, cut cheese, soft cheese or cream cheese) and the yellow fat pallet (e.g. butter, margarine or butter oil). The sales volume of this category totalled nearly EUR 1.3 billion and represents about 11.3 per cent of the Austrian grocery retail sales volume. Dairy products also belong to the product category with a short consumption cycle and therefore create customer frequency in stores, which makes them extremely interesting for store managers in grocery retailing. The interview consisted of three parts: (1) assessment of the logistical distance indicators of time and space in order to characterize the input/output relation of instore logistics; (2) evaluation of the usages of the instore logistics execution; and (3) the identification of the process specific differences between store formats.

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We have chosen a face-to-face-interview approach with 202 store managers of a leading grocery chain, representing three store types (following the typology of ACNielsen, 2004a) – 147 supermarkets (size between 400 to 1,000 m2), 36 small hypermarkets (size between 1,000 to 2,999 m2) and 19 large hypermarkets (size over 3,000 m2). Our sample includes all stores of this chain within the capital city of the home market, i.e. Vienna. We confronted the respondents with our generic model as presented in the previous sections of this paper. Therefore, the chronology of the questionnaire includes 65 questions (open/closed; metric and ordinal scale level) following the sequence of instore logistics processes. Discussion of selected results Basic conditions regarding instore-logistics. Table I summarizes the logistical relations and structural differences of the examined store types. Those variables turn out to be statistically significant different between all three store formats (Mann-Whitney U-test, p , 0.05) approving the heterogeneity between the three formats. The high values for the standard deviation within the category of supermarkets refer to a low standardization degree due to inner-city locations with specific physical structure. This means specific requirements for instore logistics as the width of the outlets and the placement of the products within the store vary a lot.

Store format Space store (m2) Space sales room (m2) Number of employees (full- and part-time) Length of the shelves (fridge) (m) Number of stock keeping units

Supermarket M SD N

Small hypermarket M SD N

Large hypermarket M S N

685.9 504.4

240.4 143.8

122 139

1,876.8 1,419.4

639 398.1

28 32

5,010 4,303.4

1,470 10,40.8

12 16

18.1 10.2 309.5

18.4 11.6 224.3

143 120 105

32.4 15.7 412.9

14.8 4.6 182.7

30 36 24

60.8 34.8 757.4

25.9 16.1 417.1

6 19 10

Notes: M ¼ mean; SD ¼ standard deviation; n ¼ valid answers

Table I. Instore logistics’ key data of the observed store formats

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We will refer in the next sections only those differences between the types of stores that had been significant from a statistical point of view. Characterization and analyses of instore-logistics processes Delivery/receipt. In all the examined outlets dairy products were received on a daily basis. The delivery time was mainly outside the regular shopping hours (58.9 per cent, n 1 ¼ valid answers ¼ 190)[1]. In 46 per cent of the cases (n =202), dairy products were delivered with other fresh products. A total of 95 per cent of the products were delivered in a cooled manner (n =202) and 92.5 per cent (n =202) of all respondents indicated that the delivery of dairy products did not affect the other instore logistics processes. In 33.2 per cent of the stores (n =201), store employees were present while the products were delivered. Only in a few cases (11.4 per cent; n =202), retail personnel brought the products from the truck into the outlet. The majority of the deliveries were cross-checked with the order form (61.5 per cent; n =200) and the delivery note (76.2 per cent; n =202). This control step took 24.7 minutes (SD (¼ standard deviation): 24.6; n =187) and we could not identify any statistical significant differences between the store types. Also the number of products did not affect the duration of the control process (correlation-analysis, p ¼ 0.3). In terms of problem areas at this stage of instore logistics, our respondents indicated differences between the promised delivery date and the actual delivery date. This difference was in three quarters of the cases (3rd quartile; n =53) up to 120 minutes. The overall satisfaction with the delivery intervals (97.5 per cent; n =201) and delivery date (88.1 per cent; n =201) can be considered as relatively high. The respondents estimated the share of damaged products to be lower than 3 per cent (n =187). Damaged goods were claimed in 40 percent of the cases at the retail headquarter, 36 per cent was written off and/or was recycled in 59 per cent of all cases (multiple responses: 287). The overall satisfaction with the tertiary packaging ( ¼ roll container) was average on a five-point Likert scale (n =201). Store managers of large hypermarkets were significantly less satisfied than store managers of supermarkets which could be due to the number of SKUs to be handled in the larger store formats. In general, it can be said that our respondents perceived the preliminary instore logistics process as working in a proper way. However, in some cases the employees could not rely on accurate delivery of goods, which makes manpower planning challenging. Storage I. All outlets had a cold room besides cooling devices. The average size of the cold rooms was 13.9 m2 (SD: 9.7; n =197). The store managers considered the size of the cold room as satisfactory (95 percent; n = 200). In case of shortage, store managers mainly used an alternative cold room (n = 56). We also asked about the duration of storage of selected dairy products representing fast movers such as fresh, butter and curdled milk, plain yoghurt, whipped and sour cream and curd. The average storage time over all those products was 12.5 hours (SD: 13; n =196). The longest duration time was identified in the small hypermarkets, which was significantly higher than in the other store formats (see Table II). This could be due to the different shopping frequency of the consumers. One typical problem the respondents perceived was the expiry date. Based on these results we can conclude that the storage I process is well dimensioned although we could make out certain indications for over capacities. Certain limitations of these findings refer to the specific time the interviews were conducted, which was in

Store format

M 2

Storage space (m ) Storage time (hours) of selected dairy products (M) Spatial distance: incoming dock – cooling chamber Spatial distance: cooling chamber – shelves Spatial distance: incoming dock – shelves Time for shelf replenishment (h/day) Personnel needed for shelf replenishment (h/day) Disposal (% quantity/day) Disposal (% value/day) Orders per week Time for order processing

11.3

Supermarket SD N

a,b

Big hypermarket M SD

Small hypermarket M SD N a,c

10.3

34

17.6

N

b,c

17.6

19

34

10.2c

12.1

18

5.9

144

17.4

10.9a

11.2

144

20.4a,c

21.8

37.4

142

39.3

107.1

33

20.7

18.5

19

22.9a

37.7

146

50.9a

95.7

35

37.5

50.4

18

33.7a,b

43.7

145

87.9a

32

60.2b

68.3

18

2.7a,b

2.2

146

4.7a

2.5

34

6.4b

4.7

19

4.1a,b

3.7

144

8.8a,c

6.8

34

14.3b,c

10.4

19

1.2 1.3 5.9b

3.6 4.2 0.4

130 118 147

1.5 1 5.8

2.5 2 0.4

31 26 36

0.7 1.1 5.6b

0.9 1.7 1

17 15 19

31.6a,b

16.3

147

31.1

36

46.5

19

48a

178

27

71b

a,b,c

Significant difference between store formats (Mann-Whitney U-test, p , 0.05). M ¼ mean; Notes: SD ¼ standard deviation

June and May. At this time the demand for dairy products might differ to time periods before holidays and/or weekends. It seems that storage capacities are rather dimensioned to peaks in demand. Transport I and II. Here, we measured the specific length of the distances within the stores. The spatial difference between the receiving area and storage I was on average 24.6 metres (SD: 54.8; n =194). The distance between storage I and the cooling shelves (devices) was on average 29.1 metres (SD: 54.3; n =199; see also Table II). This was also due for the direct distance between delivery area and cooling shelves (M: 45 metres; SD: 85.5; n =195). In more than 50 percent of the outlets (55.9 per cent; n =200) we could not identify any problems that might affect internal transportation. In all the other outlets it is the physical structure of the store that could be seen as the main transportation barriers (i.e. steps, doors, floor conditions, etc.). Handling/storage II. This process refers to the break bulk of transportation units to consumer specific units and handling in the shelves. This activity took on average 3.3 hours/day (SD: 2.9; n =199) and ties a lot of man-hours. On average, our respondents indicate 5.9 employee hours for this process (SD: 6.2; n =197). Here, we could also make out some differences between the store types as the number of articles in the dairy

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Table II. Instore logistics key data of observed store formats

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assortment varies. We also asked about the frequency of stock-outs regarding the selected products stated in process “storage I”. The average value over all products was 4.6 meaning that there are almost never out of stock situations from the respondent’s point of view (on a five-point Likert scale where 1 ¼ occurs very frequently; 5 ¼ never occurs). This corresponds also with our findings regarding overcapacities in the stores. Disposal. In terms of disposal of dairy products, we asked for the share of removed articles based on the overdrawn expiration date. The average rate for disposals was calculated with an average of 1.2 percent of all articles (SD: 3.2; n =178). From our selected dairy products, whipped cream (159), plain yoghurt (150) and sour cream (120) were most affected by damages. Looking at the root cause of these damages we identified the aluminium lid of the beaker (n =138) or the beaker itself (n =37), that were the weak points of the products causing disposal or reductions in price. Fresh milk (n =89) and whipped cream (n =79) were the products, which have been disposed most frequently. The reason for that high disposal rate was the comparable short expiry dates and damages. According to these results it can be said that disposal had been an indicator and a result of suboptimal logistics performance including inaccurate sales forecasts or bad delivery quality. Ordering. Store Managers indicated to order products of this category on a daily basis (M: 5.9 times per week). We found out that dairy products in larger hypermarkets were not that frequently ordered, which might be due to larger inventory sizes in such stores. The order process took on average 38.2 minutes (SD: 26.6; n =202) and was shorter in supermarkets than in hypermarkets. The reason for that might have been the breath of assortment (number of articles). In 29 per cent of the cases, store managers did not order as suggested by headquarters, and used those suggestions only in 12.9 per cent of the cases. The results showed that employees only relied on automated re-ordering systems to a certain degree or being unburdened by IT to a minimum. The lack of knowledge regarding the demand and the inaccuracy of virtual and real stock in the stores could be a reason for that. Overall evaluation. We found out that the main problem areas in our case were the following: . lack of knowledge on cost and service levels of day-to-day work such as showing of a carton; . lack of standardized optimization guidelines for all stores; . lack of qualified personnel; constructional defects; and . lack of inappropriate architecture and store design. In addition, we saw that logistics activities disturb consumers’ shopping experience, which all result in out-of-stock-situations due to lacking coordination of order management and replenishment at store/shelve level. Our findings have also demonstrated that modelling the supply chain and operations processes on a retail store level is more complex and important than many researchers and practitioners might believe. Conclusions and managerial consequences We have shown that the fundamental goal of making products available for consumers can be split up into certain sub-logistics processes, which on the one hand follow the

logic of any logistics system, but on the other hand deal with very small units. Our empirical results validated our assumptions and following consequences should be highlighted: . We made out two weak points, which are due to previous steps in the supply chain: deliveries behind time and damaged products. However, both cause negative consequences for managing staff and orders on a store level. . Instore logistics is a service and therefore dependent on trained personnel, especially in a self-service setting. IT can assist but is difficult to replace staff by IT for this process. It will be interesting to see in the future how the RFID-application could help in this area (see, e.g. Metro, 2003a, b). Based on our findings we identified also some dilemmas that occur, when taking a total chain view into account, as some improvements on the store level can lead to problems further up the channel: . The delivery of pre-sorted units could save both parties’ time and costs as merchandise can be delivered in store-specific logically sorted roll cages (¼ roll cage sequencing). However, this can lead to a shift of enormous and costly set up activities to distribution centres. Although roll cage sequencing (e.g. EAN-Austria, 1997) can then improve the receipt activities at the store level because checking and replenishment can be done more efficient as the roll cages can be moved directly to the place where the merchandise is needed, from a DC-perspective this can lead to inefficiencies as full truck load principles and standardized routines can be interrupted. . The replenishment of the shelves sometimes disturbs consumers’ shopping activities. Therefore, inventory can be placed directly behind the shelves, which in the case of dairy products is already done. Another possibility can be seen in replenishing the shelves after regular shopping hours by specific service providers (Bu¨ttgen, 2003). In order to obtain these improvements, retail management is asked to measure the efficiency of their existing instore logistics systems, where our model can be used as a pragmatic tool in order to identify potential problem areas. Limitations of our approach refer to the external validity of our results that has to be considered as limited, as we investigated our research phenomenon in one selected product area in the stores of one (leading) retail company. Due to specific characteristics of observed logistical objects (perishableness, sensitiveness to temperature, pressure, high shelf turnover, etc.) other problems stemming from the high value of products were not being considered, such as shrinkage, theft, fraud, etc. (Van Ossel, 2003). The results of our research can therefore not be drawn to all products of the examined types of stores. The choice of our research approach also showed some weaknesses as the face-to-face interview was partly suitable regarding two issues. We found out that store managers were sometimes assisted by staff, which is mainly involved in instore logistics issues. Also, when asking about out-of-stock-situations we identified some problems that can be avoided by measuring out-of-stock by observations. Although we have to point out that the most critical issue here is still the buying behaviour of the consumers. An alternative, although more expensive, might have been the observation combined with to the interview approach. Observations could also show certain

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specific activities that cannot be tested by interviews. We suggest considering adaptations of our approach in the future. Our approach can also be considered to be on an exploratory level. Future research may include an expansion of our flow model with a more specific investigation of information (automated order processing, IT) and backward flows (recycling, disposal). Another future research area refers to a simulation of different instore logistics processes based on our empirical data. It would be interesting to see how the influence of different parameters such as storage space, delivery times, share of damage goods etc. affects the availability of products. Such simulation can analyse which variables are really responsible for shelf availability of products within the instore logistics system and give managers more insight into this neuralgic business area. Note 1. Not all respondents were capable and/or willing to answer questions in an appropriate way. This is the reason why “n”, i. e. valid answers, vary throughout the presentation of empirical results. References ACNielsen (2004a), Statistical Yearbook 2004, ACNielsen, Oxford, available at: www.acnielsen.at ACNielsen (2004b), “Dairy products definition”, internal presentation, ACNielsen, Oxford. Azuma, X. and Fernie, X. (2001), “Retail marketing strategies and logistical operations at a Japanese grocery supermarket chain – case study of Summit Inc.”, International Journal of Retail & Distribution Management, Vol. 29 No. 6, pp. 282-97. Bourlakis, M. and Bourlakis, C. (2001), “Deliberate and emergent logistics strategies in food retailing: a case study of the Greek multiple food retail sector”, Supply Chain Management: An International Journal, Vol. 6 No. 4, pp. 189-200. Bu¨ttgen (2003), Sie verkaufen, wir sorgen fu¨r le Regale, (You sell, we ensure full shelves), available at: www.teamwork-germany.com/regalservice/index.html Cachon, G. (2001), “Managing a retailer’s space, inventory, and transportation”, Manufacturing & Service Operations Management, Vol. 3 No. 3, pp. 211-99. Cooper, M.C., Lambert, D.M. and Pagh, J.D. (1997), “Supply chain management: more than a new name for logistics”, International Journal of Logistics Management, Vol. 8 No. 1, pp. 1-13. ¨ sterreich I (ECR Handbook Austria), EAN-Austria, EAN-Austria (1997), ECR Handbuch O Vienna. ECRE (2003), “Optimal shelf availibility”, available at: www.ecrnet.org/conference/docs/ Break-outs%2014May2003/Optimal%20Shelf%20Availability/1-Intro%20Rackebrandt %20RBerger.ppt Fearne, A. (1998), “The eution of partnerships in the meat supply chain: insights from the British beef industry”, Supply Chain Management, Vol. 3 No. 4, pp. 214-31. Fernie, J. (1992), “Distribution strategies of European retailers”, European Journal of Marketing, Vol. 26 Nos 8/9, pp. 35-47. Fernie, J. (1999), “Relationships in the supply chain”, in Fernie, J. and Sparks, L. (Eds), Logistics and Retail Management. Insights into Current Practice and Trends from Leading Experts, Kogan Page, London, pp. 23-46. Fernie, J. and Hughes, D. (2000), “Success factors in the fresh produce supply chain: insights from the UK”, British Food Journal, Vol. 102 No. 10, pp. 760-72.

Fernie, J., Pfab, F. and Marchant, C. (2000), “Retail grocery logistics in the UK”, International Journal of Logistics Management, Vol. 11 No. 2, pp. 83-90. Fisher, M. and Raman, A. (2001), “Introduction to focused issue: retail operations management”, Manufacturing & Service Operations Management, Vol. 3 No. 3, pp. 189-90. Handfield, R.B. and Nichols, E.J. (1999), Introduction to Supply Chain Management, Prentice-Hall, Upper Saddle River, NJ. Kopczak, L. (2001), “Designing supply chains for the ‘click-and-mortar’ ecomy”, Supply Chain Management Review, Vol. 5 No. 1, pp. 60-6. Kotzab, H. (2000) in Klaus, P. and Krieger, W. (Eds), “Handelslogistik” (“Retail logistics”), Gabler Lexikon Logistik, Gabler, Wiesbaden, pp. 181-7. Levy, M. and Weitz, B. (2004), Retailing Management, McGraw Hill-Irwin, Boston, MA. Liebmann, H.-P. and Zentes, J. (2001), Handelsmanagement (Retail Management), Vahlen, Munich. Metro Future Store Initiative (Metro) (2003a), Extra Future Store Rheinberg, Technical Components in Detail, Metro Group, Du¨sseldorf. Metro Future Store Initiative (Metro) (2003b), Welcome to the New Reality in Retailing, Metro Group, Du¨sseldorf. OECD (2004), “Stan new database”, available at: www.oecd.org/home/ Pache´, G. (1998), “Retail logistics in France: the coming of vertical disintegration”, International Journal of Logistics Management, Vol. 9 No. 1, pp. 85-93. Pal, J.W. and Byrom, J.W. (2003), “The five Ss of retail operations: a model and tool for improvement”, International Journal of Retail & Distribution Management, Vol. 31 No. 10, pp. 518-28. Raman, A., DeHoratius, N. and Ton, Z. (2001), “Execution: the missing link in retail operations”, California Management Review, Vol. 43 No. 3, pp. 136-52. Schary, P.B. and Skjott-Larsen, T. (1995), Managing the Global Supply Chain, Copenhagen School Press, Copenhagen. Schnedlitz, P. and Teller, C. (1999) in Pfohl, H.C. (Ed.), “Aktuelle Perspektiven der Handelslogistik” (“Recent perspectives in retail logistics”), Logistikforschung. Entwicklungszuge und Gestaltungsansatze (Logistics Research. Developments and Trends), Erich-Schmidt-Verlag, Berlin, pp. 233-252. Sparks, L. (1999), “Logistics and retail management”, in Fernie, J. and Sparks, L. (Eds), Insights into Current Practice and Trends From Leading Experts, Kogan Page, London, pp. 1-22. Theis, H.-J. (1999), Handels-Marketing. Analyse- und Planungskonzepte fu¨r den Einzelhandel (Retail Management. Analysis and Planning Concepts for Retailing), Deutscher Fachverlag, Frankfurt am Main. Toporowski, W. (1996), Logistik im Handel. Optimale Lagerstruktur und Bestellpolitik einer Filialunternehmung (Logistics in Retailing – Optimal Stock and Order Policy of a Retail Chain), Physica, Heidelberg. Van Ossel, G. (2003), “Fraud and shrinkage – facts and figures”, available at: www.realsoftware. be/NR/rdonlyres/esch7qv3of3ygqcki3vuip4ovj5cp7aoog3nufbtu4uxae2bwgdcl4xh7gosz wimm2xlmn3qmtl36b/shrinkagetheftrealsoftwareNLhandout.ppt

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Exploring the gap between attitudes and behaviour Understanding why consumers buy or do not buy organic food Susanne Padel Organic Research Group, Institute of Rural Sciences, University of Wales, Aberystwyth, UK, and

Carolyn Foster Countryside and Community Research Unit, University of Gloucestershire, Cheltenham, UK Abstract Purpose – The purpose of the paper is to explore the values that underlie consumers purchasing decisions of organic food. Design/methodology/approach – The paper draws on data from focus groups and laddering interviews with a total of 181 regular and occasional consumers of organic food that were contrasted with survey results of other studies. Findings – The results show that most consumers associate organic at first with vegetables and fruit and a healthy diet with organic products. Fruit and vegetables are also the first and in many cases only experience with buying organic product. The decision-making process is complex and the importance of motives and barriers may vary between product categories. Research limitations/implications – While further research would be required to facilitate full understanding of the consumer-decision making process with regard to organic produce, this work indicates the complexity of the process and the likelihood of variation between different product categories. Future research should consider tradeoffs that consumers make between values and product as well as consumer segmentation. Originality/value – Prior research concerning the consumer decision-making process with regard to organically produced food is limited. Theses findings have implications for future sector-based communications to consumers and, potentially, for product development and labelling. Keywords Organic foods, Purchasing, Consumer behaviour, United Kingdom Paper type Research paper

Introduction The UK has one of the leading organic markets in Europe and worldwide with an estimated value of £1.2 billion in 2003 or, about half the size of the leading European market for organic food, Germany (SA, 1999; Richter and Padel, 2005). British Food Journal Vol. 107 No. 8, 2005 pp. 606-625 q Emerald Group Publishing Limited 0007-070X DOI 10.1108/00070700510611002

Financial support of the EU for the OMIARD project is gratefully acknowledged. The authors would also like to thank all our project partners in OMIARD that helped develop the methods, and all participants and their colleagues who helped with organising and conducting the field work in various locations, Peter Midmore, Catherine Seymor, Sensory vision in Reading, Hilke Barghaus, Michaela Ba¨hr and Pascal Desmond.

Certified organic land area in the UK has also increased considerably over the last few years, but in 2003 declined for the first time from 724,523 in 2002 to 695,619 ha. This is likely to be a reflection of changes to certification requirements in Scotland – all producers are now required to certify both land and stock, whereas before livestock could be exempt. However, it could also be a reflection of problems that organic producers experienced in the market particularly in relation to milk and meat, where, depending on product type, only 60 to 80 per cent of organic production is sold under organic labels with the remainder going into conventional channels (Hamm and Gronefeld, 2004). Although demand for organic food is still buoyant, there are signs that markets are maturing and growth rates over the last few years have slowed to below 10 per cent (Firth et al., 2004; MINTEL, 2003; Organic Monitor, 2001; Organic Monitor, 2002; Smith and Marsden, 2004; SA, 1999). Smith and Marsden (2004, p. 355-356) have suggested that the slow down might be placing limits on the potential of organic farming to act as a “panacea for the problems of rural economic development”. Like other authors before them who have supported a shift away from purely production-based subsidies (e.g. Hamm and Michelsen, 1996; Hamm and Gronefeld, 2004; Dabbert et al., 2004), they conclude that a lack willingness of policy makers to intervene in the supply chains in the UK has led to peculiar mix of government production support with retailer-led private interest regulation of the rest of the supply chain. They argue that it is necessary to go beyond the trends charted by the statistics and examine in greater detail the evolving construction of limits both in production and consumption. In relation to growth potential of consumer demand and its limits, many surveys have identified and ranked motivations for buying organic food and have generally painted a positive picture of robust demand, confirming the growth witnessed in the value of the retail market throughout the 1990s and into the twenty-first century (e.g. MINTEL, 2000; SA, 1999). However, the observable slow down in market growth may indicate a discrepancy between an evident willingness to buy, captured by these surveys, and actual purchasing behaviour (Makatouni, 2002). Zanoli et al. (2004) also talk about differences between the perceived organic consumer and the actual organic consumer. On this basis, it is necessary to be cautious of the very positive conclusions that some studies reach. Drawing on the results of in-depth research on consumer attitudes to and perceptions of and organic food, this paper explores the values that underlie consumers purchasing decisions. The first section includes an overview of recent surveys and other literature on organic food and the consumer, followed by an introduction to the method and results of our empirical research with consumers in England and Wales using focus groups (96 participants) and laddering interviews (85 responses). In the discussion section we explore links and discrepancies between attitudes and behaviour and suggest strategies to understand better the consumption of organic food.

Organic food and the consumer The retail market has grown from an estimated £605 million in 1999 to £1.1 billion in April 2004 (SA, 1999). The development of the organic sector in the UK has been largely driven by three factors:

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(1) growing interest of consumers; (2) retailers, especially the multiples, which have had a key role in furthering growth, promoting products, increasing range and aiding farmers to convert; and (3) conversion support available to producers (Michelsen et al., 2001). Growing consumer demand has been attributed to a response to various food-scares including widespread concern and resistance to the introduction of genetically modified organisms in the food chain (MINTEL, 1999; SA, 1999; Farodoye, 1999; Michelsen et al., 2001). Leading UK market intelligence companies have regularly surveyed purchasing of and shoppers’ attitudes to organic food in the UK using nationally representative samples (e.g. Datamonitor, 2002; MINTEL, 2003; MORI, 1996; TNS, 2004). The surveys have covered a number of issues, such as socio-demographic aspects and shopper typology, frequency, availability and place of purchase, motivations and perceptions, barriers, and information about organic labels (summarised in the following section) supplemented by panel data in relation to actual purchasing behaviour of consumers in relation to organic food (TNS, 2004; SA, 1999).

Who is the organic shopper? A MORI poll in 1999 found that one third of the public buy organic food (SA, 1999). In an NOP poll in August 2004 this had increased to 77 per cent of all households buying some organic products (SA, 1999). On the basis of a TNS survey, the Soil Association (SA, 1999) provided a detailed breakdown of organic shoppers into eight categories, according to frequency of purchase and the number of product categories bought. “Frequent” organic shoppers were generally older, more affluent and had fewer children than the average UK shopper. Two-thirds of frequent organic shoppers belonged to socio-economic groups A, B, C1), compared to under 50 per cent in the population. However, people who are among the highest spenders on organic food were on average more affluent and younger. In contrast, the MINTEL (2000) survey found youngest and oldest age groups least concerned with organic, reflecting a lower emphasis on health and diet. Organic purchasing grows as consumers reach their 30s and have no children. More affluent families and those with children that have left home have more disposable income to buy organic food. However, it was concluded that with improved supply, the profile could spread down the socio-economic scale. Based on a NOP World survey of a representative sample of 1,057 adults, the SA, 1999, 2000, 2001, 2002, 2003, 2004 claimed that the appeal of organic food is broadening to include a wider spread of social groups. MINTEL (2003) claims that organic meat and fruit have become more popular and differentiates between consumers of organic vegetables and other categories. The most common purchasers of organic vegetables are 45-54 year olds, whereas the youngest age group is the least likely of all demographic groups to purchase organic vegetables.

How much do they spend? Data from TNS panels (published in SA (1999, 2000, 2001, 2002, 2003, 2004) show that despite slowing growth the frequency of purchase and average spend of organic consumers has continued to increase in the last two years. In the year ending June 2004, the average organic consumer bought organic food 13.6 times per year, compared with 12.8 times per year in 2002 and the average spend per household increased to £59.39, compared with £32.44 in 2002. However, 84 per cent of all organic purchases are made by only 25 per cent of all customers buying organic food, i.e. the market depends on a small number of committed organic shoppers (TNS, 2004). Several surveys found a pronounced North/South divide in the organic sector with demand steadily diminishing northwards (e.g. MINTEL, 2000) For example, spending of “heavy” organic shoppers was found to be skewed towards the South East and London (TNS, 2004). Most organic food in the UK continues to be bought in supermarkets, although direct sales of organic food have seen higher than average growth in the last two years (16.2 per cent compared with 10 per cent on average). Despite slower than average growth in the last two years, multiple retailers remain, with a share of 80 per cent of all sales, the most important outlets for organic food in the UK. The stores most active in marketing organic foods and stocking the widest range are concentrated in southern England, and availability of organic produce tends to be less in other regions.

The gap between attitudes and behaviour 609

Attitudes and motives to buy organic According to MINTEL (2000), the term “organic” and organic labels have strong emotional resonance with consumers in terms of personal wellbeing and health and in the wider context of benefits to the environment. In various surveys, personal health remains a strong motivating factor for the purchase of organic food (e.g. Datamonitor, 2002). Over the years, the Soil Association has published several surveys of consumers’ reasons for buying organic food, which are contrasted in Table I. Slight changes in the wording of the attitude statements make a direct comparison between the surveys difficult but illustrate an overall increase in agreement with various statements about organic food. The main driving force behind expected health benefits could be the absence of residues, but altruistic motives (such as concerns for the environment and animal welfare) are becoming more important. A recent survey by MINTEL (2003) suggested that concerns about food safety remain important for consumers, but that in the absence of major food scares in the last two years these drivers have arguably been less important; this could in part explain the slow down of growth in the organic retail

No chemicals/additives/pesticides Better for the environment/better for wildlife Personal health/it is better for me/my family Tastes better GM free Higher animal welfare Sources: SA (1999, 2003, 2004)

1999 MORI (%)

2002 TNS (%)

2004 NOP1: 1 (%)

59 28 53 43 30 24

68 59 49 34 N/a 50

78 78 66 48 74 N/A

Table I. Development of consumer motives for organic food in the UK

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market. MINTEL (2003) see animal welfare and environmental concerns remaining important as secondary drivers of the market. McEachern and Willock (2004) identify four key factors in consumer attitudes to organic meat in an analysis of postal questionnaires: meat safety, animal welfare, quality assurance and media topics – but highlight that this cannot be generalised in relation to other product categories. The 2002 TNS survey provides some indication that motives change as purchasing frequency increases, with heavy shoppers taking on board a greater number of issues. Motives can also vary depending on what category of product is purchased (TNS, 2004). In addition to the structured survey data presented above, consumer attitudes to organic food have also been explored in a small number of qualitative studies, mainly outside the UK (e.g. Nielsen et al., 1998; Torjusen et al., 2001). Similar to the quantitative surveys, reasons for buying organic food revolve around the issues of health and environmentally sensitive production methods and are generally contingent on convenience, availability and cost. “Naturalness” of the product also emerges as a factor, but is interpreted in a variety of ways, e.g. animal welfare and non-use of agrochemicals (Lockie et al., 2002; McEachern and Willock, 2004). In studies carried out in Greece, for example, health is not the overriding motive that it is in the UK and other northern European countries, and issues of food quality and “eating to enjoy” (derived from the organoleptic qualities of organic food) emerge as important driving forces in both Greece and Italy (Fotopoulos et al., 2003; Zanoli and Naspetti, 2002). Barriers Price continues to be cited as the main reason for not buying organic food, despite a slight shift in this trend recently (MINTEL, 1999, 2000; SA, 1999, 2003). Multiple retailers have experimented with initiatives to discount prices, but no scientific studies into the effect of such promotions could be identified. Other barriers include lack of information, poor presentation (e.g. the amount of packaging used; uninviting displays in the shops) and availability (Makatouni, 2000; MINTEL, 2000). In 1999, 26 per cent of consumers in Wales did not know where to find an organic product and a further 35 per cent found it difficult. Analysing the data in relation to purchasing frequency, the study concluded that lack of availability was one reason preventing people from buying organic food in more marginal regions of the UK. MINTEL (2003) refer to improved accessibility of organic products since the multiple retailers have greatly increased the range of products they stock, but the research does not differentiate between different regions of the UK. Knowledge and information TNS asked 4,000 households in 2002 how they would identify an organic product. A total of 52 per cent claimed that they look for the word “organic” on the label (SA, 1999, 2000, 2001, 2002, 2003, 2004). This supports the conclusion of MINTEL (2000) that the best-known brand in the UK is probably the word “organic” itself rather than specific certification labels. UK consumers, unlike their continental counterparts, do not look for and are not familiar with the various organic labels and compared with other European countries relatively few organic brands exist in the UK (MINTEL, 2000). However, about one-third of respondents of the 2002 TNS survey did not know how to correctly identify an organic product: 21 per cent “didn’t know” and 11 per cent would

look for the word “natural”. This casts doubts on the results in terms of frequency of purchase based on self-classification by consumers. In addition, according to focus group research, both buyers and non-buyers would like to be better informed and would appreciate more supplementary information about the organic certification process when they make a purchase (Makatouni, 2002).

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In summary Many attempts have been made to develop a typography of organic shoppers, and key reasons for buying or not buying organic food are well documented. Regular consumers tend to be educated, affluent and of higher social class, but age profiles vary slightly between different studies. They buy organic products because they perceive them to contain no pesticide residues and to be better for their own health. Of continuing importance to them are ethically-based motives relating to the environment and animal welfare. However, this largely positive attitude stands in stark contrast to the size of the organic food market which accounts for only 1.2 per cent of the food retail market in the UK (SA, 1999). Few attempts have been made to explore whether the motives and barriers identified apply equally to product categories that have only recently become more widely available, such as organic meat. Research exploring underlying values and other factors influencing purchasing intentions such as availability and convenience remains limited. Some authors refer to the complexity of the decision-making process of consumers and it will be influenced and determined by their attitudes, preferences and socio-demographic or socio-economic profile; they will make trade-offs accordingly. Those who consume organic food on a regular basis face the same “barriers” of price, convenience etc. as others, but more often opt in favour of organics as opposed to their non- or occasionalbuying counterparts (Torjusen et al., 2001; Lockie et al., 2002). This is confirmed by one qualitative study of parents’ attitudes to organic food in the UK which found no difference in general perceptions between regular and non-buyers in relation to product quality (no chemicals), production method (natural, home grown) and product value (safety and health). The non-buyers were more sceptical regarding some claims made for organic food (e.g. health benefits, superior taste) and consider themselves to be less able to afford it, whereas the families that bought organic food had at least one child suffering from asthma or food allergies and considered themselves to be better off (Makatouni, 2002). This raises the question of whether the major barrier “price” is related to scepticism surrounding justification for a premium among non-buyers, who are uncertain or doubtful about various claims made for organic food. This paper seeks to explore in greater depth the underlying values of the purchasing decision and the circumstances in which decisions are taken. It focuses on whether positive perceptions and opinions of organic food can be turned into purchasing reality and considers how a larger body of non-buyers could be reached.

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Empirical research approach The paper draws on focus groups and laddering interviews with UK consumers that were carried out as part of a wider study of consumer behaviour in Europe covering eight countries: Austria, Denmark, Finland, France, Italy, Switzerland and the UK[1]. A summary of the EU-wide data relating to consumers was published by Zanoli et al. (2004).

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Focus groups Focus groups are a qualitative method, giving importance to each individual voice, encouraging dialogue in the group and listening to individual concerns (Saumure, 2001), but not aiming to obtain data on representativeness of a particular position. In carefully prepared discussions (90 to 120 minutes) with six to 15 participants the researchers aim to learn about the perceptions, feelings, attitudes, values and ideas of the participants in a defined area of interest (Calder, 1977, cited in Kahan, 2001; Zanoli et al., 2004). Historically, focus groups can be traced back to Merton in the 1930s, who worked with non-directive group interview techniques and soon found that people were most revealing when they found themselves in a safe, comfortable place with individuals like themselves (Saumure, 2001). Focus groups represent one of the most widely used techniques in market research. Since the mid 1980s they have become re-accepted as a valuable method in academic research, including the area of policy research (Saumure, 2001; Kahan, 2001). In this study, focus groups were used to explore the perceptions of organic consumers, their level of knowledge concerning organic and similar “competing” products and to identify the most effective way to communicate with target groups about organic products and organic market initiatives (Zanoli et al., 2004). The 12 focus groups were conducted in two blocks in August and November 2002 in Aberystwyth (four groups), Reading (two groups) and Lancaster (six groups) (see Table II). In total, 96 participants were interviewed, about half of whom classified themselves as regular consumers of organic food. Participants were recruited to reflect a range of characteristics: just over half were female, a third in full-time employment; a relatively high proportion had an academic education. Participants were recruited through local contacts and were given an incentive to take part. Some participants in the Lancaster region had a higher than expected level of environmental awareness, which may be a reflection of the recruitment which was carried out in association with a particular Organic Marketing Initiative. The groups were moderated by one of the authors and another researcher from the University of Wales, Aberystwyth. All discussions groups were recorded and fully transcribed and each statement attributed to the individual person so that it could be related to the participant’s gender and frequency of purchase. The results were analysed with the help of computer software for the analysis of unstructured data. Laddering interviews The in-depth interview technique of laddering is frequently used in market research and has been employed in several studies to explore the consumption of organic food (e.g.

Table II. Composition of focus groups

Location

Children , 14 Full-time Regular employed years organic Female (%) (%) (%) (%) No.

Aberystwyth Reading Lancaster Total

28 18 50 96

86 50 42 56

46 56 62 56

29 39 20 26

21 56 26 30

Age (years) Academic education 18-35 36-64 , 55 (%) (%) (%) (%) 64 61 76 70

36 28 32 32

46 39 48 46

18 33 20 22

Fotopoulos et al., 2003; Makatouni, 2002; Zanoli and Naspetti, 2002). This method aims to uncover cognitive structures of consumers, explore the underlying values of purchasing choices, and to follow through the decision-making process by eliciting product attributes or characteristics and encouraging the respondent to reflect on why these are important to them. The basis of the laddering technique is the means-end-chain model (MEC), linking the consumer’s knowledge about product attributes with consequences and values in a hierarchical way in the form of a ladder. The structures of the chain are divided into three basic levels: attributes ! consequences ! values, whereby attributes can be concrete or abstract, consequences are functional or psycho-social and values are instrumental or terminal (see Figure 1)). It has been suggested that the model can be understood in terms of a problem solving process. The consumers select a course of action according to their association of products with particular attributes as a means to reach an objective or end. In other words, “product attributes (e.g. in the case of organic food, “produced without artificial chemicals”) are a means whereby consumers to obtain desired ends (e.g. “personal health”) (Gutman, 1982).

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Figure 1. Example of a means-end chain

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The present study adopted a laddering approach to shed light on core motivating values underlying purchase decisions of organic food (for further details see Zanoli, 2004). By exploring the cognitive structures, the discrepancy between positive attitudes towards organic food and actual purchasing behaviour can be better understood (Makatouni, 2002). In all, 85 laddering interviews were undertaken in the following locations, about 80 per cent of which were recruited in predominantly urban areas: . Aberystwyth in Wales (rural area); . Chorley in Lancashire (market town in a post industrial area); . Norwich (provincial city); and . London (major metropolis). Interviewees were chosen according to frequency of purchase (50 per cent regular buyers and 50 per cent occasional or non-buyers); area (70 per cent urban and 30 per cent rural); main place of purchase (supermarkets, direct marketing, speciality shops); and interview time (80 per cent weekdays and 20 per cent at weekends) to ensure that a variety of consumer types were represented. They were recruited through a number of routes: at random, either customers in specialist health food shops and supermarkets or passers-by in the street; and via a mail shot included in weekly boxes provided by a direct organic vegetable box scheme. The period of surveying was between January and August 2002. It was easier to recruit regular rather than occasional purchasers of organic food, and the sample is therefore biased towards them. However, results were analysed for the range of values expressed rather than their distribution in the sample-making representativeness, less important. Motives and barriers were investigated in relation to four product categories: dairy products, fruit and vegetables, cereal products and meat. The category meat elicited a poor response and yielded insufficient data and is therefore not included in this analysis. As it was the last product to be discussed, we attribute this to interview fatigue. Other areas explored in the interviews were preferred point of purchase, understanding of certification and labelling and how the consumer relates to these issues, and finally “usage situations” i.e. in what circumstance the consumer is most likely to buy organic products. Results In the following section, the results of the focus groups and laddering interviews have been combined to reveal insights into consumer attitudes to organic food, highlighting different aspects that might or might not influence their decision to buy. Where possible, the responses of regular consumers (RC) and occasional consumers (OC), are contrasted with one another. Initial associations with the term organic All focus group participants were asked for their first association with the term organic. Participants in all six groups in Lancaster clearly associated “organic” with fresh fruit and vegetables and tended not to mention other products (meat, dairy etc.). The association of organic vegetables with soil was largely seen as positive, the proof of a genuine, wholesome and healthy product that has an “earthy feel” to it (“dirty but

pure”). Groups in Aberystwyth and Reading hardly made any spontaneous reference to product categories, but during the later discussion it became clear that they shared the strong association of organic with fresh produce. RCs mostly mentioned abstract product related aspects that are known from other studies as first associations, such as “healthy products”, “less contaminated”, “no chemicals/pesticides”, “good taste” and “price”, but also “friendly service” and “unpackaged”. There seemed to be a shared understanding also supported by many OCs that “real” organic products are those that are home-grown. One-third of the spontaneous associations of RCs with organics had a negative touch, in particular in relation to the high price (“expensive” but also “e´litist”) and to product appearance (“a better taste, but not terribly attractive” (RC, female ). In the OCs responses such negative statements clearly outnumbered the positive ones. Some stated that they are too expensive without further elaboration; others refer to uncertainty about the reliability of information received on the topic. RCs appeared more reflective on price issues; price has to be seen in context of the shopping situation and individual price perceptions. The most significant result across all the product categories discussed in the laddering interviews was the proportion of respondents associating organic food with non-use of pesticides (seen by most interviewees as the “definition” of organic). This led to a secondary association of organic foods with “natural production” leading to the end value of “personal health” followed by “protection of the environment”. In the case of fruit and vegetables only, the ladder, “tastes good ! eating to enjoy” emerged. The respondents were more articulate and engaged when discussing fruit and vegetables than any other product category which is reflected in the more complex hierarchical maps that have emerged and the strong association of organic food with horticultural products (see Figures 2 and 3). This confirms the strong first association of organic with vegetables and fruit observed in some focus groups. Why consumers buy organic food The focus group discussion guide did not contain direct questions about why participants buy organic food, but they were recorded when they came up in the discussion. Some RCs seem to take for granted that everybody is clear about the reasons for buying organic, and hence did not discuss them further. The main motives that were mentioned in the focus groups are health consciousness, the assumed higher health value, as well as social aspects like support of local farming, fair trade and – further down the scale – environmental protection. In relation to health, two different reasons for buying organic could be distinguished; personal illness and food allergies (“my husband was diagnosed with cancer” (RC, female) and the desire to reduce the exposure to residues in a more preventive way. Particularly in the latter category, respondents admitted that they might well ignore this reason under certain circumstances. Taste was important to some and participants suggested that the organic sector should offer more taste promotions in store. Participants in the Lancaster groups also referred frequently to political motives underpinning their purchases, such as supporting the local economy and fair trade. The laddering results revealed two major chains of association that influence consumers’ decision-making: health and concern for the environment, both of which

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Figure 2. Cognitive structure of motivations for buying organic fruit and vegetables

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Figure 3. Cognitive structure of motivations for buying organic dairy products

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respondents relate directly to production methods (see Figures 2 and 3). By far the strongest reason for buying organic food was health. Interestingly, it was mostly individual health, rather than family health that was the main focus, even for parents with young children, although “buying healthy food for the sake of the children” was frequently echoed when discussing usage situations. The strongest links in the main ladders involve personal health, well-being and quality of life, which can be traced back to the intrinsic qualities of organic food, including “naturalness” in production, specifically the perceived absence of agrochemical use, health-giving properties and a sign of a positional good. The other major chain leads from the absence of agrochemicals through to a reduced impact of farming on the environment to a better environment overall. Secondary reasons for buying organic food were animal welfare (dairy products), taste (fruit and vegetables, and cereal products) and local/regional products (fruit and vegetables and, to a lesser extent, dairy products). Environmental consciousness is relatively well developed in some sections of the population in the UK, and the character of the sample may have led to rather more emphasis being placed on this. The same is true of animal welfare, which has a longstanding profile in the UK. A minority of respondents associated organic dairy products and fruit and vegetables with local production stating that they like to buy organic because it supports the local economy and makes them “feel good”. This chain does not appear in the ladder maps for cereal products. As regards organic fruit and vegetables in particular, there was a strong association between heavy agro-chemical use and vegetable production and consequently, reducing exposure to chemicals in their diet was one of the major attributes that consumers claimed to consider when buying organic vegetables. This then taps into the desire to maximise personal health and wellbeing. A segmentation of the laddering results revealed that households without children made clear connections to organic fruit and vegetables as a source of “enjoyment”, “good health” and “environmentally sensitive production”, whereas those with children displayed a set of interconnected values which related mostly to the health factor, indicating that more thought and effort has to be expended to tempt children into eating “healthy” vegetables. Male interviewees produced a less complex map than female, suggesting that the latter have a subtler attitude to the more extensive issues involved. Young working women and middle-aged women are among the core buyers of organic food, they are perhaps better informed and have reflected in greater depth on the issues involved. These findings reflect a fairly standard gender division of household labour, with women having more involvement in the preparation of food and family care. However, men in the UK are becoming increasingly health conscious, which emerges in the ladder-maps as a strong motivator for buying organic food. The results confirm that consumer motivations for buying organic products vary. Health was a main reason, but also more altruistic reasons entered the discussion (e.g. “better for the environment”), especially among the more regular consumers. The results clearly illustrate that different motives and reasoning applies to different product categories. The issue of lower residues is particularly important for fruits and vegetables (where you eat the skin), but also for dairy (less drugs in animal production), leading to values of personal health considerations as well as respect for nature and the environment. For organic meat and dairy production the political value of animal welfare appears, but also the localness of the food production. The issue of

fair trade may be more important for politically motivated organic buyers of coffee or bananas, but these consumers displayed a level of confusion as to whether organic products are always fair trade.

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Important barriers Discussion of barriers to buying organic food revolved around the issue of price, but also covered price perception, access and availability, visual product quality and presentation, mistrust of organic food in supermarkets, eating habits and lack of cooking skills. Looking at different types of respondents a more differentiated picture emerges. In the focus groups, the RCs in particular seemed to be more reflective on price issues. While they agreed that organic products are more expensive, they highlighted variation in premiums between different organic product categories and the places of purchase, a link with the disposable income of the household and with other food choices, such as the proportion of convenience food that is purchased. They make clear reference to value for money comparisons:

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The main important thing is quality if people can see what they are paying for and can taste the difference . . . and as with any other product they will be willing to pay slightly more for that (OC, female).

When the moderator used an indirect projective technique to elicit purchase barriers, RCs mostly reflected on habit and convenience aspects as well as lack of information about the potential benefits rather than on high price premiums. RCs also criticised a lack of choice of organic product lines and stressed that they do not want to have to make too much of an effort to buy organics. In suggesting price reductions as a supportive tool for the development of the organic market, they acknowledged the price barrier, but saw it as more important for other less frequent consumers than for themselves. Also among RCs, mistrust persisted as to whether something labelled organic actually is organic (see below). In contrast, OCs mostly see a low food budget as the main barrier for buying organic products, but this was related to the levels of awareness about healthy eating and health issues; because they do not really know what organic means and what guarantees and personal benefits a consumer can expect from an organic product, they find it difficult to justify paying a high premium. On the question of availability, OCs simply declare that what they can get organically depends on what is stocked where they shop regularly. They also mention a mismatch with a certain culture as a potential barrier: I can think of certain areas where I have lived in the past where [the] culture would just not be – people would just not be into having lots of fresh fruit and vegetables and stuff, but its not a definite anti-organic thing (OC, male).

The laddering interviewees almost invariably mentioned price as a characteristic, and further probing was unsatisfactory, leading to restricted income and the need to provide household provisions from a limited budget. This more evident the less affluent the interviewee, but only slightly so.

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The role of the point of sale Responses to questions concerning retail outlets in both focus groups and laddering interviews suggest a strongly segmented population of consumers, with different retail channels being associated with different and unrelated chains. Using projective techniques in the focus groups, RCs emphasized that convenience is an important factor that has to be considered when developing new outlets for organic products. Supermarkets appeared to have a negative connotation for some as regards the emphasis placed on cosmetic presentation and in relation to food miles. OCs primarily commented on the financial control of supermarkets: “they make the products more expensive but do not pay enough to farmers”. Some focus group participants, particularly in the Lancaster groups, expressed a preference for buying organic produce from markets and specialist shops. Some went so far as stating that they would never buy organic produce in multiples (“If my option is to buy organic from the supermarket, I have no faith in it– so I just go in and buy the regular stuff” (OC, female). However, others preferred shopping in supermarkets because of the convenience of being able to do all shopping in one place. Although the supermarkets are cited as the main point of purchase for most respondents in the laddering interviews, some were ambivalent about them as a point of sale for organic products; a number of people expressed reservations about shopping there but admitted to doing so for the sake of convenience. There are no links through chains to terminal values suggesting that the convenience and range offered by supermarkets is relatively low down the Maslow hierarchy of needs. When asked about the least preferred place to buy organic food, only supermarkets were mentioned. These respondents expressed a lack of trust in supermarkets and also a concern about the incompatibility of marketing organic food through these outlets: “they do not support organic farming”. Specialist organic shops, on the other hand, were associated with knowledge, personal relationships and trust, while local retail outlets were strongly associated with the “feel good” factor. When contrasting the results of regular with occasional buyers of organic products, there was evidence that regular consumers are willing to trade-off their values against the convenience and choice offered by supermarkets. Differences between rural and urban interviewees reveal a stronger inclination to buy through local or direct marketing outlets. This could simply be attributed to ease of access to such outlets in rural areas or greater affinity with food production issues. The greater ease with which urban interviewees use supermarkets may reflect the fact that in larger towns and cities the supermarket offers a more pleasant overall environment, and improved range and quality of products; supermarket strategies for smaller stores in small towns and rural areas are to carry a restricted range in a smaller space. Contrasting the results of employed and not working groups with the medium income and low-income groups, we initially felt that there may be significant overlap between these although having rechecked the data it seems this is not necessarily the case. However, we find that the stereotype that less well-off consumers want cheap food is contradicted by the map. The ladder of avoiding anxiety by being able to trust is not as important as for the medium-high income group. Trust builders: certification and labelling Both focus groups and laddering interviews provided evidence of a relatively low level understanding of the organic inspection and certification systems and the legal

protection of the term organic on food products. “Is organic an actual definable term or is it just another bendable thing” (male). This was reinforced by widespread confusion about labelling issues. The association of truly organic with home grown in the focus group could also relate to the issue of trust. Consumers feel they can only trust the quality claims if the product is almost passed over the garden fence. The high number of unprompted negative statements that OCs made could also be connected to issues of trust as well as insecurity about information received on the topic of organics in relation to GM and labelling; mistrust among RCs was already mentioned (“It is a label you can put on something and charge extra for” (male)). They demand more reassurance about truly organic quality, and suggested for this direct contact to producers, more widely available information, stricter controls (more than twice a year and unannounced inspections of farms), and rigorous enforcement of the rules to counteract fraud. Distrust is especially strong in relation to imported organic products, combined with insecurity about the equivalence of organic standards elsewhere. Most RCs seem to have greater trust in small companies working along their self-set philosophies, but for a few participants, even these businesses were not exempt from their feelings of distrust. It proved difficult to draw out opinions around the issues of labelling and certification in the laddering interviews. Few spontaneous associations arose requiring vigorous probing and eliciting answers, which in some cases seemed forced. Most respondents were uncertain about these issues and were evidently unfamiliar with or confused by labelling. Answers revolved around the need to be able to trust both the product and any organisation responsible for validating that product. Independent organisations, with clearly defined and explained standards and information about them, were felt to be more trustworthy than a state controlled certification system. Also mentioned was the need for a “unique” or “clearly identifiable” symbol in order to simplify shopping/choosing. Discussion and conclusions The findings in this qualitative study illustrate some patterns and themes that appear to be in consumers’ minds when considering whether or not to buy organic food. They show a need to differentiate reasons and barriers according to product categories and provide some insights into trade-offs that consumers make between competing and conflicting values and needs. Organic vegetables are one of the earliest recognised and the most widely available organic products and in some focus groups are the main product category that consumers associate with organic. At the same time, some respondents make reference to the health benefits of eating five portions of fruit and vegetables a day, highlighting the generally strong association between fruit and vegetables and a healthy diet. Coupled with the perception that horticultural production is characterised by high intensity and heavy use of agrochemicals, it is unsurprising that fruit and vegetables have been a major focus of attention concerning organic food and the available range continuous to grow. For many consumers these are the sole or major focus of their “organic experience” and they have indeed been described as a “key entry point” for most organic shoppers, who subsequently might move on to other categories, such as eggs and dairy, grocery products, meat and soft drinks (SA, 1999, 2000, 2001, 2002,

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2003, 2004). Their importance is reflected in a higher than average share of organic sales in the vegetable sector (3 per cent compared 1.05 per cent organic share of total retail sales (Firth et al., 2004)). However, in the UK organic market, fruit and vegetables are among those product categories that are characterised by high dependency on imports (76 per cent compared to the average of 56 per cent imports across all product categories; (SA, 1999), indicating a clear mismatch between the importance of horticulture in UK organic production compared with consumer expectations. Our results confirm that health is an important but not the only motive for buying organic food. In relation to health both personal experience with ill health and more general concern about healthy eating and health promotion could be observed. The former is likely to be stable irrespective of external determinants, whereas the latter is more likely to be affected by overall trends in consumption. Most consumers express more than one motive for buying organic and our results confirm the presence of “food as enjoyment” and also more altruistic concerns; concern for the environment and animal welfare and more “political” motives such as support for the local economy and “fair trade” are other drivers. There is indication that the importance of drivers may vary for different product categories. Consumers are ambivalent about point of sale. This may reflect the increasingly successful profile of multiple retailers in the UK, which, in the last few years, have committed themselves to an extensive organic range. Supermarkets are clearly by far the most dominant place of purchase for organic food and may now be crowding out small organic shops in a manner similar to other independent small retailers, although direct sales of organic products have increased over the last two years (SA, 1999). Trust emerges as an important factor in deciding where to buy organic food and our results suggest that consumers have less trust in supermarkets and large corporations. The higher trust of specialist organic or local shops over supermarkets may be a reflection of wider anxieties about the food system. Interestingly, none of those who express a preference for shopping at supermarkets reach the “value level” in the ladder maps. This is true regardless of income, gender, frequency of purchase, rural/urban, etc. and suggests that supermarkets, as a point of sale, serve a purely functional purpose and unlike local, specialist shops, do not tap into or fulfil any deep desires or aspirations. Regular consumers of organic food, whose choices tend to be more value laden, are willing to enter into a process of negotiation with themselves and, according to circumstance, sacrifice these values to the convenience of the one-stop shop. However, in everyday life the convenience of shopping in a supermarket often wins out. Although data on regional variations exist in relation to frequency of purchase and availability, few studies investigate consumer attitudes and awareness in the different regions, and how these may influence buying behaviour. With increasing amounts of organic food being sold and bought through direct sales, it would be interesting to explore the competing consumer discourses of local and organic food and how, if at all, this could impact on the production and consumption patterns for organic food at a local level. Our findings confirm the significance of price as a barrier. Other consumer research suggests that, as supermarkets compete to reduce prices for organic products, the overall importance of price as a barrier is decreasing (Reuters, 2002). However, a marketing structure that inherently leads to an erosion of the organic price premium

may dilute the incentives for farmers to convert or stay in organic production in the UK and risk jeopardising the potential of the market to take proper care of environmental and ethical demands, thereby undermining the uniqueness of the product and one of its key selling points. Our research further indicates that price is not an absolute barrier but only one factor in the complex decision-making process that underlies purchasing decisions. Consumers consider price in the context of disposable income, but also “value for money” and need to feel in a position to justify a premium through other gains to be willing to pay a higher price for organic products. Consumers are faced with an almost bewildering array of choices and decisions when buying organic food. Lockie et al. (2002, p. 37) refer to competing and conflicting discourses that revolve around consumer motivations (environment, health, food production, nutrition, etc.) as well as competing desires, needs and preferences. Add to this mix the vast array of products (organic and non-organic) that are available today with their competing and sometimes conflicting marketing messages and associations of relative “value” targeted across all segments of society then it is not surprising that the consumer is confused. In relation to organic products our research indicates that there is a lack of knowledge about certification and labelling and about the guarantee that organic standards really offer to consumers. By implication, many of these consumers will lack confidence when it comes to claims made about organic food that ultimately will prevent them from buying it. An observable link between organic consumption and education could indicate that only those consumers who have attained a certain level of education have the confidence to negotiate conflicting claims and counterclaims in relation to organic food (Lockie, 2002). Beyond the two poles of the converted (regular consumers) and the sceptical non-consumers who would never consider buying organic, there is a large body of consumers who buy organic food on a more occasional basis, but lack the knowledge, financial resources, conviction, or simply the inclination to buy more regularly. It appears that so far, attempts to communicate the need for premiums as a result of higher production costs have not reached these occasional consumers. If the industry wants to attract new consumers then they need to pay attention to the body of occasional buyers and communicate clearly the benefits of different categories of organic food to a wider audience. Conclusions Qualitative studies of this kind can provide important insight into the way consumers are willing to enter into trade-off between values when they make an actual purchasing decisions. Fruit and vegetables, generally associated with a more healthy diet, are the first and in many cases the only experience of consumers with organic food. This stands in contrast to the low level of UK-grown organic fruit and vegetables. Price remains a barrier for many consumers, but it is possible that its significance could be diminished, were consumers to be made more aware of the reasons for the higher price and convinced that organic food is a value for money choice despite the premium. The importance of motives and barriers appears to vary between different product categories and future research should focus on product segmentation.

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The complexity of consumer decision making is illustrated by their ambivalence in relation to points of sale and our results suggest that consumers opt often but not always for convenience rather than the more value laden choices which they are confronted with when shopping in smaller shops or farmers’ markets, for example. Further research could explore other value trade-offs that consumers make, for example between the potentially conflicting values of local and organic food.

624 Note 1. OMIARD– Organic Marketing Initiatives and Rural Development (www.irs.aber.acuk/ omiard). References Dabbert, S., Haering, A.M. and Zanoli, R. (2004), Organic Farming: Policies and prospects, Zed Books, London. Datamonitor (2002), The Outlook for Organic Food and Drink, Datamonitor Europe, London. Farodoye, L. (1999), “Focus on organic food”, Meat Demand Trends, Vol. 3, pp. 3-10. Firth, C., Geen, N., Foster, C., Green, M., Haward, R. and Smithson, A. (2004), The UK Organic Vegetable Market (2002-2003), HDRA, Coventry. Fotopoulos, C., Krystallis, A. and Ness, M. (2003), “Wine produced by organics grapes in Greece: using means-ends chains analysis to reveal organic buyers’ purchasing motives in comparison to non-buyers”, Food Quality and Preference, Vol. 14, pp. 549-66. Gutman, J.A. (1982), “A means-end chain model based on consumer categorization processes”, Journal of Marketing, Vol. 46 No. 2, pp. 60-72. Hamm, U. and Gronefeld, F. (2004), “The European market for organic food: revised and updated analysis”, School of Business and Management, University of Wales, Aberystwyth. Hamm, U. and Michelsen, J. (1996), “Organic agriculture in a market economy: perspectives from Germany and Denmark”, in Oestergaard, T.V. (Ed.), Fundamentals of Organic Farming, Vol. 5, IFOAM, Tholey Theley. Kahan, J.P. (2001), “Focus groups as a tool for policy analysis”, Analyses of Social Issues and Public Policy, Vol. 1 No. 1, pp. 129-46. Lockie, S., Lyons, K., Lawrence, G. and Mummery, K. (2002), “Eating ‘green’ motivations behind organic food consumption in Australia”, Sociologia Ruralis, Vol. 42 No. 1, pp. 23-40. McEachern, M.G. and Willock, J. (2004), “Producers and consumers of organic meat: a focus on attitudes and motivations”, British Food Journal, Vol. 106 No. 7, pp. 534-52. Makatouni, A. (2002), “What motivates consumers to buy organic food in the UK? Results from a qualitative study”, British Food Journal, Vol. 104 Nos 3/4/5, pp. 345-52. Michelsen, J., Lynggard, K., Padel, S. and Foster, C. (2001), “Organic farming development and agricultural institutions in Europe: a study of six countries”, University of Hohenheim, Hohenheim. MINTEL (1999), Organic Food and Drink Retailing, UK Economist Intelligence Unit, London. MINTEL (2000), Organic Food and Drink Retailing, Market Intelligence Unit of the UK Economic Intelligence Unit, London. MINTEL (2003), Organic Foods UK, MINTEL International Group, London. MORI (1996), Attitudes to Organic Food, The Soil Association, Bristol.

Nielsen, N.A., Bech-Larsen, T. and Grunert, K.G. (1998), “Consumer purchase motives and product perceptions: a laddering study on vegetable oil in three countries”, Food Quality and Preference, Vol. 9, pp. 455-66. Organic Monitor (2001), The UK Market for Fresh Organic Vegetables, Organic Monitor, London. Organic Monitor (2002), The British Market for Organic Meat Products, Organic Monitor, London. Reuters (2002), The Outlook for Organic Food and Drinks: Consumer Trends and New Product Development, Datamonitor, London. Richter, T. and Padel, S. (2005), “The European market for organic foods”, in Willer, H. and Yuseffi, M. (Eds), The World of Organic Agriculture: Statistics and Emerging Trends 2005, IFOAM, Bonn. Soil Association (SA) (1999), Soil Association Organic Food and Farming Report, SA, Bristol. Soil Association (SA) (2000), Soil Association Organic Food and Farming Report, SA, Bristol. Soil Association (SA) (2001), Soil Association Organic Food and Farming Report, SA, Bristol. Soil Association (SA) (2002), Soil Association Organic Food and Farming Report, SA, Bristol. Soil Association (SA) (2003), Soil Association Organic Food and Farming Report, SA, Bristol. Soil Association (SA) (2004), Soil Association Organic Food and Farming Report, SA, Bristol. Saumure, K. (2001), “Focus groups: an overview”, University of Alberta, Alberta. Smith, E. and Marsden, T. (2004), “Exploring the ‘limits to growth’ in UK organics: beyond the statistical image”, Journal of Rural Studies, Vol. 20, pp. 345-57. TNS (2004), Organic Food: Understanding the Consumer and Increasing Sales, result of a 2003 Taylor Nelson Sofres Survey published jointly by the Soil Association, Welsh Agri-Food Partnership, Organic Centre Wales and the Welsh Development Agency, Aberystwyth. Torjusen, H., Lieblein, G., Wandel, M. and Francis, C.A. (2001), “Food system orientation and quality perception among consumers and producers of organic food in Hedmark County, Norway”, Food Quality and Preference, Vol. 12 No. 3, pp. 207-16. Zanoli, R. (Ed.), (2004), The European Consumer and Organic Food, Vol. 4, School of Business and Management, University of Wales, Aberystwyth. Zanoli, R. and Naspetti, S. (2002), “Consumer motivations in the purchase of organic food: A means-end approach”, British Food Journal, Vol. 104 No. 8, pp. 643-53.

The gap between attitudes and behaviour 625

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The current issue and full text archive of this journal is available at www.emeraldinsight.com/0007-070X.htm

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The development of the European market for organic products: insights from a Delphi study

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Susanne Padel and Peter Midmore The University of Wales, Aberystwyth, UK Abstract Purpose – The purpose of the paper is present experiences using a well-established forecasting tool, the Delphi method, to explore the dynamics of, and prospects for the development of the market for organic food in Europe. Delphi, developed by the Rand co-operation to improve military technology forecasting, uses expert feedback to refine an informed perspective on complex or uncertain issues. Design/methodology/approach – This study used experts of the organic food market in 18 countries to explore factors influencing the development of the organic market, future market prospects, and the role of governments in future market development. Findings – The results show that short supply chains and focus on regional organic shops may be an indication of an earlier stage of market development, likely to be followed by integration into mainstream outlets and involvement of multiple retailers. Research limitations/implications – While more research would clearly be required, it is concluded that the mutual but mismatched interdependence of demand and supply acts as a constraint to the overall development. Policy intervention should not only take the specific local conditions, but also the stage of market development into account. Originality/value – Prior research in this area is limited, as is work using the Delphi method. Keywords Organic foods, Marketing strategy, Delphi method, Europe Paper type Research paper

Introduction The organic market in European countries has grown rapidly over the past decade (Michelsen and Hamm, 1999; Hamm and Gronefeld, 2004), although pace and continuity varies from country to country, and the sector remains a small part of the overall food market, between below under 1 and up to 7.5 per cent in Switzerland. Nevertheless, it has attracted more than its fair share of attention, particularly because of its important role in European agricultural policies (e.g. CEC, 2004), consumers’ perception of safety of its products (Harper and Makatouni, 2002; Padel and Foster, 2005), and its role in the sustainability of agricultural production (Lotter, 2003). Because of these external influences, the development of organic for organic food market is of interest to policymakers, environmental lobbyists and also to businesses

British Food Journal Vol. 107 No. 8, 2005 pp. 626-647 q Emerald Group Publishing Limited 0007-070X DOI 10.1108/00070700510611011

The authors acknowledge the support of the European Commission’s Fifth Framework Programme for Research and Technological Development Programme, which funded the project “Organic Marketing Initiatives and Rural Development”, QLK5-2000-01124, and also the support and input of the many colleagues who formed the project research team, and of course participants in the Delphi study. However, the views expressed in this paper are their sole responsibility, and do not necessarily reflect the views of or anticipate the European Commission’s future policy in this area.

engaged in it. However, there is lack of statistical data in this sector (Hamm and Gronefeld, 2004), and because of the rapid recent development and diverse local circumstances, it is very difficult to use conventional analysis to predict the evolution of the markets. This paper presents our experience with using a well-established qualitative tool for improving foresight, the Delphi study, to explore the dynamics of, and prospects for the development of the market for organic food in Europe. Delphi studies have been used widely since development by the Rand Corporation to improve (military) technology forecasting in the 1960s. The approach involves successive questionnaires to an expert panel, using feedback to refine an informed perspective on complex or uncertain issues. Epistemologically, Delphi studies are not merely deductive but also disclosive (Jones, 1989), and allow fragmentary perspectives to coalesce into a larger collective understanding. The best definition of the approach is found in the seminal work of Linstone and Turoff (1975, p. 3): Delphi may be characterised as a method for structuring a group communication process so that the process is effective in allowing a group of individuals, as a whole, to deal with a complex problem.

Recent use of the approach has been widespread, especially in health and education topics (for examples, see Tigelaar et al. (2004); Powell (2003); Leach et al. (2001); and Lafourcade and Chapuy (2000)). A topical review of methodology and critiques of Delphi studies is provided by Mullen (2000). A small number of studies have been carried out to forecast food market development, but as Critcher and Gladstone (1998) note, its use in applied social science is not widespread, perhaps because it is less well known among researchers than other techniques. While many Delphi studies are focused on purely forecasting issues, a “policy Delphi” variant (Turoff, 1975) aims to provide a forum for idea generation, commentary and evaluation; facets of both forecasting and idea-generation are used in this study. Given conditions in the organic market, use of the Delphi approach provided potential for valuable market intelligence on key issues, including future growth trends, evolution of and factors influencing consumer demand and supply chains, and scope for improved policy intervention. The study reported here formed part of a larger study of the marketing of organic products in Europe (reported in Schmid et al., 2004), aiming to support marketing strategies for collaborative producer groups. This paper concentrates on emerging issues concerning the development of the organic market across Europe that are of general interest, leaving out material related to the internal management competences of organic marketing initiatives and spill-over impacts on rural development that were also part of the survey (see Padel et al., 2003 for full details). The remainder of the paper is organised in three sections. The next section provides brief description and commentary on our approach, giving links to methodological literature where appropriate. Then the results of the Delphi study are described, providing some detail on regional differences within Europe. The final section analyses the main implications and conclusions that can be drawn, and provides some general commentary on the usefulness of the Delphi approach in this context. Description of the organic market development Delphi approach The stages involved in the method were the selection of the expert panel, and the development of the three questionnaires, with an intervening analysis phase

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(successive questionnaires were based on results of previous rounds), and a final analysis and interpretation of the conclusions (reference to report). This process occurred over two years, the first round questionnaire was sent in March 2001; the second in January 2002; and the third in March 2003. Members of the expert panel were recruited in 18 European countries (Austria, Belgium, Czech Republic, Denmark, Finland, France, Germany, Greece, Ireland, Italy, The Netherlands, Norway, Portugal, Slovenia, Spain, Sweden, Switzerland and the UK: efforts in Luxembourg failed to recruit respondents). Since the organic sector is still relatively small, and the researchers involved in the project were familiar with and engaged in networks of key market actors, it was possible to identify panel members on an informal basis. However, as Tichy (2004) notes, there is some controversy over the self-selection of experts involved in Delphi processes, and evidence that where self-rated “top” experts are recruited, optimism bias may distort efficiency of the process. Therefore, in each country the aim was to recruit a broader representation of experts from a range of occupational backgrounds. For countries with relatively large organic markets, the overall recruitment target of 20 participants included four representatives each from commercial organisations in the organic food market, government agencies, organic producer organisations, non-organic producer organisations, and the academic research sector. In countries with relatively smaller organic markets, the aim was to recruit one in each category. Initial recruitment was by letter, accompanied with an explanatory leaflet outlining the Delphi approach, and expectations of results and benefits likely to be gained. The first round questionnaire was unstructured, using broad, open questions relating to market development that required narrative response. All returns were analysed using N-Vivo qualitative analysis software (Richards, 1999), involving an initial coding and then repeated re-reading of the responses, by individual question, in order to build up a representation of the strands of opinion (and any clear divergences) contained within them. Respondents received a report of the first round results with the second round questionnaire. The second round was mostly structured, using statements derived from first round responses on which respondents were invited to agree or disagree. Use of a Likert scale provided accuracy (Delbecq et al., 1986), and also ease of use for participants (Scheibe et al., 1975). The third round provided a general report of second round results; it contained only questions where significant prior divergence existed, and provided feedback to respondents to give an opportunity to revise their original response. Each questionnaire was piloted, using UK respondents not included in the panel, prior to its administration. The questionnaires were translated into German, Finnish, Italian, Spanish and French, and where necessary, responses translated back into English. In countries outside these linguistic areas, the English version was used. Non-response from panel members is a major problem in questionnaires involving several rounds, and in Delphi studies the norm is reckoned to be a 50 per cent attrition rate at each round (Cyphert and Gant, 1971). In this study, the overall respond was very good, 51 per cent of our original panel still responded in the final round (see Table I for a more detailed breakdown of responses by countries). The proportion of respondents from different occupational backgrounds changed little between rounds, although there was some dropout by non-organic organisation respondents after the first round, and of organic organisation respondents after the second. In the final round, the

Responses (%): Original Final number number sent Round 1 Round 2 Round 3 received Overall % response Austria Belgium Czech Republic Denmark Finland France Germany Greece Ireland Italy The Netherlands Norway Portugal Slovenia Spain Sweden Switzerland UK Total

20 8 20 5 20 20 29 25 5 5 20 8 10 5 10 5 11 26 252

100 63 90 100 55 100 69 92 80 80 55 88 90 60 90 60 100 100 85

95 60 94 80 73 85 90 87 100 50 73 71 67 33 78 33 91 67 80

95 100 82 75 75 76 83 90 75 50 75 80 67 100 71 0 40 55 76

18 3 14 3 6 13 15 18 3 1 6 4 4 1 5 0 4 11 129

90 38 70 60 30 65 52 72 60 20 30 50 40 20 50 36 42 51

majority of respondents were aged between 30 and 44 years, 72 per cent were male and most (93 per cent) bought organic food for themselves. Average length of involvement of respondents in the organic sector increased between the second and third rounds from ten to 11.6 years; some respondents with shorter involvement did not return their third round questionnaire. Delphi study results The first round The first Delphi questionnaire contained six open questions. These covered the most important events and influences that had shaped the development of the organic market in the respondent’s country in the past ten years, the current state of the organic market (including regional variations), and the respondent’s expectation of the organic market’s development over the coming ten years. Three additional questions concerned marketing initiatives by collaborating organic producers, but these are less central to the topic of the current paper. Respondents in all countries described the organic market as a still small segment with potential for further growth. Past growth had come from various crises in the conventional food sector, and generally positive media coverage. In some countries in the established market category with wide availability of organic products, respondents noted market stagnation, oversupply in some products, downward pressure on prices and greater competition, but also increased professionalism of all market actors. In other countries also with well-developed organic markets, further growth was constrained by fragmented marketing structures. Although direct marketing and specialist organic shops are generally less important than supermarkets, they provide market access for small-scale producers and outlets

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Table I. Analysis of responses by country

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(especially through direct marketing) for advocates of local production and consumption patterns. In growing market countries constraints to growth included the underdeveloped nature of distribution structures, lack of volume, weak consumer demand confined to a core, minority group, and low consumer confidence in certification and labelling. Supermarkets were seen as the key drivers of development and direct marketing was considered unimportant for future growth. Market infrastructure and organisation were severely limited in emerging market countries. Most sales were either through direct marketing or specialist organic shops, with little supermarket involvement. Lack of supply was seen as a constraint on development, although market growth has been rapid in Belgium, Ireland and Spain, where producer and organic organisations are better established. In many countries variable quality, poor availability, consumer confusion about labelling and product identification and reluctance to pay price premiums were identified as restricting organic demand growth. Reduction of consumer prices through scale economics achieved through larger industrial scale production was foreseen as the best opportunity for greater growth potential. Although some respondents were also concerned that this might conflict with high consumer ethical expectations of organic products, others argued that the “conventionalisation” of the organic sector (supermarkets and conventional processors moving into organic lines) is one condition for expanding demand in mature market countries; the other is income growth. Competition from “near-organic” alternatives was seen as increasing and requiring innovative strategies. One approach suggested was to bolt on additional sustainability characteristics to organic products, such as local origin, social and ethical content and high quality. Other respondents felt that the nature of organic products (premium, high quality products with specific ethical characteristics) itself confined them to a niche market. Concerns were widely expressed about the potential of an organic food “scandal”, particularly if organic production standards are compromised by the rate of expansion. Alongside this, initiatives to provide information, promote organic food and ensure a transparent labelling system were seen as vital to maintain consumer confidence and raise awareness. On the supply side, respondents recognised the role that farm support schemes can play in encouraging conversion, but that they can also lower farm gate prices for organic products. Respondents anticipated increased volumes of internationally traded organic products, particularly within the EU. Although the prospect of increased export potential was welcomed by countries with a saturated domestic market, imports raised concern that in countries with currently low organic production prospects for more widespread conversion could be stifled. Respondents also predicted higher levels of product processing. The results showed that there were very strong similarities in the conditions in countries at particular chronological stages of development of their organic food market (Table II). This led to a preliminary, subjective categorisation of countries according to market development stage. Countries with established (mature henceforth EST) organic markets are characterised by the important role of supermarkets as sales channels for organic products. In these countries, environmental protection and animal welfare are of high importance to consumers. In countries with growing organic markets (henceforth GRO), specialised organic food shops and direct sales are

important outlets for organic products; animal welfare seems to play a less important role in these countries. In countries with emerging markets (henceforth EMG), the experts described the organic sector as a market niche, mainly serviced by organic farming pioneers, involving a small number of actors and lacking organizational structure. This has proved useful as a means of summarising responses, although the categorisation of one country was modified based on responses to the second round (see below). The categorising was subsequently confirmed by other findings of the project (Hamm and Gronefeld, 2004). Other main conclusions that can be drawn from this first round of inquiry concern the overall direction of marketing strategies whether there should be a focus on integration into mainstream outlets through the multiple retailers, or on short supply chains either in regional organic shops or through direct marketing. The former allows organic products to penetrate the mainstream food market, but requires greater production efficiency and supply chain organisation so that continuity of supplies at a consistently high quality can be assured. There was, however, concern that this could reduce producer prices and dilute organic standards. To offset this, strong countervailing producer organisations would be required. The latter strategy appears particularly suited to areas with currently low organic consumer demand, but also alongside conventional distribution systems in EST countries where demand for an alternative, not perceived as compromising the ethical characteristics or image of the product, exists. However, respondents emphasised that this requires an equally high level of commitment and professionalism in order to be successful in the long term. There was widespread agreement on the necessity to safeguard integrity and quality of organic products in an increasingly competitive environment.

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Second and third round questionnaires The summary in the previous subsection highlights key issues which provided a basis for the development of structured questionnaires for the second and third rounds. These two questionnaires were divided into thematic sections: country specific issues relating to the historic development of the organic market; prospects for the future development of the organic food market, the role of governments in future market development. A fourth main section, relating to the role of organic marketing initiatives in rural development which was of particular interest to the project but to a large extend was only included in the third round questionnaire has not be considered in this paper. In the third round respondents received feedback on second round questions where consensus was not clear. We used the mean response of all other respondents from the same home country. While many Delphi practitioners adopt the median and inter-quartile range of responses, Phillips (1996) suggests that these are more properly used in applications evaluating individual scores in the context of a larger group; in the current context, evaluation of the characteristics of a group as a Established

Growing

Emerging

Austria, Denmark, Germany, Switzerland, UK

Finland, France, Italy, The Netherlands, Norway, Portugal, Sweden

Belgium, Czech Republic, Greece, Ireland, Slovenia, Spain

Table II. Countries clustered by stage of market development

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whole with median scores would have eclipsed outlying results, distorting the range of opinion. Question in relation to the current state of the organic market. This section began in the second round with feedback on the proposed “soft” classification of respondents’ home countries in terms of stage of market development (see Table II). Compared with data on the market development (Hamm and Gronefeld, 2004), the question was raised, whether France, the UK and Belgium were correctly classified, so respondents in these countries were asked again about the proposed classification. Based on the results of the second round, France was re-classified from EST to GRO. Other questions focused on variations in the level of development of markets in regions and for major product groups within countries. Respondents were asked to classify urban and rural areas as established, growing or emerging in terms of market development. The category chosen by most respondents for urban markets closely reflected the overall categorisation of the country, whereas markets in rural areas were always considered to be less developed. Markets for dairy, cereal products and fruit and vegetables were considered better established, with convenience and meat products at the earliest stages of development. There was some variation depending on the market development of countries: In EMG countries, dairy products were the most developed; in GRO countries, cereal products; and in emerging, fruit and vegetables; convenience products achieved the lowest rating in all categories. Respondents were also asked to rank the importance of different retail channels in the organic market. In all except EMG countries, multiple retailers were considered most important in urban areas, specialist organic shops second, direct marketing was ranked third, followed by other shops and catering. This average ranking was largely identical, with the following exceptions. In Germany specialist organic shops were on average ranked higher than multiple retailers; in Finland direct marketing ranked second before specialist organic shops; and in Sweden catering and public services ranked second and specialist organic shops received a comparably low ranking. In rural areas, multiple retailers also maintain the leading position in EST and GRO countries, but direct marketing was mostly ranked second, and the difference in ranking between multiple retailers and direct marketing was less distinct. In EMG countries, direct marketing was considered more important in rural areas than multiple retailers. Respondents were asked to assess the impact of food scandals on the development of the organic market, differentiating between impact on demand and supply in general, and for specific product groups. Their impact was considered to be clearly positive on demand and, to a lesser degree, also on supply. This applied also to most product groups, although a majority considered the impact to be negligible on the supply of fruit and vegetables, cereals and convenience products. No great differences emerged if the average scores on the demand side were analysed by country category. Much the same response emerged when we asked about the media impact: overall, this was perceived to be positive, and with a higher impact on the demand than the supply side. Respondents classified a given a list of constraints on the development of organic supply according to importance, using Likert categories from “very important” to “not at all important” (Table III). The most important constraints were considered to be a fragmented or underdeveloped market and lack of marketing know-how; both

Notes: a Very important” and “important”;

Fragmented or underdeveloped market Lack of marketing know how Poor cooperation and communication Low farm gate premiums Low level of organic support payments Lack of consumer demand Limited processing capacity Over-reliance on imports in retail sales Lack of supermarket involvement Competition from near-organic alternatives Lack of information for producers Limited availability of organic inputs b

17 12 31 39 42 46 34 49 41 63

Round 2 Not importantb 2 3 3 5 2 2 5 8 3 2

Don’t know 88 87c 75c 73c 66c 64c 55d 48c 47d 38c 52 49

c

Important 11 11 25 26 34 36 42 45 52 61 45 45

Round 3 Not important

1 2 0 2 0 0 3 7 1 1 2 5

Don’t know

“Not important” and “not at all important”; c Increase in third round; d Decrease in third round

80 85 65 56 55 52 63 43 56 35

Importanta

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Table III. Classification of constraints of the supply of organic products (% of responses, both rounds)

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attracted heightened importance in the third round. Responses were converted into averages using numerical scores; these were contained in the third round questionnaire, with the participant’s second round response. Poor co-operation and communication and low levels of farm gate premiums were also considered important by more than 70 per cent of respondents in the third round. Only two constraints listed were considered unimportant by a majority of respondents to the third round, which were lack of supermarket involvement and competition from near organic alternatives. Two new statements, added on the basis of second round comments, were considered, on average, important by only a bare majority. The importance respondents attributed to the supply constraints listed varied in relation to the stage of development of the organic market. For example, lack of supermarket involvement was considered more important in GRO countries. Limited availability of inputs, limited processing capacity and low support payments were considered more important, the lower the level of development; therefore importance was rated highest in EMG countries. Also, although not considered important by an overall majority, limited availability of organic inputs was considered more important among respondents from EMG countries. The importance rating of organic supply constraints also varies according to occupational background of respondents; to a degree, different groups of stakeholders in the organic sector vary in their attitudes. Notable differences (approximately 0.3 points difference in averages or more) occurred in the following areas. Respondents from a research background in organic farming consider a fragmented and underdeveloped market and limited processing capacity to be more important than other respondents. Respondents from a commercial background, on the other hand, consider the low level of support payments as more important than others. Respondents from organic organisations see lack of information for producers and lack of supermarket involvement as more important. Respondents from non-organic backgrounds see lack of know-how and over reliance on imports as more important than the average for all respondents. In the second round, respondents were asked an open question on means to overcome organic supply constraints. Suggested strategies mostly encompassed themes already covered in later sections of the second round questionnaire. Respondents were also asked to assess for importance given list of constraints on the development of organic demand (see Table IV). In both rounds (with little change in opinion) most considered the issue of high consumer price to be important, followed by poor product availability and lack of consumer information. The importance attributed to lack of consumer awareness and poor product presentation increased in the third round, compared with the second. The lack of a common logo for organic food and lack of credibility of organic certification were not considered to be important. Overall, ranking of constraints on organic demand development was confirmed in the third round. Among constraints considered important, there is little variation between categories of countries and respondents. Poor product quality is considered less important, and lack of consumer information more important, in EMG countries, suggesting that as supply increases, competition, quality awareness and consumer information also increase. The lack of a common logo, on the other hand is considered more important in EST and GRO than in EMG countries.

92 84 74 61 67 46 37 44 28

8 16 26 35 30 51 62 54 70

Round 2 Not importantb 0 1 1 2 1 2 1 2 1

Don’t know 91 88c 84c 81c 71c 45d 39c 35d 26d

d

Important

9 12 16 18 28 53 59 64 74

Round 3 Not important

Notes: aVery important” and “important”; b“Not important” and “not at all important”; cIncrease in third round; dDecrease in third round

High consumer price Poor availability Lack of consumer information Lack of consumer awareness Poor product presentation Poor quality of organic produce Lack of common logo Competition from near-organic alternatives Lack of credibility of organic certification

Importanta

0 1 0 1 1 1 2 2 1

Don’t know

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Table IV. Classification of constraints of the demand for organic products (% of responses, both rounds)

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Variation of more than 0.3 average score points between different occupational backgrounds only occurred in relation to two statements. Respondents from organic organisations considered the lack of a common logo as a more important constraint than those from a commercial background. Poor product presentation was considered less important by respondents from non-organic organisations, perhaps indicating a lower level of awareness. Overall, ranking of constraints on development of organic demand was confirmed by the third round: price, availability and a lack of consumer information are important constraints, whereas issues related to certification systems and labels are not. The second round contained also an open question on means to overcome organic demand constraints. Many respondents from a variety of countries noted a need for better information and reduced prices for consumers, confirming the importance of the constraints discussed in immediately preceding paragraphs. Respondents also recognised the potential of achieving this through economies of scale accompanying growth in the organic market, but also by support to producers and reduced profit margins among various actors in the organic food chain. The need for a common logo that can be clearly identified and the need to improve the marketing of organic products in multiple retailers were also frequently mentioned, particularly by respondents from EST countries and from organic organisations, but a statement about the absence of a common logo as a constraint for demand development did not attract agreement from the overall majority (see Table IV). Questions in relation to the future development of the organic markets. Experts were asked to forecast the growth rate of the organic market in their home country for five years from the receipt of the second round questionnaire; as well as overall growth, they forecasted regional growth and also by product category. In the second round questionnaire, they were asked to forecast growth using interval categories (less than 0 per cent; 0-2 per cent; 2-5 per cent; 5-10 per cent; and more than 10 per cent); Across all countries, overall future growth rates were considered to be between 2 and 10 per cent by the majority of respondents, and only 2 per cent of respondents expected a negative growth rate. There was some differentiation between product groups, with more than 30 per cent of respondents expecting more than 10 per cent growth for meat and convenience products. Similar growth was expected in the organic market in urban areas, whereas nearly 30 per cent of respondents expect less than 2 per cent growth in rural areas. In the third round, these were converted into average estimates using a mid-point method, and respondents were invited to comment and dissent. While a majority of respondents agreed with these averages, weighted disagreements were used to modify the final estimates: Table V provides details for selected EST countries, and for all countries combined in the GRO and EMG categories. For meat and convenience products, higher growth than overall is expected, with the converse anticipated for dairy and cereal markets. The wide variation in growth rates (from 1.5 per cent up to 11 per cent or more in GRO countries) can be accounted for by many factors such as: . high consumer prices (particularly for organic meat); . the level of market penetration in specific sectors or countries; and . the general economic climate.

Round Overall Convenience products Meat products Dairy products Fruit and vegetables Cereals products Urban regions Rural regions

2nd 2.4 3.3 2.3 2.3 2.8 1.9 2.9 1.8

DK 3rd 1.5 3.3 1.7 1.0 4.0 2.5 2.9 0.0

2nd 3.9 4.9 4.9 3.5 6.1 3.6 5.4 3.3

AT 3rd 7.4 6.9 7.5 7.3 6.3 6.4 8.6 5.5

2nd 8.0 9.2 7.5 7.8 9.2 7.0 10.8 6.5

CH 3rd 5.4 4.3 7.3 5.3 4.7 5.5 6.9 2.9

2nd 6.3 5.1 7.5 5.5 7.3 4.5 8.0 2.0

UK 3rd 4.6 8.4 3.2 3.4 5.7 5.3 5.9 2.8

2nd 5.2 7.0 5.7 4.2 4.1 3.1 6.4 3.0

DE 3rd 4.5 7.0 8.0 1.5 5.0 2.0 5.3 3.5

2nd 8.4 8.4 7.3 6.3 6.3 5.8 7.8 5.1

3rd 11.0 8.8 12.3 8.8 8.3 6.0 9.9 6.9

All growing

2nd 8.9 9.5 9.0 9.1 8.1 7.6 9.8 6.5

3rd 4.8 7.3 3.1 6.7 7.1 4.6 8.1 4.7

All emerging

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Table V. Expected market growth rates 2002-2007, overall and for specific categories of product categories

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Figure 1. Expected future rank order (5 ¼ most important) of retail channels in urban and rural areas (average third round, reversed ranks)

Respondents ranked retail channels in terms of their importance for future organic food market development both in urban and rural areas. Multiple retailers were perceived as most important, followed by specialist organic shops; direct marketing and farmers markets were expected to become more important in rural areas, particularly in conjunction with tourism on farms and local restaurants (Figure 1). There was little variation either by the occupation of respondent or country category, results show some difference when compared with the current importance of retail channels investigated in the first section of the questionnaire. Catering and public service procurement are considered more important in the future; particularly, respondents in EMG countries expect multiple retailers to become more important. In contrast, direct marketing and shops (specialist or general) are expected to decrease in importance in the future. Comments received to an open question in the second round also highlighted a potential role for catering and public services in rural areas in the future and provide further explanation why multiple retailers are considered important for development of the organic market beyond niche status. One participant from Austria noted “. . . to reach the majority, you have to sell where the majority shops”. Further reasons for this critical role included the larger potential volume of sales than possible through health food or organic shops; inflexible consumer shopping habits; a need to focus on middle income groups; easy access and wide availability; the busy lifestyle of organic consumers; and the conversion of occasional into regular buyers as the main source of future growth. Some, although not all, multiple retailers have actively supported development in the supply of organic products, improving overall quality by applying rigorous product selection. Respondents raised concerns about loss of direct contact between producers and consumers, and problems that aggressive price policies of some supermarkets could cause for organic producers. Respondents from EMG

countries, particularly, noted the augmented role of supermarkets as production volumes increase. From responses to the second round it became clear that most respondents consider organic markets in rural areas to be less developed, and expected this trend to continue. Because rural markets are important for organic marketing initiatives, we asked respondents to classify possible barriers to purchases of organic food by rural consumers according to their importance, on a four-point scale ranging from very important and not at important. The most important barrier overall was that buying local produce is considered more important in rural areas than buying organic. The importance given to this statement appears inconsistent with the lack of importance accorded to competition from near-organic alternatives which respondents registered when considering constraints on supply development; possibly, respondents consider local produce not to be near-organic, or only important in a rural rather than in an urban context. Following in importance are the barriers stemming from a food culture restricted to urban areas, and more frequent access for rural consumers to home grown vegetables. Statements that rural consumers are less concerned about the environment, animal welfare and their own health were rejected. Respondents in GRO countries consider the restriction of food culture to urban areas as a more important barrier; those from EMG countries considered home grown vegetables and lower disposable income to be more important barriers, but local food as less important. Overall, the responses confirm that different barriers act in the rural context and that buying local might be a more important consideration than buying organic for the rural consumer. A set of general statements about the future development of the organic markets followed, to which respondents were asked to indicate their level of agreement on a four-point scale (Table VI). Statements receiving high-generalised support in the second round related to market structure, the importance of multiple retailers as distribution channels, the need to increase product range and targeting new market segments. There was least support for organic food to be promoted on the basis of risks associated with conventional food. Clear disagreement also emerged on statements that the organic market would remain a niche; that involvement of multiple retailers poses a threat to local retail structures and organic standards; and that labelling could be used effectively to differentiate niches within the organic market.

“Local” is more important than “organic” Grow vegetables in their own gardens Lifestyle’ food culture is restricted to urban Reduced availability of organic products Solidarity with conventional farmers Lower disposable incomes in rural areas Less concerned about the animal welfare Less concerned about the environment Consumers in rural area less health conscious

Importanta

Not importantb

Don’t know

80 71 66 64 59 58 35 35 30

18 28 25 35 39 41 60 60 60

2 1 9 1 2 2 5 5 9

Notes: a “Very important” and “important”; b “Not important” and “not at all important”

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Table VI. Barriers to the purchase of organic foods in rural areas (n ¼ 128, per cent of respondents, third round only)

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Statements not receiving clear agreement or disagreement across all countries were repeated with relevant feedback in the third round and Table VII shows their responses for both rounds. Based on comments to the second round some new statements were also formulated. Clearer support was expressed for decreasing prices resulting from competition between producers and cheap imports; and for increased development of the organic sector unrelated to crises in the conventional sector. Clearer disagreement emerged regarding the role of consumer price reductions in developing demand, contradicting the prior view expressed that high price is the most important barrier to the development of demand. Analysis of variations according to country classification and occupational background used Liekert scale scores. Notable differences, involving 0.3 average scale points or more, were few. Respondents from EST countries showed more agreement with marketing of organic products as a premium product; and those from EMG countries see mainstream channels as more of a threat to sector development that may also compromise standards, expect more consumers to buy direct from producers, and disagree less with promotion based on risk associated with conventional foods. Variation in responses from different occupational backgrounds was more marked. Respondents from non-organic backgrounds agreed more strongly that cheap imports will drive down prices for organic producers, and also that international trade in organic products with countries outside Europe contradicts the basic philosophy of the organic movement. Respondents from organic organisations disagreed strongly with the statement that reductions in consumer price premia have a major role to play in developing demand for organic products, although they also agreed more strongly with the statement that the organic sector will grow independently of crises in the conventional sector and that in future more consumers will prefer to buy directly from the producer as an alternative to the increasing globalisation of the organic food market in multiple retailers. Respondents from a government background disagreed more strongly than others with the statement that regionalisation will increase trust, whereas respondents from a commercial background agree less with a need to further differentiate the market. Questions related to the role of government. Where respondents were asked to assess the impact regional and national policies have had on the development of the organic market, the first clear polarisation occurred, and consequently this question was repeated in the third round. Overall, and in urban markets, the impact of national and regional policies was considered to be positive by the majority of respondents in both rounds; however, in the second round, a bare majority believed the impacts to have been negligible in rural markets and for consumer demand. On review in the third round, these were transformed into clearer majorities. Analysis by country category shows a similar assessment of lower impact in rural areas and on consumer demand; Figure 2 shows the percentage of respondents that viewed government action as positive; these percentages fall below 50 per cent for impacts on rural markets in GRO and EMG countries, and for consumer demand in EMG countries in both rounds. Individual country responses reflect differing policy environments; for example most Scandinavian countries gave higher scores for impact on consumer demand than elsewhere. Comments on the low perceived impact of policy in rural areas suggest why consumers in rural regions may be less interested in organic produce. Reasons included

Second round Agreea Disagreeb Organic marketing structures need to improve, to be able to keep pace with the expected increase in demand Supermarkets and conventional distribution channels are appropriate for organic products It is important to increase product range (for example wider choice of different dairy products, introduction of convenience products) in order to extend the demand Organic food should be marketed as a premium, high quality product It is important to target new consumer groups (for example consumers of a different social category) in order to increase demand Price premiums for producers will decrease once supply increases because of competition between producers Reductions in consumer price premia have a major role to play in developing demand for organic products Regionalisation of organic sales (also in supermarkets) will increase consumer trust Different sectors of the organic market require the development of different marketing structures Cheap foreign imports are driving down the prices for organic producers Direct marketing offers an alternative to mainstream outlets for producers in disadvantaged rural areas Price premia for consumers will decrease with increasing volume of sales Price premiums for producers will decrease because of the competition between various multiple retailers Organic marketing should be clearly differentiated from the marketing of non-organic products The organic sector will grow independently of crisis in conventional agriculture It is inevitable that the organic food sector will develop on an agro-industrial scale to serve the requirements of mainstream customers Reductions in consumer price premia conflict with the positioning and marketing of organic food as a high quality product

Third round Agreea Disagreeb

93

7

91

9

89

9

89

10

88

11

69

26

82c

13

70

28

80c

19

78

15

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79

15

78d

16

62

28

78c

20

77

19

86

10

73d

22

57

37

73c

22

65

29

71c

24

66

30

72c

26

61

35

69c

30

42

51

57c

42 (continued)

Table VII. Future development of the organic market

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Second round Agreea Disagreeb The involvement of mainstream marketing channels poses a threat to local, small-scale distribution channels Dominance of mainstream food companies in retailing of organic food will lead to the lowering of organic standards for commercial reasons Public procurement will become an important alternative outlet for organic producers in rural areas within the next three years In future more consumers will prefer to buy directly from the producer as an alternative to the increasing globalisation of the organic food market in multiple retailers International trade in organic products with countries outside Europe contradicts the basic philosophy of the organic movement Trade in organic products between regions in Europe contradicts the basic philosophy of the organic movement Different labels (for example “organic” and “organic þ ” products) can be used effectively to differentiate niches within the organic market Highly processed organic goods (for example convenience products) conflict with the organic aims It is inevitable that organic food as a premium, high quality product, remains restricted to a niche market Promotion for organic food should be based on risks associated with conventional food a

Table VII.

Third round Agreea Disagreeb

40

56

53c

46

33

61

42c

54

41

39

41

53

41d

56

42

52

36

58

33

58

34

63

29

67

15

83

b

Notes: “Very important” and “important”; “Not important” and “not at all important”; c Increase in third round; d Decrease in third round

the better condition of the rural environment, different value systems and lifestyles, and more conservative rural consumers who are less interested in following “fashion” trends. Also, from EST and GRO countries, complaints emerge of a general lack or focus of policy measures on market development, with current policies directed at supply rather than demand. In the second round respondents were asked some questions about the importance of both national and regional government in developing the organic market, and in an open question asked to explain their response. 85 per cent believed national government policies to be either important or very important, and 63 per cent in the case of regional governments. Participants explanations provided some fresh insights: at national level, arguments were made in respect of non-market, public good benefits of organic farming, and respondents suggested that integrated strategic policy development based on government commitment can increase the pace of development of the organic market overall. The effect of organic conversion support on supply was clearly recognised, through direct payments, raising the confidence of producers and

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Figure 2. Impact of regional or national policies on the organic market according to country categories (% positive, both rounds)

other actors, and in setting production standards. The potential role of government on demand was recognised through educational promotion campaigns, public procurement, and increasing the credibility of organic certification systems and, from Germany, the issue of a common logo. At regional government level, responses reflected the variation in policy structure between countries. For example, in Germany, Italy and Spain, regions have considerable power in agricultural policy decision-making, whereas in other countries major issues are decided at national level. A clear distinction between the national and regional government level is thus problematic. Varying levels of governmental support for the organic sectors are well documented elsewhere (Lampkin et al., 1999). Respondents were also presented with statements relating to the role of government in the development of the organic sector, and asked to indicate agreement level on a four point scale (Table VIII). Where clear consensus emerged from the second round, statements were not repeated in the third: these related to further development of European standards for organic production and consideration of environmental impact of trade in organic products (agreement) and discontinuing financial support to producers in favour of marketing grants (disagreement). Other statements were repeated with feedback on average responses, and two, relating to the role of production incentives in overcoming supply problems (especially in EMG countries) and the greater credibility of government certification systems than private sector schemes, attracted increased agreement. Converting responses to numerical scale, notable variations involving an average of 0.3 scale point difference or more was mostly observed among respondents from EMG countries. Agreement that production incentives for producers help overcome problems in the supply of organic raw materials was less strong; and the effect of national and regional governments buying organic products for public canteens attracted higher than average agreement. By occupational background, respondents from non-organic backgrounds agreed more strongly governmental certification systems for organic produce are more credible for consumers than private sector

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Table VIII. The role of government

Second round Agreea Disagreeb There is a need to develop common (EU) standards in new areas (foe example fresh water fish production, glasshouse production) There is a need to consider the environmental impact of trade in the further development of organic standards Production incentives for producers help overcoming problems in the supply of organic raw materials Government initiatives are important in creating demand for organic produce Government certification systems for organic produce are more credible for consumers than private sector schemes National government should introduce and promote a common logo for organic produce Conversion incentives for organic producers should target specific types of producers (for example fruit producers) to deal with supply constraints National government should run a common certification system for organic production in a country Financial support to organic producers helps to lower the price to consumers National and regional governments interfere in the organic market though buying organic products for public canteens, such as schools and hospitals Confidence in the future of the organic market for all actors is not related to government support Financial support to producers leads to oversupply and should be stopped in favour of marketing grants a

Third round Agreea Disagreeb

86

11

77

16

83

10

90c

9

72

25

83

c

16

55

37

71c

26

61

32

66c

29

54

39

63c

33

57

34

62c

34

38

c

42

52

40

44

53

54

24

57

70

b

Notes: “Very important” and “important”; “Not important” and “not at all important”; c Increase in third round

schemes, and that national government should run a common certification system for organic production. Respondents from an organic background agreed more strongly with national governments interfering in the market through public procurement. Research respondents agreed more strongly with the statements related to a common national logo whereas the opposite was true of commercial respondents. Conclusions Clearly, results of a Delphi study such as this can provide a multifaceted and enriched perspective, relatively cost-efficiently and rapidly. From the preceding presentation of the results two sets of conclusions are evoked: those relating specifically to the development of the organic market, and those which emerge more generally from the

experience of applying the Delphi method as a qualitative tool in market research more generally. The result show that the application of the Delphi method can provide more than just forecasts for market growth, even though these can be readily obtained. The responses highlighted a number of contingent conditions that, unless fulfilled, will act to constrain potential growth to a lower level. In responses to the open question in the first round it appeared as if to alternative models or strategies exist in relation to the development of the organic market development in European countries: a focus on integration into mainstream outlets through the multiple retailers, or concentration on short supply chains either in regional organic shops or through direct marketing. The study suggests that this might not be a question of alternative strategies but one of different stages of the development of the organic food. In emerging markets the organic sector occupies a small niche, mainly served by direct sales of pioneer producers and a small number of other actors. In the next stage specialised organic shops become more important alongside direct sales, before the involvement of multiple retailers and a higher level of organisation structure takes in the organic sector into the mainstream. The study suggests that the mutual but mismatched interdependence of demand and supply acts as a constraint to the overall development. For example, fragmented markets are considered an important constraint for supply, whereas poor availability of organic products is considered an important constraint for the development of demand. This would suggest that policy intervention could help to bring a about a more smooth development of these still very small markets, if this is sensitive, not only to particular local contexts, but also to the specific chronological stage of development that the organic market has reached. Specifically, promotion of supply through farm subsidies, support for supply chain infrastructures, and validation of the authenticity of organic provenance could be important instruments during the emerging and growth phases, whereas in more established markets a focus on further development of the demand (such as promotion and consumer education campaigns) could help facilitate economies of scale and thus reduce consumer prices. In respect of the underlying motive for this Delphi study, the extent to which organic farming can provide a base for rural development, the production system has often been seen as a successful response to declining incomes on small or otherwise production-limited farms. Consequently, a policy aspiration has been to extrapolate these benefits more widely for peripheral (especially high nature value) rural regions as well. The results of this survey illustrate some potential, but up until now at least the organic market are largely concentrated in urban rather than peripheral rural areas. This confirms caution in relation to the policy expectation that support to organic farming will automatically bring substantial benefits for wider rural development as suggested by Smith and Marsden (2004, pp. 355-6). The results highlight that there might be a greater potential of this, if the marketing is effectively organised to cope with the demands of the multiple retailers, and does not rely on direct and local sales alone, but this process of shifting from limited direct sales to supplying greater volumes in consistent quality can be very delicate. Turning finally to the broader lessons that can be derived from this study, the anticipatory character of Delphi studies can, through a sharing knowledge and experience, augment understanding within the expert group. A consequence of this

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could be to make leading opinion-formers into a more effective caucus, and (to the extent that this happens) turn the outcome of the process into a self-fulfilling prophecy from their enhanced ability to achieve their preferred future. Although the accuracy of the current study has yet to be fully confirmed, indications are that its main outlines are broadly correct (see, for example, Blank and Thompson, 2004). Concerns of this nature can be lessened if an action research (Quigley and Kuhne, 1997) rather than more conventional empirical approaches, underpin the study framework. This requires clear moral choices to be made by the researchers who control the process, but provided that these are explicit at the outset, greater use of the approach could and should be made in food market research. References Blank, S.C. and Thompson, G.D. (2004), “Can/should/will a niche become the norm? Organic agriculture’s short past and long future”, Contemporary Economic Policy, Vol. 22 No. 4, pp. 483-503. Commission of the European Communities (CEC), (2004), European Action Plan for Organic Food and Farming, COM (2004) 415 final, CEC, Brussels. Critcher, C. and Gladstone, B. (1998), “Utilising the Delphi technique in policy discussion: a case study of a privatised utility in Britain”, Public Administration, Vol. 76 No. 3, pp. 431-49. Cyphert, F.R. and Gant, W.L. (1971), “The Delphi technique: a case study”, Phi Delta Kappan, Vol. 52 No. 5, pp. 272-3. Delbecq, A.L., Van de Ven, A.H. and Gustafson, D.H. (1986), Group Techniques for Program Planning: A Guide to Nominal Group and Delphi Processes, Green Briar Press, Middleton, WI. Hamm, U. and Gronefeld, F. (2004), The European Market for Organic Food: Revised and Updated Analysis. Organic Marketing Initiatives and Rural Development, Vol. 5, University of Wales Aberystwyth, (School of Management and Business), Aberystwyth. Harper, G.C. and Makatouni, A. (2002), “Consumer perception of organic food production and farm animal welfare”, British Food Journal, Vol. 104 Nos 3-5, pp. 287-99. Jones, E. (1989), Reading the Book of Nature, University Press, Columbus, OH. Lafourcade, B. and Chapuy, P. (2000), “Scenarios and actors’ strategies: the case of the agri-foodstuff sector”, Technological Forecasting and Social Change, Vol. 65 No. 1, pp. 67-80. Lampkin, N.H., Foster, C., Padel, S. and Midmore, P. (1999), “The policy and regulatory environment for organic farming in Europe”, Organic Farming in Europe: Economics and Policy, Vol. 1, University of Hohenheim, Stuttgart. Leach, J., Mercer, H., Stew, G. and Denyer, S. (2001), “Improving food hygiene standards – a customer focused approach”, British Food Journal, Vol. 103 No. 4, pp. 238-52. Linstone, H.A. and Turoff, M. (Eds.) (1975), The Delphi Method: Techniques and Applications, Addison-Wesley, Reading, MA. Lotter, D.W. (2003), “Organic agriculture”, Journal of Sustainable Agriculture, Vol. 21 No. 4, pp. 59-128. Michelsen, J., Hamm, U., Wynen, E. and Roth, E. (1999), “The European market for organic products: growth and development”, Organic Farming in Europe: Economics and Policy, Vol. 7, University of Hohenheim, Stuttgart.

Mullen, P.M. (2000), “When is Delphi not Delphi?” Discussion paper 37, Health Services Management Centre, University of Birmingham. Padel, C., Seymour, C. and Foster, C. (2003), SWP 5.1: Report of All Three Rounds of the Delphi Inquiry on the European Market for Organic Food, IN QLK5-2000-01124, OMIARD (Ed.), University of Wales Aberystwyth. Phillips, J.L. (1996), How to Think About Statistics, Freeman and Company, New York, NY. Powell, C. (2003), “The Delphi technique: myths and realities”, Journal of Advanced Nursing, Vol. 41 No. 4, pp. 376-82. Quigley, B.A. and Kuhne, G.W. (Eds.) (1997), Creating Practical Knowledge through Action Research, Jossey Bass, San Fransisco, CA. Richards, L. (1999), Using NVivo in Qualitative Research, Sage Publications, London. Scheibe, M. (1975), “Experiments in Delphi methodology”, in Linstone, H.A. and Turoff, M. (Eds), The Delphi Method: Techniques and Applications, Addison-Wesley, Reading, MA, pp. 262-82. Schmid, O., Sanders, J. and Midmore, P. (2004), Organic Marketing Initiatives and Rural Development, Organic Marketing Initiatives and Rural Development Report Series, Vol. 7, University of Wales Aberystwyth (School of Management and Business), Aberystwyth. Smith, E. and Marsden, T. (2004), “Exploring the ‘limits to growth’ in UK organics: beyond the statistical image”, Journal of Rural Studies, Vol. 20, pp. 345-57. Tichy, G. (2004), “The over-optimism among experts in assessment and foresight”, Technological Forecasting and Social Change, Vol. 71 No. 4, pp. 341-63. Tigelaar, D.E.H., Dolmans, D.H.J.M., Wolfhagen, I.H.A.P. and Van der Vleuten, C.P.M. (2004), “The development and validation of a framework for teaching competencies in higher education”, Higher Education, Vol. 48 No. 2, pp. 253-68. Turoff, M. (1975), “The policy Delphi”, in Linstone, H.A. and Turoff, M. (Eds), The Delphi Method: Techniques and Applications, Addison-Wesley, Reading, MA, pp. 84-101. Further reading Sackman, H. (1975), Delphi Critique: Expert Opinion, Forecasting, and Group Process, Lexington Books, Lexington, MA.

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