Product Differentiation and Market Segmentation in Applesauce: Using a Choice Experiment to Assess the Value of Organic, Local and Nutrition Attributes

Jennifer S. James, Bradley J. Rickard and William J. Rossman

No 48916, Working Papers from Cornell University, Department of Applied Economics and Management

Abstract: Recently there is much interest among horticultural producers concerning the marketing of organically- and locally- produced food. Here we developed a consumer survey that asked respondents to choose an applesauce product from a list of products differentiated by price and four attributes. The products were differentiated by labels that described fat content, nutrition content, and whether the product was grown organically and/or locally. The survey was distributed to 3,000 residents in rural Pennsylvania and over 1,500 responses were collected yielding a response rate of 56%. Survey results were used to assess consumers’ willingness to pay for the product attributes in applesauce, and we found that consumers were willing to pay more for locally-grown applesauce compared to applesauce that was labeled organic or low fat and low sugar. Furthermore, the analysis incorporated the effects of consumer characteristics on the demand for applesauce attributes and we find evidence that increased knowledge of agriculture decreases the willingness to pay for organically- and locally-grown applesauce.

Keywords: Agribusiness; Consumer/Household Economics; Food Consumption/Nutrition/Food Safety (search for similar items in EconPapers)
Pages: 35
Date: 2009-01
New Economics Papers: this item is included in nep-agr, nep-dcm and nep-mkt
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Citations: View citations in EconPapers (47)

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Persistent link: https://EconPapers.repec.org/RePEc:ags:cudawp:48916

DOI: 10.22004/ag.econ.48916

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