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

Published online by Cambridge University Press:  15 September 2016

Jennifer S. James ,
Bradley J. Rickard  and
William J. Rossman
Jennifer S. James
Affiliation:
Agribusiness Department at California Polytechnic State University in San Luis Obispo, California
Bradley J. Rickard
Affiliation:
Department of Applied Economics and Management at Cornell University in Ithaca, New York
William J. Rossman
Affiliation:
Department of Agricultural Economics and Rural Sociology at The Pennsylvania State University in University Park, Pennsylvania
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Abstract

Recently, there has been much interest among horticultural producers concerning the marketing of organic and locally produced food. A consumer survey was administered that asked respondents to choose an applesauce product from a list of products differentiated by price, and by labels that described fat content, nutrition content, and whether the product was grown organically and/or locally. Our analysis indicates that consumers were willing to pay more for locally grown applesauce compared to applesauce that was labeled USDA Organic, Low Fat, or No Sugar Added. Furthermore, we find evidence that increased knowledge of agriculture decreases the willingness to pay for organic and locally grown applesauce.

Keywords

applesaucechoice experimentconsumer demandfruit and vegetable marketslocal foodmultinomial logit modelorganicPennsylvaniawillingness to pay
Type
Contributed Papers
Information
Agricultural and Resource Economics Review , Volume 38 , Issue 3 , December 2009 , pp. 357 - 370
Copyright
Copyright © 2009 Northeastern Agricultural and Resource Economics Association 

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