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Factors Determining Consumer Purchasing Behavior towards Organic Food

Yuhan Zhou, Junyu Chang, Luoou Tang, Xuedan Bai, Hanxuan Wang

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To identify and examine the importance of various factors influencing consumer purchasing decisions of organic food and their willingness to pay

Purpose

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Research Methods

Initial interest: Rise of organic food (Amazon’s acquisition of Whole Foods)
Literature review
Develop hypotheses (various possible factors)
Data collection - used MTurk to collect primary survey data
Regression Analysis to identify significant variables
Qualitative analysis of market
Conclusions�

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Binary Logit Regression

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Our Sample

The gender of our survey sample is pretty even: 263 females vs. 237 males.
Consumers in our sample are evenly spread out in all age groups
A little more than half of our research sample are not buying for children
Most of our survey sample are satisfied with their organic food purchase (91.6%)
Most of survey sample really care about quality, and ranked it as very important (84.5%)
A high percentage of our survey respondents ranked taste as very important (79%)
For income distribution, half of our survey respondents have below $2000 monthly disposable income, only 8.4% have $6000+ monthly disposable income.

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7 Statistically Significant Regression Results

Variable Type	Log Odds	Interpretation
Continuous variable	a one-unit increase in price importance rating results in decrease of log odds by 1.45	a one-unit increase in price importance rating decreases the probability of buying organic food by 19%
Continuous variable	a one unit increase in quality rating results in increase of log odds by 0.66	a one unit increase in quality rating increases the probability of buying organic food by 66%
Continuous variable	a one unit increase in sustainability importance rating results in increase of log odds by 0.43	a one unit increase in sustainability importance rating increases the probability of buying organic food by 61%
Continuous variable	a one unit increase in health importance rating results in increase in log odds by 0.58,	a one unit increase in health importance rating increases the probability of buying organic food by 64%
Continuous variable	A one unit increase in taste rating results in decrease in log odds by 0.65	A one unit increase in taste rating decreases the probability of buying organic food by 34%
Dummy variable	Consumers aged between 31-35 years old increase log odds by 0.95	Probability of buying organic food for consumers aged between 31-35 are 72% higher than consumers aged from 18 to 25
Dummy variable	Not be able to recognize USDA label decrease log odds by 1.03	Probability of buying organic food are 26% lower for consumers who are NOT able to recognize USDA labels than consumers who are able to recognize USDA labels

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FACTOR FREQUENCY

Price 51

Availability 40

Local 36

Freshness (Expiration Date) 31

Quality 22

Health Concern 21

No Chemicals or Pesticide-free 14

Non-GMO 12

Origin (Country) 11

Notes: Highlighted are the factors included in our regression model already

KOKO This is the open question where we asked them what other factors are important for your purchasing behaviors. though we already include “price, quality, health concerns” (the highlighted factors)in our previous questions, people still considered them to be really important. It is emphasized many times in their responses that people would pay more and buy more organic food if it is produced from local farms and they are willing to support their businesses. Also, the advantages of organic food—no chemicals, pesticide-free and non-GMO (genetically modified organism) are also the reasons why customers choose to buy organic food. Still, the problem appears to be that not many consumers really know what “organic” food is and we believe that the familiarity with organic food will be enhanced by the conception of differences existing between organic and conventional food.

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The Organic Food Team

Cornell University

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The Organic Food Team

Cornell University

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The Organic Food Team

Cornell University

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The Organic Food Team

Cornell University

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Conclusion��

Most significant quantitative factors: Price, quality, sustainability, health, taste, age 31-35 and recognize as USDA Organic

Most important qualitative factors to increase willingness to pay: availability, produced locally, freshness (expiration date), price, quality, health concerns, taste

The most purchased organic food sector: egg/poultry

The most unsatisfied sector with the past purchase: fresh produce and meat