Consumer Perception towards Organic Food Products in India Essay

Consumers worldwide are becoming health conscious and are concerned about nutrition (Hart, 2000) and the quality of food consumed. Consumers are also increasingly concerned with food safety issues taking into consideration, the recent salmonella case in Germany and elsewhere. Gil, Gracia and Sanchez (2000) have investigated that consumers are getting health conscious and are paying more attention to quality of food consumed. Therefore, food must deliver an added value that are sought after by consumers besides basic hedonistic and functional needs such as nutrition, taste, health, favorable price-quality ratio, etc., in the selection of food. This added value may be perceived in the form of ecological, social and individual bene? t. A study on consumer perception towards organic food products may add insight into the nascent but emerging organic food industry in India. The review of related literature in the area of organic food products and consumer perception studied has provided many insights for the study. It has also provided direction in designing the present study. A number of researchers have identi? ed various factors that in? uence consumer perception of organic food products mainly in developed countries. Some studies have also been undertaken in Asian countries like Malaysia and Indonesia. Very few researchers have attempted to focus in detail the various factors that in? uence consumer perception towards organic food. Having reviewed several studies and having identi? ed the gap, the investigator felt an imperative need to undertake the present investigation. Keywords: Demographic Factors, Organic Food Products and Psychographic Factors In? uencing Consumer Perception Organic Food in India The organic food market in India is at a nascent stage. Country speci? c research undertaken by A. C. Neilsen in 2006 has indicated that Indians are among the top ten buyers of food with health supplements but lack access to organic food products. Due to high logistic cost & low volume operation, organic food products are costly. However, India is an emerging player in the export market with billions of export potential. Also the domestic market is characterized by limited retail presence, low certi? ed branded produce and a small range of organic product offerings with respect to varieties though marginal growth is becoming evident. Some of the exclusive retail outlets selling organic food products in and around Bangalore are Hypermart, Spar, Spencer’s, ADITYA Birla group’s More outlet etc. Branded organic food products like ProNature, Navadarshanam, ITC’s Aashirvaad Organic Spices, etc. , are also available at most super-markets. Arogya, Jaivika Krishik Society, Econet, Janodaya, Era Organics, Khnadige, Foodworld Gourmet, Koshy’s Departmentals, organ, Green Channel, Namdhari’s Fresh, Green Fundas, Savayava Siri, Health Fo od, Srinidhi Nysargika Thota, Iha Naturals, Tibetian Organic, Iskon, Plant Rich, Jaiva and 2 4 Letter Mantra. 304 Business Management and Information Systems Literature Review Organic food is a topic of great interest in the USA (Greene, 2000), Europe (Food and agriculture Organization, 1999) and the market is fast growing in other parts of the globe (Yusse? and Willer, 2002). Crutch? eld and Roberts (2000) expressed that the last one decade has witnessed growing public concern towards issues such as health, nutrition and safety. Introduction of genetically modi? ed organisms, spread of Escherichia coli infections, etc. , have lead to the association of risk with the consumption of conventionally grown produce amongst consumers (Williams and Hammitt, 2001). Makatouni (2002) studied that organic food is closely associated with not just health, but also with social, economic and ecological sustainability. Organic food products is amongst the fastest growing areas of the food market in Europe, Northern America, Australia and Japan with sales exceeding $114. 5 billion in 1999 (Ebrahimi, 2007) with plent y of international growth potential according to agricultural & food industry experts. Organic food market in the South East Asian region constitutes average consumption of 20% per annum, while the organic industry is valued at US $25 million (Ramli, 2005;Organic Monitor, 2006). Research Gap Based on the above literature review, the following research gaps could be identi? ed and have been suggested as follows: 1. Fear over food scandals and certain technological advances such as genetic manipulation and food irradiation has heightened consumer concern on safety issues giving rise to a growing demand for quality guarantees and additional information about production methods. Despite concern towards safety of food consumed, consumers do not completely trust organic food products on this parameter and hence it is imperative to  conduct a study to identify the present scenario. 2. Country speci? c research undertaken by A. C. Neilsen has indicated that, ‘Indians amongst the top ten buyers of food with â€Å"health supplements† globally but lack access to organic food products. ’ Statement of the Problem The market for organic food products in India has emerged because of the following two reasons. †¢ To tap the lucrative export markets for organic products in the developed countries. †¢ Organic processed food products represent higher ‘added value’. †¢ Producers and Consumers general concern for environment and ideologies Incidentally, in India, most of the organic produce is grown to be exported to the $25-30 billion global market. The rest is sold at predetermined retail outlets. So, if the trend for organic p roducts is growing among producers then, its bene? ts must naturally reach the local population of a countr y. This will also ensure that the food products are nutrient rich as processing required would be minimal from the point of origin & consumption. Objectives of the Study The objective of the study is on consumer perception towards organic food products in Bangalore are as follows: a. To study the organic food market in Karnataka b. To study the relationship between demographics of customer and factors of perception of consumers towards organic food products Consumer Perception Towards Organic Food Products in India 305 c. To identify the in? uence of factors of perception on the overall satisfaction of customers towards organic food products . Hypothesis of the Study The following hypothesis was used to test the effect of perceptual factors on the overall satisfaction of consumers towards organic food p roducts. †¢? Hypothesis? 1:? There is no significant in? uence of factors on the overall satisfaction of customers towards organic food products †¢? Hypothesis? 2:? There is no signi? cant difference between demography of customers & factors of percep tion. †¢ Hypothesis 3: There is no signi? cant correlation among factors of p erception Sample Size For the present study, questionnaires were distributed to around 300 respondents, from whom 246 correctly completed questionnaires have been obtained, yielding a response rate of 81. 9 percent. Table 1. Distribution of the Sample According to Gender, Age, Educational Quali? cation, Average Spending Per Month and Frequency of Consumption. The Table 1 describes male constitution as 59% and females as 41%, the distribution of sample with reference to age wherein maximum respondents were below 30, according to education, maximum 306 Business Management and Information Systems respondents are graduates and 25% of the respondents are post graduates. fourthly, average spending is more than 1000 per month. Lastly, Maximum numbers of respondents consume organic food products on a weekly basis followed by a minimum number of respondents consuming organic food products once a month. The least amount of consumption falls in the category of once a month consumption pattern. General Findings Following are the ? ndings related to this study on consumer perception towards organic food products in Bangalore. 1. Consumers of organic food products evaluate product quality with the price theyp a y . 2. Demographic variables namely gender has a positive impact on consumer perception towards organic food products while difference in educational quali? cations do not have a signi? ca nt impact. 3. There is signi? cant impact of psychographic factors on overall satisfaction of consumers towards organic food products. 4. Consumers consider organic food products as safe for consumption. 5. The respondents have also felt that organic food products are healthy to consume 6. Consumers generally prefer to consume grain based organic food products followed closely by organic grains and organic fruits. Implications of the Study It is important to study factors that have an influence on consumer perception towards organic food products. This study helps consumers and producers/marketers of organic food products to understand the importance of various factors on overall satisfaction towards organic food products. An understanding of consumer perception leads to the creation of better marketing strategies. Here the marketers can focus on appropriate pricing and promotional methods particularly to increase the visibility of organic products to make a positive impact on their perception so as to increase potential sales in the domestic market. Consumers are both quality conscious and price sensitive. Marketers and producers should collectively work towards bringing quality produce in the market to gain market acceptance. At the same time, both marketers and producers should work in consensus with the pricing factor which is perceived to be one of the most important factors in? uencing consumer perception as well as their overall satisfaction towards organic food products. This will help marketers to formulate a strong communication plan in order to influence consumer perception towards organic food products. This study has identi? ed availability of information and promotional activities undertaken by marketers to be one of the important factors influencing consumer perception towards organic food products in Bangalore. Marketers can look into ways of increasing consumer knowledge on organic food products and help them differentiate the bene? ts of consumption of organic versus nonorganic food products. Conclusion The results of the study show that there is a signi? cant relationship between various psychographic factors on the overall satisfaction of consumers towards organic food products. This implies that both producers and marketers need to concentrate on speci? c factors so as to improve the market potential for organic food products and thereby contributing to the general well being of the society and the larger good to en viro nm ent. Consumer Perception Towards Organic Food Products in India 307 References [1] Allen, W. M. (2000). The attribute mediation of product-meaning approach to the In? uence of human values on consumer choices, Advances in Psychology R esearch, l, pp. 31–76. [2] Arzen, I. (1991). The theory of planned behavior. Organizational Behaviour and Human Decision Processes, 50, pp. 179–211. [3]Baker, S., Thompson, K. and Engelken, J. (2004). Mapping the values driving organic food choice: Germany vs. the U. K. and the U. K. vs. Germany. European Journal of Marketing, 38(8), pp. 995–1012. [4] Brown, E. , Dury, S. and Holdsworth, M. (2009). 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