What is decisive for a purchase? Seal or price?
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Whether organic, fair trade or CO₂-neutral - seals influence the decision for a product far less than its price. Despite the label’s advantages for the environment or society.
Agricultural economists at the University of Göttingen have investigated the extent to which self-serving factors such as the so-called "Warm Glow Giving" influence consumers' purchasing intentions. The "warm glow" is the personal benefit that people feel when they do good. The results were published in the Journal of Cleaner Production.
First the price, then the seal
The researchers from the Department of Marketing for Food and Agricultural Products at the University of Göttingen each had around 450 consumers from Germany and the United Kingdom to make virtual purchasing decisions: The choice was between chocolate, which differed in price, country of origin of the cocoa and country of manufacture, as well as in the seal depicted. The labels available were Organic, Fair-Trade and CO₂-neutral, but also an alternative without a label. Consumers then answered questions about their purchasing intentions, values and feelings.
The result: In both countries, price is the most important decision criterion, followed by seal and country of manufacture. In addition, the "Warm Glow" has a comparatively large influence on the purchasing intention - the prospect of getting a good feeling obviously attracts many consumers to buy products with ethical seals.
Seals work differently well
In the real purchase decision, the influence of the "Warm Glow" is only relevant for Fair Trade chocolate. The researchers assume that this is partly due to the strong common good concept of the Fair Trade label, which supports farmers in developing countries. "Other studies have shown that consumers also associate positive health aspects with organic food," says Sarah Iweala, lead author of the study and doctoral student in the "Global Food" graduate college. "Of course, this dilutes the seal's public-interest concept."
"If consumers don't know what a seal stands for, the good feeling cannot be created when shopping and thus cannot become the motivation for shopping," says Prof. Dr. Achim Spiller, Head of the Department of Marketing for Food and Agricultural Products.
Although consumers stated that they felt good when they reduced their CO₂ footprint, this good feeling did not make them choose the CO₂ neutral product. This can be explained by the low level of awarement of the seal. In both countries, less than 20% of the participants stated that they had already seen the seal while shopping. In contrast, over 90% of consumers were familiar with the Fair Trade seal.
The conclusion of the scientists is: "Our results show that in the marketing of ethical products the social benefit should be communicated quite offensively". They further write: "It is also important for marketing that labels can only be effective on the market if they are known. Today's flood of often unknown labels is counterproductive".