A new study of consumer attitudes found that discount retailer Wal-Mart may be better suited selling organic “virtue” foods such as fresh produce than organic “vice” foods such as cookies, while the upmarket Target could be effective selling both products.
The University of Illinois study offered new insights about how organic virtue and vice products are viewed in different stores.
“We found that selling vice organic products in a store that has a very functional image like Wal-Mart, with more price-conscious shoppers, did not align well with the Wal-Mart image, but selling organic virtue products should go relatively well,” said study co-author Brenna Ellison, University of Illinois food economist.
On the other hand, in a store like Target, which is more design-oriented and upscale, Ellison said both virtue and vice products do relatively well.
The study found that consumers don’t look for organic goods like cookies and potato chips at Wal-Mart, but are open to buying organic strawberries and other produce.
Polling 605 people in an online survey, researchers asked participants to evaluate a food’s expected taste, nutrition, safety and likelihood of purchase, according to a news release. The products were fresh strawberries and cookies sold by a fictitious brand called Cam’s.
In the study, the products were either organic or non-organic, and sold in either Wal-Mart or Target.
“We chose strawberries and cookies because they represent a ‘virtue’ and a ‘vice’ product, respectively, and both are currently available in the marketplace in organic and non-organic forms,” Ellison said in a news release. “We chose Target and Wal-Mart because the two stores have similar prices but very different brand images. Target has positioned itself in the marketplace as a store that emphasizes style, design and aspiration. Wal-Mart, conversely, promotes a low-price image.”
Researchers also found that organic labeling provides different advantages for virtue and vice products. Consumers expect organic virture foods such as strawberries to taste better, and believe organic vice products like cookies are more nutritious compared with its conventional counterpart.
“These results suggest that the purchase of organic virtue foods like strawberries may be based more on taste considerations, but organic vice foods like cookies may be purchased based on nutrition considerations,” Ellison said in the release.
The study also found that consumers were not clear about organic standards.
“Even though products carrying the (U.S. Department of Agriculture) Organic label must contain at least 95% organic ingredients by definition, our participants believed organic cookies only contained 62% organic ingredients,” Ellison said in the release. “This suggests more education may be needed to ensure consumers understand what the organic label means and that this definition does not change across products or stores.”
The paper, “Putting the organic label in context: Examining the interactions between the organic label, product type, and retail outlet,” is published in Food Quality and Preference. The study was not funded by retailers or suppliers, according to the release.
Ellison said she has conducted another study that’s waiting publication on marketing organic fresh produce in a broader spectrum of retailers, from supercenters, supermarkets, farmers’ markets and specialty stores like Whole Foods. That study, which featured actual consumer purchases of organic tomatoes, also sought insights on perceptions of food safety for various retail outlets, she said.
“We gave people information about who is likely to be exempt from the Food Safety Modernization Act — smaller farmers — and we wanted to see how that information would change how consumers perceive the safety of products across the different outlets and if that would change what they are willing to pay,” she said.
Ellison said exemptions from food safety regulations did change perceptions of safety at various retail outlets, giving a big bump to supercenters, for example.
However, Ellison said that didn’t change what consumers would be willing to pay at various types of outlets, she said.
“Farmers markets and specialty stores like Whole Foods did get the highest willingness-to-pay values, followed by supermarkets and then supercenters,” she said.