Consumer Behavior Impact: Meta-Analysis to Household Consumers’

Demand and Choice on Counter/In-season Bio-food

Applying Integrated Marketing Communication to Bio-food Market
Tian Yating
Consumer behavior has been hit topic as an inherent part of most marketing theories. It is
broadly applied in various industrial products marketing, however, cannot be formulized and
generalized, especially agro-food industry in Europe Union whose many countries debate
whether open the doors to GM food completely or not. Bio-food entering market is not new
for everyone in Europe, but bio-food marketing remains challenge in this field. It was
estimated European sales of organic products were worth between 13-14 billion € in 2005,
Germany was with the biggest market, which had annual sales of 3.9 billion € at the time. The
annual growth in the market for organic products is between 10-15%, European Commission
(2005). The market share of organic products of the total food market varies between 0-5% in
Europe according to Kottila and Rönni (2010) and Hamm and Gronefeld (2004). There are a
series of reasons behind this data among which is own to demands of fragmented consumer
segments-favored in organic food stated by Kottila and Rönni (2010). In agricultural food
field, more researchers and managers have discussed either downstream or chains which
considering farming, planting, production, feeding or upstream which considering much fast
sales through short-term tactical promotion, both of them are focusing on from agro-food
industry itself but not crucially from degree of customers’ need and want in-depth particularly
in bio-food market.

According to von Alvensleben (1997), the theory of consumer behavior is a complex,

multidisciplinary approach which goes far beyond the classical economic demand analysis,
which explains the food demand mainly based on income and prices variables.

Peter and Olson (2010) stated it is important to recognize that influencing overt consumer
behavior is most critical. It thought consumers must perform more than one overt behavior
but not intermediate steps in the influence process, and then marketing strategies can work
well. Practically it is passive transformation process from organizational strategies.
Obviously, this is less possible currently that consumers are more free to choose what they
want and substitute commodities ubiquitously.

Herrmann and Röder (1997) had analyzed food demand at the retail level and explained how
traditional econometric variables such as prices, income and newly-concerned food demand
variables as nutrition, attitude affected consumers demand. The two important conclusions
come up that are firstly price elasticities of retail demand are strongly affected by the way
price changes are communicated inside and outside the stores and sociodemographic variables
as well as health and diet information significantly affect food consumption.

Bio-food industry focuses on the customer demand and choice is a marketing way-out
differentiating from the GM food and involved intensively-farmed food. This is also fitting
for the market orientation theory that is popular among researches, a lot of scholars stressed
on the importance of market orientation from upstream to downstream industry chain to
organizational strategies. Jaworski and Kohli (1993)‘s findings showed market orientation is
helped by the visibility of top management emphasis on market orientation, the presence of
reward systems for employees for getting data and its’ feedback to market needs. In addition,
different levels of market turbulence, competitive intensity, or technological turbulence robust
the relationship between market orientation and business performance. A recent book is
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turning to transform food and agribusiness around the customer from Lindgreen et al. (2010)
explained from the days the consumers had been taking agricultural food granted as simply
commodities to market-oriented practices are fully implemented, customer value are added
more and more through appropriate routes of exploitation, during which win-win
opportunities are formed. They do collected the cases proofs to suggest managers that they
could benefit from upstream to downstream through more value-added process transforming
to customers, however, industry benefit and consumers benefit is not going to crossing but
fluctuate at any point of consumers’ shifting demand. Looking back to the bio-food is really
occupied the much more of market share or still “tip of the iceberg” or long-held in niche
market? Need to be observed.

Accompanied by consumers’ demand and choice, the food safety and nutrition consideration
gradually instilled by public education, knowledge transferring and research suggestions. In
2006 Food and Agriculture Organization (FAO) and World Health Organization (WHO)
indicated food safety problem potentially exists with risk in many countries due to the
complexity of food production systems and the ever-changing nature of international trade in
foods, FAO and WHO (2006). European Commission (2006) given the creation of an
inventory of existing food quality assurance scheme (FQAS) within the EU-25. The
international organizations, institutes of official authorities including FAO, WHO, European
Food Safety Authority (EFSA) and Council Regulation (EEC) set a lot of policies and
regulations following “From the Farm to the Fork” for food, particularly organic food, from
raw materials to production, quality inspection until final products those legislation decreases
the agility of the chain to respond to changes in demand but forces actors to ensure that the
information of organic origin is passed on from farmers to consumers as opinion from Kottila
and Rönni (2010).

Quality perception as a initial influence reflected to customers, it has been developed by a

long time debates. Marreiros et al. (1997) clarified modern consumers are no more satisfied
being guaranteed a safety level but require more information being delivered for decision-
making according to their individual concepts of health and natural even their tastes. Nutrition
as a key factor acquiring the knowledge by consumers selves drives preferences mainly
among certain group. Grunert et al. (2009) even specify understanding of guideline daily
amount (GDA) by front-of-pack (FOP) in six European countries, among those Germany is
one of highly understanding of GDA labels.

Not only those quality perception affect consumers’ purchase decision, but also others
combined layout design relative to food package or labeling. Grebitus et al. (2009) specified
that consumers’ increasing knowledge about food technologies and changes in food labeling
regulation influence agribusiness’ future product development and marketing strategies.

Against those backgrounds, the proper marketing strategy is needed to be specialized in terms
of customers’ demand and choice. As Mulder (2007) indicated marketers should make
communication efforts that are based on information that offer a platform to talk to
consumers.

Integrated marketing communication (IMC) has a long-term argument from theory forming,
launching, and enlarging to practical applying. The cross-functional process for creating and
nourishing profitable relationships with customers and stakeholders by strategically
controlling or influencing all messages sent to these groups and encouraging data driven,
purposeful dialogue with them, as is definition from Tom Duncan wrote in IMC. It changes a
traditional marketing-mix: 4 P’s (product, price, place, promotion) to the 4 C’s customer, cost,
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convenience, communication which focus more customers and relationship-based marketing
effort.

The objective of this study is to how much extent the multivariable facts affecting the
household consumers’ demands on bio-food purchase under strict food quality inspection,
various package designs, distribute channels, and how bio-food market can communicate
more and more highly-diversified-demand consumers by scientific education, individual
health requirement, driving by anti-disease plan to implement proper strategies to survival in
huge agro-food market.

The primary methods firstly may be used to data collection from household consumers’ who
often go to supermarket and bio-food stores or using home-purchase. The necessitate
projecting data generalization is questionnaires and web-based survey. Some summarized
public data may from policy bodies officially. The Statistical Package for the Social Science
(SPSS) software computation is no doubt applied to categorized math result coming out.

Part I. Theoretical

1. Household Consumers’ Demand

1.1 Needs, Motives and Exogenous Influences

− Family structure (size, international/local, generation/with children/not)
− Income/expenditure for food
− Religions
− Geography factors (moving house, regular residence)
− Cultural-cross (country)

1.2 Perceptions to Bio-food

− Bio-food Quality Assessment (Intrinsic quality, Extrinsic, Experiential, Credence)
− Potential social issues (QAS, BVL, Anti-GMO enviorment)

1.3 The Purchase Decision-Making

2. Outside-in Integrated Marketing Communication (IMC) and Bio-food Marketing

2.1 IMC Model
2.2 Bio-food Market
2.3 IMC in Bio-food Market

Part II. Empirical

3. Methodological Approach
3.1 Data Collection
3.2 Analysis

4. IMC launched in Bio-food Market

− Consumer-BioValue-based Analysis
− Consumer Marketing (Building a relevance with consumers Emphasizing Consumers’
reception being responsive to customers)
− Convenience
− Communication/Consumer relationship

5. Conclusion and Recommendations

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References:

European Commission (2006). Structured inventory of existing food quality assurance

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Prospective Technological Studies (Seville), Sustainability in Agriculture, food and Health,
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European Commission (2005). The Organic Farming in the European Union - Facts and
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FAO and WHO (2006). Food safety risk analysis - A guide for national food safety
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