CHAPTER 2

COFFEE CONSUMPTION

A REVIEW

Abstract

This chapter represents the theories related to consumer preference and

its results. Moreover, this chapter reviewed the challenges a agricultural
business in the coffee industry is facing, the concepts of buying behavior
studies and the impacts and benefits it contributes to the industry.

2.1 Coffee industry

Coffee is one of the most popular beverages worldwide and it has played
an important role in consumer culture since the mid-sixteenth century. Over
the last decades, coffee has undergone a transformation from a pure
commodity to a specialty product, an evolution that is commonly divided into
the so-called “three waves of coffee consumption” (Manzo, J., 2014). The
first wave of coffee consumption started in the 1960s, which was
characterized as a mass-market with exponential consumption growth and
wide availability. The second wave of coffee consumption began in the 1990s
with the formation of coffeehouse chains, mainly Starbucks. Coffeehouses
introduce specialty coffee to respond to the new consumer interest in coffee
quality. Coffee becomes a luxury product rather than a commodity (Carvalho
et al., 2015). The third wave of coffee had its genesis with small roasters, who
promoted specific regions and new brewing techniques . Coffee is now
considered a high-quality artisanal food, often compared to wine. The act of
drinking a coffee means more than just consuming a beverage. It is about
pleasure, experience, lifestyle and social status. This change in consumer
behavior has been possible due to three approaches that currently characterize
the consumer product coffee: pleasure, health and sustainability (International
Coffee Organization (ICO), Global Coffee Forum, 2015). Coffee is the
world’s second most consumed liquid solute next to water. Coffee beans
themselves have little to no taste at all. The flavor, the aroma of coffee: it all
comes from the roasting process which releases a large number of chemicals
from the tiny bean. In fact, the average cup of coffee contains more than 1,000
chemicals. To transfer those delicious chemicals to the hot water in our cup,
we run water over those roasted beans. To increase our success, we both grind
the beans to increase their surface area (and thus more exposure of those
chemicals to the water) and heat the water since higher temperatures (and thus
energies) speed up the removal of molecules from a solid. The common
cultivated varieties are namely the robusta, arabic, liberica and excelsa which
are used for household consumption and commercial purposes like
manufactured output coffee base product and others of raw materials for other
beverages that uses coffee base by products this is according to Philippine
Statistics Authority (PSA). According to sustainable commodities
marketplace series 2019 coffee one of the most traded agricultural
commodities in the world: in 2017 alone 70 per cent of total coffee production
was exported, worth USD 19 billion. That same year, the sector had a retail
market value of USD 83 billion, providing jobs for 125 million people. Coffee
is grown on 12.5 million farms worldwide, of which 67–80 per cent are
smallholder farms primarily located in developing countries, including 22
Low Human Development Countries (LHDCs). The largest producing and
exporting countries in 2017, irrespective of human development level, were
Brazil (USD 4.6 billion), Vietnam (USD 3.5 billion) and Colombia (USD 2.58
billion), while the largest importing countries in 2017 were the United States
(USD 6.3 billion), Germany (USD 3.5 billion) and France (USD 2.8 billion).6
Overall, coffee supply growth outpaced demand growth from 2016 to 2017, at
rates of 5 per cent versus 2 per cent respectively, resulting in a global coffee
surplus of around 250,000 metric tonnes. The global supply–demand balance
of coffee varies from year to year: 2016 closed with a supply deficit, while a
surplus is estimated for 2018. The sector is projected to grow, fuelled by
increasing demand from producing countries and emerging economies that
have not traditionally been among the major coffee importers, such as Brazil,
Indonesia and China, as well as the expansion of retail options and coffee-
based products such as readyto-drink products. Another notable development
is the increased adoption of voluntary sustainability standards (VSSs) by
coffee producers: in 2016, 34.5 per cent of the market was made up of VSS-
compliant coffee, while coffee that was potentially VSS-compliant
represented 21.4 per cent, and conventional coffee production accounted for
44 per cent of the market. The market advisory firm Mordor Intelligence
predicts that the global market (retail) value of the coffee sector will
experience a 5.5 per cent compound annual growth rate (CAGR) from 2018 to
2023, yet this positive outlook must be viewed against the coffee sector’s
history of price volatility across multiple decades and long-term price decline.
Traditionally, farm gate prices have struggled to keep pace with production
costs, which hurts farm profitability and makes it difficult for coffee farmers
to make long-term decisions on investments and planting, ultimately
disincentivizing many of them from staying in the sector. Increasing the
volume of coffee production, regardless of whether this coffee is VSS-
compliant, to meet the projected growth in demand from non-traditional
coffee importers is further challenged by the effects of a changing climate, as
land suitable for coffee cultivation will be subject to more unpredictable
weather patterns, with negative implications for coffee yields. These climate
change risks are not limited just to extreme weather events: there are already
cases where coffee-producing countries have faced severe pest and disease
outbreaks, such as coffee rust, that have decimated their crops and further
exacerbated the volatility of the global coffee market. Since the 1990s, the
coffee production and consumption in low- and middle-income countries is
increasing, with accounting production increase of 69% percent, and cacao &
leafy teas are also increasing consumption on the particular beverages. China,
Vietnam and Brazil, in particular, have emerged as major coffee raw products
producers. Meanwhile North American and European producers have lost
their global market shares. Global demand for coffee raw products and coffee
agro-products will continue to increase, owing to global population increase
and growing per capita consumption. Trade will also go up, facilitated by the
effect of globalization that aligns the development in transportation,
infrastructure development, marketing networks and technological innovation.
These factors, and the rapidly changing regulations and rising standards for
food safety in high-income countries, create both challenges and opportunities
for low- and middle-income countries. In low-income countries, commercially
produced coffee based output product is well placed to satisfy the demands of
a rapidly increasing affluent, middle class who can afford to pay for premium
coffee beans or coffee products. Facilities and agricultural methods that adapts
technological development for producing volume of premium quality coffee
beans can be established quickly and soon start generating. In developing
countries, the diet of people living in cities usually contains more on the
norms of having a coffee drinks as simulant beverages to start the social
activity comparing to the rural people, mainly because urban people are more
prosperous, but also because they generally have access to a wider variety of
foods and beverages at local markets or other form of retail outlets. In addition
urban people has a higher purchasing power that they can utilize. In low-
income countries, imports of cheap low-quality of 3 in 1 package ( Coffee,
Sugar and Creamer) manufactured by the large producing company provide
accessible to the average consumer. This coincides with changing
consumption habits in developed countries, where consumers tend to buy
roasted coffee beans which also relate on the health conscious consumers that
preferred to have an organic synthesis product. Coffee products are usually
exported in a bulk sizes.In many low-income countries, local produce cofee
are traditionally sold to big companies like (nestle, commonwealth food,
Universal Robina, Regent foods corp and other large producers of coffee by
products). In addition other segment of the coffee bean produce locally goes
to the local roastery and coffee shops.
2.2 Philippine Coffee Industry

The Philippines has been dependent on the Small farmers which

accounts the country‟s vast volume of production and the main contributor
of producing green beans coffee producers is in the region of Mindanao. The
main four varieties grown are: Robusta which accounts for 69% of production,
Arabica (24%), Excelsa (6%) and Liberica (1%). However, the country‟s
coffee supply is not enough. In 2015, coffee production was only 36,171 MT
of green coffee beans. Farm yields averaged only 0.30 tons per hectare.
According to the International Coffee Organization (ICO), 144.8 million or
8.668 million tons was the global estimated number of 60-kg bags of coffee
produced in 2015-2016. There was also an estimated increase of 1.6 percent in
global coffee production in 2015-2016. Farmers market coffee to small
processors, large companies and specialty coffee shops. These buyers process
coffee into various forms – such as green coffee beans (GCB), roasted,
ground, and instant. The continuous drop in production was caused by various
factors such as: increase number of coffee growers shifting to other crops, old
age of trees with limited or no rejuvenation; poor farm practices – limited
knowledge on appropriate coffee technology of farmers, aged farmers; limited
access to certified planting materials and limited access to credit. Structure
Majority of coffee farmers have an average farm size of one to two ha, with
most farms owned by the farmers themselves. Most farms are intercropped
with vegetables, coconut, fruit trees and forest trees (especially in the case of
Arabica coffee). There are very few commercial scale plantations in the
country. According to department of agriculture the most common variety
grown in the country is Robusta, which accounted for 69 percent of total
production in 2015. Robusta is mainly used for instant coffee. Next is
Arabica, which contributes 24 percent (%). Arabica is mostly cultivated in
high elevation areas (1000 meters 6 above sea level) and sells at a premium
price. It is primarily used for brewing or blending. The other varieties are
Excelsa and Liberica (kapeng barako). There are local small and medium
coffee processors of roasted beans and ground coffee in the country. Nestle
Philippines, Inc., located in Cagayan de Oro, is the largest local processor of
soluble coffee which accounts for 80% of the instant coffee market. It is
followed by Universal Robina Corporation and Commonwealth Foods Corp.
Green coffee beans (GCB) are used to produce roasted beans, as well as
ground or instant coffee. Roasted beans are intended for grinding. It has a high
demand among industrial buyers and some institutional users. Ground coffee
is derived from crushed roasted beans, mainly for brewing and has a better
flavor than instant coffee. The market includes industrial buyers, institutional
users and households. Instant soluble coffee is easy to prepare and priced
lower than ground coffee. These include pure soluble coffee, single-serve
sachet mixes (e.g., 2-in-1 (coffee and sugar), 3-in-1 (coffee, sugar and
creamer), mixtures and ready-to-drink. There are also 5-in-1 and 7-in-1 coffee
variants with added functional ingredients. There are also specialty coffees
made from the high quality green coffee beans roasted and brewed according
to well-established standards. They include Arabica blends, organic coffee,
Civet coffee (Alamid coffee), etc. which cater to niche markets. At the global
level, total production by all exporting countries from 2014 to 2015 increased
by 0.7%. Philippine production increased at a faster rate for the same period at
3.5%. According to Food and Agriculture Organization (FAO) statistics,
Brazil is the top coffee global producer in 2014 with a volume of 2,804,070
MT of GCB. It is followed by Vietnam, Colombia, Indonesia and Ethiopia.
However, the Philippines ranked 25 th with a volume of 37,727 MT of GCB.
In the Philippines, small farmers grow coffee. Based on official statistics from
the PSA, production has generally declined by 3.51 percent per annum over
the past ten (10) years from 52,047 tons GCB in 2006 to 36,171 tons of GCB
in 2015. Meanwhile, area planted for coffee also decreased by 1.02% per year
over the last ten years. About 117,451 ha planted/harvested for coffee in 2014
had declined by 3.16% to 113,738 ha in 2015. This was attributed to the
increase of number of coffee growers shifting to other crops, land conversion
to real estate and recreation areas and urbanization. In the past 10 years, yield
per hectare declined by 2.53% per year. Meanwhile, yield per bearing tree
decreased by 2.09% per year over the last 10 years. The low productivity was
caused by old age of trees, limited rejuvenation and poor farm management.
(Note: Based on industry data, the average yield is 250 – 300 kg green coffee
beans per hectare.) On the average, there were 693 bearing trees in a hectare
during the 10-year period as compared to the standard 1,100 trees per hectare
planting density or at three meters by three meters planting distance for
Robusta. The drop in densities is attributed to crop shifting and cutting of old
trees. In 2015, the top three producing regions were concentrated in Mindanao
namely, Davao Region, SOCCSKSARGEN, and ARMM. Collectively, they
contribute 68 percent of the coffee produced in the whole Philippines.
SOCCSKSARGEN accounted for 37 percent of total output in 2015 or 13,479
tons of green coffee beans followed by Davao Region with 16% or 5,840 tons
of GCB and then ARMM with 15 percent or 5,263 tons of GCB. Based on
PSA 2015 estimates, Robusta accounted for 24,924 MT or 69% of total
production, followed by Arabica with 8,717 MT or 24%. In 2015, the
dominant regional producers of Robusta and Arabica coffee were Davao
Region and SOCCSKSARGEN while Excelsa was mostly produced in
ARMM and Davao Region. Liberica coffee was mainly produced in Western
Visayas and ARMM. According to Salvador Salacup 2011, Assistant
Secretary of the Department of Agriculture, that there is a shifting pattern
between coffee and Leafy tea drinks or cocao based products in the global
market. Filipinos tend to buy coffee more when substitute products prices are
high and vice versa. Since Coffee prices are much lower for now, Filipinos
tend to buy coffee by products rather than the substitute products which in
turn increase opportunities for local farmers to produce more quality and
consistent coffee products. Coffee products became the Filipino’s staple
viand. Before Filipinos would prefer to coffee rather that buying “Tsokolate”
a cacao products non-caffeine which is, the substitute product long, which
became scarce and are more expensive than Coffee. Today, everywhere
people can buy different kinds of coffee products and as well as green coffee
beans raw products. Even the roasted coffee bean varieties on the process and
curing period presented by the product output is also present at cafes,
resturants, and even fast food chains at almost every street corner in the
country’s major cities. Filipino Consumer reports say eight out of 10 adults in
the Philippines drink an average of 2.5 cups of coffee every day.
2.3 Coffee Buying Behavior

Past consumer research towards coffee consumption and purchasing

behavior has focused strongly on the issue of sustainability and ethical
consumption (26 out of 54 papers). Among the sustainability labels, the fair
trade issue was the most analysed (17 out of 26 papers on sustainability).
Most of the reviewed literature on sustainable consumption and purchasing
behavior used a willingness-to-pay approach (11 of the 25 studies on
sustainability), with choice experiments being the most adopted method to test
willingness-to-pay for coffee with sustainability labels (e.g. Andorfer &
Liebe, 2013; Asioli, Almli, & Næs, 2016; Asioli, Næs, 131 Øvrum, & Almli,
2016; Basu & Hicks, 2008). Researchers used consumer-preference methods
based on actual purchasing behavior to overcome limitations of social
desirability of stated preference methods (Arnot, Boxall, & Cash, 2006; Basu
& Hicks, 2008; Breidert et al., 2006). Two studies applied the hedonic price
method that allows for an investigation of what consumers actually have to
pay for various coffee attributes in the market (Bissinger & Leufkens, 2017;
Schollenberg, 2012). Other authors conducted experiments with price
perception in supermarkets (Andorfer & Liebe, 2015) or coffeehouses (Arnot
et al., 2006), testing consumers for revealed and stated consumption and
purchasing behavior. Arnot’s (2016) study is apparently the first to examine
fair trade purchase behavior in an actual market setting, adjusting prices of
coffee vendor on campus. Similarly, Cailleba & Casteran (2009) claimed that
that there are not enough studies that measure and test actual ethical
purchasing behavior, but they focus to consumer perception and values.
Therefore, they used a quantitative approach and supermarket panel data to
study actual consumer behavior towards fair trade. After sustainability, the
second most important issue of interest is consumer behavior towards
coffeehouse brands, mainly Starbucks (6 of the 9 papers focusing on
coffeehouses). Six of these studies used a qualitative approach, applying
interview techniques, direct observation, and text analysis as preferred
methods for data collection. The qualitative studies focused mostly on
consumer behavior in coffeehouses and on the context of consumption. These
studies were conducted in North America and Asian markets (e.g. Bookman,
2013; Quintao et al., 2017; Huang, 2014; Wu, 2017; Smith Maguire & Hu,
2013). Furthermore, it is worthy to note that the interest in specific aspects of
consumer consumption and purchasing behavior towards coffee changes in
relation to the geographical area where the studies were conducted. Table 3
offers a location profile of main research issues of the selected papers. The
issues of sustainability and ethical consumption play a major role in
consumer studies from Europe and North America. In Asia, the two issues still
play a minor role. In studies from Asia, the main research subjects are
consumer behavior towards coffeehouse brands and the context of
consumption, as well as consumer preferences for 1ready-to-drink coffees.
Some of the studies conducted cross-country analysis of consumer behavior
(Basu & Hicks, 2008; Sepúlveda, Chekmam, Maza, & Mancilla, 2016). The
issue of coffee consumption and health is only addressed in three European
studies and mainly limited to caffeine intake (Ágoston et al., 2017; Hewlett &
Wadsworth, 2012). Finally, the review shows that there has been an evolution
in the researchers’ interest. The 167 interest in consumer behavior towards
coffee consumption has grown over time. Before 2010 168 the number of
studies was limited and they investigated nearly exclusively the fair trade
issue. 169 In the following years other topics were analyzed. Fair trade has a
peak of interest in 2015. In 170 the recent years, there is a growing research
interest in different aspects of coffee 171 consumption behavior, such as
motives for coffee consumption behavior, the context of 172 consumption
specialty coffee, coffeehouse brands, and coffee drinking as a lifestyle 173
experience. The focus on coffee stores, brands and coffee consumption as an
experience, 174 increased beginning from 2012.

2.4 Drivers and barriers to coffee consumption Several studies have

investigated the reason why consumers drink coffee or caffeinated beverages.
The review identified seven main factors driving or limiting coffee
consumption, which have been grouped into two categories: personal
preferences and economic attributes. The category of “personal preferences”
includes the motives “functional“, “sensory (taste, smell)”, “health belief”,
“habit, tradition and culture”, and “connoisseurship”. The factors of price and
promotion build the category economic attributes. There is evidence that the
two most important factors for consumers’ coffee purchasing and
consumption behavior are “sensory preferences” and “functional motives”.
Furthermore, some studies provide insight into how these two principal
motives are related to the issue of emotions and physical effects experienced
during coffee drinking.

2.4.A Sensory perception and pleasure

The sensory qualities of coffee, taste and smell, are key motives for coffee
consumption behavior. Several papers mention taste as the main motive for
coffee drinking (Sousa et al., 2016; Harith, Ting, & Zakaria, 2014; Van Loo et
al., 2015). At the same time, the taste motive also limits the consumption of
coffee. The main reason for those who do not to drink coffee is because they
do not like the taste and/or the smell of coffee (Sousa et al., 2016). Similarly,
Harith et al. (2014) report that coffee-drinkers appreciate the bitterness of
coffee, while non-coffee drinkers disapprove of the bitter taste. People who
like the sensory properties of coffee also have a positive attitude towards
specialty coffee consumption (vander Merwe & Maree, 2016). A study on
motives for caffeine consumption of different caffeinated beverages (coffee,
tea, energy drinks, etc.) shows that taste is equally and highly important for all
types of caffeine consumers (Ágoston et al., 2017). Bhumiratana et al. (2014)
relate the taste motive to the emotion type “positive-lower energy feelings”:
consumers want to elicit positive feelings from the coffee drinking experience
that are related to sensory enjoyment and pleasure. In the same vein, (Labbe,
Ferrage, Rytz, Pace, & Martin, 2015) illustrate that consumers who drink
coffee for sensory enjoyment attribute more importance to coffee smell and
taste and find the experience in general more pleasant. On the emotional level,
drinking a cup of coffee is a personal moment of pleasure (Harith et al., 2014;
Sousa et al., 2016) and a source of comfort, which allows consumers to stay
calm and 227 face daily challenges (Richelieu & Korai, 2014). For example,
Richelieu & Korai (2014) mention that coffeehouse consumers associate
coffee with attributes of happiness, joy, companion and extended relationship.
Conversely, Aguirre’s (2016) results show that the taste motive appeared only
on the eighth position among the factors influencing coffee consumption
behavior.
 2.4.B The functional motive

is a key motive for coffee consumption. Several papers mention physical and
mental stimulation as one of the main motives for coffee consumption. People
drink coffee to elicit positive-high energy emotions (Bhumiratana et al.,
2014), with the objective to be aroused, to reduce fatigue, to stay awake, to
improve work performance and for feelings of a focused mental state (i.e., to
be motivated, in-control, productive, or clear minded) (Ágoston et al., 2017;
Aguirre, 2016; Bhumiratana et al., 2014; Harith et al., 2014; Hsu & Hung,
2005; Spinelli et al., 2017). Different motives for the consumption of coffee
result in different emotional experiences. Labbe et al. (2015) observe that
consumers who drink caffeinated beverages for stimulation consider the
experience as functional, i.e. driven by caffeine absorption to obtain the
expected mental and physical energy boost. Therefore, the functional motive
results in a less pleasant experience compared to sensory motivation.
Consumers seem to move from an impulsive behavior (such as consuming
caffeine for its stimulant effect) to compulsive behaviors (consuming caffeine
and coffee as a habit) (Ágoston et al. 2017). Conversely, Sousa et al. (2016)
find the alertness motive to play a minor role: only

A further surprising observation is that preferences for “sensory” or

“functional” motivations of coffee consumption depend on “individual
physiological characteristics”. Subjects with a lower caffeine metabolism rate
(CMI) focus more on social aspects of the coffee drinking experience, while
higher CMI find the sensory properties of coffee more rewarding. Individuals
with a lower number of fungiform papillae (FP) find the product sensory
characteristics more rewarding than individuals with higher FP number, which
focus more on the stimulating effect of coffee. Both PROP non-tasters and
supertasters tend to prefer acontext where the focus is on social aspects related
to the coffee consumption (Spinelli et al., 264 2017). 4% of respondents
consume coffee because they consider it ‘stimulating’. Concerning socio-
demographics, age influences the preference for the stimulation motive.
Younger consumers drink coffee more for stimulation reasons than older
people, who mainly consume coffee out of habit and for symptom
management reasons. Symptom management refers to the effect of coffee on
specific physical conditions. Coffee is consumed for its perceived positive
effects on blood pressure or headaches (Agoston et al. 2017) and to improve
physical performance, for example after a meal for the digesting effect
(Spinelli et al. 2017).

2.4.C Health belief

The health factor has not received a lot of consideration in coffee consumer
research, which is surprising giving that the health aspect, even though
controversial, is often an issue in coffee consumption. A consumer study
reveals that 49% of respondents believe drinking coffee may cause health
problems (ISIC 2015). It would also be in line with the increasing interest on
consumer health perception of other food products with debatable effects on
health, such as wine (Samoggia, 2016). The belief in coffee’s health benefits
or risks can be a driver or barrier for quantity and frequency of coffee
consumption. Aguirre (2016) finds the health benefit (e.g. anti-migraine
effect) to be the second most important factor, after gender influencing coffee
consumption in a consumption context, with a traditionally positive
inclination towards the health benefits of coffee. On the other hand, other
research findings suggest a possible link between certain coffee drinking
habits and other pro-health behaviors. Hewlett & Smith (2006) show that
consumers who preferred drinking decaffeinated coffee do so for health
reasons, and to avoid the full effect of caffeine. Sousa et al. (2016) find that
13% of respondents avoid coffee for medical reasons, like anxiety and
insomnia, and 10% do so because they hold a general belief that coffee “is bad
for health”. The health motive can also have a significant positive effect on
consumers’ purchase intention towards coffee. Consumers with a positive
attitude towards organic coffee will actually pay higher prices for it because
of their belief in its health benefits (Lee, Bonn, & Cho, 2015). Interestingly,
perceived health benefits also contribute to a positive attitude towards
specialty coffee consumption (van der Merwe & Maree, 2016).

2.4.D Habit, tradition and culture

The habit factor includes items that characterize caffeine consumption as a

daily routine, as a behavior that is regularly repeated and tends to occur
subconsciously (Ajzen, 2002). Habit is one of the main motivational factors
for coffee consumption identified by Agoston et al. (2016). Results of their
study on motives for consuming caffeinated beverages (coffee, tea, 293
energy drinks, etc.) show that, for coffee-drinkers, the habit factor was of
greater importance. The habit factor shows socio-demographic differences.
Habit as a factor for coffee consumption is more important for women and for
older people. Gorgoglione, Messeni Petruzzelli, & Panniello (2017) find in a
study comparing consumption of innovative and traditional coffee brands,
that the item habit is associated with the concept of a traditional consumption
behavior. Aguirre (2016) emphasizes the strong influence of culture and
tradition and points to the family/household context as a source of information
in forming a coffee consumption behavior. In this context, gender also plays a
role, as mothers transmit the taste for coffee and how to consume it to new
generations. Likewise, Sousa et al. (2016) find the factor “tradition and habit”
(e.g. consuming it since childhood as a part of breakfast/snack) to be the
second most important driver for coffee drinking after taste.

2.4.E Connoisseurship

Quintão, Brito, & Belk (2017) theorize the process that converts regular
consumers into connoisseur-consumers by establishing standardized ritual
practices that differentiates them from the naïve/mass consumers.
Connoisseurship means applying a schema to understand, evaluate, and
appreciate the consumption objects (Holt, 1998). A connoisseur-consumer has
differentiated consumption knowledge compared to regular consumers due to
his expertise. Connoisseur-consumers develop their taste perception through a
reflexive consumption activity helped by professionals and other
connoisseurs. Giacalone, Fosgaard, Steen, & Münchow, (2016) point out that
in contrast to the connoisseur-consumer, the regular coffee drinker may lack
the sensory skills to recognize coffee quality. Naïve consumers are not able to
detect quality differences between two coffee samples widely different in
intrinsic quality. They suggest that the regular consumer may experience
coffee as “just coffee” and, therefore, rely on external cues, such as price,
packaging and advertising for their coffee purchase. Consumers who are
better at identifying quality differences are more likely to prefer high quality
coffee. Better sensory skills increase appreciation of quality (Giacalone et al.,
2016).

2.4.F Economic attributes

The price attribute of coffee is widely studied in connection to consumer

perception of sustainable coffee and out-of-home coffee consumption. In these
contexts, coffee consumers are significantly price-sensitive. A decrease in
price, or an increase in price promotions, stimulates an increase in consumer
purchasing attitudes. In the reviewed papers, the price attribute is mainly
discussed concerning the willingness-to pay for specialty and sustainability
labeled coffee products. Price is a significant barrier to the purchase of fair
trade products (Cailleba & Casteran, 2010; De Pelsmacker, Janssens, Sterckx,
& Mielants, 2005b; Cranfield, 2010). In ethical consumption behavior, the
price attribute stands in conflict with individual preferences for further coffee
attributes. Consumers find that fair trade coffee is too expensive, but at the
same time they feel a moral obligation to buy it (Andorfer & Liebe, 2015).
Therefore, Cailleba & Casteran (2010) argue that price promotions can
stimulate the adoption of fair trade coffee consumption behavior. Non
purchasers of fair trade coffee switch to opportunistic consumer behavior
motivated by a lower price. Similarly, Andorfer & Liebe (2015) confirm that
reduced product prices impact positively on fair trade consumption behavior.
Sales of fair trade coffee increased significantly during a three-week price
promotion experiment in supermarkets, while additional information and an
appeal to consumers’ moral obligation, on the other hand, showed no effect.
Price influences purchase behavior of specialty coffee: as the price of coffee
increases the likelihood of purchasing specialty coffee decreases (Sepúlveda
et al., 340 2016). Price promotions are of interest for marketing and consumer
research in out-of-home coffee consumption. One study reveals that price
promotions determine whether customers are satisfied with product and
service quality and encourage repeat-purchase intentions in a coffeehouse
context. Coffeehouse customers see price promotions as a reward or incentive
31% of respondents in a consumer survey went to Starbucks due to
promotional activities; compared to 41% who went because of the coffee
itself. The importance of the price attribute depends on age, gender, the social
status and the cultural background of the consumer. Student customers were
more attracted and willing to return to coffeehouses due to price-promotion
activities (Huang, Chang, Yeh, & Liao, 2014). Age affects also coffee type
preferences: younger consumers present higher willingness-to-pay for ‘Latte’
products, while older consumers show higher willingness-to-pay for
‘Espresso’ and vice versa (Asioli et al. 2014). There are gender differences
concerning price sensitivity. As reported by Aguirre (2016), coffee price is a
more relevant factor for women than for men. In another study, younger
consumers prefer ready-to-drink coffees as a cheaper alternative to specialty
coffees (Hsu & Hung, 2005). Concerning the cultural background, Aguirre
(2016) has observed that consumers coming from a culture with a strong
coffee consumption tradition are willing to pay for high-quality coffee a price
premium about twice of what they pay today.
2.5 Theory of Planned Behavior

Theory of Planned Behavior (Ajzen, 1991) stresses in the link between

beliefs and behavior and it has been applied to studies of the relation among
beliefs, attitudes, behavioral intention and behavior. Behavioral intention is
an indication of an individual's readiness to perform a given behavior, is based
on attitude toward the behavior, subjective norm, and perceived behavioral
control, and it is assumed to be an immediate antecedent of behavior (Ajzen,
1991).Behavior is an individual's observable response in a given situation with
respect to a given target (Ajzen, 2010). Ajzen (1991) said a behavior is a
function of compatible intentions and perceptions of behavioral control. The
Theory of Planned Behavior is presented, and it is used in this study to
examine consumers’ behavioral intention and purchasing behavior towards
organic food products. These behaviors are examined in term of how
consumers’ perceived of safety, health, environmental factors and animal
welfare, and quality of the organic food products, as discussed in the five
steps consumer decision making process (Armstrong and Kotler, 2010).
Basically, purchase intention represent to what consumers think they will buy
(Blackwell et.al, 2001). According to Brown (2003), consumer with intentions
to buy certain product will exhibit higher actual buying rates than those
customers who demonstrate that they have no intention of buying.
Consumer’s intention of purchasing organic foods is the first step in
developing demand for organic food products. However, intention do not
necessarily equate with actual purchasing.
2.5.A Consumer preferences for coffee attributes

A number of studies included in this review focused on consumers’

preferences for the most important attributes of coffee. The review revealed
seven key coffee attributes affecting consumers’ consumption behavior:
sustainability labeling, organic, fair trade, country of origin, type of coffee
(espresso, filter, instant, single cup, with milk, iced) and intrinsic attributes
(roast degree, specialty coffee), and extrinsic attributes (brands and
packaging).

2.5.B Buying Intention

Collins and Mullan (2011) noted that intention to perform a behavior is a

significant predictor of actual behavior. Consumers repeat to purchase
products and services because they form intention to do so (Wood & Neal,
2009). The notion of buying intentions reveals consumers’ likely behavior in
short-term future buying decisions or more precisely, future prediction of
consumer buying behavior is called buying intention (Fandos & Flavia´n,
2006). Behavioral intention is a measure of the strength of a decision maker
drive to execute a specific behavior (Fishbein & Ajzen, 1975).

Saba and Natale (1998) claimed that Intention has significant effect on actual
consumption of red, white and preserved meat. McCarthy et al., (2004)
investigated beef buying intention of Irish consumer and significantly
predicted its impact on the actual consumption behvior of beef. Olsen, et al.,
(2008), described and explain consumers’ intention regarding to new fish
product, using framework of the theory of planned behavior. Zagata (2012)
confirmed significance impact (β=0.21) of buying intention on buying
behavior. Gracia and Maza (2015) provided an evidence for consumer
purchase intention to purchase lamb meat from a local breed in Spain.
Intention is considered by the marketing managers as a key driver of long
term profitability of firm, because it is the purchase intention that leads to
actual behavior (Frank et al., 2015). Very little is known about chicken buying
intention in the meat market of Pakistan. Therefore based on the arguments
presented in the stated literature the study put forward the following research
hypothesis.

2.5.C Attitude

Behavioral intention is determined by an individual attitude toward

engaging in the behavior, social pressure felt (subjective norm) and perception
regarding control over the behavior (Gracia & Maza, 2015). A
comprehensive description of human behavior requires all three elements to
be taken into consideration (Zagata, 2012). Menozzi, et al., (2015) found 60%
to 28% variation accounted for the TPB variables in the intention for traceable
food choice in their two sub samples of France and Italy.

The constructs of attitude towards buying behavior is an evaluation of

a particular purchase of particular product with some degree of favor or
disfavor (Zhou et al., 2013). Consumer’s attitude towards specific type of
meat influences the choice of buying (Guenther et al., 2005). Hayley et al.,
(2015) found strong negative effect of attitude towards reduced consumption
of red/white meat and actual consumption. Evidence of attitude as an
important precursors of behaviors has been previously been demonstrated by
many studies like Monnery et al., (2016) and Mallinson, et al., (2016).

Attitude is significant antecedent of intention and behaviors. Attitude

consists of cognitive and affective components. The cognitive components of
attitudes in the case of food shows the positive or negative belief about the
attributes of food like nutritional value, healthiness, trust and safety while the
affective components reflect the feeling and emotions about food like taste,
excitement and variety (Monnery et al., 2016). Audebert et al., (2006),
claimed on the bases of their results that affective component is a factor that
determines an individual’s attitude towards meat.

2.5.E Subjective Norms

This has been established by consumer behavior and marketing

research that subjective norm is important predictor of buyer behavioral
intention (Ajzen, 1991; Baker et al., 2007; Rong et al., 2011). Consumption
behaviors are directly or indirectly shaped by the people with whom we have
relationship (Simpson et al.,2012). The subjective norm in the theory of
planned behavior brings social pressure on the decision maker as what other
members in the group think the decision maker should do (Lin & Huang,
2012). Influence of SN on buying behavior and buying intention is wel
documented in the literature (Cheng et al., 2012; Zhou et al.,2013; Al-Swidi et
al., 2014). In their examination of consumer intention to purchase sustainably
source food Liobikienė et al., (2016) analyzed green purchase behavior in
European Union countries and claimed that subjective norm significantly
determine green products purchase intention in all countries. Several studies
did find a stronger influence of subjective norm on the intention, however
contrary to these findings several studies in the field of food purchase
behavior have contended that the subjective norm component is hardly
capable of predicting intention (Armitage & Conner, 2001; Menozzi, et al.,
2015). Likewise Yadav, and Pathak (2016) also reported that subjective norm
failed (β=-0.045, t=0.759) to determine buying intention to purchase organic
food. There are two aspects of subjective norms, namely “social norm” and “
personal norm”. Social norm refers to the external social pressure that is the
belief about performing or not performing behavior because of the approval or
disapproval of others. While personal norm is the feeling of an individual
about the moral obligation or responsibility to perform behavior in question
(Verbeke & Vackier, 2005). As the opinion of the people very close to the
individual and his or her own moral obligation towards other are very strong
determinant of performing or not performing a behavior.
2.8 Perceived Behavioral Control

Perception of a person’s about his or her own ability to perform certain

behavior is referred to as perceived behavior control (Aertsens et al., 2009).
Increase perceived control of the person who performs behavior can influence
the relationship between intention and behavior (Motyka, et al.,2014). In their
Study of analyzing intention to consume new fish product Olsen, et al., (2008)
confirmed very high significant impact of perceived behavioral control
(β=0.43). Study of Verbeke and Vackier (2005) concluded that attitude,
subjective norm and perceived behavioral control (β=0.26, p < .001) towards
eating fish have positively and significant impact on intention to eat fish.
Rong et al., (2011) found that perceived behavioral control as the more
important predictor of intention to consume the fish burger than other TPB
variables in Spain and Norway. Khalek (2014) analyzed young consumer
attitude towards halal food outlets in Malaysia and maintained that perceived
behavioral control of young consumer significantly influence their intention to
choose halal food outlet. In their analysis to understand the green purchasing
behavior Liobikienė et al., (2016), maintained that perceived behavioral
control is an important determinant of green purchase intention. Massive
literature is available that validate the relationship between PBC with
intention & behavior (Aertsens et al., 2009; O'Connor,et al., 2010; Bang et al.,
2014). Consistent with the available literature this study expects that increase
in perceived behavioral control will lead to more favorable intention towards
coffee commodity. In the existent literature (George, 2004; McCarthy et al.,
2004; Gopi & Ramayah, 2007; Lada et al., 2009;Meng & Xu, 2010; Ferdous
& Polonsky, 2013) direct influence of the consumer’s intention on the actual
behavior is determined. However the significant correlations between
psychographic variables(Attitude, Subjective Norm and Perceived Behavioral
Control) with buying behavior and buying intention and similarly significant
correlation between buying intention and buying behavior, suggest that
psychographic variables (Attitude, Subjective Norm and Perceived Behavioral
Control) have both direct and indirect effect on buying behavior through
buying intentions. Theory of Planned Behavior also proposes that behavioral
intention is determined by the three independent variables (Attitude,
Subjective Norm and Perceived Behavioral Control) and intention in turn
predict performance of a particular behavior (Ajzen, 1991; Fishbein & Ajzen,
2005; Zhou et al., 2013). Saba & Natale (1998) found indirect effect of
attitude and habit on red, white and preserved meat behavior by means
intention. However empirical research on the mediating influence of buying
intention between the psychographic variables and actual behavior is quite
rare. The study therefore additionally explores mediation effect of the chicken
buying intention between the three constructs of TPB (i.e., attitude, subjective
norm, and PBC) and buying behavior.

Price sensitivity

Kim et al. (1999) mentioned that price is the value of purchasing goods or
services and might be involved in consumer buying behavior and price could
be an important factor for some consumers because they are more likely to
feel price sensitivity when purchasing the product at a lower or higher price.
Monroe (1971) also stated that price sensitivity is an individual difference
variable describing how individual consumers show their reactions to changes
in price levels. In addition, Kanghyun and Thanh (2011) conceptualized that
price sensitivity occurs when each consumer shows their reactions to changes
in price levels. Basically, it is the awareness of the consumers to what they
observe about the cost when purchasing a particular product or service.
Normally, each customer will have a certain price acceptability range in their
mind. When customers are satisfied with the products or services, they are
more likely to buy the product again Price sensitivity and brand image. Soba
and Aydin (2012) stated that when consumers have a high income level, it
means that price sensitivity of the consumers is low because consumers with a
higher income prefer to buy products at higher prices and they also think that
a higher price means higher quality. Moreover, price sensitivity of the
consumers also has an impact on brand image. For example, the consumer
with a high income is more likely to purchase any product which has a good
brand image. Dhurup et al. (2013) studied about price sensitivity and brand
image and found that there is an impact of price sensitivity on brand image.

Price sensitivity, brand image and consumer buying behavior. Diaz (2003)
conceptualized that consumers’ knowledge of prices was found to be
dependent on how much importance they placed on price. For example, if the
consumer comes from lowerincome households, they tend to spend less
because their sensitivity to price is influenced by their income level.
Kanghyun and Thanh (2011) also mentioned that when consumers do an
evaluation on the price of the product, price sensitivity will occur. Brucks et
al. (2000) summarized that there is a relationship between price and consumer
buying behavior. Sial et al. (2011) mentioned that a good brand image
enhances the value of the brand in the consumer’s mind because a good image
could increase the likeability and desirability of the product. Fianto et al.
(2014) also concluded that that brand image has a positive and significant
influence on consumer buying behavior

Synthesis of Review of Related Literature

Investigating the effect of price and non-price factors on the consumption of

agricultural products in the coffee commodity. The results of the secondary
data analysis confirmed the change in coffee consumption behavior among
Czech consumers can be attributed in the health consciousness and would
associate on the intrinsic and extrinsic factors of the product presentation.
And also to analyzed the result of the study conducted in China that coffee
demand has significant increase in the coffee beans consumption and also it
is gaining importance in the food and beverages of Individual chinese
consumer behavior tends to change the trend on the dominant beverage that
associated on cultural factor on the consumption of tea leaves.

In early days of the cofffee industry in China they considered the coffee as
high-end commodity which leads to the consumption patterns of the market.
Examined consumers' perception of Coffee and found strong relevant finding
between coffee consumption and drinking occasions. Consumers tend to
choose tea drinks over coffee which buying behavior will be attributed on the
availability of the commodity that dictates the price value of the products. In
modern days innovative coffee production in the locality and neighboring
asian countries has started to imports the commodity with significant vast
volume of production in order to address the constrain on the value chain of
the coffee commodity and to lower the price assumption of the coffee.
Futhermore the consumer are sensitive on the price mainly because of the
buying power and capacity to purchase goods and service. Explored the
influence of attitude and subjective norms on the buying intention and found
significant effect of both attitude and subjective norm on the coffee buying
intention of an adults consumers. Discovered that attitude and subjective
norm, and ambivalence are the predictors of current market trend of
consumption. The study is limited to the consumption of coffee beverages in
any kind by individual consumer based on the per capita consumption
Consolidation of the existing studies find out that consumer behaviors varies
on the area which has been conducted which limits our understanding on the
exact factors can be affiliated on countries belongs to the 1st and 3rd countries
as per global economic ranking takes place which gives the importance of the
buying capacity of the consumer.. The study is only limited to one coffee
consumption in any kinds ( Ready mix, roasted, and other forms of coffee
presentation) in the area of Philippines Mindanao. In addtion to the lack of
underlying theory. Using qualitative methodology noted that product
appearance or attributes like the freshness, aroma, ambiance sensory and
health related factors are the significant attributes that aligns segmentation of
a coffee quality. The study is qualitative, considered one coffee by product
type and lacks the underlying theory to explains consumption behaviour.
Factors influencing consumption and purchasing behavior towards coffee
evidence from the systematic review of 54 papers helped identify various
factors and product attributes that determine coffee consumption and
purchasing behavior. These independent factors were classified into five main
categories: (1) Personal preferences, (2) Economic attributes, (3) Coffee
attributes, (4) Context of consumption, and (5) Socio-demographics, The
theory of planned behavior aims to measure behavioral intentions, measures
attitude toward the act of buying, recognizes the power of other people to
influence what we do and power of behavioral control. There are still
impediments in predicting behavior using the model of TPB. The theory of
trying states recognizes that additional factors might intervene between the
variables of TPB.