Segmentation of the Industrial Market for Food Commodities- A Conjoint Study of Purchase of Vegetable Oils in the Mayonnaise and Margarine Industries

Abstract

The purpose of the study presented in this article is to examine whether the concepts developed in the area of industrial buying behavior can add to the understanding of commodity purchasing behavior, and segmentation of commodity markets. The industrial market for vegetable oil was chosen as the outset of the study, because it is characterized by the appearance of changing demands and technological opportunities, which potentially can lead to differentiation possibilities. The article describes a framework for the study of industrial buying of food commodities and the results of a conjoint study based on interviews with oil purchasers in the margarine and mayonnaise industries in Denmark, Sweden, Germany, the United Kingdom and Switzerland. The main result of the study is that the price is an omnipotent decision criterion, when vegetable fats and mayonnaise producers buy vegetable oil, but also that product and supplier criteria can be used to segment the market, if the price premium is held within limits.