Third-party certification labels for organic food: consumers' purchase choice and willingness-to-pay

Abstract

PurposeThe purpose of the present study is to examine the effect of organic food certification labels of different third-party verification institutions on consumers' choice of organic food in terms of willingness-to-pay (WTP) using cue utilization theory.Design/methodology/approachThe study conducted an experiment in which organic rice and organic certification labels were presented to 360 valid participants.FindingsWith different organic rice labels issued by various third-party verification institutions, including (1) foundations, (2) associations, (3) university certification centers and (4) private businesses, results indicate that consumers had different preferences and WTP for certain labels. The institutions preferred organic food labels issued by non-profit organizations. In addition, consumers showed different WTP as a result of different purchase motivations (e.g. health vs environmental protection).Originality/valueThese results imply that consumers might not have confidence in the organic labels issued by associations and private institutions. Therefore, different types of certification institutions can have significantly different impacts on consumers' WTP. The study further proposes that the extrinsic attributes of food products (i.e. the cues used in making a purchase decision) must be incongruent with the image of third-party certification institutions in order to develop more efficient communication of product information and to encourage consumers to give positive comments regarding organic food.