econ project -- 48 hrs（-）

Running Head: MARKETING RESEARCH PROJECT PROPOSAL 1

MARKETING RESEARCH PROJECT PROPOSAL 2

Organic Vegetables and Fruits at Clean Trade Supermarket

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Institution of Learning

When fruits and vegetables are produced without the use of pesticides and chemical fertilizers then they are considered organic. There has been an increased campaign to promote food safety and raise environmental concerns on the production and consumption of these products. Consuming fresh and organic food products has been said to prevent people from being exposed to health hazards associated with conventional foods that they consume. The dangers of consuming the conventional foods can be attributed to the increased inappropriate use of chemical pesticides and fertilizers that is inorganic by farmers as well as producers who may not be aware of the associated health hazards of the chemical components. Fruit and vegetable consumption in the United States has continuously been encouraged by the American Heart Association to reduce cardiovascular diseases (Sacks, Yi, & Nonas, 2015). The Special Supplemental Nutrition Program has also been bearing fruits in encouraging women, Infants and children to consume fruits and vegetables (Orciari, 2014). As a result consumers’ purchases at Clean Trade have risen and business for fruit and vegetable supplier has been on the peak. Consumers have however been careful in choosing between organic and inorganic fruits and vegetables. There has been therefore a need to analyze the willingness of consumers to pay a premium for products that are organic. While gender and income have been the most notable determinants, age has also influenced the willingness of consumers to offer more money so that they can purchase an organic fruit and vegetable. This is the problem that Clean Trade Supermarket is looking forward to understand and solve before they open up their greengrocer section within their premises. Products that they are looking forward to stock in this section include spinach, celery, peaches, apples, nectarines, potatoes, mixed nuts and cashew nuts.

Family feeders is one of the market segment that Clean Trade Supermarkets is targeting in selling both organic and inorganic vegetables and fruits. This kind of target group involves a buyer who is mostly the parent who purchases greengrocers on behalf of the family. The varieties that they select are influenced by the preferences of the end users who are often the children in the house. Variety seekers is also another market segment that includes people with little brand loyalty hence they can purchase either organic or inorganic vegetables and fruits at the supermarket’s greengrocer. The ‘Healthy and natural’ market segment on the other hand focuses on the environmental together with the health impact of their purchases hence they will mainly consider purchasing products at the grocery which are mainly natural. This market segment purchases products that they know are ethical. Organic fruits and vegetables can therefore be considered the main products that they purchase. Local greengroceries are one of the major competitors to supermarkets. Grocery stores and other local supermarkets have also increased the amount of organic products at their greengroceries shelves to keep up with the fast growing market. They are thus another competitor for Clean Trade supermarket when it comes to sale of organic fruits and vegetables.

There is a data gap that Clean Trade Supermarket needs to fill through a survey. It will include understanding the economic incentives that guide people purchase organic vegetables and fruits. Besides, it will collect reasons why people choose to purchase an organic or inorganic product. It will also be essential in finding out whether consumers understand what is organic and is inorganic. The survey will also focus on finding out how people determine that a product is either organic or inorganic. In addition, understanding the relationship between purchasing organic fruits as well as vegetables and gender will also be a part that the survey will clarify. The influence of age on purchasing vegetables that are organic or inorganic will also be understood through analyzing data that will be provided by the survey. Through the survey, the role of ethnicity and education level in deciding on whether to purchase organic or inorganic vegetables. The data will be essential in confirming that older households are less likely to purchase organic vegetables unlike households with high levels of education.

Once the data is collected through the survey, the organic or inorganic choice will be regressed on the type of vegetable or fruit purchased and other constants. The dependent variable will be the type of vegetable where it will have the organic level and inorganic level. Independent variables will be the gender, income and age. The multinomial logit regression model; . Ŷ is the expected value of the dependent variable which is the organic and inorganic vegetables. X1 represents the independent variable gender, while X2 represents income and X3 represents age. bo,b1,b2 and b3 on the other hand are estimated regression coefficients. After the regression, the value of the coefficients bo,b1,b2 and b3 will be identified. The significance of b1,b2 and b3 will then be tested. For any of the variables, Xi that are included in the multiple regression model, the null hypothesis states that H:b1 =0 , H:b2=0 and H:b3=0 while the alternative hypothesis will state H:b1 ≠0 , H:b2≠0 and H:b3≠0. If any of the regression coefficients is greater than zero, then it will be considered statistically significant hence Clean Trade Supermarket will put the variable into perspective as they set up their greengrocer section.

References

Orciari, M. (2014, May 14). Families on food assistance are purchasing more fruits and vegetables. Retrieved from https://news.yale.edu/2014/05/14/families-food-assistance-are-purchasing-more-fruits-and-vegetables

Sacks, R., Yi, S. S., & Nonas, C. (2015). Increasing Access to Fruits and Vegetables: Perspectives From the New York City Experience. American Journal of Public Health, 105(5), e29-e37.