Masters Thesis

Labeling organic food products: the role of perceived risk, framing, and prospect theory on purchase decisions

The organic food industry is in a period of rapid growth and product diversification (Organic Trade Association, 2006). Because of this expansion, the market for organic food should be studied in detail. Differences in labeling strategies for organic foods may influence a consumer’s decision to purchase a specific product. Longstanding theories within consumer behavior such as prospect theory and perceived risk can help in understanding consumer reaction to label framing effects. Research by Gifford and Bernard (2006) indicates that positive framing is more effective than negative framing in affecting consumers’ intent to purchase more organic products. The research reported here examined how the framing of information contained specifically on labels influenced consumer purchase decisions. Different fictional brands and their corresponding labels were evaluated through an online survey looking at consumer willingness to buy. It was hypothesized that labels using positive framing would be more desirable (examining purchase intention) than labels using negatively framed information. The findings indicated that there was no difference between positively and negatively framed information on willingness to buy across all three product labels. There was, however, an interaction between survey group and framing condition which indicated a framing effect for milk product labels. Participants showed preference for the negatively-framed milk labels, this finding is in contrast to previous research supporting positive framing as a more effective tool for influencing consumer behavior. Both framing conditions across all three products differed from a control condition suggesting that consumers respond favorably to more information on the label regardless of how it is framed. The current research also expanded on Gifford and Bernard’s (2006) findings on framing and organic foods. The conclusions provided some insight on consumer attitudes and behavior toward organic and conventional foods. The unexpected discovery of milk framing effects strongly suggests that future research should be conducted on the potential framing influences with different categories of food (basic vs. luxury). Future research should also focus on strengthening framing manipulation strategies and possibly explore the relationship between amount of product knowledge and willingness to buy.