The Value of Locally Produced Household Cheese : A study about the added value of locally produced on the market of Jönköping, Sweden.

The value of locally produced household cheese

Subject: Bachelor thesis within business administration

Authors: Viktor Kihlblom Oscar Persson

Bachelor Thesis in Business Administration

Title: The value of locally produced household cheese Author: Viktor Kihlblom & Oscar Persson

Tutor: Erika Arévalo

Date: 2014-05-12

Subject terms: Locally Produced Household Cheese

Abstract

The gained attention towards “locally produced” has made it to a hot issue in todays so-ciety. The uncertainty regarding the meaning of the term is high and the definition of “locally produced” differs a lot in the mindset of the consumers.

The purpose of this study is to define the term looking at the market of Jönköping and also to see how much “locally produced” matters to the consumers in Jönköping and how much added value they give it in relation to other important parameters. The study uses a mixed approach of both qualitative and quantitative information in form of a semi-structured interview, focus group and a conjoint analysis.

The limitation of the term, associations to the term, and the country of origin-effect in relation to the term are presented during different headings and subheadings in the em-pirical findings-section.

The limitation of the term was stated to be within the province of the consumers’ home location. The main associations to the term were price and quality, and the main motiva-tors of buying locally produced household cheese were to support the local business and having personal knowledge of the producer.

Furthermore, price and brand awareness were two factors that tended to sideline “local-ly produced” when consumers purchases cheese. Due to the price differences, it is stated that Swedish produced cheese (COO) is more preferable in terms of reality-based condi-tions.

Table of Contents

1  

Introduction ... 1  

1.1   Cheese and the market of cheese ... 2  

1.2   Locally produced ... 2   1.3   Delimitations ... 3   1.4   Disposition ... 3  

2  

Specification of problem ... 4  

3  

Purpose ... 7  

4  

Background ... 8  

4.1.3   Types of buying decision behaviour ... 12  

4.1.4   Willingness-to-pay ... 13  

4.1.5   Packaging ... 14  

4.1.6   Characteristics affecting consumer behaviour ... 15  

4.1.7   Demographic variables ... 16  

4.1.8   Consumer affecting variables ... 17  

5  

Methodology ... 18  

5.1   Time planning of method ... 18  

5.2   Semi-structured interview ... 19  

5.2.1   Choosing subject ... 20  

5.2.2   Identify possible informants ... 20  

5.2.3   Compose a guide for the interview ... 20  

5.2.4   Contact the selected informant regarding the interview ... 20  

5.2.5   Perform the interview ... 20  

5.2.6   Organizing and processing of the gathered material ... 21  

5.2.7   Analyzing the interview ... 21  

5.2.8   Present relevant result from the interview ... 22  

5.2.9   Selection of informant ... 22  

5.2.10   Grounded Theory ... 22  

5.2.11   Shortcomings of a semi-structured interview ... 23  

5.2.12   Performance ... 23  

5.3   Focus group ... 23  

5.3.1   The process ... 24  

5.3.2   Analyzing ... 24  

5.3.3   Selection of informants to the focus group ... 24  

5.3.4   Shortcomings of focus group ... 25  

5.4   Conjoint Analysis ... 25  

5.4.1   Design of the conjoint analysis ... 26  

5.4.2   Performing of the conjoint analysis ... 27  

5.4.3   Shortcomings of the conjoint analysis ... 27  

6.1.1   Demographics ... 28  

6.2   What does consumers associate to locally produced, and what is important in the purchase decision? ... 29  

6.2.1   Price ... 29  

6.2.2   Quality ... 31  

6.2.3   Motivators ... 31  

6.2.4   Purchase decision ... 32  

6.3   What are the limitations in terms of geography? ... 35  

6.4   Is country of origin (Sweden) more important than locally produced for consumers in Jönköping? ... 37  

7  

Analysis ... 39  

7.1   Demographics ... 39  

7.2   What does consumers associate to locally produced, and what is important in the purchase decision? ... 40  

7.2.1   Price ... 40  

7.2.2   Quality ... 41  

7.2.3   Motivators ... 42  

7.2.4   Purchase decision ... 43  

7.3   What are the limitations in terms of geography? ... 44  

7.4   Is country of origin (Sweden) more important than locally produced for consumers in Jönköping? ... 45  

8  

Conclusions ... 47  

9  

Discussion ... 49  

List of references ... 50  

10  

Appendix ... 56  

10.1   Semi-structured interview with Christer Lundin ... 56  

10.1.1   Interview guide ... 56  

10.2   Focus group ... 56  

10.2.1   Focus group guide ... 57  

10.3   Codes from the semi-structured interview and focus group ... 59  

10.4   Conjoint analysis ... 60  

10.4.1   Design of the conjoint analysis ... 60  

10.4.2   Age statistics of the participants in the conjoint analysis ... 62  

10.4.3   Diagrams from the conjoint analysis ... 62  

1

Introduction

The introduction part will introduce the topic of the thesis, and give the reader general information within the area

When you enter a store to purchase household cheese, do you evaluate your choice by price, origin or another attribute? Today we have many options when it comes to buying household cheese. There are cheap ones, stored ones, organic ones, imported ones and locally produced ones. Locally produced cheese has got increased attention past years and consumers found it to be more important today than earlier (Adams & Salois. 2010).

The following study is focusing on the phenomenon “locally produced” in terms of branding and consumer behavior in Jönköping, on the Swedish market. The study will narrow it down to household cheese because there are no current studies on mixed products (several different ingredients). The authors of this study have done previous research in consumer behavior and have always been interested in food marketing.

One can tell for sure that customers value attributes as freshness, high quality, packaging and taste when purchasing food, but locally produced has become more relevant and got increased attention in media the past years (Darby, Batte, Ernst & Roe, 2008). Even if the phrase has been declared as important there are a lot of uncertainty regarding what it actually means since it is slightly ambiguous (Adams & Salois, 2010). Some people only suggest their home region or society as local while other mean that the whole country could be considered as local (Sveriges Konsumenter, n.d.). This study aims to find out what consumers and companies actually think about when they hear the term locally produced.

According to Lantbrukarnas Riksförbund in Sweden (n.d.), the demand of locally produced food has never been as high as now. As many as 40 % of the Swedish consumers believe that it is important that the food they are buying is produced regionally, and 95 % would buy more locally produced products if it were available in their local store. The main reason for this is to promote the local industrial life, small-scale production and to protect the environment through shorter transportations (Lantbrukarnas Riksförbund, n.d.).

Furthermore, it is important to have a strong brand that differentiate itself from competitors, this study hopes to answer if a company can enhance their brand and strengthen its position on the market by using locally produced frequently in their marketing and branding. If the study can find a clear definition for the term and find out how much consumers value locally produced, a solution to the problem could be reached. This in turn can form the basis whether local producing manufacturers of

This study is part of a course and are designed to improve the understanding of consumer behavior towards food.

1.1

Cheese and the market of cheese

There are many different types of cheeses, but one of the most common is the full-cream cheese. The full-full-cream cheese is a dairy product and has a high fat content (Box-holm Mejeri, n.d.).

In Sweden people consumes nineteen kilos of cheese per year in average. Even if Swe-dish cheese is the one that is most consumed, the sales of imported cheese has in-creased. In the last ten years the sales of imported cheese on the Swedish market has re-duplicated (Byström, 2013). The competitive advantage that imported cheese gains to-wards Swedish cheese is primary the price. Foreign producers get a surplus of milk in certain periods, which enable a quick production of cheese to a low cost. The price that foreign producers can offer their cheese at is out of reach for the Swedish producers (Byström, 2013).

One possible reason to why the sales of Swedish cheese is declining could be that Swe-dish producers miss innovation and creativity. They do not produce new types of cheese, but have focused on rationalizing the manufacturing process instead (Byström, 2013). The declining of Swedish cheese is chocking since there is a big demand for lo-cally produced cheese in the country (Lantbrukarnas Riksförbund, n.d.). It is argued that the explanation could be that this is the result of a marketing failure from the producers (Byström, 2013).

1.2

Locally produced

Locally produced is a complex term that does not have a well-known definition. While a product that is labeled as “organic” have to fulfill a lot of demands regulated by gov-ernments, locally produced is a more fluid concept that does not have those regulations (Adams & Adams, 2011).

While Adams and Adams (2011) found that consumers defines locally produced very differently in terms of miles, they claim that locally produced actually is about ethical factors rather than the geographical location. For consumers, it is more important that the product is produced in a sustainable and environmental-friendly way than it is pro-duced within five-mile radius for example. Toler, Briggeman, Lusk & Adams (2009) can also confirm this theory, they state that fairness is a very important element for con-sumers when buying locally produced products. Thus, one have to be aware of that even if a product is locally produced, it does not automatically mean that it is environmental-friendly. Economical factors or a lack of interest can make the farmer to produce the product in a way that is not good from an environmental point of view (Hinrichs, 2003). Bondens egen marknad has stated that the product have to be produced within an area of 250 kilometers from the selling spot in order to have the right to be called locally

pro-duced (Bondens egen marknad, n.d.), while the Department for environment, food and rural affairs (2003) argues that 30 miles (english measurement) is a reasonable limit.

1.3

Delimitations

The study will be narrowed to consumers of the city Jönköping, mainly because there are not many studies within this area on the Swedish market. Another reason is due to the fact that the authors are located within this area. There are certainly different types of cheeses and the focus in this study will be on household cheeses.

1.4

Disposition

The second chapter of the study includes the specification of problem. The problematic of the topic is described.

The third chapter describes the purpose of the thesis; it explains why the thesis is written and what the aim of the thesis is.

The fourth chapter consists of the background that describes the relevance of our study; the reader shall be able to understand its significance. Previous research is presented and the second section of the background contains the theoretical framework.

The fifth chapter includes the description of the methodology that will be used in the thesis.

The sixth chapter presents the result of the study. The empirical findings will be presented to the reader in a logical way.

The seventh chapter consists of the analyses of the study. The analysis of the empircal findings that is connected with the result will be introduced.

The eight chapter presents a summarisation of the conclusions drawn from the study, and its relation to the purpose.

The ninth chapter contains the discussion of the study.

The tenth chapter contains of the appendixes, such as interview sheets, data codings etc.

2

Specification of problem

The specification of problem part will introduce the problem of the research area and gives a motivation to why this study is justified

There is a gap in the consumers’ mindset regarding the term locally produced. Previous studies within the subject of locally produced groceries show that there is not a clear definition that could be applicable to the term (Wreting-Clarin, 2010). The consequence of this is that it slows down the development of the term and how companies should translate it to their consumers (Hingley, Boone & Haley, 2010). The problem has rised since the term is not well defined, and in previous research a gap is identified. That gap get even more important since there is a high demand for locally produced food in Swe-den today (Lantbrukarnas Riksförbund, n.d.). To answer this problem, one must explore what the consumers in Jönköping associates with the term locally produced, which tributes that are important and how much it is valued in comparison to those other at-tributes.

Studies in the U.S. have shown that there is an actual demand for locally produced products. Darby et al. (2008) concluded that there was a consumer demand for locally produced food. One indicator that emphasized the demand of locally produced food was that it was an independent factor and not linked to any other factors.

From previous research, differences between American and Swedish studies within the subject of locally produced products can be seen, but both came up with interesting conclusions that are relevant. In the U.S., locally produced is related to high quality and low price. Furthermore, it is associated as something that is good for the society (Gal-lons, Toensmayer, Bacon & German, 1997). Gallons et al. (1997) also highlight the de-creasing importance of organic food and one cannot ignore that this could depend on trends.

In Sweden, locally produced is related to high quality, environmental consciousness, and a high price (Gustafsson & Rokotova, 2012). Both these definitions are very general and cannot be representative for household cheese since the researcher used milk and strawberries in their surveys. However, this is the closest that can be found about asso-ciations to the subject. These two studies also show that the term is very ambiguous and that the definition of locally produced vary between countries and consumers.

Darby et al. (2008) highlights the problem to limit the term, their conclusion was that many of the consumers thought that locally produced food should be produced within the region or the state. One must be critical and conclude that this might not be the case in Sweden and Jönköping, since there are differences between the U.S. and Sweden. This is a problem since the country of origin effect (COO) could be more relevant in Sweden, rather than a Swedish province limit.

So, there is a big uncertainty within the subject. Since the term has no clear definition companies does not know how to take advantage of “local produced” in their marketing, and consumers does not know if the household cheese really is locally produced in rela-tion to the definirela-tion in their mindset. Household cheese buyers are in need of a defini-tion statement. If this study could define locally produced and find out to which extent consumers value it (In Jönköping), explicit guidelines for how companies should use it in their marketing can be created.

Therefore, first one need to define the subject to make clarity. Secondly, the term has to be put in relation to other factors affecting the consumer in the moment of purchase, to really find out how much extra consumers are willing to pay for locally produced cheese and what they are associating the term with. It is also important to know how much locally produced is valued in relation to other factors.

Furthermore, Adams and Salois (2010) states that the consumers perception of locally produced food has increased significantly past year, the willingness to pay for locally produced food is following the same pattern. Plentiful research is also done when it comes to “fixed products” such as vegetables, while there is not much information at all when it comes to “mixed products” such as cheese. Based on the willingness to pay, one can tell how much consumers’ value locally produced products in comparison to other factors. So, the willingness to pay responds to how much consumers value locally pro-duced.

When the definition is stated there is a problem when it comes to setting the term in re-lation to other factors. Some consumers are willing to pay extra for locally produced cheese, but not all target groups. There are some segments that value locally produced higher than others in relation to other factors.

Since Sweden is a smaller country than the U.S. there is uncertain whether consumers’ value COO higher than locally produced, or if brand awareness is a stronger value be-cause of the low involvement.

In a study based in the U.S., Darby et al. (2008) concluded that males were most willing to pay extra in order to get locally produced products. This indicates that there are cer-tainly some target groups that are more willing to pay extra for locally produced house-hold cheese than others in Sweden (Jönköping). One must take into account the net in-come of the target groups as well.

In Sweden, locally produced household cheese is in general perceived as a cheese with a higher price, while a cheese that are imported is perceived as cheaper. Ockelbo Ost for

Summarized, there is a need of a general definition for locally produced(Wreting-Clarin, 2010). However, as mentioned earlier focus will be on household cheese in the market of Jönköping. How locally produced affects consumers perception of cheese, lo-cally produced limitations and attributes associated to the term. There have been many studies on locally produced food, but no one regarding its influence of household cheese. The hope is that this study will give a clear definition of locally produced cheese, in the customer’s, and to find out how much locally produced is valued in

3

Purpose

The aim with this study is to give the term “locally produced” a definition that is applicable to the market of Jönköping. Furthermore, the study will also show how much it matters for the consumers in Jönköping that household cheese is locally produced and how much value they put in it.

3.1.1 Research questions

- What does consumers associate to “locally produced” and what do they consider when they purchase locally produced household cheese?

- What are the limitations in terms of geography?

- Is country of origin (Sweden) more important than locally produced for consumers in Jönköping?

4

Background

The background part will introduce previous research within the subject and further-more, introduce the theoretical framework

During the past 30 years the term “locally produced” has never been stronger than it is today (Adams & Salois, 2010). Local production has got a lot of attention, and consum-ers in Sweden regularly associate local production with high quality (Gustafsson & Ro-kotova, 2012). Globalization has made it harder for consumers to know the products country of origin (Okeckuku, 1994). It has got even more attention since there have been several meat scandals in Sweden last couple of years. The one that got biggest at-tention was when the well-known company IKEA used horse meat in food that was said to only contain beef (Svenska Dagbladet, 2013). But even if the demand for locally pro-duced seems to be high, the sales of Swedish propro-duced cheese is declining while im-ported cheese sales is increasing. It is especially low-price cheese that is popular among Swedish consumers (Byström, 2013).

Previous studies made in the U.S. shows that locally produced food achieves a lot of at-tention. The value of locally produced did increase from 4 billion dollars 2002 to 5 bil-lion dollars in 2007, and is expected to increase even more (Tropp, 2008). Big corpora-tions have observed this trend, Wal-Mart have put more focus on locally produced now and offer ingredients from local farms (Guptill & Wilkins, 2002).

Furthermore, it is unclear what Swedish consumers consider as “local” in terms of pro-ducing and selling, it could be the area around the city as much as the province. Country of origin could be greater or equally important as locally produced. In Darby et al.’s (2008) study made in Ohio, U.S., it appears that locally produced is associated with the state that the consumer live in rather than the local community when speaking about ge-ographical limitations. By knowing what consumers in Jönköping understand as local and how much value they put in it, companies in the region could get an advantage in their marketing and branding. However, a study made in U.S. argue that consumers use the term “locally produced” as a value description, a value assurance, rather than an in-surance that the product is made within a certain area (Adams & Adams, 2011).

The project Miljösmart mat defines locally produced as “food, where the production, processing and distribution to consumers occur within a “delimited area” (Livsmedelssverie, 2008). They also state that the products can be produced far from the consumer, thus there is no distance-limitation regarding the range between the home lo-cation of the consumer and where the product is sold. Bondens egen Marknad, (n.d.) on the other hand defines locally produced as a grocery that has been produced within a ra-dius of 250 kilometers. These definitions differ a lot from each other. This may be be-cause people perceive locally produced in different ways. Since the interest and demand for locally produced food have increased past years a problem have occurred; people do

not really know what locally produced is and which demands a locally produced prod-uct have to fulfil (Adams & Salois, 2010). Because of the uncertainty regarding the term, a study that clarifies locally produced is needed and justified (Wreting-Clarin, 2010).

Furthermore, it is hard to say how much locally produced is worth to consumers in terms of money, i.e. if they are willing to pay a premium price to get locally produced products and that is a way of seeing how consumers’ value it. There have been done some work regarding whether locally produced is an important term or not, and for whom it could be important to. Some main controversies within the area are the defini-tion of the term that is mainly essential. There is a need of defining it (Wreting-Clarin, 2010) and to find out how important it is for consumers in Jönköping and if they are willing to pay a premium price for it, that due to that many researchers have focused on the development of the American market. Adams and Salois (2010) describes that the development of the subject has increased successfully. A need for research about the question on a part of the Swedish market is justified.

In a previous research regarding willingness to pay for locally produced products re-searchers found out that the willingness to pay for locally produced is as big as the will-ingness to pay for a freshness guarantee (Darby et al., 2008).

Thus, they conclude that the term locally produced food is independent of other varia-bles. Darby et al.’s (2008) American study emphasizes that locally produced is associat-ed with freshness and “anti”-corporate image. A Swassociat-edish study, on the other hand, points out that less environmental impact, support for the local business and good hus-bandry is some of the main associations with local production (Gustafsson & Rokotova, 2012). This might indicate that locally produced in general is independent from other variables. But the previous research is at most very general. If consumers are willing to pay more for local food, companies can use it in their marketing by clarifying that their products is locally produced (Darby et al., 2008), and in that way increase their selling. Therefore, dairy businesses could take advantage of this term.

The following study will now focus on the Swedish city Jönköping, which is located in the southern part of the country. It will also focus on the dairy-product household cheese.

4.1

Theoretical framework

The theoretical framework will analyse the data that is gathered. The theories that are going to be used in to analyze the empirical findings are brand awareness, country of origin, types of buying decision behavior, willingness to pay, packaging, characteristics affecting consumer behavior, demographic variables and consumer affecting variables.

4.1.1 Brand awareness

Brand awareness is a big influencing factor for consumers’ when buying household cheese; it creates a picture in the mindset of the consumer and builds recognition. Ros-siter and Percy (1987) define brand awareness as the customers’ capacity to identify its logo or brand under different types of circumstances. Brand awareness consists of two parts: brand recall and brand recognition. Brand recall describes whether a consumer as-sociate to the brand when referring to a particular product category, and brand recogni-tion is whether the consumers is able to differentiate the brand that they have been ex-posed to earlier (Keller, 1993). Furthermore, Hoyer and Brown (1990) defines brand awareness as the rudimentary level of the brand awareness where the consumer should at least be able to recognize the brand name.

Aaker (1996, p.114) defines brand awareness as “the salience of the brand in the cus-tomers mind”, and he divides brand awareness into six different parts, and those are recognition, recall, top-of-mind, opinion, knowledge and dominance. Recognition is the consumers ability to recognise the company, recall is the proportion of brands a con-sumer can define in a sector and top-of-mind is the first brand it recognises within a sec-tor. Furthermore, brand opinion is when a consumer have an opinion about a brand. Brand knowledge is if a consumer know what the brand stands for in form of values, brand dominance implies if a consumer does only recall one company in a sector. Companies that are offering low involvement products, such as household cheese, want to create brand awareness with the purpose to affect the consumer in the moment of purchase (McMahon, 1980). To accomplish that companies tend to use repetitive adver-tisements that creates a consciousness regarding the brand in the consumers mindset, and they become comfortable with the brand (Bogart, 1986). To show the importance of brand awareness when it comes to low involvement products such as household cheese, previous studies indicates that consumers in blind tests cannot determine their preferred product (Hoyer & Brown, 1990).

Brand awareness is certainly important when it comes to low involvement products, it is surely important for unexperienced consumers concerning to make a new decision, and consumers that are aware of one brand and chooses between several brands tends to choose the recognized brand independently from the quality (Hoyer & Brown, 1990). Consumers’ evaluation step changes when the consumer gets more experienced and to summarize, one can determine that brand awareness has big affect on consumers’ choice of low involvement product. An advertisement that focuses on increasing the brand awareness could be very effective (Hoyer & Brown, 1990).

One could argue that brand awareness could be a dominant factor when consumers are set to choose cheese, since it is a habitual buying it is easy for consumers to just choose a cheese that they are familiar with. Thus, factors like locally produced. might be side-lined.

4.1.2 Country of origin

A marketer can create associations to a product in many ways, branding and marketing are the most consistent tools companies uses. But another factor that have a clear impact on consumers perception about the quality of the product is the nation that it is made or designed in (Ahmed, Johnson, Yang, Fatt, Teng & Boon, 2004). This factor is known as the country of origin effect. The COO factor has got even more attention since the globalization break through (Pecotich & Ward, 2007). This factor has its biggest impact on consumers when a judgement of the product has not, or cannot be made. Then the COO is used as a tool, the country’s reputition and image are the two elements that is valued (Lantz & Loeb, 1996).

According to previous studies consumers may use COO in one or two ways; the first way is when consumers perceive and value the product along of the experiences or perception of the country, if a consumer wants to buy a car, they may associate a car that are produced in Germany with good quality since Germans produces great cars in general. In this case the COO enhance the product, and works as a “halo” for the product. The second way is the opposite to the first one. If consumers have bad experience from the country that the products have been made in, the perception will be negative. In this case, the COO lower the perceived quality of the product. If this is the case, the COO can be called a summary of construct (Han, 1989). If a marketer is aware of how the country that the product is associated with is perceived, it can either be enhanced or minimized in order to get greatest effect (Ahmed et al., 2004).

It is also argued whether COO is more important for consumers with less knowledge and experience about the product (Pecotich & Ward, 2007). However, Pecotich and Ward (2007) found that country-of-origin is important for consumers with both much and less knowledge about the product, especially when they evaluate the price and qual-ity of the product.

Moreover, Pecotich and Ward’s study was made about high involvement products, such as computers. Since cheese cannot be considered as a high-involvement product, COO has to be described in a perspective of low-involvement products.

Ahmed et al. (2004) suggest that COO does affect the moment-of-purchase when buy-ing low-involvement products such as cheese in the same way as high-involvement does, but not to the same extent. The purchase decision is shorter regarding food and consumers tend to choose after experience, knowledge or recognition rather than after COO, i.e. a strong brand is more important. But it is also suggested that when a low-involvement product becomes more expensive, when the price gets higher, COO be-comes more important for consumers (Wall, Liefel & Heslop,1991). Moreover, if the country has a reputation of producing good quality the product may be preferred by

cus-The COO theory is used in this study since there is uncertainty if locally produced is equal or more equal important than COO when consumers buying household cheese. 4.1.3 Types of buying decision behaviour

Consumer behaviour differs dependently on which type of product the consumer is buying (Assael, 1998). Complex buying indicates that the consumer is involved on a high level, since the product is generally expensive and there are a big difference between different brands. It could for example be “purchasing of a car”, the consumer want to learn about different features of the product and create beliefs and in that way procure an attitude, and thereafter make a decision (Assael, 1988). This part is not relevant for this study since household cheese is not considered as a high involvement product.

Dissonance-reducing buying behaviour means that the consumer is involved at a high level. But unlike complex buying behaviour, there are not many differences between company’s offerings. Even though there is a small difference between companies, consumers tend to search around to be able to evaluate the choices available, it is a fast process. The post-service from companies is very important here, the consumers may perceive dissonance and then the companies need to be prepared to support the consumer. Regarding household cheese, consumers is faced by many different choices from different producers in the store. So one can conclude that this buying behavior is not applicibale on householde cheese.

Habitual buying behaviour is the third type of buying behaviour where there is a low level of involvement, and there is also a tiny difference between company’s offerings. These purchases works more as a habit rather than brand loyalty, the consumer just walks to a store and purchases the product habitually, but the brand awareness factor cannot be denied. In comparison to the complex-buying behaviour, the consumer does not search actively for information or evaluate the purchase before buying. The consumer and the brand does not form a relationship, instead the consumer just chooses the chosen brand since it is familiar. To create a competitive advantage when it comes to low-involvement products one must emphasize the price in ads, or actively work with sales promotion (Assael, 1988).

The last type of buying behaviour is the variety-seeking buying behaviour. The consumer acts with a low level of involvement but unlike the habitual buying behaviour, there are differences between the companies offerings. The consumer may buy a product, and thereafter evaluate. Next time when the person will buy the same product, one might choose another type because of simply boredom. The trading of type must not depend on dissonance; the consumer just might want to seek for variety. Companies want to make it to a habitual buying behaviour, by using repetitive

commercials for example. The respond from competitors usually is lower prices and free samples. Due to this one could argue that brand awareness should be raised.

There is a lack of literature that states whether household cheese is a low- or high involvement product. However, low involvement products are characterized as being bought frequently and that little effort is put into the choice of product, since it does not have any effect on the consumers lifestyle. High involvement products are on the other hand associated with high capital value and is psycological important to the buyer, cars and jewelries are typical high involvement products (StudyMode.com, 2010). In this study, household cheese is defined as closer to a low involvement product since it matches better with its description, rather than a high involvement product. Furthermore, the fact that household cheese is a low involvement product means that consumers does not put a lot of engangement in the choice of product, but there are many other factors influencing the consumers.

To be even more specific, household cheese can be seen as a variety-seeking behaviour product (Arora, 1982). This means that the consumers involvement and engagement in the purchase is not high high, since the price is low. Generarly, this also means that consumers does not have a plan about exactly which cheese they are going to buy before entering the store, the decision is taken in front of the shelves. Therefore, brand awareness is an important factor that affect consuemrs choice of cheese (McMahon, 1980).

Due to that consumers make a quick decision when purchasing cheese, it is normal that the consumer picks a product habitually and then the choice tends to fall on a product that they know about or has a tempting price. Therefore brand awareness should be raised and companies could more clearly try to create a local touch in the mindset of the consumers. Furthermore, consumers value locally produced differently and a measurement of the importance of locally produced could be pronounced through their willingness to pay.

4.1.4 Willingness-to-pay

Consumers’ valuing of locally produced could be measured in different ways, and the willingness to pay is a way of seeing how consumers’ value locally produced.

When a company is about to set a price for a product there are two concepts that can be used to measure how much a consumer would pay for the product. The concepts are reservation price and maximum price. The reservation price is the line where the con-sumer is neutral to buying the product or not. The maximum price on the other hand is the price difference between the product that the consumer primary wants and the se-cond best alternative. Maximum and reservation price togheter stands for willingness-to-pay, which is the maximum price the consumer will pay (Breider, 2005). For

repeatedly has a maximum price that they have valued the product to in their mind, this is known as the reservation price. To decide what to buy consumer then compare the actual price to the reference price (the imaginary price) and buy the one with the most favourable difference (Kalish & Nelson, 1991).

When talking in terms of cheese, willingness-to-pay could also be described as consumers willingness to pay a premium price for specific products in order to get certain qualities (Darby et al., 2008). In Sweden it is known that locally produced is linked to a higher price in comparison to a regular price (Gustavsson & Rokotova. 2012). There are a lack of studies about the subject in the area of Jönköping, which makes it uncertain regarding how high consumers in Jönköping value locally produced and if they are willing to pay a premium price in order to get it, there are many competetive brands with lower prices which local products compete with. Jekanowski, Williams & Shiek (2000) concludes that if consumers have a specific relationship or bond to an area, province or city, they are repeatedly more willing to pay a premium price for locally produce food. This could be to support the local business (Adams & Salois, 2010).

In a study made 2011 in Florida Adams and Adams (2011) found that 68 % of the people they asked were willing to pay extra for locally produced food. Many previous studies have enlightened that the willingness to pay a premium price for locally produced food has increased past decades (Adams, Salois. 2010). Thus, one have to consider the price differences regarding locally produced in the U.S. and Sweden. 4.1.5 Packaging

Consumers entering a store have generally not yet decided which product they will de-termine to purchase. Especially not when it comes to low involvement products such as household cheese and other food products (Silayoi & Speece, 2004). One of the main communication tools between the consumer and the brand is the product package, and companies in the low involvement businesses need to put a lot of work with their pack-age to attract the consumer in the moment of purchase. The fact is that packaging is the most important factor when it comes to convince the consumer in the moment of pur-chase (Prendergast & Pitt, 1996). Cheese is considered as a low involvement product and many companies within this business try to catch the consumers’ attention in the moment of purchase. Thus, the package is really important.

One can argue that packaging could be particularly important for locally produced cheese, if it is communicated on the package which farm the milk of the cheese comes from, the consumer might have some personal relation to it and that could play a role. When it comes to the decision-making the package have four purposes to fulfil, which could be separated into two different parts; informational aspects and visual aspects. The informational elements consist of product information and product technology (Si-layoi & Speece, 2004).

The product information is most important for products that are characterized by a high involvement from the consumer; the information stated on the package helps the con-sumer to make a good decision (Silayoi & Speece, 2004). Though, this is less important for our study since household cheese is stated as a low involvement product. Packaging technology generally comes from certain accurate trends regarding the consumer behav-iour and products.

The visual aspects consist of graphics, colours, packaging size and shape. The graphics and colours consists of the layout of the product, which could be formed of colours, pat-terns and typography. These mentioned factors are highly influencing the purchasing decision for low involvement products (Silayoi & Speece, 2004). Furthermore, graphics and colours are two important elements when affecting consumers in the moment of purchase of low involvement products (Grossman & Wisenblit, 1999). Since household cheese is stated as a low involvement product, one can argue that companies should try to work hard with their packaging since their consumers mainly determine their choice of household cheese in the moment of purchase. Many consumers perceive the product as the package.

Colours are certainly critical since consumers have different colour associations and some consumers associate certain colours to certain product areas (Grossman & Wisenblit, 1999). Thus, using colours on the package may have a big impact on the consumers and especially when the consumer is associating the colour to a specific brand (Silayoi & Speece, 2004). Colours can also be connected to the country and it is not a long shot to argue that the COO is equally important as within the region.

These visual elements are most important for this study since it is them that are most in-fluencing when it comes to low involvement products, such as household cheese. 4.1.6 Characteristics affecting consumer behaviour

In Sweden locally produced products are associated with a high price in relation to general products (Gustavsson & Rokotova, 2008), and there may be some segments that are more price sensitive. Because of that they are not able to buy locally produced household cheese on a regular basis.

Furthermore, consumers shopping habits is changing and the age-factor is relevant for this study. Brooker, Eastwood and Orr (1987) came up with that a higher age had a positive impact on the willingnes to pay extra for locally produced food in Tennessee. Moreover, one can assume that elder people are willing to pay extra for locally produced household cheese and therefore, value it higher.

Age and life cycle stage is a parameter since persons do not purchase the same food products during their whole life (Kotler, Armstrong, Wong & Saunders, 2008). That indicates that the purchase behaviour changes as well, the age differences is

characterized by differences regarding social life and psychological differences (Wells & Prensky, 2008).

Maslow’s hierarchy of needs is a good description of how persons are driven by their needs (Maslow, 1970). According to Maslow’s classical theory the most important steps are chronologically psychological needs, safety needs, social needs, esteem needs, cognitive needs, aesthetic needs and self-actualisation. The logic in this model is that the person fulfils the most basic one first and so on (Maslow, 1970).

Houehold cheese and food, is partially a psychological need that a person consumes to survive (Maslow, 1970). But when it comes to locally produced cheese, it could satisfy another element in the hierarchy of needs. When a consumer purchase locally produced cheese it is mainly because they care about good husbandry, the local businesses and the environment, according to Gustavsson & Rokotva (2012). This indicates that locally produced products satisfies the third or the fourth element of the theory. Adams and Adams (2011) suggests that the purchase of locally produced food is an intersection between the consumers perception and belief regarding the food system in general, and that simultaneously interact with aspects such as availability, economical barriers and other typical barriers.

Since locally produced cheese are considered as more expensive than non-locally produced cheese one can argue that demographic factors of the consumers may have an impact.

4.1.7 Demographic variables

As mentioned previously, the age of a person affects the purchasing behavior. Many studies made in the U.S have showed interesting results that have enlightened this. Many studies have also showed that people with higher income also tends to buy more locally produced products (Jekanowski et al., 2000). One could suggest that there is a link between the age and the income since elder people tend to have more money to spend than younger people (Antonidis & van Raij, 1996).

The gender is also something that previous studies paid regard to. Antonidis and Van Raij (1996) defines both “the male market” and “the female market” to clarify that there are differences between the purchasing behavior between men and women. Darby et al. (2008) concluded that males were more likely to purchase locally produced products. That might indicate that males show larger preferences to buy locally produced household cheese in Jönköping, Sweden.

Education is also linked with a higher income. Nayga, Govindasamy, Wall & Thatch (1995) concluded that shoppers of locally produced products were mainly middle-aged females that had college education, and the income was above average. Consumers that are environmentally conscious also tend to be more willing to pay extra for locally

produced products (Brown, 2003). Therefore, environmentally conscious consumers in Jönköping, Sweden might be more willing to pay for locally produced cheese.

Though, one has to be critical of this statement since Brown’s study was made in the U.S., and locally produced is associated with quite different aspects in the U.S. and Sweden.

4.1.8 Consumer affecting variables

Govindasamy, Italia and Liptak (1997) found out that taste, freshness, health value, cleanliness and absence of pesticides are the most important and highest valued attrib-utes for consumers when buying locally produced products. The same research also concludes that organic food is lower valued today than before in comparison to locally produced food (Govindasamy et al., 1997). What should been taken in mind is that this study is made in year 1997 and it ignored ethical based values that are assumed to be important today.

When comparing different attributes to each other, it is important to separate traditional attributes from more ethical based attributes. For Swedish consumers, ethical factors are factors such as good husbandry, supporting local farmers and less environmental im-pact. (Gustavsson & Rokotova, 2012). Gabriel and Lang (1995) define these new ethical factors as a new wave of consumerism. More recent studies have put their focus on the-se ethical factors, and that is a big drive for purchasing local food.

Recent years, buying locally produced alternatives has become sort of a trend among consumers (Adams & Adams, 2011). Brown (2003) suggests that consumers repeatedly associate locally produced food with supporting local businesses and the environment, and according to Adams and Salois (2010) this, sustainable growth methods and ethical work within the food system are the main motivators for consumers in the U.S. Accord-ing to Darby et al. (2008), supportAccord-ing local business was among the top reasons to why consumers buy locally produced. But it was not until recently it was confirmed that “fairness” is an important factor for consumers (Toler et al., 2009). According to Adams and Adams (2011), locally produced is about sustainable production, ethical and com-munity factors.

5

Methodology

In the methodology part a deeper explanation of the research approach will be present-ed.

Previous research within this area have mainly used quantitative data when they studied this subject. To collect data to this study, the authors will use both quantitative and qualitative data in order to get a deeper understanding in the topic. The qualitative data collection will contribute with deeper answers and findings regarding how consumers thinks about locally produced, while the quantitative method will show how consumers in Jönköping generally value locally produced against other attributes and alternatives, such as country-of-origin, brand awareness and so on. The data that is gathered through the qualitative method is also partially a foundation to the quantitative method.

Primary, to precede the purpose of this study a choice-based conjoint analysis will be used as a method. As a pre-step to the conjoint analysis a semi-structured interview and a focus group will be carry through. Green, Krieger and Wind (2001) suggests that internal corporate knowledge and information from consumers could be used as a pre-step to the analysis. The purpose of this pre-pre-step is to gather information in order to develop a set of attributes that are going to be used in the conjoint analysis (Green et al., 2001). These attributes are going to represent elements that are important for consumers when they buy cheese (Green et al., 2001). Attributes are functions and elements of the product such as price, style, design, quality and packaging (Wyner, 1992). To get as much data and information as possible for this study, a mix will be used. A mix of qualitative and quantatitive research gives many advantages when exploring complex questions. The use of mixed research gives greater evidence for the empirical findings (Driscoll, Yeboah, Salib & Rupert, 2007).

The semi-structured interview will be held with the CEO of Boxholm Mejeri, Christer Lundin. The hope is to get access to internal corporate knowledge about how they use locally produced in their branding and marketing. The focus group will remain of people that represent consumers of Jönköping. The purpose with the interview and the focus group is to get information about how consumers perceive locally produced and other factors that are important to them when they are buying household cheese.

5.1

Time planning of method

First of all a semi-structured interview with the CEO of Boxholm Mejeri and a focus group is going to be performed. The focus group is going to consist of five members that represents consumers of Jönköping. Toghether, the two methodologies will give enough information to develop attributes for the conjoint analysis as well as information that could answer some of the research questions. The interview will give access to internal corporate knowledge about locally produced, and the focus group will

contribute with the consumers experience and perception of locally produced and in also terms of household cheese.

After the first part is done the information that is gathered will be processed, the data will be coded and the parameters and attributes that are important for consumers when buying cheese will be analyzed. Now, the conjoint analysis will be designed, and which questions that will be used is determined and how many people that are going to be involved as well. After performing the conjoint analysis the result and analysis will be compiled from the information that is gathered and the analysis will be presented.

5.2

Semi-structured interview

Previous studies (Dalen, 2007) suggest that the purpose with an interview is to obtain important and well-defined information about how other people experience different things in life. This method is a good tool to use when one wants to get insight about peoples thoughts and experiences from a product for example. For this study it is decided that a semi-structured interview was the best-suited method for a part of the purpose; to get internal information from a company that operates in the cheese business and to define important attributes for the conjoint analysis. Dalen (2007) also states that an interview is a good tool to use to complement another method, in this case the conjoint analysis. This thought is also supported by other sudies, such as Green et al.’s. study made in Missouri (2001).

A semi-structured interview is a method that is commonly used when a researcher want to get qualitative data about a certain subject. Furthermore, a semi-structured interveiw is a qualitative methodology that is concentrated on a certain topic that the researcher has identified in advance. Unlike fully structured interviews, where one use predefined categories that the question and answers should stay within, semi-structured interviews is free and the researcher should use open questions in order to give the informant the opportunity to express their own thoughts about the subject (Dalen, 2007).

When structuring the interview there are several steps that should be done before, during, and after the interview (Dalen, 2007). These steps do not necessarily need to be done in the order listed below, the important part is to structure and to organize them. These steps are:

- Choosing subject and frame problems with it. - Identify possible informants.

- Compose a guide for the interview.

- Contact the selected informant regarding the interview. - Perform the interview.

- Organizing and processing of the gathered material. - Analyzing the interview.

5.2.1 Choosing subject

The first step is to decide which subject that is going to be researched. After this, the researcher shall gather information about the subject by searching through literature within the topic in order to get background knowledge of what has already been done. When this is done it is time to narrow down the purpose of the interview and formulate problems. This step is supposed to give the researcher a sufficient background to designing the questions in the interview. The subject that is going to be researched in this case is, as mentioned earlier, locally produced household cheese. Information have been gathered, mainly from previous studies and articles within the subject of locally produced.

5.2.2 Identify possible informants

The researcher may already have a clue about whom they want to interview before this point, but it is important to explain why this particularly person is chosen and on which criteria. The choice of informant is of great importance in qualitative interviews. Dalen (2007) states that there should not be to many interviews since every interview consumes much time. However, it is of great importance that the interview that is being done contribute replete information and quality that it gives a sufficient basis to the analysis. The identified informant in this study is Christer Lundin.

5.2.3 Compose a guide for the interview

This part is particularly important in a semi-structured interview. This guide should include the central part of the subject and questions that together will cover the most important part of the study. The work in this part is to convert the problems that are identified in the first step to problems with underlying questions that is used in the interview (Dalen, 2007). Dalen (2007) suggest that one should start the interview with some gentle questions, for example questions that are in the periphery in relation to the key issues in order to get the informant relaxed. After a while the focus should turn to the central theme though. It is important to be profound when designing the questions, the information you get from the interview is going to be the material one are going to work with, it is significant that this information is of great quality. The interview guide made for the interview with Christer Lundin can be found in the appendix.

5.2.4 Contact the selected informant regarding the interview

In this step it is time to contact the informant that has been identified in earlier stages and check if they are willing to perform an interview.

5.2.5 Perform the interview

When performing the interview it is important to remember that it is the interviewed person’s thoughts and feelings that is of interest, meaning that the researcher should try to not involve own feelings or moralize the answers (Dalen, 2007). Regarding the questions it is generally a good tip to ask the informant to “describe something” instead

of just asking a “yes or no”-question in order to get a deeper answer. It could also be a good idea to use research result and ask the informant to give its opinion on it (Dalen 2007). To not miss or forget any information from the interview it is common to use some type of tape recorder (Hove & Anda, 2005).

5.2.6 Organizing and processing of the gathered material

Now when the interview is done it is time to gather, organize and process the material that is collected. The first thing to do is to transcribe the interview, meaning put the interview down on paper. When transcribing, it is important to write down everything that’s been said or happened during the interview, even quite moments could be important. One should also consider social factors that appear in the interview (Halkier & Torhell, 2010). Other thing besides the interview that is important is relevant facts about the informant, such as age, place of residence for example.

Next step is to interpret and analyze the data. When doing this, there are two concepts that could be useful for the reader to know about and understanding the differences. The concepts are experience near and experience distant. Experience near regards the informants phrase when speaking about something, the word the informant use and how it is said. This is regularly the basis for the citations that later is used in the study. Experience distant is more analytical and the researcher is now allowed to put own thoughts and interpretation from the interview. When doing experience distant the researcher has gone from an interpretive to an analytical level. After this it is time to consider which theoretical approaches to use.

5.2.7 Analyzing the interview

One of the most important parts when analyzing the material is coding. Coding could be defined as the process when theories are built from data. Strauss and Corbin describe the process as when the researcher breaks down the data that is gathered in little pieces, theorize them and put them together in new ways (Strauss & Corbin, 1990a). The researcher has to go trough the material and describe what it actually is about. The purpose is to find categories that helps understanding the data in a better and more academic way, to get a deeper understanding of the material (Dalen, 2007). This categories can also be used to structure the empircal findings. The process of coding consists of several levels, which could be described as different types of coding. Strauss and Corbin (1990a) describe these levels as open, axial and selective coding. These three types of coding together constitute the process of coding and are dependent of each others (Dalen, 2007), but the researcher does not necesseraly perform them in the order stated below (Pandit, 1996).

5.2.7.1 Open coding

problem and a solution to it. Later the categories are being compared to each other and one try to find patterns in them. Pandit (1996) refer to this part as when the researcher is labelling and categorise the phenomena that is specified by the data.

5.2.7.2 Axial coding

Axial coding is a form of description of behavior and is a good tool when one wants to describe experiences (Strauss & Corbin, 1990a). The purpose of axial coding is to contextualize a happening, reactions from the informant, the reason to the reaction and consequences of the reaction (Dalen, 2007). Axial coding is about identifying connections between the categories.

5.2.7.3 Selective coding

Selective coding is the last part of coding and is to summarize the categories that have been identified in open coding and their relationship to each other. The purpose is to get an understanding of which categories or phenomenon that are fundamental in the subject (Dalen, 2007). The result of this part should be to identify a “core category” which is the central theme of the study (Strauss & Corbin, 1990b). The core category is all categories that are identified joined and connected together. To understand the central categories better the researcher could create theoretical models.

5.2.8 Present relevant result from the interview

The result could be described as either state images or models that enhance the understanding of the results. The state images are predicated on the experience distant described earlier in this study; general descriptions from the informant’s statements. The models are being processed and developed ongoing and are based on the researchers theoretical perspective and the material that is gathered (Polkinghorne, 1995). It is important that the results that are being presented in a way that appears like a proposal for the subject more than complete truths (Söndergaard, 2001).

5.2.9 Selection of informant

The informant that have been identified is, as mentioned earlier, the CEO of Boxholm Mejeri, Christer Lundin. The choice of Christer Lundin is based on his knowledge within the area. As CEO of a company that produces locally produced cheese Lundin could give the study valuable information about how they as company perceive locally produced and how they use it in their marketing. Another intention with the interview is to get information to that will be needed for the attributes in the conjoint analsis.

5.2.10 Grounded Theory

There are many different tools one can use when analyzing the empirical data that is gathered, but one of the most common used regarding qualitative research approaches is Glaser and Strauss theory, grounded theory (Glaser & Strauss, 1967). The theory that was founded in the 1960s use the data that is collected as a basis for the theories that are going to be developed. Dalen (2007) suggests that it is the informant’s opinions and

perspectives that should be the benchmark for the analysis and theories. The most important part is that the theories that are developed should be completely based on the empirical data, and the analytical concept that is created should derive to the empirical data in induction (Glaser & Strauss, 1967). One of the most fundamental parts of grounded theory is coding, where the data is broken down and compared in an iterative process (Glaser & Strauss, 1967).

5.2.11 Shortcomings of a semi-structured interview

A weakness with interviews are if the informant does not feel confident toward the researcher, which could lead to shorter answers and less information and data to work and analyze after (Dalen, 2007). Another problem could be that the researcher is feeling unease and circumvents important subjects in the interview because the interviewer feels discomfort (Dalen, 2007). Since one of the authors also has contact with the informant in his job it can affect how the data is interpret and analyzed, it is important to be objective and indifferent to the information one gets (Dalen, 2007).

5.2.12 Performance

The interview was performed in Boxholm Mejeri’s conference room, and much relevant information was gathered.

5.3

Focus group

Focus group is a qualitative methodology that could be described as a crossing of unstructured interviews and participant observations (Morgan, 1997). Focus groups are a good way to provoke a discussion about the subject that hopefully could lead to a deeper explanation of consumer behavior, the face validity of focus groups is general high since the result regularly refers to direct quotations from the group (Hylander, 2001). The method is commonly used when one wants to investigate consumers attitude and value towards somehing (Hylander, 2001), in this case locally produced household cheese. The collection of the data is composed by open questions that is asked by a moderator. In this way, directing the discussion too much can be avoided which could lead to more correct answers from the participants.

A focus group should consist by 4 to 12 participants (Kight, n.d.) and a moderator (Halkier, Torhell, 2010). How many participants a group should consist of rely on the topic that is being researched and the involvement of the participants. In generally, small groups generate more specific ideas while larger groups develops more ideas. A risk with bigger focus groups is that every participant gets less time to speak and express their opinions. The hope is to get as specific and concret answers as possible from the members of the focus group (Hylander, 2001). For this study, the focus group is going to consist of five members. The resarcher feels that this is a good size for the purpose, since a deeper discussion about the subject is requested, in that case, a smaller

A critical part of focus groups is to choose people that have much knowledge about the subject that the researcher wants to investigate. It is also important that the members of the group match with each other and dare to open up and share their experiences, it is therefore essential that the members are at the same level educationally (Merton, Fiske & Kendall, 1990). Hylander (2001) suggests that preferably is if the members do not know each other at all, but share mutual knowledge and interests.

To summaraze, the purpose of the focus group is to collect qualitative data, the group consists of members with someting in common, interest, knowledge or education, and the members discuss about a specific subject or theme (Hylander, 2001). This tool is chosen since a deeper discussion about locally produced is desired by the researchers, then a focus group is a good alterntive.

5.3.1 The process

Before performing the focus group it is a good idea to prepare a “topic guide” where general questions is stated. The focus group should start with an introduction by the moderator where the members get background information about the purpose of the focus group, and what the researcher hopes to find out. A tip is to start with a general statement and then ask a member what they think about it, gradually other members of the group will join the discussion and the activity has started. The main task of the moderator is to ask questions about what is being discussed, ask the members to elaborate more if more information is needed and keep the flow in the discussion (Hylander, 2001). It is essential that the focus group is being recorded so that everything can be transcribed afterwards (Halkier & Torhell, 2010). The question that was asked in the focus group can be found in the appendix.

5.3.2 Analyzing

There is no specific theory that is better suited than other regarding focus groups, if the interview is transcribed to text all qualitative theories could be used. Grounded theory can be applied for the focus group and this theory will, as well as for the interview, be used to analyze the data contained from the focus group (Hylander, 2001).

5.3.3 Selection of informants to the focus group

A variety of different kinds of informants were preferred for the focus group, in terms of gender, marital status, age, income and so on. This was desired in order to cover dif-ferent targets groups and to get opinions from people in difdif-ferent stages in their life. Since the subject that the focus group talked about is narrowed and very specific, five participants were chosen to get a deeper discussion. The aim was to get five people that did not knew each other, but late defection made that impossible. The informants that participated in the focus group was;