The effects of experience versus description of attributes on willingness‐to‐pay for beefsteaks

• Published in: Agricultural economics 2019-03, Vol.50 (2), p.129-137
• Main Authors: Palma, Marco A., Johnson, Myriah D., Anderson, David P.
• Format: Article
• Language: English
• Subjects: Agricultural commodities; Agricultural economics; Beef; D12; Experiments; Flexible mixing distribution; Market penetration; Meat processing industry; Mixed logit; Purchasing; Random parameters; Willingness to pay; Willingness‐to‐pay space
• ISSN: 0169-5150; 1574-0862
• DOI: 10.1111/agec.12471

We study the influence of the market environment in the beef industry by setting up an experiment in which the economic setting is changed from a “market purchasing” setting to a “tasting experience repurchasing” setting. In the market purchasing setting, subjects respond to a stated choice experiment for beefsteaks while shopping at a grocery store. This setting appeals more to the homegrown “purchase intention” and the results show that participants place more value on credence attributes rather than sensory attributes. In the experience repurchasing setting, subjects respond to the same discrete choice experiment (DCE), but the task is performed in a tasting facility where participants taste several steak products before making their choices. The experience repurchasing treatment appeals more to repurchase intentions and the results show that participants valued more the physical and sensory attributes of the beefsteaks. The information provided in this article is useful for the beef industry to understand the key drivers of market penetration purchasing based on attribute descriptions and repurchase intention based on experiencing physical and sensory attributes of beefsteaks.