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The character of demand in mature organic food markets: Great Britain and Denmark compared

Abstract

We investigate the organic food market in two selected European countries, Great Britain and Denmark, identifying main differences and similarities. We focus particularly on consumer preferences and priorities, labelling schemes, supply and sales channels, as a basis for assessing market stability and prospects for future growth. We employ a unique set of household panel data that includes information on stated values and concerns, as well as registered purchasing behaviour. Most organic food on both markets is produced and processed by large-scale industrialised units and distributed through concentrated mainstream sales channels, consumer confidence being sustained at present by organic labelling schemes that appear to function well. However, a parallel market, based on various types of direct sales to heavy users, prevails. We find that organic food purchase decisions are primarily motivated by ‘private good’ attributes such as freshness, taste and health benefits, attributes that may be perceived as being compatible with modern production and sales structure. More traditional ‘public good’ organic attributes, such as environmental and animal welfare attributes, small scale production and local supply, are less compatible with current market structure, but are also accorded less priority by the majority of consumers in practice. Mature markets for organic foods nevertheless may constitute a source of consumer dissatisfaction, particularly in the group of organic heavy users

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