A Research Proposal of

Consumer Perception and Purchasing Intention toward

Organic Products in Butwal .

By

Binita Aryal

Butwal , Nepal

27/12/2018
 CHAPTER 1

Introduction
Organic food refers to the way agriculture products are grown and processed. Organic crops must
be grown without the use of synthetic pesticides, bioengineered genes (GMOs), petroleum-based
fertilizers and sewage sludge-based fertilizers. Organic food, also called green food refers to foods
that are safe to be consumed, are of fine quality, concerned with humane animal treatment,
nutritious foods and are produced under the principles of sustainable development (Lie, 2003).

Organic food can provide various benefits to its consumers such as the nutrient contain are a lot
more than non- organic food. Organic foods often have more beneficial nutrients such as
antioxidants, than their conventionally grown counterparts and people with allergies to foods,
chemicals, or preservatives often find their symptoms lessen or go away when they eat only organic
foods. Human concern toward environment is increasing and they are becoming more serious on
how to convert it into green environment and tend to seek green products. Organic food is
perceived to have better taste then conventional food and it is also perceived to be more
environmental-friendly. Consumer is taking organic food as a better lifestyle choice. The healthy
foods and drinks market is performing well, in terms innovation and market penetration; according
to (Nielsen, 2007)the healthy foods in Europe have a turnover of Euro 5.7 billion. This trend is
fully confirmed when referred to the Italian market, where demand for health product has, over the
five year 2005-2006, the highest growth rate in terms of purchases volume. Nepal’s organic
agriculture production has a relatively short history. Adoption of organic farming is quite slow,
market for organic products is not well developed and no market statistics are available in Nepal
(Bhatta G. W., 2008a).There is growing trend among urban consumers to consume organic
products from places where they could get an assurance about the quality of the products. Market
features of organic production in Nepal show that it is still in the “formative stage” of the product
life cycle (Bhatta G. W., 2008a).
Result of studies confirmed that consumers have positive attitudes toward organic products where
one of the most common mentioned reason for purchasing organic products was it is perceived as
healthier than conventional alternatives (Vhinnici et al., 2002; Harper amMankatouni,2002).
Consumer do not always buy sustainable products as consequences of environmental concern or
to benefit the community or due to personal beliefs but mainly to give priority to health, to be part
of the social group, to distinguish from others and to accomplish the need to try out new
technologies (Vermeir & verbeke, 2004).

Problem of Statement
Organic food has entered the global markets and rapidly gained market share. Generally, in
purchasing organic product consumer passes through five steps: Need recognition, Information
search, evaluation of alternatives, purchase decision and Post purchase behavior. The consumer
may reflect satisfaction or either dissatisfaction from the use of a product.

Many studies indicated that one major factor that considered being the barrier to organic food
consumption is due to its high price and lack of confidence in its status, but there are some other
factors too that might considered as barriers to organic food consumption among consumer. For
instance, knowledge on organic food as well as action taken by the government either to inform or
to create awareness has not reach the satisfactory level in encouraging sustainable consumption
with organic food.

Therefore, knowing how consumer perceived organic food product by understanding the reasons
of buying would probably help the marketers of organic food to establish a proper communication
message. Other factors that affect in consumer buying decision for organic food are perceived
quality, risk, demographic factors like: age, gender, income, education and purchase intention.

In addition, consumer thought that organic food had to be eaten promptly because it spoiled faster
than conventional food. Limited availability of organic food was also an important barrier to
purchasing organic food. Consumers indicated that even if they wanted to buy organic food, they
could not find it easily.
Research Question
This report gathers some information about the perception and purchasing intention of consumer
of Butwal . It mainly tries to find the factor affecting the consumer intention of buying organic
food.

 What is the relationship between perceived price with consumer perception and purchasing
intention of organic food?
 Does health conscious affect the consumer perception and purchasing intention of organic
food?
 Does quality and subjective knowledge conscious affect the consumer perception and
purchasing intention of organic food?
 What is the relationship between consumer attitude and their purchase intention?
 What is the consumer attitude towards organic food?

Objective of the Study

The main objective of the study is to understand attitude of consumer on their perception towards
buying organic food products. The other aim of this study is:

 To find out relationship of perceived price with consumer perception and purchasing intention
toward organic food.
 To find out relationship of attitude with consumer perception and purchasing intention toward
organic food.
 To find out relationship of Health Conscious with consumer perception and purchasing
intention toward organic food.
 To find out relationship of quality with consumer perception and purchasing intention toward
organic food.
 To find out relationship of subjective knowledge with consumer perception and purchasing
intention toward organic food.
Literature Review
The concept of organic food was originally introduced and commercialized between the 1940s and
1950s (Pearson, Henryks, & Jones, 2011). Due to the growing awareness of consumers and their
standard of living, organic food is now gaining recognition and importance. Many countries are
further developing the concept of organic food, such as the ‘ecological agriculture’ in Switzerland
and the ‘biodynamic agriculture’ in Austria and Germany. The development of the organic
movement intensified during the 1960s and 1970s when consumers became more concerned about
manmade products and their effect on the environment. The International Federation of Organic
Agricultural Movements (IFOAM), which was formed during that period, has continued the effort
to provide a forum for the global coordination of the organic movement. In the 1990s, organic food
finally gained significant recognition from many national governments as a food production
system and was commercialized by the mainstream food industry.

In Malaysia, the pioneering initiative behind organic food started in the early 1990s. This early
initiative faced the double challenge of developing organic practices as well as devising a means
to establish a market (UNESCAP, 2002). Now, the development of organic food is becoming more
important and widely accepted.

Organic food has been analyzed from many perspectives in many countries. The National Organic
Standards Board of the U.S. Department of Agriculture (USDA) defines organic as follows:

“Organic food, defined by how it cannot be made rather than how it can be made, must be produced
without the use of sewer-sludge fertilizers, most synthetic fertilizers and pesticides, genetic
engineering (biotechnology), growth hormones, irradiation and antibiotics” (Ahmad, 2010)

A formal regulation under Council Regulation (E.C.) 2092/91 defines organic food as follows:
“Organic food production refrains from using synthetic chemicals like pesticides and fertilizers”
(Schifferstein, 1998)
Health Consciousness

Health consciousness is defined as an attitude in which people is aware of the healthiness in their
diet and lifestyle (Oxford Dictionaries, 2014). A consumer positive attitude towards organic food
is originated from the belief that organic food is good for health, thereby they can consume without
any fear and suspicion. The more health conscious consumers, the more positive attitude they have
towards organic food.

Consumer Knowledge
Consumer knowledge determines to have a positive influence on their attitude towards organic
food. Knowledge of consumer is categorized as subjective knowledge, objective knowledge and
prior experience (Brucks, 1985). Subjective knowledge refers to what the consumers perceive
that they know. In other words, it is called as self- rated knowledge. The low level of subjective
knowledge results in the lack of confidence (Chryssochoidis, 2000; Padel and Foster, 2005).
Objective knowledge is what the consumers actually know and finally prior experience is defined
as what the consumers have experienced before (Brucks, 1985). In particular, subjective
knowledge is concluded to have more positive influence on consumer attitude than objective
knowledge (Ellen, 1994). In addition, prior experience plays an essential role to determine
consumer attitude since the more experienced consumers have, the more positive attitude they
would have (Sorensen et al., 1996).
Consumer knowledge about organic food could be gained from different sources. The source may
be local governments, social media, social networks, notifications from ecological organizations
and advertisements. Subsequently, prior experience is also considered as essential factor that
influence consumer knowledge towards organic food. Thus, the more knowledge (subjective
knowledge, prior experiences and information) consumers have the more positive attitude they
have towards organic food.

Research Methodology
Research methodology is simply the study to analyze relation between various variables and
elements. Research Methodology is a systematic way to solve a problem. Here in this research we
have dependent element as consumer perception and purchase intention with various independent
like perceived price, attitude, health conscious, quality and subjective knowledge.
Primary data collection
Primary method of data collection was used for the study. Here interview and questioner method
was used to collect the data.

Sampling
The 70-80 samples were collected for the primary data. A sample of questionnaire was prepared
and administered to respondents.

Interview
Some of the respondents were interviewed to gain proper prospects of the survey.

Data Collection Instrument

Researchers develop a set of questionnaire regarding the description of the respondent, phenomena
of the respondent and collect the data through the questionnaire.

Data Analysis
Data will be analyzed by using relevant charts and graphs by using the SPSS software.

Secondary data collection

Secondary method of data collection was also used for the study. Here data were collected from
different magazine, Newspaper, Internet, Article and so on.

Analysis plan
Analysis plan is a critical component for research study. Data analysis plan clearly identifies the
specific statistical tools used to examine the research questions and test hypothesis. Data collected
from the respondent were categorized and summarized.

Limitations
The study may not be able to capture every detail of the field some of the major limitation are

 The data collected may not cover the full depth of the topic.
 The research is more about psychological state of mind of the subscribers, so they may not
reveal the truth and may not answer the questionnaire honestly.
 The study will be carried out in Kathmandu valley; the customer satisfaction level may
differ to various geographical locations.
 Some of the information will extract from website, magazines, so that data may not be
accurate and updated.
 The study will be conducted for the fulfillment of academic requirement so it may not
provide sufficient information.