A conjoint analysis of consumer preferences for product attributes: The case of Illinois apples

The current study is designed as a part of the proposal entitled: Initiative for Low-input Apple Production in Illinois. Major difficulties currently facing apple production in Illinois are competition from lower cost producers in more favorable climates and the use of traditional production technologies which require intensive use of pesticides. Recently, the successful use of biotechnology has resulted in the development of new disease-resistant apples varieties. The objectives of the study are to learn about consumer preferences for such apple attributes as place of production (locally grown versus non-locally grown), method of production (genetically modified versus conventionally produced) with respect to different pricing, and to determine whether locally grown genetically modified apples would be appealing to the consumer. Consumers responding to the online survey were asked to rate hypothetical apples and later choose a preferred apple alternative from multiple sets, each consisting of three choices. Using the conjoint analysis technique, the study analyzes two versions of the survey: one referred to the choice of genetically modified apples as "GM", while the other version referred to that choice as "REI" (reduced environmental impact). The study results conclusively prove that consumer preferences for apples are influenced by place and method of production attributes. Although price remains one of the dominant attributes, it may play a different role for consumers who are willing to pay a premium for locally grown apples with combination of benefits provided by the method of genetic modification. The study also contributes to the literature on the issues related to the labeling language of GM food. The study results suggest that labeling language has to be carefully worded. When apples are labeled as "GM", respondents value this attribute negatively, while labeling apples as "REP" results in a positive valuation of the same attribute. It can be concluded that labeling should reflect both: the method (GM) and the specific benefits it could provide. As a result, consumers would have more information to make a desirable and affordable choice among products.