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Доверие потребителя к органическим продуктам питания на рынках России и Германии Consumer trust in organic food on the German and Russian markets
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Introduction 2
Chapter 1 Trust on the organic food market in Russia and Germany: theoretical framework 7
1. The general concept of organic food: basic ideas and explanations 7
2. Legislative base for organic production 18
3. Understanding and estimating trust in organic food 22
Chapter 2. Building trust on the organic food market: comparative analysis of Russian and German cases 39
1. Methods and data collection 39
2. Trust in organic food among Russian and German consumers: comparative analysis of empirical data 42
3. Organic food issues in Russian and German mass media 61
4. The impact of governmental and private standards on building trust on the organic food market in Russia and Germany 69
Conclusion 83
Bibliography 89
Appendix I Research program for empirical study 98
Appendix II Questionnaire for consumers (in English) 109
Appendix III Interview guide (in English) 117
Appendix IV Table of respondents 120
Appendix V Example of the interview transcript (German) 121
Appendix VI Example of the interview transcript (Russian) 134
Chapter 1 Trust on the organic food market in Russia and Germany: theoretical framework 7
1. The general concept of organic food: basic ideas and explanations 7
2. Legislative base for organic production 18
3. Understanding and estimating trust in organic food 22
Chapter 2. Building trust on the organic food market: comparative analysis of Russian and German cases 39
1. Methods and data collection 39
2. Trust in organic food among Russian and German consumers: comparative analysis of empirical data 42
3. Organic food issues in Russian and German mass media 61
4. The impact of governmental and private standards on building trust on the organic food market in Russia and Germany 69
Conclusion 83
Bibliography 89
Appendix I Research program for empirical study 98
Appendix II Questionnaire for consumers (in English) 109
Appendix III Interview guide (in English) 117
Appendix IV Table of respondents 120
Appendix V Example of the interview transcript (German) 121
Appendix VI Example of the interview transcript (Russian) 134
It is evident that nowadays a market for organic food in Europe, and especially in Germany, is constantly growing (European Commission). The same trend can be also observed in Russia (Bruschi et.al. 2015). Despite numerous differences between German and Russian organic food markets, there is one common problem which is typical for both. This is the problem of information asymmetries. Organic products are often even called credence goods because information about the nature of the product is asymmetric: while producers know whether the product is really organic or not, in most cases the presence or absence of the organic characteristics are not detectable by consumers even after purchase and use of the product (Giannakas, 2002). It means that consumers generally cannot distinguish organic products from conventional ones by their appearance or taste. More than that, it is hardly possible to say if the product is organic or not even after the consumption (Schneider et.al. 2009). In other words, buyers do not really sure if the product is organic unless they are told so. Surely, this issue is relevant for any market in general, whether it is the automobile, insurance, credit or labor markets (Akerlof, 1970), and for the food market in particular (Nestorowicz, 2014). This is explained by the fact that producers, in comparison to consumers, from the very beginning possess more information about goods they offer. However, at the same time, this problem becomes even more important for the organic food market due to the peculiarity of traded goods.
From the one hand, reasons for purchasing organic food are seemed to be very altruistic. Thus, originally organic farming has been emerged as an alternative production system to help preserve the environment, and reduce the negative impact on natural resources such as soil, air, and water (Vega-Zamora et.al. 2013). This goes along with the striving for rural economic development (Ibid.). On the other hand, motifs for buying such products are also rather egoistic. Individual health and food safety together with the quality and flavor are in the spotlight for many people (Ibid.). However, in both cases commodities, which are purchased by people who claim themselves as organic food consumers, are endowed with a bigger value. It is difficult to argue that a person would choose organic product instead if it’s conventional counterpart without having a strong reason. And this very strong reason makes organic food and organic food market unique. In order to satisfy their particular needs, it is important for consumers to be sure that money is invested in a truly organic product. For this reason, information provision can affect consumers’ willingness-to-pay for environmental goods (Rousseau & Vranken, 2013). And this confidence cannot be totally complete until the problem of information asymmetries is solved.
Actually, one of the possible solutions for this problem is the formation of consumer trust toward organic food. Moreover, there is a general agreement on the importance of trust in decisions on organic food (Schneider et.al. 2009). Nevertheless, the question arises: how customers could trust in the truly organic origin of a product under the conditions of information shortage? Because the necessity for trust is argued to be usually caused by uncertainty what is actually the lack of important knowledge (Sztompka, 1999). In this case, the main problem is where consumers obtain necessary information and how does it influence their trust in organic food at the end.
Generally, there is an opinion that “social institutions and arrangements <...> are better viewed as the efficient solution to certain economic problems” (Granovetter, 1985). In this case, quality uncertainty and trust formation could be attributed to these problems as well. It is possible to mention that there are studies that prove the importance of institutions in regard to the food safety and trust in food in general (Kj^rnes et. al. 2007). Thus, G. Akerlof (1970) identifies four basic types of such institutions: guarantees, brand-name, chains and licensing practices or certifications. What is more, literature review in the field of organic food consumption gives an evidence that the most common way to enhance consumer trust especially in this kind of commodities is the establishing of various institutions, like labels, brands, laws, regulations (Giannakas, 2002; Schneider et.al. 2009; Zagata, Lostak, 2012; Janssen, Hamm, 2012; Brcic- Stipcevic, Petljak, 2012; Smed et. al. 2013; Hamzaoui-Essoussi et. al. 2013; Anisimova, Sultan, 2014; Vitterso, Tangeland, 2015).
However, the occurrence of these institutions does not lead to absolute protection against a fraud. It could be explained by the fact that introduction of these activities sometimes creates incentives for such manipulations as, for instance, mislabeling of conventional food as organic (Giannakas, 2002, Muller, Gaus, 2015). It means that consumers sometimes are provided with false information. In other words, it shows that certification and labeling are necessary but insufficient for winning the trust of consumers. In this perspective, we agree with G. Akerlof (1970, 500), who writes that “informal unwritten guarantees are preconditions for trade and production”. Consequently, there should be some other ways to enhance consumer trust in organic food except mentioned formal institutions. Thus, one of the possible solutions could be an interaction between market agents, especially communication between consumers. It is a common knowledge that people tend to ask advice or recommendations from other buyers in order to clarify some issues about future purchasing. In other words, other consumers are the most reliable source of information about organic food which enhances their level of trust in it. M. Granovetter (1985) also argues that market is not an impersonal mechanism because people tend to turn it into the network of social relations, which are, in turn, a reliable and trustful source of cheap and detailed information. Despite the fact that German organic food market is known as better regulated than the Russian one, there are a number of laws and controlling bodies, it could be assumed that personal interaction still plays a great role in the process of trust formation on the both of these markets. Hence, the major research question could be formulated as follows: how consumer’s trust in organic food is constructed on the market? Consequently, the main aim of the thesis is to reveal common and specific factors that influence the process of consumer trust formation on Russian and German organic food markets. The following hypotheses are tested in the study: 1) personal communication among consumers related to organic food consumption positively affect consumer’s trust in these products both in Russia and Germany; 2) institutions regulating Russian and German organic food market influence consumer’s trust in these products; 3) personal communication plays more important role than institutional arrangements in the process of consumer’s trust formation both in Russia and Germany.
In order to address the research question and hypotheses, the following tasks have been fulfilled:
1. Giving the basic definition of organic food based on the analysis of literature related to the organic food concept and current legislative base for organic food production;
2. Defining trust in organic food and the possible ways of its measurement;
3. Providing the explanation of trust formation on the market through network and neo- institutional approaches;
4. Comparison of Russian and German consumers’ motivation for purchasing organic food and estimation of their trust level in these products;
5. Detection of the factors that influence consumer trust in organic food among Russian and German consumers the most;
6. Finding differences and similarities in Russian and German Mass Media coverage of organic food topic;
7. Comparison of governmental laws and private standards for organic production in Russia and Germany.
The object of the study is organic food market in Russia and Germany. The subject of research is the formation of consumer trust in organic food on the Russian and German market. The study is based on case study approach. Organic food systems (Kj^rnes et.al. 2007) in Russia and Germany are investigated as the cases in the research. The spheres of production, distribution, consumption, and regulation are covered by the organic food system. The latter both in Russia and Germany includes manufacturers, retailers, consumers, government, mass media, expert organizations and controlled bodies. Two specialized organic food stores in Russia and two in Germany together with a private controlling authority from each country are considered as objects of comparison along with media sources which are nationwide newspapers and news websites, and current national legislation on organic food. Empirical data for the hypothesis testing is obtained by following methods: the qualitative analysis of documents; the qualitative analysis of Mass Media content; the online survey among organic food consumers; semi¬structured interviews with organic products purchasers.
This paper consists of a theoretical chapter, the outline of research design and methodology, description and analysis of empirical findings in a comparative perspective, a conclusion containing some ideas for further research, and several appendices. The chapter represents the theoretical framework the research is built on. The framework is organized around basic concepts: organic food and trust in organic food on the market. Consumer trust is analyzed on the basis of classical sociological theories of trust, produced by a range of outstanding scientists (Sztompka, 1999; Luhmann, 1979; Giddens, 1990; Simmel, 1978; Fukuyama, 1995; Seligman, 1997; Coleman, 1990; Granovetter, 1985; Akerlof, 1970); along with the analysis of current studies on consumer trust on the food market (Kj^rnes et.al. 2007; Gracia & De- Magistris, 2016; Rampl et al. 2012). Analysis of organic food markets was done on the basis of secondary sources (Giannakas, 2002; Schneider et.al. 2009; Zagata & Lostak, 2012; Janssen & Hamm, 2012; Brcic-Stipcevic & Petljak, 2012; Smed et. al. 2013; Hamzaoui-Essoussi et. al. 2013; Anisimova & Sultan, 2014; Vitterso & Tangeland, 2015) along with some investigation into the question of prices for organic food made in Germany and Russia. Empirical part represents the results of an online survey and analysis of semi-structured interviews conducted by the author in a comparative way together with the comparative analysis of documents and media content. The paper concludes with the final chapter where the empirical findings are summarized and connected to the theoretical concepts discussed in the first chapter. This section also includes discussion on limitations of the research and provides some ideas for further investigation.
From the one hand, reasons for purchasing organic food are seemed to be very altruistic. Thus, originally organic farming has been emerged as an alternative production system to help preserve the environment, and reduce the negative impact on natural resources such as soil, air, and water (Vega-Zamora et.al. 2013). This goes along with the striving for rural economic development (Ibid.). On the other hand, motifs for buying such products are also rather egoistic. Individual health and food safety together with the quality and flavor are in the spotlight for many people (Ibid.). However, in both cases commodities, which are purchased by people who claim themselves as organic food consumers, are endowed with a bigger value. It is difficult to argue that a person would choose organic product instead if it’s conventional counterpart without having a strong reason. And this very strong reason makes organic food and organic food market unique. In order to satisfy their particular needs, it is important for consumers to be sure that money is invested in a truly organic product. For this reason, information provision can affect consumers’ willingness-to-pay for environmental goods (Rousseau & Vranken, 2013). And this confidence cannot be totally complete until the problem of information asymmetries is solved.
Actually, one of the possible solutions for this problem is the formation of consumer trust toward organic food. Moreover, there is a general agreement on the importance of trust in decisions on organic food (Schneider et.al. 2009). Nevertheless, the question arises: how customers could trust in the truly organic origin of a product under the conditions of information shortage? Because the necessity for trust is argued to be usually caused by uncertainty what is actually the lack of important knowledge (Sztompka, 1999). In this case, the main problem is where consumers obtain necessary information and how does it influence their trust in organic food at the end.
Generally, there is an opinion that “social institutions and arrangements <...> are better viewed as the efficient solution to certain economic problems” (Granovetter, 1985). In this case, quality uncertainty and trust formation could be attributed to these problems as well. It is possible to mention that there are studies that prove the importance of institutions in regard to the food safety and trust in food in general (Kj^rnes et. al. 2007). Thus, G. Akerlof (1970) identifies four basic types of such institutions: guarantees, brand-name, chains and licensing practices or certifications. What is more, literature review in the field of organic food consumption gives an evidence that the most common way to enhance consumer trust especially in this kind of commodities is the establishing of various institutions, like labels, brands, laws, regulations (Giannakas, 2002; Schneider et.al. 2009; Zagata, Lostak, 2012; Janssen, Hamm, 2012; Brcic- Stipcevic, Petljak, 2012; Smed et. al. 2013; Hamzaoui-Essoussi et. al. 2013; Anisimova, Sultan, 2014; Vitterso, Tangeland, 2015).
However, the occurrence of these institutions does not lead to absolute protection against a fraud. It could be explained by the fact that introduction of these activities sometimes creates incentives for such manipulations as, for instance, mislabeling of conventional food as organic (Giannakas, 2002, Muller, Gaus, 2015). It means that consumers sometimes are provided with false information. In other words, it shows that certification and labeling are necessary but insufficient for winning the trust of consumers. In this perspective, we agree with G. Akerlof (1970, 500), who writes that “informal unwritten guarantees are preconditions for trade and production”. Consequently, there should be some other ways to enhance consumer trust in organic food except mentioned formal institutions. Thus, one of the possible solutions could be an interaction between market agents, especially communication between consumers. It is a common knowledge that people tend to ask advice or recommendations from other buyers in order to clarify some issues about future purchasing. In other words, other consumers are the most reliable source of information about organic food which enhances their level of trust in it. M. Granovetter (1985) also argues that market is not an impersonal mechanism because people tend to turn it into the network of social relations, which are, in turn, a reliable and trustful source of cheap and detailed information. Despite the fact that German organic food market is known as better regulated than the Russian one, there are a number of laws and controlling bodies, it could be assumed that personal interaction still plays a great role in the process of trust formation on the both of these markets. Hence, the major research question could be formulated as follows: how consumer’s trust in organic food is constructed on the market? Consequently, the main aim of the thesis is to reveal common and specific factors that influence the process of consumer trust formation on Russian and German organic food markets. The following hypotheses are tested in the study: 1) personal communication among consumers related to organic food consumption positively affect consumer’s trust in these products both in Russia and Germany; 2) institutions regulating Russian and German organic food market influence consumer’s trust in these products; 3) personal communication plays more important role than institutional arrangements in the process of consumer’s trust formation both in Russia and Germany.
In order to address the research question and hypotheses, the following tasks have been fulfilled:
1. Giving the basic definition of organic food based on the analysis of literature related to the organic food concept and current legislative base for organic food production;
2. Defining trust in organic food and the possible ways of its measurement;
3. Providing the explanation of trust formation on the market through network and neo- institutional approaches;
4. Comparison of Russian and German consumers’ motivation for purchasing organic food and estimation of their trust level in these products;
5. Detection of the factors that influence consumer trust in organic food among Russian and German consumers the most;
6. Finding differences and similarities in Russian and German Mass Media coverage of organic food topic;
7. Comparison of governmental laws and private standards for organic production in Russia and Germany.
The object of the study is organic food market in Russia and Germany. The subject of research is the formation of consumer trust in organic food on the Russian and German market. The study is based on case study approach. Organic food systems (Kj^rnes et.al. 2007) in Russia and Germany are investigated as the cases in the research. The spheres of production, distribution, consumption, and regulation are covered by the organic food system. The latter both in Russia and Germany includes manufacturers, retailers, consumers, government, mass media, expert organizations and controlled bodies. Two specialized organic food stores in Russia and two in Germany together with a private controlling authority from each country are considered as objects of comparison along with media sources which are nationwide newspapers and news websites, and current national legislation on organic food. Empirical data for the hypothesis testing is obtained by following methods: the qualitative analysis of documents; the qualitative analysis of Mass Media content; the online survey among organic food consumers; semi¬structured interviews with organic products purchasers.
This paper consists of a theoretical chapter, the outline of research design and methodology, description and analysis of empirical findings in a comparative perspective, a conclusion containing some ideas for further research, and several appendices. The chapter represents the theoretical framework the research is built on. The framework is organized around basic concepts: organic food and trust in organic food on the market. Consumer trust is analyzed on the basis of classical sociological theories of trust, produced by a range of outstanding scientists (Sztompka, 1999; Luhmann, 1979; Giddens, 1990; Simmel, 1978; Fukuyama, 1995; Seligman, 1997; Coleman, 1990; Granovetter, 1985; Akerlof, 1970); along with the analysis of current studies on consumer trust on the food market (Kj^rnes et.al. 2007; Gracia & De- Magistris, 2016; Rampl et al. 2012). Analysis of organic food markets was done on the basis of secondary sources (Giannakas, 2002; Schneider et.al. 2009; Zagata & Lostak, 2012; Janssen & Hamm, 2012; Brcic-Stipcevic & Petljak, 2012; Smed et. al. 2013; Hamzaoui-Essoussi et. al. 2013; Anisimova & Sultan, 2014; Vitterso & Tangeland, 2015) along with some investigation into the question of prices for organic food made in Germany and Russia. Empirical part represents the results of an online survey and analysis of semi-structured interviews conducted by the author in a comparative way together with the comparative analysis of documents and media content. The paper concludes with the final chapter where the empirical findings are summarized and connected to the theoretical concepts discussed in the first chapter. This section also includes discussion on limitations of the research and provides some ideas for further investigation.
In the final section of the paper, it is necessary to come back to the questions outlined throughout the thesis. A brief overview of the obtained empirical results in their connection to research findings and theoretical concepts outlined in the first chapter will be provided. Moreover, the limitations of the research will be discussed in addition to some ideas for future research.
The research seeks to provide a comparative analysis of the consumer trust in organic food formation on the German and Russia markets. The investigation is based on the theoretical framework organized around two major concepts: organic food and consumer trust. With respect to the former concept recent work demonstrates the complexity of such notion as organic food as it is based on a range of different characteristics. However, as based on the current literature three basic approaches to explaining this term could be found which are mostly based on the differences between organic and conventional food at different stages of production and consumption process. First, the process-oriented approach, which was not found as the fundamental one for consumers, emphasize that organic food should be understood as the fresh food with minimal, careful and sustainable processing what allow at the end to keep as many useful compounds in a product as possible, and also not to harm those, who take part at the processing stage. Second, the agro-ecological approach is based on the idea of organic agriculture which is based on environmentally- and animal-friendly techniques in order to preserve natural resources, such as soil, water, air, etc., as well as biodiversity. Following the rules of organic agriculture, no chemicals or only a few allowed could be used; soil should be free from pesticides and other harmful substances; production waste has to be utilized with no harm to the environment; animals should be kept under the special conditions. All in all, it means that all the stages of growing correspond to the requirements of organic production. Finally, product quality-oriented or consumer-oriented approach highlights those benefits that could be obtained from the very process of consuming organic products. It is connected with such characteristics as nutritional value, bioactive compounds, health impact, safety, and taste. The last two approaches were revealed to be the foundational for consumer understanding of organic food both in Russia and Germany. Moreover, standards defined by the Codex Alimentarius and IFOAM complement these approaches by stating that an organic product could be called organic only if it was certified and carries an ecological label on it. Based on this argumentation, generally, we define organic food as one produced by environmentally - and animal friendly techniques, which allow to preserve natural resources and biodiversity; as a consequence associated with naturalness and freshness; which is undergone minimal, careful, and sustainable processing what in turn guarantee its higher nutritional value, positive effect on consumer health and characterized by better sensory attributes.
The second theoretical concept used in the theoretical framework for the research is consumer trust. Our definition of trust was based on two basic sociological approaches which are rational and sensual. The former one sees trust as a product of rationalization which is not groundless and inborn but based on some calculations; actors try to predict the outcomes of each other’s actions based on some computations. The latter, conversely, understand trust as the element of faith; actors based their trust on feelings and beliefs that familiar things will remain stable. However, when talking about market relations and consumer trust it is necessary to say that these approaches could be implemented simultaneously and that’s how the notion of critical trust appears. It means that consumers base their trust both on feelings and calculations when undertaking their actions on the market. Generally, consumer trust was defined as a bet about the future fulfillment of expectations in a situation of uncertainty, caused by other human’s actions and underpinned by a lack of important information, based both on rational calculations and people’s beliefs. In the case of organic food, this uncertainty connected with the fact that consumers can hardly know whether the product is really organic or not in terms that it is not always possible how it was grown and processed by the actors of the production chain and the access to this information is usually hindered. At the same time, expectations are strongly depend on consumer’s definition of organic food and their motivation to buy it. In order to define the level of trust in organic food among consumers the methodology proposed by a group of Danish authors (KjTrues et. al. 2007) was used. Thus, 5 key factors that reflect basic characteristics and consequently consumer’s expectations from organic food were distinguished (safety, nutrition, quality, ethics, and value for money); on the base of consumer’s level of agreement with the statements about the presence of these qualities the trust index was calculated.
However, grounds for trust could be different and on the organic food market, they strongly depend on the information sources where consumers get knowledge about ecological products. In these regards, institutional and network approach were used to compare whether personal contact or institutions are considered by consumers to be the most trustworthy sources of information about trust. In this case recommendations from other consumers were considered as personal contacts, while labels, brands, content, mass media and advertisement were defined as institutional arrangements. In regard to these grounds for trust such categories as thin interpersonal trust, thick interpersonal trust, and institutional trust were used to describe the results. Thus, respondents were asked how often they pay attention to these different sources of information during the process of purchasing a product starts with the very decision to start. Later the dependencies between these two variables: trust level and the frequency of paying attention to different sources of information were calculated when trust index is dependent variable. The results of the survey were also complemented by structured interviews with organic food consumers.
Turning now to the empirical findings it is necessary to remind that the main research question of the thesis was: how consumer’s trust in organic food is constructed on the market? And the main aim was to prove that despite numerous differences between the Russian and German organic food markets, there is a high level of trust in these products, underpinned equally by interpersonal communication between consumers and institutional regulations on both of them. The results show that consumers in both countries have high level of trust in organic food what is proved by trust in organic food indexes which are 4, 10 and 4, 29 for Russian and Germany correspondingly. On the scale from absolute distrust to absolute trust, it could be interpreted in general as trust. Moreover, it was also found out that interpersonal communication and institutional arrangements have a big influence on consumer trust in both countries. However, consumer’s trust on the market is formatted gradually and is influenced by different factors on every stage which could be stated as the decision-making process, choosing process, and the very act of purchasing. That’s why it is possible to view trust, not as a stable phenomenon, and it should be analyzed in the process of its formation. Nevertheless, by fulfilling the specified tasks the hypothesis formulated at the beginning were partly proved.
First of all, it was assumed that personal communication among consumers related to organic food consumption positively affects consumer’s trust in these products both in Russia in Germany. This assumption was partly proved due to the fact that personal communication plays the most important role during the process of decision making both in Russia and Germany and positively correlated with the level of trust, but do not have much influence during others stages. It slightly influences only Russian consumers during the choosing process and highly depends on whom exactly they communicate with, namely, experts in the field of organic or at least those who possesses more knowledge about these matters. On the base of the survey results underpinned by the information obtained from the interviews, it is possible to state that
generally, people decide to start buying organic food and base the initial trust impulse exactly on their personal communication. Approximately half of the respondents for the first time received information about these commodities my means of so-called “World of mouth”. It refers both to the people with whom people are known to have strong connections, for example, family members. But also connected with just other consumers, for example, those with whom consumers communicate in social networks. That’s why this stage is characterized by thick and thin interpersonal trust.
Secondly, it was presumed that institutions regulating Russian and German organic food market influence consumer’s trust in these products. This hypothesis was proved completely: institutions have strong influence on consumer’s trust and more than that they increase its level during the stages of choosing and purchasing. Importance of institutional regulations is explained by the fact that consumers are not able to recognize whether a product corresponds to the basic requirements of being organic, but controlling bodies on the base of laws and regulations are able to detect those qualities on every stage of production process. For example, whether production process is not harmful for the environment, how animals are treated, which additives a product contains. However, institutional arrangements that increase the level of trust on each stage vary. Thus, labels play the most important role during the process of choosing both for Russian and German consumers. Strong correlation between trust index and the labels was found out. Nevertheless, as it was revealed from the interviews, not just the presence of label matters but what is behind the labels, precisely, laws and regulations which regulate the process of organic production.
Moreover, it is necessary to mention the fact that European labels could hardly be counterfeited because it is unprofitable for producers to do so: punishment for these actions is rather severe. That is why when speaking about Russian market, where the lack of national legislation and national organic labels could be noticed precisely European labels are the base for trust. At the same time German consumer tend to rely on their national labels more than on their European analogs what indicates a high level of confidence on national regulating systems. In comparison to self-declarations about organic qualities made by producers on the Russian market, which are pretty often groundless, European labels are more trustworthy because they are better controlled and it allows saying that Russian consumers trust more in European controlling institutions but not in national ones. Simultaneously, German consumers also highlight the difference between governmental and private labels and tend to rely more on the latter, because this labels usually presuppose stricter rules for production. However, the lack of trust towards national labels among Russian consumers demonstrate the absent of trust towards state controlling bodies and the national way of organic certification in general. It in turn shows pretty low level of trust towards national institutional system.
Surprisingly, it was also revealed that mass media influences consumer’s trust in organic food but oppositely in Russia and Germany. As it turned out mass media serves as the trustworthy source of information and in general increases the level of trust in these products among German consumers: the more they pay attention to mass media the higher their level of trust is. It is the other way round when considering Russian consumers: strong negative correlation was found out between mass media and trust. Generally, this difference could be explained by the fact that German mass media covers the topic of organic food more often and usually focuses on positive aspects of the topic. On the contrary, organic food in Russian media is discussed only occasionally and is put in more negative light with constant emphasis on its unreasonably high prices, permanent cases of forgery, and so on. At the same time, German media often pay attention to such issues as control in the sphere of organic production, strengthening of rules and regulations.
Finally, during the last stage, namely, the very process of purchasing the most attention is paid by consumers to the information about the content that they can find on the packaging. Thus, 52% of German respondents and 54% of Russian respondents named information about the content on the packaging of the product as the decisive factor in the choice of organic products. It could be explained by the fact that some norms allow the usage of particular additives to the product, which might be unacceptable for them or have a bad impact on the health. Reasons could be different and need further investigation. However, this is also what is reasonable to call institutional trust as long as what can be written on a packaging is also controlled by corresponding legislations and regulatory bodies.
A key limitation of the research as could be stated for now is the inability to make the investigation which covers the whole markets in general. Nevertheless, even if the current study is limited by organic food systems which include only several actors of the market, it is reasonable to say that they could be applied to the whole German and Russian organic food markets in general. Even the very fact that these markets are rather different makes the results of the research rather disputable, but, nevertheless, the cases of analysis were chosen in a way to be as similar as it possible in order to cope with this problem. Moreover, some methodological limitations should also be mentioned, such as, for example, the difficulty of trust measurement. It is known that trust is a complex phenomenon and could hardly be studied in quantitative techniques. However, the attempt undertaken in this work allows making necessary calculations in order to create the general picture of trust. Moreover, structured interviews also reduce the amount of information that could have been gathered by means of semi-structured interviews. However, investigation of trust problem by means of structured interviews help to avoid the abundance of unnecessary information connected with the specificity of the subject.
To conclude, it is important to express some ideas for future research which could be realized in further studies. It would be interesting to concentrate attention particularly on the first target of trust, namely labels and content. It could be supposed that these arrangements could be regarded also as secondary targets of trust as long as labels are issued by certification bodies and to trust in labels it is necessary to trust in these bodies. The same goes for the content as long as to trust information written on the packaging it is important to trust those who provide this information and control this process. What is more, the problem of trust in organic food was studied here from the point of consumers, while it would be great to enrich the results by researching producers and other actors of the market in order to get complete picture of the problem. In general, it is possible to say that results of the work could be considered as applicable for those who are interested in the further development of the organic food market in Russia and Germany.
The research seeks to provide a comparative analysis of the consumer trust in organic food formation on the German and Russia markets. The investigation is based on the theoretical framework organized around two major concepts: organic food and consumer trust. With respect to the former concept recent work demonstrates the complexity of such notion as organic food as it is based on a range of different characteristics. However, as based on the current literature three basic approaches to explaining this term could be found which are mostly based on the differences between organic and conventional food at different stages of production and consumption process. First, the process-oriented approach, which was not found as the fundamental one for consumers, emphasize that organic food should be understood as the fresh food with minimal, careful and sustainable processing what allow at the end to keep as many useful compounds in a product as possible, and also not to harm those, who take part at the processing stage. Second, the agro-ecological approach is based on the idea of organic agriculture which is based on environmentally- and animal-friendly techniques in order to preserve natural resources, such as soil, water, air, etc., as well as biodiversity. Following the rules of organic agriculture, no chemicals or only a few allowed could be used; soil should be free from pesticides and other harmful substances; production waste has to be utilized with no harm to the environment; animals should be kept under the special conditions. All in all, it means that all the stages of growing correspond to the requirements of organic production. Finally, product quality-oriented or consumer-oriented approach highlights those benefits that could be obtained from the very process of consuming organic products. It is connected with such characteristics as nutritional value, bioactive compounds, health impact, safety, and taste. The last two approaches were revealed to be the foundational for consumer understanding of organic food both in Russia and Germany. Moreover, standards defined by the Codex Alimentarius and IFOAM complement these approaches by stating that an organic product could be called organic only if it was certified and carries an ecological label on it. Based on this argumentation, generally, we define organic food as one produced by environmentally - and animal friendly techniques, which allow to preserve natural resources and biodiversity; as a consequence associated with naturalness and freshness; which is undergone minimal, careful, and sustainable processing what in turn guarantee its higher nutritional value, positive effect on consumer health and characterized by better sensory attributes.
The second theoretical concept used in the theoretical framework for the research is consumer trust. Our definition of trust was based on two basic sociological approaches which are rational and sensual. The former one sees trust as a product of rationalization which is not groundless and inborn but based on some calculations; actors try to predict the outcomes of each other’s actions based on some computations. The latter, conversely, understand trust as the element of faith; actors based their trust on feelings and beliefs that familiar things will remain stable. However, when talking about market relations and consumer trust it is necessary to say that these approaches could be implemented simultaneously and that’s how the notion of critical trust appears. It means that consumers base their trust both on feelings and calculations when undertaking their actions on the market. Generally, consumer trust was defined as a bet about the future fulfillment of expectations in a situation of uncertainty, caused by other human’s actions and underpinned by a lack of important information, based both on rational calculations and people’s beliefs. In the case of organic food, this uncertainty connected with the fact that consumers can hardly know whether the product is really organic or not in terms that it is not always possible how it was grown and processed by the actors of the production chain and the access to this information is usually hindered. At the same time, expectations are strongly depend on consumer’s definition of organic food and their motivation to buy it. In order to define the level of trust in organic food among consumers the methodology proposed by a group of Danish authors (KjTrues et. al. 2007) was used. Thus, 5 key factors that reflect basic characteristics and consequently consumer’s expectations from organic food were distinguished (safety, nutrition, quality, ethics, and value for money); on the base of consumer’s level of agreement with the statements about the presence of these qualities the trust index was calculated.
However, grounds for trust could be different and on the organic food market, they strongly depend on the information sources where consumers get knowledge about ecological products. In these regards, institutional and network approach were used to compare whether personal contact or institutions are considered by consumers to be the most trustworthy sources of information about trust. In this case recommendations from other consumers were considered as personal contacts, while labels, brands, content, mass media and advertisement were defined as institutional arrangements. In regard to these grounds for trust such categories as thin interpersonal trust, thick interpersonal trust, and institutional trust were used to describe the results. Thus, respondents were asked how often they pay attention to these different sources of information during the process of purchasing a product starts with the very decision to start. Later the dependencies between these two variables: trust level and the frequency of paying attention to different sources of information were calculated when trust index is dependent variable. The results of the survey were also complemented by structured interviews with organic food consumers.
Turning now to the empirical findings it is necessary to remind that the main research question of the thesis was: how consumer’s trust in organic food is constructed on the market? And the main aim was to prove that despite numerous differences between the Russian and German organic food markets, there is a high level of trust in these products, underpinned equally by interpersonal communication between consumers and institutional regulations on both of them. The results show that consumers in both countries have high level of trust in organic food what is proved by trust in organic food indexes which are 4, 10 and 4, 29 for Russian and Germany correspondingly. On the scale from absolute distrust to absolute trust, it could be interpreted in general as trust. Moreover, it was also found out that interpersonal communication and institutional arrangements have a big influence on consumer trust in both countries. However, consumer’s trust on the market is formatted gradually and is influenced by different factors on every stage which could be stated as the decision-making process, choosing process, and the very act of purchasing. That’s why it is possible to view trust, not as a stable phenomenon, and it should be analyzed in the process of its formation. Nevertheless, by fulfilling the specified tasks the hypothesis formulated at the beginning were partly proved.
First of all, it was assumed that personal communication among consumers related to organic food consumption positively affects consumer’s trust in these products both in Russia in Germany. This assumption was partly proved due to the fact that personal communication plays the most important role during the process of decision making both in Russia and Germany and positively correlated with the level of trust, but do not have much influence during others stages. It slightly influences only Russian consumers during the choosing process and highly depends on whom exactly they communicate with, namely, experts in the field of organic or at least those who possesses more knowledge about these matters. On the base of the survey results underpinned by the information obtained from the interviews, it is possible to state that
generally, people decide to start buying organic food and base the initial trust impulse exactly on their personal communication. Approximately half of the respondents for the first time received information about these commodities my means of so-called “World of mouth”. It refers both to the people with whom people are known to have strong connections, for example, family members. But also connected with just other consumers, for example, those with whom consumers communicate in social networks. That’s why this stage is characterized by thick and thin interpersonal trust.
Secondly, it was presumed that institutions regulating Russian and German organic food market influence consumer’s trust in these products. This hypothesis was proved completely: institutions have strong influence on consumer’s trust and more than that they increase its level during the stages of choosing and purchasing. Importance of institutional regulations is explained by the fact that consumers are not able to recognize whether a product corresponds to the basic requirements of being organic, but controlling bodies on the base of laws and regulations are able to detect those qualities on every stage of production process. For example, whether production process is not harmful for the environment, how animals are treated, which additives a product contains. However, institutional arrangements that increase the level of trust on each stage vary. Thus, labels play the most important role during the process of choosing both for Russian and German consumers. Strong correlation between trust index and the labels was found out. Nevertheless, as it was revealed from the interviews, not just the presence of label matters but what is behind the labels, precisely, laws and regulations which regulate the process of organic production.
Moreover, it is necessary to mention the fact that European labels could hardly be counterfeited because it is unprofitable for producers to do so: punishment for these actions is rather severe. That is why when speaking about Russian market, where the lack of national legislation and national organic labels could be noticed precisely European labels are the base for trust. At the same time German consumer tend to rely on their national labels more than on their European analogs what indicates a high level of confidence on national regulating systems. In comparison to self-declarations about organic qualities made by producers on the Russian market, which are pretty often groundless, European labels are more trustworthy because they are better controlled and it allows saying that Russian consumers trust more in European controlling institutions but not in national ones. Simultaneously, German consumers also highlight the difference between governmental and private labels and tend to rely more on the latter, because this labels usually presuppose stricter rules for production. However, the lack of trust towards national labels among Russian consumers demonstrate the absent of trust towards state controlling bodies and the national way of organic certification in general. It in turn shows pretty low level of trust towards national institutional system.
Surprisingly, it was also revealed that mass media influences consumer’s trust in organic food but oppositely in Russia and Germany. As it turned out mass media serves as the trustworthy source of information and in general increases the level of trust in these products among German consumers: the more they pay attention to mass media the higher their level of trust is. It is the other way round when considering Russian consumers: strong negative correlation was found out between mass media and trust. Generally, this difference could be explained by the fact that German mass media covers the topic of organic food more often and usually focuses on positive aspects of the topic. On the contrary, organic food in Russian media is discussed only occasionally and is put in more negative light with constant emphasis on its unreasonably high prices, permanent cases of forgery, and so on. At the same time, German media often pay attention to such issues as control in the sphere of organic production, strengthening of rules and regulations.
Finally, during the last stage, namely, the very process of purchasing the most attention is paid by consumers to the information about the content that they can find on the packaging. Thus, 52% of German respondents and 54% of Russian respondents named information about the content on the packaging of the product as the decisive factor in the choice of organic products. It could be explained by the fact that some norms allow the usage of particular additives to the product, which might be unacceptable for them or have a bad impact on the health. Reasons could be different and need further investigation. However, this is also what is reasonable to call institutional trust as long as what can be written on a packaging is also controlled by corresponding legislations and regulatory bodies.
A key limitation of the research as could be stated for now is the inability to make the investigation which covers the whole markets in general. Nevertheless, even if the current study is limited by organic food systems which include only several actors of the market, it is reasonable to say that they could be applied to the whole German and Russian organic food markets in general. Even the very fact that these markets are rather different makes the results of the research rather disputable, but, nevertheless, the cases of analysis were chosen in a way to be as similar as it possible in order to cope with this problem. Moreover, some methodological limitations should also be mentioned, such as, for example, the difficulty of trust measurement. It is known that trust is a complex phenomenon and could hardly be studied in quantitative techniques. However, the attempt undertaken in this work allows making necessary calculations in order to create the general picture of trust. Moreover, structured interviews also reduce the amount of information that could have been gathered by means of semi-structured interviews. However, investigation of trust problem by means of structured interviews help to avoid the abundance of unnecessary information connected with the specificity of the subject.
To conclude, it is important to express some ideas for future research which could be realized in further studies. It would be interesting to concentrate attention particularly on the first target of trust, namely labels and content. It could be supposed that these arrangements could be regarded also as secondary targets of trust as long as labels are issued by certification bodies and to trust in labels it is necessary to trust in these bodies. The same goes for the content as long as to trust information written on the packaging it is important to trust those who provide this information and control this process. What is more, the problem of trust in organic food was studied here from the point of consumers, while it would be great to enrich the results by researching producers and other actors of the market in order to get complete picture of the problem. In general, it is possible to say that results of the work could be considered as applicable for those who are interested in the further development of the organic food market in Russia and Germany.
