Organic Food Market Segmentation in Lebanon

By : Malak TLEIS (IAMB), Rocco ROMA (UNIBA), Roberta

CALLIERIS (IAMB)

European Geosciences Union

General Assembly 2015

Vienna | Austria | 12-17 April 2015

SSS10.1 Organic farming and Soil management

Outline:

Introducing Organic in Lebanon

Research Problem & Objectives

Materials & Methods

Results

Conclusion

Lebanon – Country profile

0.002% (692ha)

0.06% (17'030ha)

0.14% (19'987ha)

0.25% (2'567 ha)

0.48% (3'303 ha)

1.73% (6'354ha)

1.82% (442'582ha)

1.82% (178'521ha)

2.23%

(82'167ha)

Algeria

Morocco (2010)

Syria (2010)

Jordan

Lebanon

Palestine (2010)

Turkey

Tunisia

Egypt

Organic crops distribution (%) in Lebanon by

cultivated land (MOAN, 2011)

Wild

collection

50.8%

Fallows &

pastures

19.5%

Fruit trees &

nuts 10.8%

Olives

10.2%

Vegetables

6 % Vineyards

2.5%

Cereals

0.8%

Organic agricultural land and share of organic land out of the total

agriculture land (2011) of some Southern & Eastern Mediterranean

Countries (FiBL & IFOAM, 2013)

Lebanese Organic Market

Organic goods are mainly imported.

Only 25-30 % is supplied by Local

production (MoA, 2012)

Some export of traditional food, olive oil

and plantlets

Local Production:132 Producers, 62

Processors

Domestic marketing channels

(27)

Supermarkets

Restaurants

with

organic

menus

Online delivery service

Specialized

organic

shops &

organic

bakeries -2-

Box scheme

-1- system

for indoor

delivery

Farmers markets

-2-

Non-organic Shops

Research Statement

Review of Lebanese Sector:

o Low local production.

o Relatively small, demand is growing

faster than supply.

o Imported organic foods are

expensive.

What are the most appropriate

marketing strategies to meet Lebanese

organic consumers?

Research Objectives General Aim:

Identify consumers profiles of the Lebanese purchasers and non purchasers of organic food and preform psychographic segmentation of Lebanese organic consumers .

Objectives:

o Define consumers’ socio-demographic and psychographic characteristics.

o Evaluate level of organic knowledge and awareness and understand purchasing behavior (WTP, frequency of purchase, place of purchase).

o Analyze future perspectives towards organic food.

Research Hypothesis:

Different consumer segments are motivated by different factors according to their psychographic makeup. Therefore there is a need for appropriate strategies to meet each segment.

Research Design

Research plan:

Survey of Lebanese consumers (Feb- March 2014).

Type of survey:

Face to face interviews and online questionnaire.

Sample:

Size: 400 consumers.

Place: Different outlets of organic products (organic shops, farmers market and supermarket selling organic) in Beirut & online questionnaire.

Representativeness: Sample composition based on demographic statistics : distribution of number of household members (%).

Lebanon

Beirut

Questionnaire: 29 questions

YES

Section V:

Current Organic

consumer:

- Since when they buy.

- Reasons to buy.

- Place of purchase.

- Type of products.

- Frequency of buying.

-WTP.

- Future intentions.

Section VI:

Socio-demographic

characteristics: Sex,

age, education,

income, presence

of children &

number.

Have you already bought organic products?

Section I : Screening

1- Responsible for

food shopping?

2- Familiar with

organic products?

NO

Section IV:

Potential Organic

consumer:

- Reason behind

not buying

organic.

- Intention to buy

in future.

-Type of products.

- WTP.

Section III: Knowledge of

Organic Food:

- Since when consumers

know.

- Level of Knowledge of

organic.

- Source of info.

Section II : Food

Shopping:

- Food choice criteria.

- location of food

shopping.

-Personality.

Data Analyses

Descriptive analyses:

Identify consumers profiles (total sample, organic purchaser, non-

organic purchaser).

Multivariate Analyses:

Principal component analyses (PCA).

Cluster Analyses:

K-means Cluster Method.

To:

Reduce data set in order to find main factors characterizing the sample.

Make organic market segmentation

Dimension-reduction tool : transforms a

number of (possibly) correlated variables

into a (smaller) number of uncorrelated

variables called principal components.

Finding groups of objects where the objects in

a group (cluster) are homogenous and different

from the objects in other groups.

Results from Descriptive Analyses

Organic

Purchasers 80%

Non- organic

purchasers 20%

General

Characteristics

of Total Sample

Females

More purchasing food from famers

markets & health food shops

Well educated

>36 years old

Middle class

Food choice: Healthy

High Knowledge of organic

More with higher education

More of healthconcerned

More Confused organic with

traditional food

Food from

supermarkets

More having low class income

Results from Multivariate Analyses

PCA Results: 6 significant components (account for 61 % of the total

variance in the sample.

Component Variables

“Social Status”

- Education, FL=0.67- Income , FL= 0.63

-Occupation , FL= 0.57- First encounter with organic, FL= 0.53

- Average WTP , FL= 0.52

“Maturity” Age, FL= 0.55

“Healthy and hedonists” Personality, FL= 0.65

“Knowledge” Definition of Organic Products, FL= 0.72

“Awareness” Motives, FL= 0.53

“Tendency”Intention to increase purchase of organic in future,

FL= 0.62

Results of Cluster Analyses

“Social Status”

“Maturity”

“Healthy and

hedonists”

“Knowledge”

“Awareness”

“Tendency”

K-means

Clustering

Irregular

(18%)

Health

Conscious

(41%)

Rational

(18%)

Localist

(23%)

6 PC 4 Clusters

Cluster Analyses Results

Health Conscious (41%) Marketing Strategy

Promoting positive

qualities of organic food

(healthy, safe).

Pricing strategies:

Justification of price.

Changing the perception

of value for money.

Price reduction.

Mature, highly educated,

moderate class;

Personality: Healthy;

Food choice: Healthy food;

Knowledge: High;

Reasons to buy: Health;

WTP: Moderate;

Location: Supermarkets &

organic shops;

Future attitude: Very positive;

Males, mature, highest education, upper class.

Personality: Comfortability, hedonists, traditional and nature concerned.

Food choice: Healthy food, brand, taste & local food.

Knowledge: Low (confusion with traditional).

Reasons to buy: Healthy, safe, environmentally friendly & similar to baladi (local food) .

WTP: Moderate.

Location: Organic shops & supermarkets.

Awareness campaigns:

Organic concept and

practices to reduce

confusion & clarify

difference between

organic and traditional.

Integrate the ‘organic’

and ‘baladi’ concepts.

Stress on the

“environmentally

friendly” concept of

organic.

Localist (23%) Marketing Strategy

Cluster Analyses Results

Young, mainly employees, low

class.

Personality: Healthy &

hedonists.

Food choice: Healthy food,

brand and taste.

Knowledge: Highest.

Reasons to buy: Safe, healthy

WTP: low

Location: Supermarkets &

organic shops.

Future attitude: Very positive.

Pricing strategies:

Price reduction.

Justification of price.

Changing the perception of value for money .

Promotion of some positive attributes of organic:

Safe : No use of chemical fertilizers or pesticides, control system.

Rational (18 %) Marketing Strategy

Cluster Analyses Results

Mature, unemployed,

moderate middle class

Personality: Healthy &

traditional;

Food choice criteria: Healthy

food, brand and low price;

Knowledge: High;

Reasons to buy: Health and

safe;

WTP: high;

Location: Organic shops;

Future attitude: Negative.

Promotion of some positive

attributes of organic:

No use of chemical

fertilizers or pesticides.

Safer than other products

(reason: control ..).

Introduction to local organic

brand (Biomass), promote this

brand, insisting on its

guarantee of quality and

integrity of organic products.

Irregular (18 %) Marketing Strategy

Cluster Analyses Results

Some Conclusions

Evidence of potential organic market where

diversified consumer categories exist.

Positive attitude toward organic.

Slight WTP for organic products.

High price and low trust in organic are the main constraints limiting consumption.

Egoistic motives are prevailing over altruistic motives.

Action of public sector to spread knowledge and importance of organic towards environment.

Action of private sector to promote organic (Promote local organic brand).

Thank You for

Your Attention!