Recently, the increase of the stock of rice that results in a drop of consumer price has been accelerating the crise of the rice industry in Korean agricultural sector. With the rising concerns for the rice industry, we try to establish marketing stra...
Recently, the increase of the stock of rice that results in a drop of consumer price has been accelerating the crise of the rice industry in Korean agricultural sector. With the rising concerns for the rice industry, we try to establish marketing strategies to overcome this crisis by reflecting the changes in consumer market and purchasing patterns.
For the study I use the Choice Experiment Method as a methodology and consider 5 purchasing factors (or profiles) that are the origin of rice, a quality certificate, a quality control, the price of rice and a traceability system for the model estimation.
Two models are estimated : one for the model excluding all demographical characters and alternative-specific constant and the other for the model excluding demographical characters and excluding alternative-specific constant.
The shadow price derived by the origin of rice is 7,025 won for Cheolwon product, 52,388 won for Icheon product, 28,245 won for Cheongwon product while it is zero in other provinces with the standard 8Kg rice.
The shadow price derived by the quality certificate is 12,230 won for low chemical certificate, 17,807 won for no chemical certificate, and 32,280 won for organic certificate while it is zero for the rice without the quality certificate.
The shadow price is zero for the rice without any quality control symbol while it is 14,038 won for the rice with quality control symbol. The shadow price for the rice without the traceability system is zero while it is 5,595 won for the rice with the traceability system.
Selecting probability, relative probability, and willingness to pay(WTP) for nine rice products are surveyed based on the attributes reorganized from the above results in Nonghyup Hanaro Mart and Home Plus.
In Home Plus, the products produced from Cheolwon, Icheon, and Cheongwon include the same attributes except for the attribute with brand value for each province. The estimation of brand value shows that consumers prefer the brand name in the order of Icheon, Cheongwon, and Cheolwon. Beside, the results show that consumers have evaluated the value of provinces as the same as their preference.