Exploring Co-labeling Strategies in Local Food Markets: Insights from a Choice Experiment on Southern Buyers’ Preferences for Cherry Tomatoes

Abstract

Labeling strategies are often discussed in the context of local food purchase. Substantial research has been undertaken to discern buyers’ preferences for different labeling strategies associated with a production practice or a geographic location. Some studies have also emphasized the substitution or complementarity effects that may occur across these different labels. Using a large choice experiment with 1820 respondents across six US southern states, this research evaluates buyers’ preferences for co-labeling strategies, focusing on the association of a production practice and certifications (USDA Organic and Certified Naturally Grown) alongside six different production locations, ranging from local to imported sources. We focus on pint baskets of cherry tomatoes, chosen due to their popularity among purchasers of fresh produce. Based on the results provided by a Bayesian Mixed Logit model, we derived the respondent-specific posterior distribution of the partworths associated with each production location and regressed each of those against demographic indicators. Our findings highlight that most buyers substitute between USDA Organic and Certified Naturally Grown (CNG), and a minority consistently opt for the same production practice option. In addition, we underscore that price, or an indication of origin predominantly guides nearly half of buyers’ choices. We find that the premium for CNG is slightly superior to the organic one. Last, older respondents and respondents with a higher degree of education value produce grown within their state over neighboring states and more distant origins.