I originally wrote the article in 2013 as part of some research I was doing into Fair Trade, ethical trade, and similar schemes. This audio version of the article includes updated information on the topic.
The original article is titled Ethical Consumption.
Published: November 18, 2013
Mentioned in this episode
Schamp, C., Heitmann, M., & Katzenstein, R. (2019). Consideration of ethical attributes along the consumer decision-making journey. Journal of the Academy of Marketing Science, 47(2), 328–348. https://doi.org/10.1007/s11747-019-00629-x
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Today, I’m going to read an article I wrote in 2013, titled "Ethical Consumption." It’s part of a series. I was doing some research on fair trade, ethical trade, organic coffee and the various programs like those. And I wrote these articles as part of the research that I was doing.
Since the article is nine years old. I tried to find updated information for the reading. But also with all of my articles, as I find updated information, I will edit the article and update them. I do that in hopes of keeping each of the articles relevant and timely. When I update an article, I typically include the date at the top of the article, just below the published date.
Now on to the article.
Sustainable coffee initiatives all depend upon and revolve around ethical consumption. Ethical consumption is the act of consuming goods based on feelings of responsibility towards society. There are a number of different aspects to ethical consumption that benefits society in different ways. For example, there are aspects that benefit the environment, for example, organic initiatives. While, other aspects, benefit people for example, Fair Trade initiatives.
These benefits may have an impact close to the consumer geographically, or the benefits may be very far away, such as international. And that may also play into the consumer’s decision. For example, the locavore movement.
There are two ways ethical consumption has an impact directly via purchases of ethical products or indirectly via boycotting or abstaining from purchasing non-ethical products. Direct methods are more easily measured and studied. And likely more effective. Through these studies, we’re finding that consumers purchasing behavior is not in line with their ideology of ethics. We know this because market shares a products with ethical labeling are less than 1%.
This dichotomy has been labeled the consumer attitude-behavior gap and what causes it is the focus of several ongoing studies.
Now here is one point where I’m going to add supplemental or updated information to this recording.
The supplemental information I’ve found, came from an article titled "Consideration of ethical attributes along the consumer decision-making journey." And it’s from the Journal of the Academy of Marketing Science. And I will include a link to the article or the paper in the show notes. Now what I took from this paper primarily was there is a two stage decision model that consumers use before they purchase an item. And that is first consideration. And then, and then second, the choice. So the consideration phase is a pre-screening phase. There are so many options out there for purchasing. That the first phase we go through and we screen things out. We consider only a certain amount of products. And the way I think about this as a smartphone.
When I go to purchase a smartphone. I’m only going to consider some of the bigger names. I’m only going to probably consider Apple, or Google phone, Android-based phone, something like that. I’m not going to consider something like third-tier brand name that I don’t know much about.
And this is a quote from the paper: "We build on well-established two stage consderation-then-choice decision models, which emphasize that decision rules can differ across stages." So, what they’re saying is, as consumers decide what they’re going to buy, they go through different stages and narrow down or funnel in the different products that they’re considering.
Another point I took from this paper is that ethical evaluations are hard. And this is another quote from the paper. "When faced with a multitude of competing products, each characterized by many attributes, consumers must screen this vast amount of information. In the course of screening, they often focus on the most important salient and easy to evaluate attributes. Evaluations of moral values have been shown to be especially complex, making ethical strengths, less suitable for screening than natural attribute attributes related to self-centered motives, with which consumers have more experience such as price or brand reputation." So that goes back to what I was saying about the… my decision in purchasing a smartphone. Brand reputation influences that pretty significantly, because I’ve already worked through, I already have experience with a given brand. I’ve purchased a lot of Apple products. My history with Apple products goes pretty far back. And in the early days of my purchasing Apple products, I did a lot of research and decision-making around that. So now when I go to buy a cell phone, a smartphone, I already have all of that work done.
And then the third point I took out of that paper was that buyers pre-screen choices before engaging ethical consumption. So here’s another quote. " Scientific evidence on the impact of ethical attributes is based on measures of purchase, intent, or choice decisions from small assortments with few alternatives. This does not necessarily match actual market settings. Rather consumers are often confronted with many more alternatives, which can require screening processes prior to actual decision-making."
So all three of these points that I’m pulling out of this paper, go to the fact that before we make a choice we have a prescreening process where we only consider a few products.
Now I’ll go back to the article.
An article in the Journal of Consumer Affairs sums it up nicely, quote: "on the one hand consumer perceptions and attitudes clearly influence behavior as conceptualized and tested in several models of ethical consumption behavior. On the other hand, it is well documented that attributes alone are generally poor predictors of buyer behavior, especially in the social marketing area. While, some consumers refuse to buy products with an unethical background the majority of people evaluate product attributes jointly in making purchasing decisions. Price, quality, convenience and brand familiarity are often still the most important factors affecting the buying decision."
Therefore in order for ethical consumption to be successful, retailers must meet more than one of the four decision factors mentioned above. And those again, our price, quality, convenience, and brand familiarity. But there are several challenges, especially regarding price. It costs more to produce organic and or Fair Trade coffee. And in many cases, the cost can be prohibitive for producers.
As discussed in a previous post titled "Organic Coffee". And that’s another article in this series I’ll be reading later.
This is another point where I’ll step back from the article and talk about other information —updated information. So in 2017, I went to Medellin, Colombia to attend the World Coffee Producers Forum. The first one. The keynote speaker was Jeffrey Sachs. And as part of his keynote speech, he said, "Fair Trade isn’t quantitatively important enough." it’s not getting enough money. Into the hands of small holder producers to really make a difference. Now, this was in 2017. So take that with a grain of salt. But know that it’s, we’re just not there yet.
Also as part of that event there was a producer who stood up and made the comment that growers don’t see financial benefits of sustainable coffee. And there was great applause to that statement And there was another it might’ve even been the same producer. There was another comment along the lines of ‘consumers need to pay more for sustainable programs that the producers can’t they can’t saddle that financial burden as easily as consumers can especially consumers in developed countries
I hope you enjoyed that article. And again, it’s part of a series and I plan to read each article in the series. And also to provide updated or supplemental information, to each articles so that you get a little more from the podcast or audio version then you do just from reading it. Again, this is Michael with Oil Slick Coffee.