Comparing organic market strategies: being certified vs building loyalty

Purpose Customer awareness and perception of organic food products vary across geographies. So, the signaling strategies for enhancing organic food purchase intention should also differ. This paper compares how customers perceive two different signals – certification and brand loyalty – in a nascent, fast-growing organic market characterized by weaker organic regulations, low consumer awareness and artificial organic products. Such characteristics would imply that the consumer perceptions regarding regulatory effectiveness and authenticity of the “organic certification” would differ – more so for different consumer types. Thus, the comparative evaluation aims to understand the more impactful signaling strategy for influencing the purchase intention of organic food products in markets such as India. Design/methodology/approach Data were collected using a survey of 401 respondents who identified themselves as buyers of organic food products and regressions were used to test the hypotheses. Findings While certification awareness and brand loyalty positively affect purchase intention individually, brand loyalty significantly reduces the impact of certification. Also, customer segments driven by health and environmental concerns exhibit greater brand loyalty than those who adopt organic food for status or fashion. Practical implications Insights exist for organic food marketers regarding their cost allocation, marketing and brand-building strategies in newer markets. Originality/value This paper is a novel investigation of the interactive impact of two signaling strategies – brand loyalty and organic certification labels – on increasing organic food purchase intention in an emerging economy context, India, with high ambiguity in organic produce. It helps identify the signals that can help build trust and legitimacy in such organic markets.