Exploring consumption preference and behaviour of New Zealand banana consumers

Abstract

This work develops understanding of how NZ consumers’ banana choices are influenced by product characteristics including locally grown, nutritional content, environmental footprint, and price. Understanding consumer preferences is critical for constructing industry strategies, by gauging how much value consumers place on certain product attributes, growers can make more informed decisions.

• Preferences for the types of attributes considered here are not readily observable from market prices, and so the economic non-market valuation method of Discrete Choice Experiments (DCE) was used.

• This report describes the application of a DCE survey of Auckland banana consumers that is designed to examine consumer Willingness-to-Pay (WTP) for banana attributes relevant to NZ grown bananas.

• This involved an online survey of Auckland residents in October 2024. The survey process achieved 500 responses with good representation of key population demographics.

• Results indicate that many Auckland banana consumers have significant positive preferences for the types of attributes that could be representative of New Zealand grown bananas.

• The report explores differences in consumer behaviours between the main banana variety (Cavendish) and the largest alternative variety (Misi Luki) available in the Auckland region. As well as consumer willingness-to-pay values, this report details findings on:

o Purchase frequency (Cavendish, Misi Luki, Blossoms)

o Usual expenditure across (Cavendish, Misi Luki, Blossoms)

o Retail channel use across (Cavendish, Misi Luki, Blossoms)

o Factors important in purchase decisions

o Willingness-to-try banana different varieties

o Profiling high willingness-to-pay consumers

• Consumption frequency is high. A third of consumers consume bananas daily, and a further 41% 2-3 times a week.

• Bananas are a morning food. Most consumers eat bananas for breakfast (41%) or in mid-morning (23%).

• Bananas are eaten whole. The vast majority of consumers usually eat bananas on their own-whole (77%).

• Purchase frequency is high. 25% of consumers buy Cavendish bananas 2-3 times a week, and 53% weekly.

• Supermarkets dominate retail channel. Over half of consumers always buy Cavendish through supermarkets (55%), while independent grocers and fruit & vege shops attract around 20-25% of consumers often.

• Average kg/week of Cavendish purchased is 1.49kg. Which is a bunch of around 6-7 bananas.

• Average Cavendish price usually paid is $3.30/kg.

• Significant demand for Misi Luki. Over a third of consumers purchase Misi Luki bananas (175/500).

• Misi Luki retail channels diverse. While supermarkets are still the most widely used, they are far less relied on compared to Cavendish (36% vs 55% always). With other channel use higher than for Cavendish.

• Average kg/week of Misi Luki purchased is 1.18kg. Which is a bunch of around 6-7 bananas.

• Average Misi Luki price usually paid is $3.40/kg.

• Banana Blossoms in demand. 15% of consumers purchase fresh blossoms at least monthly, and 12% buy canned blossoms. With retail use for both types being highly varied and evenly distributed across channels. Consumers usually pay an average of $8.7 per fresh blossom. 13% of consumers who had not purchased blossom, said that they would try them if they saw them in store.

• Willingness-to-try different banana varieties. Six different varieties were described to participants (Bonanza, High Noon, Gold Finger, Mona Lisa, Rajapuri, Misi Luki) across four characteristics (taste, texture, size, appearance).

• Highest willingness-to-try was for Rajapuri, with 17% of respondents stating that they were very-likely, and 24% likely, to try this variety if they saw it in-store.

• Consumers are more likely to be willing-to-try this variety if they:

o consider Socially Responsible production to be important (22% more likely);

o consider small size bananas to be important (14% more likely);

o purchase Misi Luki bananas (5% more likely);

o purchase fruits other than bananas at least weekly (36% more likely);

o are in a household with children (18% more likely)

• Freshness, Non-GE, and Nutrition are important influences on purchase decisions. Freshness is the most important consideration (88%) followed by nutritional content (76%) and not genetically modified (66%).

• Freshness and quality drive support for NZ-grown bananas. 86% of consumers indicated that freshness and quality were the most important reason why bananas should be grown in New Zealand. Local economic benefits (72%) and better ethical standards of production (65%) were also important.

The survey included a Discrete Choice Experiment (DCE) to assess consumers’ willingness-to-pay (WTP) for banana attributes associated with New Zealand-grown bananas. Our objective was to identify which attributes drive product choices, by how much, and profile higher WTP consumers. Using a Latent Class Modelling approach, the consumers were segmented into three classes, each with different characteristics and preferences.

• Estimates of willingness-pay ($/kg) shown in the table below indicate that Segment 2 consumers have significantly higher WTP compared with the other consumers in the sample.

• Focusing on the high WTP consumers in Segment 2, we can see that Organic Production is valued highest, followed by NZ Grown.

• Compared to their counterparts, consumers in Segment 2 are more likely to:

o be female, Māori, single, younger, have household income of $70,001 - $100,000;

o have higher purchase frequency of banana as well as other fruits;

o purchase from independent grocers for both Cavendish and Misi Luki;

o consume chopped into pieces, or in a fruit salad;

o usually pay more per kg on average for Cavendish and Misi Luki;

o be more willing to try Rajapuri variety;

o be more environmentally and socially concerned;

o buy Organic bananas;

o consider NZ grown to be important.