IMPACT OF QUALITY ATTRIBUTES ON HEDONIC PRICING OF CHICKEN MEAT

Abstract

Product pricing is vital for businesses and marketing managers as it affects consumer buying behavior and business performance. In a highly competitive market, it is essential to observe the factors that increase the profitability of a product. The available studies concentrated on estimating the shared aspects from the sellers' perspective instead of the end user. To fill the gap this study investigates the impact of different meat quality attributes on retail chicken prices from consumers' perspectives when they buy fresh chicken meat. The data was collected from household consumers of four major cities of Pakistan, i.e. Karachi, Lahore, Faisalabad, and Islamabad, using a well designed and pre-tested structured questionnaire. The present study applies revealed preference theory and estimates log-linear functional form to study the effects of fresh chicken meat attributes on its price. The findings shows that meat quality attributes such as place of purchase, hygiene, meat cuts (drumstick,chest piece, boneless and whole chicken), texture, juiciness, and organic(desi) chicken positively impact the price of fresh chicken meat. The results indicate that consumers are paying premium price for these quality attributes of chicken meat. The implications of the results have been discussed in the perspective of developing the business strategies for the chicken industry in Pakistan. Understanding product attributes communicate the consumer`s preference, which is valuable for producers in developing production strategies, cost management strategies, investment decisions, marketing programs, and policy making regarding the development of the poultry industry.