Natural Resources in Demand Symposium: Why Promoting Region Works

Associate Professor Wendy Umberger of University of Adelaide presented her work on branding South Australia (SA) at Natural Resources in Demand Symposium at Waite Campus, University of Adelaide, 10th October 2012.

SA is recognised globally for its premium food, beverages and culinary-tourism. The challenge for “brand” SA is to grow the recognition of SA premium food and wine, including the high standards of SA producers, and the regions in which the food is produced.

Origin can be presented as a brand. Origin is multi-dimensional. It can signal quality, safety, support for local agriculture, patriotism, enthnocentrism.

The key to brand awareness is saliency. It is the propensity of the brand to be noticed or come to mind in buying situations. It can be formed by experience. Marketing should focus on increasing a brand’s share of mind rather than changing attitudes through advertising.

Wendy’s work finds high saliency of Coles and Woolworths (retailer) brands in terms of good value for money, whilst regional brands are associated with food at special occasions.

Government intervention may have potential benefits. For example, they can protect consumers from low quality products, reduce consumers’ search costs, sellers’ costs by having uniform labelling requirements and provide gains to producers of high quality products.

However, government intervention may have potential costs. For example, it may become possible barriers to food innovation; sellers’ costs of labeling may increase; it creates goverment costs of implementation.

One possible way to move forward is to focus on increasing brand salience rather than SA origin labelling program. Bottom-up strategy may be needed. The government can invest in existing regional programs to expand reputation as high quality producers of food and wine and tourist destination and promote innovation.

*This summary is written by Risti Permani.


1 Comment

Filed under Agriculture, Australia, Conference, Food and agriculture

One response to “Natural Resources in Demand Symposium: Why Promoting Region Works

  1. YS Tey (John)

    Product-of-origin is a credence attribute. The credence attribute is nearly impossible to verify before and after use. Notwithstanding that, it acts as a cue to product value (be it a combination of quality, green, safe, clean, or others).

    Wendy has shown the pros and cons of investing in product-of-origin. However, researchers and agribusiness firms should think deeply to what extent does it apply to developing countries and result in break-even. For example,

    (1) Fresh Bali cabbage vs fresh China cabbage: which one would you choose and why?

    (2) Indian beef vs Aussie beef vs NZ beef vs American beef vs Japanese beef: besides Indian, others are prospective winners. In other words, the market is crowded with the credence attribute. But only one of them can win!

    Notwithstanding that, product-of-origin could be a fruitful investment. E.g, Civet Coffee (Lopi Luwak). It is a rare, quality, and expensive variety. Its marriage with Bali (product-of-origin) brings in additional value, which derived from positive perceptions toward the place. When putting Bali Civet Coffee along Vietnamese Civet Coffee on shelf, which one would be more appealing to consumers? I bet you have the answer and that is self-explanatory to the potential of product-of-origin.

    More research is needed to identify business opportunities (like the abovementioned example).

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