Factors affecting consumer intention to purchase organic food in Ho Chi Minh city, 2022

STATE BANK OF VIETNAM THE MINISTRY OF EDUCATION & TRAINING

HO CHI MINH UNIVERSITY OF BANKING

PHAN NGUYEN NGOC BICH

STUDENT CODE: 030805170203

FACTORS AFFECTING CONSUMER INTENTION TO

PURCHASE ORGANIC FOOD IN HO CHI MINH CITY

GRADUATION THESIS

MAJOR: BUSINESS ADMINISTRATION

CODE: 7340101

SUPERVISOR: DANG TRUONG THANH NHAN, Ph.D

Ho Chi Minh city, 2022

STATE BANK OF VIETNAM THE MINISTRY OF EDUCATION & TRAINING

HO CHI MINH UNIVERSITY OF BANKING

PHAN NGUYEN NGOC BICH

STUDENT CODE: 030805170203

FACTORS AFFECTING CONSUMER INTENTION TO

PURCHASE ORGANIC FOOD IN HO CHI MINH CITY

GRADUATION THESIS

MAJOR: BUSINESS ADMINISTRATION

CODE: 7340101

SUPERVISOR: DANG TRUONG THANH NHAN, Ph.D

Ho Chi Minh city, 2022

COMMENTS OF THESIS SUPERVISOR

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Ho Chi Minh City, 6th June, 2022

CONFIRMATION OF THESIS SUPERVISOR

Dr. Dang Truong Thanh Nhan

i

ABSTRACT

Organic food is gradually becoming a necessary food for every family because of its

significant benefits. Ho Chi Minh city is densely populated with high level of

education and stable income, so it is a potential market to develop food industry in

general and organic food in particular. Therefore, the study “Factor affecting

intention to buy organic food in Ho Chi Minh city” was carried out to identify and

measure the factors impacting consumer intention to buy organic food. From the

research results, the author proposes appropriate management implications so that

business managers can approach more consumers in the city.

The method of the research was carried out in two phases: qualitative research and

quantitative research. Based on TPB theory and previously related studies, the

author has built a proposed research model including 7 hypotheses and a

preliminary scale. After conducting qualitative research including group discussions

with experts and in-depth interviews with consumers, the author has built a total of

40 observed variables, the results showed that 6/7 hypotheses were accepted.

Accordingly, except for Perceived Price, which has negative impact, the remaining

5 variables: Attitude, Subjective Norm, Perceived Behavior Control, Health

Awareness and Perceived Quality all have positive impact on the intention to buy

organic food of consumers in Ho Chi Minh city.

The author also proposes some appropriate governance implications for managers

with each factor in order of the highest influence level to the lowest.

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DECLARATION OF AUTHENTICITY

The author of this thesis is Phan Nguyen Ngoc Bich, a senior student

majoring in business administration, HQ5-GE05 class, of HCMC University of

Banking. I, the author, hereby declare that this thesis is my own research work, the

research results are truthful, in which there are no previously published contents or

contents made by others except for citations fully cited in the thesis.

Ho Chi Minh City, 6th June, 2022

Student,

Phan Nguyen Ngoc Bich

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ACKNOWLEDGEMENT

To complete this thesis, I have received such care and supports from teachers.

Therefore, I would like to express my sincere thanks to all the teachers of Ho Chi

Minh city of Banking University, especially the teachers of the Faculty of Business

Administration for imparting valuable knowledge and experience during my four￾year studying and practicing at HUB.

Besides, I would like to give my respect and thanks to my lecturer - Dr. Dang

Truong Thanh Nhan, who directly guided for this thesis. Thank you for your

support, helping me to orient my knowledge and apply it to practice during the

research so that I can complete the thesis in the best way.

At the same time, I would like to thank all of my friends who spent their time

answering my survey so that I could complete this graduate thesis. Finally, the

author would like to express deep gratitude to the authors who have done related

researches so that I have such a complete source of material and useful for the

implementation of the thesis.

Despite the efforts in learning and research, however, due to lack of experience as

well as limitations in professional knowledge, it is difficult to avoid shortcomings in

the thesis. I look forward to receiving your understanding and suggestions as well as

your contributions to improve this study.

I would like to wish all teachers and readers a lot of health and success in work.

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TABLE OF CONTENTS

ABSTRACT................................................................................................................i

DECLARATION OF AUTHENTICITY................................................................ii

ACKNOWLEDGEMENT...................................................................................... iii

TABLE OF CONTENTS.........................................................................................iv

LIST OF ACRONYMS...........................................................................................vii

LIST OF FIGURES .............................................................................................. viii

LIST OF TABLES ...................................................................................................ix

CHAPTER 1. THESIS INTRODUCTION AND OVERVIEW............................1

1.1. The necessity of the topic ..................................................................................................1

1.2. Research Objectives............................................................................................................2

1.2.1. General Objective ......................................................................................... 2

1.2.2. Specific Objectives ....................................................................................... 2

1.3. Research Questions.............................................................................................................2

1.4. Subject and scope of the research....................................................................................3

1.4.1. Research Subjects ......................................................................................... 3

1.4.2. Research Scope ............................................................................................. 3

1.5. Research Method .................................................................................................................3

1.6. Research Contribution........................................................................................................4

1.7. Thesis Structure....................................................................................................................4

SUMMARY OF CHAPTER 1 .................................................................................6

CHAPTER 2. THEORETICAL BASIS AND RESEARCH MODEL.................7

2.1. Concepts................................................................................................................................7

2.1.1. Concept of Organic Food............................................................................... 7

2.1.2. Concept of Purchase Intention....................................................................... 7

2.1.3. Concept of Consumers in Ho Chi Minh City................................................ 8

2.2. Theoretical basis..................................................................................................................8

2.2.1. Theory of Reasoned Action - TRA ............................................................... 8

2.2.2. Theory of Planned Behavior - TPB............................................................... 9

2.3. Empirical Studies..............................................................................................................10

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2.3.1. International Studies .................................................................................... 10

2.3.2 Domestic studies ........................................................................................... 14

2.4. Summary of relevant theoretical basis and research models.................................19

2.4.1. Summary of relevant theoretical basis........................................................ 19

2.4.2. Comments on previous studies.................................................................... 21

2.5. Developing hypotheses and proposed research model............................................22

2.5.1. Scientific basis to develop suitable hypotheses for the topic ..................... 22

2.5.2. Develop research hypotheses....................................................................... 23

2.5.3. Proposed research model ............................................................................. 26

SUMMARY OF CHAPTER 2 ...............................................................................28

CHAPTER 3: RESEARCH METHODOLOGY..................................................29

3.1. Research process...............................................................................................................29

3.2. Qualitative research..........................................................................................................30

3.2.1. Building preliminary scale........................................................................... 30

3.2.2. Group discussion with experts..................................................................... 32

3.2.3. In-depth interviews with consumers ........................................................... 36

3.2.4. Building the official scale and questionnaire.............................................. 37

3.3. Quantitative research........................................................................................................40

3.3.1. Sample size................................................................................................... 41

3.3.2. Data collecting.............................................................................................. 41

3.3.3. Data analysis ................................................................................................ 42

SUMMARY OF CHAPTER 3 ...............................................................................46

CHAPTER 4. RESEARCH RESULTS AND DISCUSSION..............................47

4.1 Sample descriptive statistics............................................................................................47

4.1.1. Descriptive statistics on qualitative variables............................................. 47

4.1.2. Descriptive statistics on quantitative variables........................................... 49

4.2. Cronbach's Alpha reliability test...................................................................................49

4.3 EFA analysis........................................................................................................................52

4.3.1. EFA analysis results of independent variables........................................... 53

4.3.2. EFA analysis results of dependent variables .............................................. 56

4.3.3. Adjustments of the research model after EFA analysis ............................. 57

4.4. Correlation analysis..........................................................................................................57

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4.5. Regression analysis...........................................................................................................59

4.5.1. Evaluate the fit of the regression model...................................................... 60

4.5.2. Regression coefficients and regression equation ........................................ 61

4.5.3. Testing the assumptions of the Regression model...................................... 62

4.5.4. Research hypotheses testing and results discussion ................................... 66

4.6. Difference testing..............................................................................................................72

4.7. Compare the results with previous domestic studies...............................................74

SUMMARY OF CHAPTER 4 ...............................................................................76

CHAPTER 5. CONCLUSIONS AND IMPLICATIONS ....................................77

5.1. Conclusion ..........................................................................................................................77

5.2. Management implications...............................................................................................78

5.2.1. Attitude ......................................................................................................... 78

5.2.2. Subjective Norm........................................................................................... 79

5.2.3. Perceived Price............................................................................................. 79

5.2.4. Perceived Quality ......................................................................................... 80

5.2.5. Health Awareness ........................................................................................ 80

5.2.6. Perceived Behavioral Control...................................................................... 81

5.3. Contribution of research..................................................................................................81

5.4. Limitations and directions for further research.........................................................82

SUMMARY OF CHAPTER 5 ...............................................................................84

REFERENCE ..........................................................................................................85

APPENDIX

vii

LIST OF ACRONYMS

No. Acronyms Meaning

1 HCMC Ho Chi Minh City

2 OF Organic Food

3 TRA Theory of Reasoned Action

4 CF Conventional Food

5 TPB Theory of Planned Behavior

6 SPSS Statistical Package for the Social Sciences

7 EFA Exploratory Factor Analysis

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LIST OF FIGURES

Figure name Page

Figure 2.1. Theory of Reasoned Action (TRA) Model 9

Figure 2.2. Theory of Planned Behavior 10

Figure 2.3. Model of Determinant factors influencing organic food

purchase intention 11

Figure 2.4. Model of Consumers perception, purchase intention and

actual purchase behavior of organic food products in Malaysia 11

Figure 2.5. Model of Factors driving Thai consumer intention to

purchase organic food 12

Figure 2.6. Model of Drivers of organic food consumption in Greece 13

Figure 2.7. Model of Consumer Buying Behavior for Food Products

in Haryana 14

Figure 2.8. Model of Factors affecting the intention to buy organic

food of office workers in HCMC 15

Figure 2.9. Model of Factors affecting the intention to buy organic

food of urban Vietnamese consumers 16

Figure 2.10. Model of Factors affecting consumer intention to buy

organic food in HCMC 17

Figure 2.11. Model of Factors affecting the intention to buy safe

vegetable products of urban residents in HCMC area 18

Figure 2.12. Model of Factors affecting the intention to buy safe

food in HCMC 19

Figure 2.13. Proposed Research Model 27

Figure 3.1. Research process 29

Figure 4.1. Scatter Plot diagram 64

Figure 4.2. Normalized residual histogram 65

Figure 4.3. Normal P-P Plot 66

Figure 4.4. Final research model 71

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LIST OF TABLES

Table name Page

Table 2.1. Summary of relevant theoretical basis 19

Table 2.2. Summary of the factors occurrence frequency 23

Table 3.1. Preliminary scale 30

Table 3.2. Indicator of scales 37

Table 4.1. Descriptive Statistics for Demographics 48

Table 4.2. Descriptive Statistics on the perception of buying OF 49

Table 4.3. Results of Cronbach’s Alpha test 50

Table 4.4. EFA analysis results of independent variables 1st time 53

Table 4.5. Rotated Component Matrix result of independent

variables 1st time 53

Table 4.6. EFA analysis results of independent variables 2nd time 55

Table 4.7. Pearson correlation coefficient 58

Table 4.8. Evaluate model fit 60

Table 4.9. Model fit testing 60

Table 4.10. Correlation coefficients 60

Table 4.11. The importance of the independent variables 69

Table 4.12. Summary of hypothesis testing 70

1

CHAPTER 1. THESIS INTRODUCTION AND OVERVIEW

1.1. The necessity of the topic

In the context of integration associated with the outstanding development of

the economy, people's living standards are increasingly improved. Since then, the

requirements for food have also become more stringent because the purchase and

use of food directly affects the health and quality of consumers life.

Along with the development of science and technology, the application of

technical achievements to the food production and processing process is inevitable.

However, this has led to certain hazards to the environment and people. The use of

chemical fertilizers, pesticides, veterinary drugs growth stimulants, etc. have been

causing serious effects to the living environment and human health. In general, from

2010 to 2019, there were 1,556 cases of food poisoning nationwide. From that, it

can be seen that focusing on the issue of buying and using food is indispensable and

necessary to protect consumers and their families.

From the above reasons, Organic Food (OF) has become the optimal choice

of many consumers. This is because OF are those that have been raised, handled

and prepared in a way that is safe for the environment, without the use of artificial

chemicals, growth hormones or antibiotics (Brown, 2021). According to AC

Nielsen's Trends in Organic Food Consumption Report (2017), up to 86% of

Vietnamese consumers prefer to choose organic products for their daily meals

because of their safety nutrition richness and delicious taste. Not only that, OF also

has a useful effect in reducing the risk of cancer, heart disease, high blood sugar,

etc. According to Vietnam Report (2019) shows that the prospect of Vietnamese OF

market will match the outlook of the international OF market, with the sales

expected to reach 320.5 billion USD by 2025.

Consumers living in HCMC often tend to buy and use OF higher than other

areas. Because they are aware of unsafe food risks and the attention to the food

quality so that to protect the health of themselves and their families. Moreover,