The Determinants of Consumer Purchasing Decisions of Health Food Products: An Empirical Study from Indonesia

Abstract

The COVID-19 pandemic struck several countries in 2020. After the government officially announced that individuals will be working from home, shut public service agencies, and compelled people to wear masks and maintain social distance, several hundred business actors were forced to shut down their firms. The purpose of this study is to help companies determine the steps for a new marketing strategy for healthy food products in Indonesia. The number of samples was 500 respondents. The variance-based Structural Equation Modeling (SEM) method was used to conduct this investigation, which was similar to a marketing study. The findings show that in Indonesia, lifestyle and price perceptions influence healthy food product purchasing decisions. Meanwhile, brand awareness and customer attitudes had no bearing on healthy food products purchase decisions. The novelty of this study stems from the discovery of new opportunities for business players to market healthy food products during the current COVID-19 period. This opportunity arises as a result of changes in customer lifestyles and price perceptions, both of which must be taken into account by organizations to offer nutritious food items at reasonable rates in Indonesia.

1. Introduction

In 2020, several countries around the world experienced a pandemic or disaster as a result of the spread of the deadly Corona virus (COVID-19). As a result, almost all countries were forced to take action to protect their citizens from the virus’s spread, even as the number of victims continued to rise every day, reaching hundreds of people. Thousands of people were killed. As one of the countries hit by the spread of the Corona COVID-19 virus, Indonesia took a number of proactive measures, including social distancing, work-from- home proposals, and the closure of all public service sectors. The World Health Organization (WHO) has also made the COVID-19 outbreak a global pandemic because the transmission of this virus is very fast and almost all countries in the world are exposed to this virus (Ozili & Arun, 2020).

After the government officially announced that individuals will be working from home, shut public service agencies, and compelled people to wear masks and maintain social distance, several hundred business actors were forced to shut down their firms. Although the policy has sparked debate, it is necessary to close some places that have been the lifeblood of the Indonesian economy to secure and control the spread of the virus (Iriani et al., 2021). This is what causes paralysis and insolvency in the economic conditions and business actors in many places that implement the PSBB (Large Scale Social Restriction), which is accompanied by fines and criminal consequences.

Food issues are becoming more complex and potentially detrimental to consumers’ health in today’s world (Suprapto & Wijaya, 2012). Many diseases are transmitted through food or drink, and customers are often unaware of the cleanliness or content of these items. Lack of attention to this frequently has a negative influence on one’s health, ranging from food poisoning to death (Hidayat et al., 2021a). Recognizing the increasing concern about the use of harmful ingredients in food, notably in Indonesia, some consumers are increasingly demanding organic or otherwise known as healthy food products.

Consumption of organic food is on the rise, as is awareness of the importance of living a healthy lifestyle by eating organic food (Hidayat et al., 2021b; Wijaya et al., 2020). The rise of the consumer segment that leads a healthy lifestyle is driving demand for health items such as organic food (Choi & Zhao, 2014; Rana & Paul, 2017). This way of living is founded on the belief that everything that comes from nature is good and useful, and that it keeps humans and nature in harmony (Diyah & Wijaya, 2017). This healthy lifestyle has been institutionalized internationally which requires guarantees that agricultural products must have food safety attributes, high nutritional content (nutritional attributes), and environmentally friendly (ecolabelling attributes).

A consumer with a healthy lifestyle is more likely to take efforts that are beneficial to his/her health, such as participating in sports, eating natural foods, and living a balanced life, to maintain a positive attitude (Irianto et al., 2015; Rana & Paul, 2017; Suprapto & Wijaya, 2012). Several previous studies (Hidayat et al., 2021a; Irianto et al., 2015; Rana & Paul, 2017; Suprapto & Wijaya, 2012) found a positive relationship between a healthy lifestyle and the intention to buy organic food.

The intention to purchase organic food is also influenced by consumer sentiments (Hidayat et al., 2021b; Suprapto & Wijaya, 2012; Wijaya et al., 2020). This is due to the fact that customer attitudes regarding organic food, such as overall thoughts or assessments about purchasing organic food, are founded on consumer perceptions about purchasing organic food. The more positive a person’s beliefs are as a result of the object’s attitude, the more positive the person’s attitude toward the object will be, and vice versa. The findings revealed that attitudes toward organic food and intentions to purchase organic food have a positive relationship (Choi & Zhao, 2014; Hidayat et al., 2021a; Suprapto & Wijaya, 2012).

When presented with a decision, the buyer will sort out his wants and needs, necessitating an appropriate perception as one of the things that support purchase decisions (Kotler & Keller, 2011). Phenomena, wants, desires, values, and experiences all contribute to a person’s perception. Price perception is one of the factors that will influence organic food purchases (Irianto et al., 2015; Rana & Paul, 2017; Sander et al., 2021; Suprapto & Wijaya, 2012). High prices affect consumers’ intention to consume organic food. This is supported by previous research (Irianto et al., 2015; Rana & Paul, 2017; Suprapto & Wijaya, 2012) which showed that price perception has a positive effect on the purchase intention of a product.

Buying decisions are a process that consumers do in buying products according to what they need and want (Potluri & Johnson, 2020). The purchasing decision-making process consists of five stages, namely need recognition, information search, alternative evaluation, purchase decision, and post-purchase evaluation (Kotler & Keller, 2011). The process of making purchasing decisions by consumers is also influenced by factors of marketing efforts carried out by producers, the socio-cultural environment, and the psychological field (Alvarez & Fournier, 2016; Hidayat et al., 2021b; Rana & Paul, 2017; Tran et al., 2020).

According to research conducted in Thailand, consumers evaluate marketing, location, and price aspects while purchasing products (Jangphanish, 2016). Consumer knowledge and behavior-seeking changes/ product variations have a favorable effect on the purchase of frozen food, according to research conducted in Pakistan (Saleem et al., 2017). According to research conducted in Bangladesh, frozen food purchasing decisions are influenced by price, flavor, availability, superior performance, and product quality (Islam et al., 2018). Consumers are influenced by socio-demographic parameters such as age, education, type of work, consumer income level, and gender when purchasing ready-made frozen food products, according to the study.

The COVID-19 epidemic has resulted in a shift in people’s lifestyles today. This is an intriguing topic to investigate to learn more about the factors that influence purchasing decisions for healthy food products in Indonesia during the COVID-19 pandemic. This study is useful for entrepreneurs of healthy food items in Indonesia who want to learn more about the elements that encourage people to buy their products. This research will also be considered by firms when deciding on new marketing strategy initiatives for healthy food products in Indonesia at this time. This study has the potential to help grow and improve the scientific knowledge of marketing management disciplines.

2. Literature Review and Hypothesis Development

2.1. Behavioristic Theory

This theory studies human behavior (Fishbein & Ajzen, 1975; Islam et al., 2018). The behavioral perspective emphasizes the importance of learning in describing human behavior, which is caused by based stimuli (stimuli) that result in reactive behavioral interactions (responses). This theory’s core premise regarding behavior is that it is totally determined by laws, that it can be foreseen, and that it can be determined. According to this hypothesis, people will engage in specific behaviors because they have learned to correlate these acts with rewards from earlier experiences. Someone will stop a behavior because the behavior has not been rewarded or has been punished (Islam et al., 2018).

2.2. Consumer Behavior Theory

Consumer behavior refers to the actions that are directly involved in the acquisition of goods and services. Consumer behavior is defined as a decision-making process involving individual behaviors such as monitoring, obtaining, using, or regulating goods and services. The phases of steps done and carried out by a person/individual or group of individuals to meet their needs and desires are referred to as consumer behavior. All acts made by a person to find, buy, use, assess, and spend money on things are referred to as consumer behavior (Islam et al., 2018; Rana & Paul, 2017). Understanding customer behavior is critical for building marketing strategies and operationalizing sales approaches for business players.

Consumer behavior is influenced by the ideas and sentiments people have during the purchasing process, as well as the activities they take. Other consumer feedback, advertising pricing information, packaging, product displays, blogs, and more are all included. Consumer behavior is fluid, involving several contacts and exchanges that must be recognized (Fishbein & Ajzen, 1975).

2.3. Hypothesis Development

Hypotheses are initial assumptions based on a variety of past ideas and research findings that must be retested for accuracy. The hypothesis is always expressed as a statement with a causal relationship. The following is the hypothesis that was employed in this study.

2.3.1. Brand Awareness of Healthy Food Product Purchasing Decisions

A brand is a form of text or image that is distinct from others and that can be easily recognized by consumers (Dwivedi et al., 2021; Pham, 2020). Consumers’ capacity to recognize and recall that a brand belongs to a specific product category is known as brand awareness (Pham, 2020). Top of mind refers to the brand that is remembered first when asked about a product category, brand recall refers to what brand is remembered after the brand is mentioned for the first time, brand recognition refers to when awareness of the brand appears when asked questions to remember a brand, and brand unaware is the lowest level in measuring brand awareness because consumers are not aware of the brand (Bagozzi et al., 2017; Islam et al., 2018; Pham, 2020).

To survive in a competitive market, a brand is needed that will create added value for a product (Aro et al., 2018; Islam et al., 2018; Lien et al., 2015; Pham, 2020). Based on the description above, the first hypothesis is structured as follows.

H1: Brand awareness has a positive effect on purchasing decisions for healthy food products.

2.3.2. Consumers’ Lifestyle on Purchasing Decisions for Healthy Food Products

A person’s lifestyle is their way of life in the world, as expressed by their activities, hobbies, and opinions (Kotler & Keller, 2011). People’s lifestyles reflect how they live, spend their money, and manage their time. Because the preceding lifestyle concept is so wide and general, the lifestyle construct must be narrowed down to a specific lifestyle, namely a healthy lifestyle. Psychographics can be used to assess a person’s lifestyle (psychographic). The assessment of personality features and attitudes that influence a person’s lifestyle and purchasing behavior is known as psychographics. Opinions, attitudes, and beliefs regarding various aspects of lifestyle are included in data point psychographics.

A person’s way of life is usually transient and changes frequently. Because it adjusts to changes in his life, a person can easily change the model and brand of clothing he wears. A person’s complete pattern of acting and interacting in the environment is described by their lifestyle (Kotler & Keller, 2011). A person’s lifestyle might be appraised subjectively based on the opinions of others. Lifestyle can be used as an example as well as a taboo subject. Examples of a good lifestyle: eat and rest regularly, eat 4 healthy 5 perfect foods, exercise regularly, get enough sleep, and others. Speaking inappropriately, eating carelessly, rarely exercising, rarely sleeping, and so on are all examples of a bad lifestyle. The state of your health determines your lifestyle.

The results showed that there was a positive relationship between lifestyle on organic food and intention to buy organic food (Choi & Zhao, 2014; Rana & Paul, 2017; Wijaya et al., 2020). Based on the description above, the second hypothesis is structured as follows.

H2: Consumer lifestyle has a positive effect on purchasing decisions for healthy food products.

2.3.3. Consumer Attitudes towards Purchasing Decisions for Healthy Food Products

Everyone tends to behave favorably or unfavorably towards a particular object. Attitude is one of the most important concepts that companies use to understand consumers. Attitude consists of three interconnected components that can be seen through the three-component attitude model, namely the cognitive component (related to one’s mind (brain), what consumers think), the affective component (related to feelings, so it is emotional in nature and its form is a feeling of pleasure, sadness, cheerful, happy, and so on), and the conative component (the conative component in consumer research marketing is usually treated as an expression of the consumer’s intention to buy or reject a product) (Benetos & Lacolley, 2006; Fishbein & Ajzen, 1975; George, 2004; Rana & Paul, 2017; Sander et al., 2021).

The results showed that there was a positive relationship between attitudes towards organic food and intention to buy organic food (Budiman & Wijaya, 2016; Hidayat et al., 2021a; Suprapto & Wijaya, 2012; Wijaya, 2019; Wijaya et al., 2020). The findings explain that the stronger the attitude towards organic food, the higher the purchase intention, on the contrary, the weaker the attitude towards organic food, the lower the consumer’s purchase intention. Based on the description above, the third hypothesis is structured as follows.

H3: Consumer attitudes have a positive effect on purchasing decisions for healthy food products.

2.3.4. Perception Price on Purchasing Decisions for Healthy Food Products

Perception is a process by which individuals select, organize and interpret stimuli into a meaningful and coherent picture of the world (Khandeparkar et al., 2020; Lien et al., 2015). Consumers make judgments based on what they perceive rather than objective facts, which has strategic implications for marketers.

According to previous studies (Suprapto & Wijaya, 2012), price perception influences the inclination to purchase organic food goods. The findings revealed that there was a link between the perception of organic food and the intent to buy organic food (Irianto et al., 2015; Rana & Paul, 2017; Suprapto & Wijaya, 2012). Therefore, the perception of price is also one of the factors that affect consumer purchase intentions. Based on the description above, the fourth hypothesis is structured as follows.

H4: Price perception has a positive effect on purchasing decisions for healthy food products.

3. Research Methodology

3.1. Sampling and Procedure

The methodologies used in this investigation are quantitative. The data for this study was collected through the distribution of questionnaires to respondents or users of healthy food products. Associative research is the method employed by the researcher. Brand awareness (X1), lifestyle (X2), customer attitudes (X3), price perception (X4), and purchasing decisions (X5) are all independent variables (Y). A Likert scale was used to assess the independent and dependent variables. The Likert scale is a scoring system that ranges from 1 to 5 (Likert, 1932). The number of samples in this investigation was set at 500.

3.2. Measure

The instrumental measurement of this study aims to make the preparation of the instrument more systematic, the explanation is as follows (Table 1).

Table 1: Research Instruments

3.3. Data Analysis

The goal of this study is to discover the factors that influence purchasing decisions for healthy food products in Indonesia. The COVID-19 pandemic is offered as an example of a recent event that has influenced customer behavior in making these purchases. This research was conducted like a marketing study using the variance-based Structural Equation Modeling (SEM) method (Hair et al., 2012; Ketchen, 2013). Smart PLS was used to analyze the data for this study, and verification analysis was used in three stages: measuring the outer model, evaluating the structural model (inner model), and verifying the research hypothesis. (Hair et al., 2014, 2017; Jaya, 2020; Ketchen, 2013).

4. Results

The survey data is then analyzed and tested to identify evidence or scientific findings that will help in the advancement of research. The following are some of the tests that were conducted.

4.1. Characteristics of Respondents

The characteristics of the respondents in this survey were subdivided into several categories, including gender, age, and educational attainment. The data mapping revealed that 300 of the respondents were males and 200 were females, indicating that male respondents outnumbered female respondents by 60 percent. Our respondents’ characteristics are divided into two groups based on their age: those aged 35–40 and those aged above 40. There were 274 persons in this study who were 35–40 years old and 226 people who were above 40 years old. The educational background of our respondents is grouped into 2 categories of graduates, namely Senior High School graduates and D3 (Diploma). There were 384 Senior High School graduates among our respondents, while 116 D3 (Diploma) graduates. CV (committee partnership) and UD (unincorporated business) are the two types of MSME businesses that we use as responses (trading business). MSME actors with CV-based firms number 450 and UD-based businesses number 50. We gathered this information from a number of Indonesian locations.

4.2. Validity and Reliability Test

Based on Table 2, all question items have a correlation value (r) greater than 0.3, while the alpha coefficient is greater than 0.6. Thus, it means that all question/statement items for each variable are valid and reliable.

Table 2: Validity and Reliability Test Results

4.3. SEM (Structural Equation Model) Test

This research uses the SEM test through test stages, such as the outer model test, the evaluation of the structural model (inner model), and the hypothesis test. The following is the presentation.

This outer model test employs Composite reliability indicator block data, which evaluates the composite reliability value ρc) to assess a construct. If a dimension’s composite reliability value (c) is more than 0.7, it is considered reliable. The following are the findings of composite reliability (c) calculations (ρc).

The composite reliability output derived by each latent variable is greater than 0.7, as shown in Table 3. This finding suggests that each latent variable is reliable. The inner structural model is evaluated using R-Square for the dependent construct. The inner model test is used to see if there is a significant relationship between the constructs and the R-square. The coefficient of determination is a value that indicates how significant the external latent variable’s influence is on the endogenous latent variable. The following results were obtained based on the test results acquired using the SmartPLS software.

Table 3: Composite Reliability Calculation Results

The R Square value obtained is 0.917 or 91.7 percent, as shown in Table 4 above. These findings show that brand awareness, lifestyle, consumer attitudes, and price perceptions have a significant impact on purchasing decisions, while other factors that are not part of this study account for the remaining (100-R Square) 8.3 percent effect.

Table 4: Coefficient of Determination (R²)

To conclude whether the hypothesis is accepted or rejected, the p-value at significance = 5% or 0.05 is used. If p-value = < 0.05 then H0 is rejected or there is a significant effect. On the other hand, if the p-value is > 0.05, then H0 is not rejected or there is no significant effect. The following are the results of testing the hypothesis (Figure 1 and Table 5).

Figure 1: Data Test Results

Table 5: Hypothesis Testing Results

The results of the hypothesis testing that have been carried out provide several findings, including the following.

Brand awareness has no effect on purchasing decisions for healthy food products in Indonesia. This result is evidenced by a p-value greater than 0.05 or (0.065 > 0.05). These results also indicate that the first hypothesis is rejected. As a result of the COVID-19 pandemic in Indonesia, many business actors have begun to reduce costs such as advertising costs and others, to maintain operational productivity. When advertising costs are reduced, it is only natural that brand awareness among consumers begins to be limited, so this also causes a decrease in the purchase of the company’s products. The healthy food business actors that we surveyed also stated that during the COVID-19 pandemic, their income turnover has decreased, due to the delayed delivery of raw materials.

Lifestyle influences purchasing decisions for healthy food products in Indonesia. The p-value of this variable is greater than 0.05 or (0.028 < 0.05). These results prove that the second hypothesis is not rejected. The Indonesian people’s lifestyle changed as a result of the COVID-19 pandemic. Many customers have begun to adopt a healthy lifestyle in the hope of living longer lives. This shift has an impact on consumer shopping behaviors, as people become more detailed and thorough in their purchases and consumption of healthy foods and beverages to avoid disease. This opportunity is actually extremely favorable for healthy food enterprises to start increasing their output to satisfy the needs of consumers in Indonesia.

Consumer attitudes have no effect on purchasing decisions for healthy food products in Indonesia. The p-value of this variable is smaller than 0.05 or (0.076 > 0.05), so the third hypothesis that was compiled was rejected. This finding demonstrates that people value their healthy lifestyle over their attitudes. Consumer attitudes are particularly challenging to assess because they are always shifting based on the situation and conditions at the moment. These findings contradict prior research by Wijaya (2019) and Wijaya et al. (2020).

Perception of price affects the decision to purchase healthy food products in Indonesia. The p-value of this variable is smaller than 0.05 or (0.046 < 0.05), so the fourth hypothesis that has been compiled is declared not rejected. This result is very general and in accordance with actual conditions because some literature also states that price perception influences consumer purchasing decisions for certain products and services (Wijaya 2019). The more affordable healthy food products are, the higher the consumer’s decision to buy them. The results of this study support previous researchers, namely Wijaya et al. (2020) and Wijaya (2019).

5. Discussion and Conclusion

The findings of surveys and data testing have revealed numerous things, such that this study indicates that lifestyle and pricing perceptions have an impact on purchasing decisions for healthy food products in Indonesia. This finding adds to the preceding literature’s novelty (Ali et al., 2020; Choi & Zhao, 2014; Islam, 2016; Islam et al., 2018; Rana & Paul, 2017). Meanwhile, brand awareness and consumer attitudes have no effect on purchasing decisions for healthy food products in Indonesia. This finding provides a new assumption that brands are not the main benchmark for consumers to consume healthy food products (Ali et al., 2020), so, this finding opens new hope for potential entrepreneurs who want to produce healthy food in Indonesia.

The COVID-19 outbreak in Indonesia has wreaked havoc on everyone. Changes in lifestyle that are healthier than before are proof of this. This COVID-19 phenomenon can also be leveraged by business players to develop a healthier food and beverage product line with a larger market. Everyone wants to be healthy, but being healthy is expensive. If businesses can overcome and solve this problem, they would be able to dominate the market for healthy food and beverage products, which is currently very large. COVID-19’s momentum is having an adverse effect on the global economy; any country affected by COVID-19 would face difficult economic conditions. Change, it is said, does not necessarily bring a downturn, and this study demonstrates that there is still a good opportunity for healthy food businesses in any country to expand its global market and improve the country’s economic condition. The novelty of this study stems from the development of new opportunities for business players to advertise healthy food products during the current COVID-19 period. This opportunity arises as a result of changes in customer lifestyles and price perceptions, both of which must be taken into account by the company to offer nutritious food products at reasonable rates.

5.1. Theoretical Contribution

This research adds to the existing body of knowledge in a number of ways. First, this study adds to the existing literature on Indonesia’s healthy food industry and discusses the opportunity from the COVID-19 effect. Second, by testing and validating the conceptual model of marketing management, the study adds to the literature and theory (Cho, 2015; Hidayat et al., 2021b; Ruiz-Real et al., 2021; Saura, 2021). Thus, the proposed and empirically examined structure will be helpful literature to understand the opportunity got from the COVID-19 effect in Indonesia.

5.2. Practical Implementation

Aside from theoretical contributions, the current study offers some useful practical advice for business managers. First, the study assists managers and other stakeholders in evaluating price criteria to attract more customers. The importance of an active customer base to an organization’s success cannot be overstated. Second, this study highlights the COVID-19 phenomena, which may present opportunities for healthy food and beverages businesses, since consumers are increasingly deciding to purchase nutritious foods to live longer. Management and production teams can work together to produce healthy food and beverage products to increase their market share.

5.3. Limitations and Future Directions

The limitation of this research is the process of collecting data by distributing questionnaires to respondents during the COVID-19 PPKM period, so it took a long time to collect data. Further research can identify other variables that influence customer purchase decisions for healthy food products in the future new normal so that the development of literature can be of value to prospective business actors and those who are already involved in business.