The Impact On Buying Behaviour Of GI Products

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Author(s): Abhishek Roy

Paper Details: Volume 3, Issue 3

Citation: IJLSSS 3(3) 32

Page No: 416 – 424

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ABSTRACT

Geographical Indication products are increasingly recognized for their unique qualities linked to specific regions, affecting consumer behaviour significantly. Research indicates that the quality of GI products is paramount in influencing buying decisions, often overshadowing other factors such as price and availability. Consumers demonstrate a strong preference for authenticity and origin, with many willing to pay a premium for GI labelled items due to perceived quality and cultural significance.

In this paper, we investigate about the consumers’ behavioural impact on the purchase decision after consuming the Geographical Indication Products. When it’s comes to the purchasing behaviour of a consumer may depends on various factors that may influence the decision-making process such as physical structure, income effect, price effect, reference group, culture, social, choice of a product, brand and dealer or store, purchase timing and amount, perception, and purchase effect of product, etc., All factors are depend on each other and influence the decision making process of a consumer. But the purchasing of the geographical indication is made by the consumer by their locality, tourism places, obtain information from different sources, have different perceptions, have differing satisfaction levels related to past experience etc. The internet and social media emerge as crucial information sources in the second stage, while product uniqueness plays a significant role in the evaluation phase.

Key Words:  GI, Customer experience, customer purchase decision, cultural significance, perceived quality               

INTRODUCTION

Geographical Indication (GI) products are goods that have a specific geographic origin and possess qualities, reputation, or characteristics inherent to that location. These products are often associated with traditional craftsmanship, agricultural practices, or local resources. Examples include Champagne from France, Basmati rice from India, and Darjeeling tea. The introduction of GI products into global markets has had significant implications for consumer buying behaviour, reshaping how consumers perceive quality, authenticity, and value.[1]

A GI is a symbol that “identifies a good as coming from the territory of a member, or a regional locality in that territory, where a given quality, reputation, or other characteristics of the good is essentially attributable to its geographical origin” (WTO) Geographical Indicator (GI) tagged products are highly unique and reputational products with immense traditional benefits linked to the place of origin. India is the treasure of GI, with 470 products ranging from agricultural handicrafts to natural products. These regional products act as an identifier to indicate goods originating from a specific place of origin and their manufacturing technique passed from generation to generation.[2]GI are distinctive intellectual property rights and offers community rights for the producers of specific geographically area. The first product to be tagged as GI is “Darjeeling tea” in the year 2003. The label typically designates well-known locations that have distinct with irreplaceable characteristics because of their origin.

Consumer preference is a critical factor that regulates purchase decision. Within the framework of modern marketing, all the activities are focused on consumers; therefore, it is necessary for the enterprises to manufacture the products according to the psychological needs for their survival and offer products utilities.

The impact of GI products on buying behaviour is crucial for stakeholders across the supply chain. By examining consumer motivations, perceptions, and purchasing patterns related to GI products, businesses can better align their strategies with market demands. This exploration offers insights into how GI certification not only enhances product value but also shapes consumer loyalty and trust in an era where conscious consumption is on the rise.

As consumers become increasingly aware of the origins of their food and other products, the demand for GI products has surged. This shift is driven by a growing preference for authenticity, quality assurance, and sustainability. Consumers are now more inclined to support local economies and artisanal producers, leading to a heightened interest in products that carry a GI label. This phenomenon is further amplified by social media and digital marketing, which facilitate greater access to information about product origins and encourage consumers to make informed purchasing decisions.

INDIAN CONTEXT

India who are members of the World Trade Organisation (WTO) by the WTO Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) which got concluded in 1994.

The GI tags in India are issued as per the provisions of the Geographical Indications of Goods (Registration and Protection) Act, 1999[3] whích came into force with effect from 15 September 2003, bythe Geographical Indication Registry under the Department of Industry Promotion and Internal Trade, Ministry of Commerce and Industry.

Any individual producer, an association of persons, any organization, or authority established by or under the law can apply to get a GI tag and the application moved in such a prospect should be written in the proper format along with a prescribed fee to the concerned authority. A GI tag is valid only for 10 years although it can be renewed from time to time for a further period of 10 years each through every subsequent renewal.

Darjeeling Tea became the first GI tag issued product in India, which was issued to it from 2004 to 2005 and since then, the number of registrations, as well as applications, has Increased rapidly.

According to the Indian Government, around 370 GI tags have been assigned to various goods as per Section 2(1) of the Geographical Indications of Goods (Registration and Protection) Act, 1999.[4]

Geographical indication, like any other intellectual property, is one of the lately discovered but finely benefitted opportunities for the products which have exceptionally different qualities because of their place of origin or manufacturing. Geographical indications are governed by the Geographical Indications Act, 1999, and goods falling under the category of GI are given specific signs and symbols so that the consumers can be well aware of the quality of the product. With the increasing rate of crime, the Intellectual rights are also not safe as many sellers with the wrong intention of just earning profit sell the imitated products under the false Impression of the original product and poor consumers unknowingly buy those products.

CURRENT CONTEXT

it is a challenging task to know for sure the heritage and origin of a particular food or any, item of clothing or a beautiful place of artefact or handicraft. Many special kinds of food items clothing originate from a specific place but unfortunately, some people do not shy away or types of from openly and unethically copying and passing those goods or items from another region to exploit popularity from the quality of those goods or items.

To provide legal rights to the people whose trade or craft become available only due to their geographical factors, the government provides Geographical Indications or GI Tags. It’s common knowledge that the concept of Geographical Indication has been around for centuries, however, the French were the first to develop a proper system to catalogue and recognise different articles/foods that showed Individual properties and were associated or found or produced only at a specific region.[5]

CHALLENGES AND OPPORTUNITIES

  1. To evaluate the level of consumer awareness regarding GI products, including their origins, characteristics, and benefits.
  2.  To explore the motivations driving consumers to choose GI products over conventional options.
  3.  To analyse external factors that influence consumer buying behaviour regarding GI products, including social trends, marketing efforts, and economic conditions.
  4.  To examine the relationship between GI product consumption and sustainability practices among consumers.
  5.  To examine the relationship between GI product consumption and sustainability practices among consumers.

CONCEPT AND FRAMEWORK FOR ANALYSING BUYING BEHAVIOUR

CONSUMER PERCEPTION

  • Quality Assurance: Consumers often associate GI products with higher quality due to their traditional production methods and strict regulations.
  • Authenticity: The geographical link enhances the perceived authenticity of the product, making it more appealing to consumers seeking genuine experiences.
  • Trust: GI certification fosters trust in the product’s origin and quality among consumers.

CONSUMER MOTIVATION

  • Cultural Connection: Many consumers are motivated by a desire to connect with cultural heritage, either their own or that of others, leading them to seek out GI products.
  • Health Consciousness: The perception that GI products are healthier than mass-produced alternatives drives health-conscious consumers towards these items.
  • Support for Local Economies: Consumers increasingly prefer to support local farmers and producers, which aligns with the ethos of many GI products.

EXTERNAL INFLUENCES

  • Social Trends: Global movements toward sustainability and ethical consumption significantly influence consumer preferences for GI products.
  • Marketing Strategies: Effective marketing campaigns that emphasize the unique attributes of GI products can enhance consumer interest and drive sales.
  • E-commerce Dynamics: The rise of online shopping has expanded access to GI products, allowing consumers to discover and purchase these items more easily.

DECISION-MAKING PROCESS

  • Problem Recognition: Consumers recognize a need for quality or authenticity in their purchases.
  • Information Search: They seek information about GI products through various channels, including online research, social media, and recommendations.
  • Evaluation of Alternatives: Consumers compare GI products with other options based on factors like price, quality, and brand reputation.
  • Purchase Decision: The final decision is influenced by perceived value, emotional connection, and external factors such as promotions or availability.
  • Post-Purchase Evaluation: After purchasing, consumers assess their satisfaction with the product, which can influence future buying behaviour.

RECOMMENDATION

INCREASE CONSUMER AWARENESS AND EDUCATION

  • Implement Awareness Campaigns: Develop targeted marketing campaigns to educate consumers about the benefits and unique qualities of GI products. This can include workshops, social media campaigns, and collaborations with influencers to highlight the stories behind these products.
  • Utilize Digital Platforms: Given the rise in online shopping, manufacturers should invest in e-commerce platforms that provide detailed information about GI products, including their origins, production methods, and health benefits. This approach can help bridge the gap between awareness and purchase intention, particularly in regions where online shopping is underutilized.

ENHANCE MARKETING STRATEGIES

  • Emphasize Quality and Authenticity: Marketing efforts should focus on the quality attributes associated with GI products, such as taste, medicinal value, and traditional production methods. Highlighting these aspects can increase consumer willingness to pay a premium for genuine GI products.
  • Leverage Emotional Connections: Brands should create narratives that connect consumers emotionally to GI products by emphasizing cultural heritage and local traditions. This emotional attachment can significantly influence purchasing decisions.

STRENGTHEN LEGAL PROTECTIONS

  • Combat Counterfeiting: Governments and industry bodies must enhance legal frameworks to protect GI products from counterfeiting. This includes stricter enforcement of regulations and penalties for fraudulent practices that undermine consumer trust.
  • Promote International Cooperation: Collaborate with international organizations to establish robust systems for recognizing and protecting GI products across borders. This cooperation can help prevent the exploitation of GI reputations in global markets.

FOSTER SUSTAINABLE PRACTICES

  • Encourage Sustainable Production: Producers of GI products should be incentivized to adopt sustainable agricultural practices that protect the environment while maintaining product quality. This aligns with growing consumer preferences for eco-friendly products.
  • Support Local Economies: Initiatives that promote local sourcing and production of GI products can enhance community development and economic stability. Programs should be developed to support small-scale producers in accessing markets and improving production techniques.

UTILIZE TECHNOLOGY FOR TRACEABILITY

  • Implement Traceability Systems: Use technology such as blockchain to create transparent supply chains that allow consumers to trace the origin of GI products. This transparency can enhance consumer confidence in product authenticity and quality.
  • Engage with E-commerce Platforms: Partner with e-commerce platforms to facilitate easier access to GI products online, ensuring that consumers can easily find and purchase these items while receiving detailed information about their origins.

CONDUCT FURTHER RESEARCH

  • Study Consumer Preferences: Ongoing research into consumer preferences and behaviors regarding GI products is essential for adapting marketing strategies effectively. Understanding factors that influence buying decisions will help producers tailor their offerings to meet market demands.

CASE LAWS

In one of the landmark cases of Tea Board of India Vs. ITC Ltd (2011)[6]. The defendant fraudulently used the word ‘Darjeeling’ for naming one of its premises and misled the customers to believe it was the place of origin which was not true. The Court held that using this name could pose a great threat to the tea business of that place and hence the plaintiff moved an interlocutory application for granting temporary Injunction for using the name.

In Comite Interprofessionnel Du Vin De Champagne v. M/s. Chinar Agro Fruit Products (2011)[7], Section 22 of GI Act came into the picture where the defendant was restrained from using the word ‘Champagne’ for the non-alcoholic sparkling drink. The word ‘Champagne’ was registered by the plaintiff under the Geographical Indication (Registration and Protection) Act, 1999. The use of that word led to the infringement of the plaintiff’s right under Section 22(3).

In one of the famous cases of Bikanerwala v. New Bikanerwala (2005)[8] the Court held that using a similar deceptive name for selling the product is an Infringement of the right of the plaintiff. The defendant named the shop ‘Agarwal Bikanerwala’ and used to deal in sweets and snacks and on the other hand, the petitioner was using the word ‘Bikanerwala’ since 1981 and got registered in 1992. So, the Court restrained the defendant from selling, advertising any food material under the unique mark/name.

CHAMPAGNE VS. SPARKLING WINE[9]

The legal battles surrounding the term “Champagne” serve as a crucial example of the importance of GI protection in influencing consumer behavior. Champagne producers in France have successfully defended their right to use the name against producers of sparkling wine from other regions. This legal protection reinforces consumer perceptions of authenticity and quality associated with Champagne, leading to increased demand and a willingness to pay higher prices compared to non-GI sparkling wines. This case illustrates how strong GI protections can enhance brand value and consumer loyalty.

BASMATI RICE DISPUTE[10]

The ongoing dispute over Basmati rice between India and Pakistan highlights the complexities surrounding GI registration and consumer behavior. Both countries claim Basmati as a traditional product linked to their respective regions. The lack of a unified GI status has led to confusion among consumers regarding authenticity, impacting their purchasing decisions. Research indicates that consumers often seek assurance about the origin and quality of Basmati rice, which can influence their willingness to buy one product over another based on perceived authenticity.

BANARASI SAREES AND PASHMINA SHAWLS[11]

Despite being registered as GIs, Banarasi sarees and Pashmina shawls face challenges related to quality control and market perception. These products have been affected by issues such as counterfeit goods and lack of strict enforcement of GI protections, leading to diminished consumer trust. Studies show that consumers are increasingly wary about purchasing these items unless they can verify their authenticity, indicating that effective enforcement of GI status is crucial for maintaining consumer confidence and buying behavior. 

CONCLUSION

The impact of buying behaviour on GI products is multifaceted, influenced by factors such as consumer awareness, quality perception, emotional connections, economic benefits, market challenges, sustainability concerns, and technological advancements. To maximize the potential of GI products in the marketplace, stakeholders must focus on enhancing consumer education, improving marketing strategies, ensuring robust legal protections against counterfeiting, and promoting sustainable practices among producers.

GI laws are new to India and need a strict interpretation to provide full protection against infringement. The place of origin or manufacturing of any product is given due importance under GI because such a place is exceptionally distinguished because of its climate, location, etc. Before registering a GI all the criteria should be kept in mind for its eligibility. From the commercial point of view, every entrepreneur wants to earn more and more profit by selling the products which consumers demand and every customer wants standard quality original product but sellers fraudulently sell imitated goods for the sake of profit. Every country has a different variety of goods which are an outstanding blend of its rich culture, climatic conditions and India being a diverse country in every term has a different state which is rich in their respective culture so it should be kept in mind those products representing the heart of place should be preserved and provided full protection from any kind of infringement.

REFERENCES

  • Department of Food Science, University of Arkansas, Fayetteville, AR 72704, USA; [email protected] (S.E.J.A.); [email protected] (V.H.)
  • Division of Agriculture Rice Research and Extension Center, University of Arkansas Systems, Stuttgart, AR 72160, USA; [email protected] (D.A.W.); [email protected] (K.A.K.M.)
  • https://www.wto.org/english/docs_e/legal_e/27-trips_04b_e.htm#top
  • https://www.wto.org/english/docs_e/legal_e/27-trips_04b_e.htm#top
  • Vol. 7 (2024): 6th International Symposium on Economic Development and Management Innovation (EDMI 2024)
  • Giovanni Belletti, Andrea Marescotti (University of Florence, Italy) Marguerite Paus, Sophie Reviron (AGRIDEA)
  • Angela Deppeler, Hansueli Stamm, Erik Thévenod-Mottet (IPI)

[1]Vol. 7 (2024): 6th International Symposium on Economic Development and Management Innovation (EDMI 2024)

[2] Giovanni Belletti, Andrea Marescotti (University of Florence, Italy)

Marguerite Paus, Sophie Reviron (AGRIDEA)

Angela Deppeler, Hansueli Stamm, Erik Thévenod-Mottet (IPI)

[3] https://www.wto.org/english/docs_e/legal_e/27-trips_04b_e.htm#top

[4] https://www.wto.org/english/docs_e/legal_e/27-trips_04b_e.htm#top

[5] Department of Food Science, University of Arkansas, Fayetteville, AR 72704, USA; [email protected] (S.E.J.A.); [email protected] (V.H.)

Division of Agriculture Rice Research and Extension Center, University of Arkansas Systems, Stuttgart, AR 72160, USA; [email protected] (D.A.W.); [email protected] (K.A.K.M.)

[6] SCC Online Tea Board of India v. ITC Ltd., C.S. No. 250 of 2010, Calcutta High Court (para – 26,27)

[7] 2017 SCC Del 10704.

[8] SCC Online 2005 (30) PTC 113 (Del).

[9] 2017 SCC Del 10704.

[10] Trading Corporation of Pakistan Pvt. Ltd. v. Union of India, 2023 SCC OnLine Del 7562

[11] Banaras Brocades and Sarees, GI Registration No. 99, Application Date: July 2007, Registered on 04/09/2009

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