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Millennials and the
European craft beer
market.
MASTER THESIS WITHIN: Business Administration
NUMBER OF CREDITS: 15 credits
PROGRAMME OF STUDY: International Marketing
AUTHOR: Nascimben, Sara (920827-T388); Pelegrina, Jimena (860729-T484)
TUTOR: Pantelic, Darko
JÖNKÖPING May, 2016
An exploratory study with an emphasis on the
role of labels.
Acknowledgements
We would like to express our gratitude to all those who, in one way or another, contributed to the
realisation of this thesis.
Particularly, we would like to express our appreciation to our tutor Darko Pantelic for his support,
critical feedback and overall guidance during the process.
Further, we would like to thank our fellow students, especially Fernando Perera, Niels Den Broeder and
Dionne Boerwinkel for their active participation during the feedback seminars and for helping us to
continually advance in our thesis project.
Finally, we would like to express our gratitude to our families and friends for their unconditional
support.
Sara Nascimben Jimena Pelegrina
Jönköping, May 2016
Master’s Thesis in International Marketing
Title: Millennials and the European craft beer market: An exploratory study with an
emphasis on the role of labels.
Authors: Sara Nascimben
Jimena Pelegrina
Tutor: Darko Pantelic
Date: 2016-05-23
Subject Terms: Consumer Perception, Extrinsic cues, Craft beer Labels, Millennials
Abstract
Background
In Europe, the craft beer industry represents nowadays one of the faster growing segments of the
beverage industry (Daneshkhu, 2014). The term ―Craft brewing‖ is used to identify traditional beer
production, independent and small sized breweries (not exceeding 6 million barrels of production
per year) (Warner & Erie, 2010). The increased number of craft breweries is linked to the new
market trend characterized by differentiation of beer flavours. A specific cohort seems to be driving
the craft beer popularity: Millennials, also known as generation Y. (The Brewers of Europe, 2013,
p.27). Despite this increasing popularity, the research within the field of craft beer from a
consumers’ perspective remains limited.
Purpose
The aim of this research is to gain deeper understanding regarding Millennials’ overall perceptions,
attitudes and purchase intent towards craft beers –placing the emphasis on the role that craft beer
labels have in this process- and to possibly identify different segments inside Millennials craft beer
consumers.
Method
To fulfil the purpose of this thesis both qualitative and quantitative methods were applied.
Interviews using the card sorting technique were conducted in order to further understand the
different craft beer label conventions present in the market. In addition, an online questionnaire -
where participants were exposed to three different craft beer labels- was used to explore
Millennials’ perceived importance of craft beer label cues and to assess the effect that different
brand name conventions and label designs have on this cohort’ attitudes and purchase intent.
Main Findings
Provocative labels are generally perceived as distinctive and unique and obtained higher attitudinal
scores among Millennials. Conversely, traditional label -characterized by familiar and ―old style‖
designs- seemed to evoke less favourable attitudes among this cohort. Further, the finding suggests
that consistency between brand name and label design convention does not necessarily lead to more
favourable attitudes towards craft beers. Moreover, gender, level of knowledge and consumption
frequency has an impact in the importance devoted to specific label cues. Lastly, within our sample,
three segments of craft beer consumers within the Millennials’ cohort were detected by applying
clustering techniques (―Brand switchers‖, ―Technical drinkers‖ and ―Information seekers‖).
i
Table of Contents
I. Introduction ..............................................................................................................................................1
I.1. Background......................................................................................................................................1
I.2. Problem discussion.........................................................................................................................2
I.3. Research Purpose............................................................................................................................3
I.4. Delimitations....................................................................................................................................3
I.5. Definitions........................................................................................................................................4
I.6. Structure ...........................................................................................................................................4
II. Theoretical Background..........................................................................................................................6
II.1. Craft beer industry ..........................................................................................................................6
II.2. A recent European trend driven by Millennials.........................................................................7
II.3. Craft beer: labels and trends..........................................................................................................8
II.4. The role of perception....................................................................................................................9
II.4.1. Categorical visual codes and perceived typicality............................................................10
II.5. The importance of label...............................................................................................................12
II.5.1. Label perception and Brand image ...................................................................................13
II.5.2. Visual characteristics of label design.................................................................................14
II.5.3. Label as an extrinsic cue......................................................................................................15
II.5.4. Information in the label......................................................................................................16
II.6. Retailers...........................................................................................................................................16
II.7. Theoretical overview ....................................................................................................................17
III. Methodology...........................................................................................................................................20
III.1. Research Philosophy: Critical Realism.......................................................................................20
III.2. Research Approach: Inductive....................................................................................................21
III.3. Research Design............................................................................................................................21
III.3.1. Research Purpose & Overall Design ................................................................................21
III.4. Data Collection..............................................................................................................................22
III.5. Research strategies ........................................................................................................................22
III.5.1. Pilot Study: Interviews using the card sorting technique...............................................22
III.5.2. Main Study: Online Survey.................................................................................................23
III.6. Population & Sampling................................................................................................................26
III.7. Data Cleaning ................................................................................................................................26
III.8. Ethical Considerations .................................................................................................................26
IV. Empirical Findings.................................................................................................................................27
IV.1. Pilot Study ......................................................................................................................................27
IV.1.1. Sample Labels.......................................................................................................................27
IV.1.2. Definition of the Traditional, Contemporary and Provocative conventions.............28
IV.1.3. Contribution of the Pilot Study.........................................................................................29
IV.2. Main Study......................................................................................................................................30
IV.2.1. Response rate........................................................................................................................30
IV.2.2. Demographics.......................................................................................................................30
IV.2.3. Mean Scores: Attitudes and Purchase Intent towards different craft beer label
configurations and brand name and design style conventions ...........................................................32
IV.2.4. Craft Beer Label Conventions: Analysis of Variance.....................................................33
IV.2.5. Perceived Importance of Cues and Craft Beer consumers Profile..............................37
V. Interpretation..........................................................................................................................................41
V.1. Attitudes and Purchase Intent towards craft beers from a label design perspective..........41
V.2. Differences in consumption habits according to gender, consumption frequencies, and
craft beer knowledge ..................................................................................................................................43
ii
V.3. Craft beer consumer segments inside Millennials’ cohort......................................................45
VI. Conclusion and Managerial implications............................................................................................47
VI.1. Contribution...................................................................................................................................48
VI.2. Limitations......................................................................................................................................49
VI.3. Future Research.............................................................................................................................49
Appendix A. .....................................................................................................................................................57
Appendix B.......................................................................................................................................................60
Appendix C.......................................................................................................................................................61
Appendix D......................................................................................................................................................62
Appendix E. .....................................................................................................................................................82
Figures
Fig. 1-Structure ..................................................................................................................................................5
Fig. 2-Process of perceptual selectivity. Source: Hanna & Wozniak (2000)............................................9
Fig. 3-Bottom- up and Top-down processing. Source: Hanna & Wozniak (2000)..............................10
Fig. 4-Brewery-consumer chain ....................................................................................................................17
Fig. 5-Main Study: Age and Gender.............................................................................................................30
Fig. 6-Main Study: Nationality.......................................................................................................................31
Fig. 7-Main Study: Education........................................................................................................................31
Tables
Table 1-Theoretical overview. Source: Own...............................................................................................18
Table 2-Main Study: Brand name convention and design style treatment per group ..........................25
Table 3-Main Study. Reliability......................................................................................................................25
Table 4-Pilot Study: Participants overview..................................................................................................27
Table 5-Pilot Study: Frequencies and scores per Label.............................................................................28
Table 6-Pilot Study: Characteristic per label convention. Source: Own.................................................29
Table 7-Main Study: Perceived characteristics............................................................................................32
Table 8-Main Study: Overall Attitude and Purchase Intent Mean Scores and Standard Deviations.32
Table 9-Main Study: Normality Test and Levene’s Test results for attitudinal variables ....................34
Table 10-Main Study: ANOVA results for attitudinal variables..............................................................35
Table 11-Main Study: Normality Test and Levene’s Test results for Purchase Intent variables........35
Table 12- Main Study: ANOVA results for purchase intent variables ...................................................36
Table 13- Main Study: Craft beer consumption .........................................................................................37
Table 14- Main Study: Cross-tabulation gender- importance of cues.....................................................38
Table 15-Main Study: Clusters.......................................................................................................................40
1
I. Introduction
This introductory section provides a general overview of the research subject. First, a brief background and
the main reasons why this research is significant are specified. Thereafter, the purpose and the adopted
perspective for the present thesis, together with the research questions are outlined. Lastly, relevant
definitions and delimitations of the study are provided.
I.1. Background
Craft beers have been introduced in the 1970s in the US where nowadays they represent a
successful and growing market. In fact, consumption has increased by 11 percent during 2014 and
together with it the number of microbreweries and brewpubs (Davis, 2015). In Europe, craft beer
industry has been more recently introduced and it currently represents one of the faster growing
segments of the beverage industry (Daneshkhu, 2014).
On the overall European beer market has been on a slightly decreasing trend over the period 2009-
2014. Despite the downward tendency, the number of active breweries has exponentially increased
over the same period starting in 2009 with 3781 active breweries and reaching 7,091 in 2014 (The
Brewers of Europe, 2015). Of these, almost 100% of the new breweries are craft beer producers
whose presence on the market has more than doubled over the same period. It is also worth
noticing how the positive trend of craft breweries is not confined only to traditional beer drinking
countries such as Great Britain and Germany, but also to traditional wine drinking ones such as
France, Italy and Spain (The Brewers of Europe, 2015).
Craft brewing is a general term used to identify traditional beer production, independent and small
sized breweries (not exceeding 6 million barrels of production per year) (Warner & Erie, 2010).
Craft beer is characterized by unusual flavours and it is the result of an equilibrate mix of tradition
and innovation, where traditional and non- traditional ingredients are mixed to produce peculiar
tastes (Nielsen New Release, 2007). The term microbrewery, often used as a synonym for craft
beer, it basically refers to the production threshold defining breweries producing less than 15,000
barrels per year, sharing the same characteristics as craft breweries but in a smaller scale.
The increased number of craft breweries responds to a market demand that has seen a renewed
interest for differentiation of beer styles. Despite being a general trend, a specific cohort has shown
to drive craft beer popularity: Millennials, also known as Generation Y. (Bryant, 2015; The Brewers
of Europe, 2013a). Among Millennials -those born in the early 1980s until the early 2000s- beer is
the favourite alcoholic beverage (Nielsen New Release, 2007). As beer market has evolved it seems
that this cohort has also shifted its focus to flavours, characteristics and production processes. The
main reason seems to reside on tiredness from the usual tastes offered by mass-produced beers
turning Millennials attention to new flavours and new brewery brands (Davis, 2015; Duva, 2014).
Besides their reduced budget, there is evidence that Millennials’ are willing to spend more for a
quality craft beer instead of two blend beers (Gosselin, 2010; Nielsen New Release, 2007). Beer is
thus starting to be perceived as more than a simple social drink, reflecting attitudes of a generation
that bases its preferences on a higher level of information (Brager, 2014; Brown, 2015). Perceived
value becomes a key driver for this cohort who is willing to spend money if the product is worth it
(Gosselin, 2010).
2
The lack of known brands in the craft beer industry suggests that consumers are particularly guided
by the appeal and information provided by the label in their purchase decision (Brown, 2015).
Moreover, consumers often infer specific attributes related to the product by perceiving specific
label characteristics (Sherman & Tuten, 2011). Research highlights how labels such as ―handmade‖,
―craft‖ and ―small batch‖ are generally considered as indicators of higher quality (Birth, 2015;
Gosselin, 2010). Besides new tastes, eye- catching labels and bottle designs are thus playing an
important role on the popularity of craft beers; thus craft brewers are putting efforts in creating
peculiar label designs and get consumers to try (Barnett, 2012; Brewers Association, 2016b). The
importance of label design is even more relevant considering that Millennials tend to consume most
of their drinks at home directing customers consumption choice to the shelves rather than bars and
restaurants (Brown, 2015; The Brewers of Europe, 2013a). This fact highlights the important role
that stores play in the decision making of Millennials, enhancing the importance of being noticeable
in the shelves (Sandwith, 2015). Moreover, traditional advertising techniques seem to have reduced
their persuasive power effect towards Millennials who prefer to do their own online research and
rely on peers reviews (Gosselin, 2010; Page, 2015; Sandwith, 2015). As discovery and
recommendation have become the new key drivers for beer consumption choice, breweries’ scope
is to elicit passion on their consumers and to make them try the product (Chahal, 2015).
In conclusion, Millennials are ―thirsty for novelty‖ (Nielsen New Release, 2007, p.2), suggesting
that this cohort will have a great impact on the craft beer industry (Nielsen New Release, 2007).
I.2. Problem discussion
Craft beer increasing popularity seems to be affecting beer consumption trends (Aquilani et al.,
2015). As Lo Monaco & Guimelli (2008) stated, changes in consumption habits are often correlated
with changes in attitudes and perceptions towards a product. Accordingly, consumers’ motivations
behind craft beer consumption do differ from traditional beer drinkers. Three factors seem mainly
to motivate craft beer consumers: ―desire for more knowledge, new tasting experiences and to
move away from mainstream beer consumption‖ and paired craft beer consumption with a desire
for distinction and individuality (Gómez-Corona et al., 2016, p.358).
As previously discussed, the emerging craft beer industry is one of the growing segments of the
European beverage industry (AssoBirra, 2012, 2013). Its success has been attributed to different
factors such as hyper-differentiation strategies (i.e. product variety) along with high resonance
effects (Clemons et al., 2006), high levels of availability in the market, beer quality perception and
competitive pricing (Kleban & Nickerson, 2012). Yet, the research within the field of craft beer
from a consumers’ perspective is not vast.
The literature in the field is insufficient specially when considering the European craft beer market.
The only study we acknowledge related to the topic is the one carried out by Aquilani et al.(2015)
that compares the motivations behind craft beer and industrial beer consumption with respect to
Italian Millennials. However, no studies regarding the impact of craft beer labels on consumers’
preferences have been carried out in Europe even though Millennials’ are considered as the type of
consumers that ―shop with their eyes‖ (Barber et al., 2006, p.85). In this respect, Gómez-Corona et
al. (2016) while investigating craft beer consumption habits and attitudes in the Mexican market
found out that extrinsic attributes (e.g. packaging and labels) can influence the craft experience
positively when they are perceived as unique and authentic by consumers, independently of their
gender.
3
That being said, the topic is worth studying and particularly in this field where craft brewers are
being forced to adopt alternative communication channels (Clemons et al., 2006) since Millennials
seem to be less influenced by advertisement and more by inspirational motives (Sandwith, 2015).
I.3. Research Purpose
The aim of this thesis is to investigate Millennials’ overall perceptions, attitudes and purchase intent
towards craft beers -with a particular emphasis on the role that craft beer labels play in this process-
and to try to identify potential segments within this cohort.
To achieve the first objective, the research will place its focus on the different craft beer label
conventions detected in the market. Specifically, we will try to investigate how specific craft beer
label styles -traditional, contemporary and provocative- affect Millennials’ perception of craft beer
characteristics. In addition to this, we will analyze if the consistency between brand name and design
style positively strengthens the aforementioned effects. Further, in our attempt to identify specific
segments inside this marketing cohort, different dimensions such as Millennials’ use of
informational sources during and prior purchase and the importance assigned to specific label cues
will be investigated. By relying on these dimensions we aim to identify different cluster (subgroups)
within the cohort.
Ultimately, with the information gathered we intend to (1) develop a series of normative guidelines
for craft brewers and (2) to shed light in the under-researched field of craft beer.
To fulfil all these purposes the following research questions will be addressed:
Research Question 1: How are specific label design conventions affecting consumers’ attitude
and purchase intent towards craft beer?
Research Question 2: Are there any differences in consumption habits according to gender,
consumption frequencies, and craft beer knowledge?
Research Question 3: Which specific craft beer consumers’ segments can be detected inside
the Millennials’ cohort?
It is worth mentioning that the thesis will consider the European craft beer market and will be
performed from a consumers-based perspective. Moreover, Millennials are considered as the most
appropriate target group for the study since, as previously mentioned, this cohort is nowadays
considered to be the one leading the shift from mass-beer to craft beer consumption (Bryant, 2015)
I.4. Delimitations
The exploratory nature of the research will allow providing valuable insights to the under-
researched field. We acknowledge that the aforementioned research purposes can be achieved
although limitation related to sample and criteria could arise. Limitations related to the study will be
further discussed in Section VI.1 where specific directives will be provided for further research.
4
I.5. Definitions
Brewpub: a restaurant –brewery where beer is produced primarily for restaurant and bar sale, at
least 25 percent of the beer must be sold on site (Brewers Association, 2016a).
Craft brewery: definitions are not always consistent, according to the Brewers Association it has
been defined as small, independent and traditional. ―Small” used to refer to the annual production
threshold of 6 million barrels or less per year. ―Independently-owned‖ from commercial breweries
and employing ―traditional‖ ingredients fermentation methods with an emphasis on quality and
flavours (Brewers Association, 2016b). Garrett Oliver, Brooklin Brewery brew master defined craft
beer as ―beer brewed by traditional means with the goal of creating full, complex flavours‖ (Eating
isn’t cheating, 2012). Craft beers compete with mass-produced beers in terms of quality and
diversity instead of advertising (Brewers Association, 2016b).
Microbrewery: ―Independent beer-brewing operations whose threshold of production is less than
15,000 barrels a year‖ (The Food Section, 2010). The term spread in the US in the 1980s where the
trend started and it indicates breweries producing fewer than 15,000 beer barrels. Reflection of a
flexible and experimental attitude in the brewing process (Brewers Association, 2016a).
Perceived quality: is used to stress the fact that “quality judgments are dependent on the perceptions, needs
and goals of the consumers [and refers to] the extent to which the product is perceived to be fit to provide a desired
consumption experience” (Steenkamp, 1990)
Extrinsic cues: they refer to product external attributes and information that are related to the
product but they are not part of it (Steenkamp, 1990).
Brand name convention: it refers to the often used styles for titling or naming a brand. In the
context of this thesis we refer to three of these conventions that are popular within the craft beer
market: traditional names, contemporary names and provocative names.
Label design convention: refers to the often used styles or genres in label design. In the context
of this thesis we refer to three of these conventions that are popular in the craft beer market:
traditional designs, contemporary designs and provocative designs.
Label configuration: within the context of this thesis, craft beer labels are decomposed in two
dimensions: the brand name they portray and the visual codes they use encompassed in what we
define as label design. Thus, label configuration refers to a label that presents a particular
combination in terms of brand name convention and design convention (e.g. a label with a traditional
brand name and a provocative design).
I.6. Structure
Fig. 1, illustrates the structure of the research. An introductory part highlights the importance of
conducting the study, introducing the reader to the topic together with motivating the aim of the
research and the specific research questions. The theoretical framework will provide a summary of
theories related to the topic that will contribute to a deeper understanding of the research field and
provide evidence for the research questions. The methodology section will deal with the description
of the nature of the research and the research methods used to collect the data. In the specific case
5
a mix of qualitative (interviews) and quantitative research (online survey) will be used highlighting
specific strengths of each methodology for the purpose of the study. In the empirical findings
section, data collected from both the pilot study and online questionnaire will be analyzed and
merely presented in providing answer to the research questions. In the conclusive and discussion
parts, interpretation of obtained data will be provided together with managerial implications for
craft brewers as main aim of the research. Limitations related to the study and suggestions for
further research will also be provided in the conclusive section.
Fig. 1-Structure
Introduction
Theoretical
framework
Methodology
Data Analysis
Conclusions
Discussions
6
II. Theoretical Background
II.1. Craft beer industry
Craft beer industry originated in the US, where the industry had been growing all through the 1980s
with the number of craft breweries increasing exponentially by the late 1980s and early 1990s
(Swaminathan, 1998; Warner, 2010). Different factors contributed to the success of the craft beer
industry; among them the period saw the emergence of a more educated class that sought for
alternative tastes and aromas that mass produced beers couldn’t offer (Warner, 2010). This resulted
in a spread consumption style focused on ―craftsman like, honest, authentic‖ (Brooks, 2010, p.83)
characteristics thus enhancing the success of craft beer industry during 1980s and 1990s.
Craft beer movement has crossed the Ocean taking a renewal to an industry that saw a period of
stagnation during the last decades and it is turning into a European trend. In fact, despite the
overall European beer market has suffered a decreasing trend across 2009-2014; the number of
active breweries in Europe has more than doubled over the same period. This increase is mainly
represented by the number craft breweries which in 2009 accounted for 2,373 and by 2014 reached
5,964 (The Brewers of Europe, 2015).
Craft beer can be defined as an equilibrate mix of tradition and innovation in which traditional
production styles stir with employment of non-traditional ingredients creating unusual aromas and
flavours (Brewers Association, 2016b). Craft breweries are characterized by smaller production size
(less than 6 million barrels per year) and what mainly discriminates them from commercial beers it
is the peculiarity of tastes and quality of the product (Brewers Association, 2016a; Kleban &
Nickerson, 2012). According to recent studies, craft beer consumption is primarily driven by the
different flavours it offers (honey, chestnut flavours and others) and what motivates beer drinkers
to consume it is the desire of trying new tastes than break with the common industrial ones
(Aquilani et al., 2015; Gómez-Corona et al., 2016). This is in line with what is referred as the ―taste
revolution’’ (Kleban & Nickerson, 2012). Moreover, mainly related to the raw materials used in the
production process, craft beers are generally perceived as of higher quality compared to mass
produced beers (Aquilani et al., 2015). This is reflected in an increased economic value perceived by
customers which allows brewers to charge higher prices for their products (Kleban & Nickerson,
2012).
Together with taste, there is a general increasing interest in acquiring a deeper level of knowledge
while experiencing new flavours and brew styles (Gómez-Corona et al., 2016). The scope of craft
brewers is thus to elicit passion on their customers through their products; this passion is
something craft breweries also have due to the smaller size of the company and become the
distinctive identity of the beer (Chahal, 2015). In this respect, besides peculiar flavours of craft
beers as drivers of industry sales, there is evidence that eye- catching labels and bottle designs are
playing an important role on the popularity of craft beers (Barnett, 2012). According to surveys by
IBIS world, craft beer drinker tend to consume most of their drinking at home thus suggesting that
a big share of purchase decision happens in the stores (Brown, 2015). This enhances the
importance of retailers where most of the decision making and inspiration for consumers takes
place, and the importance of being noticeable for the craft producer (Sandwith, 2015).
In general, craft beer consumers are eager to discover new flavours and brands; while for
commercial beers well known brands are available on the shelves for craft beers this is less the case.
7
This enhances the role of the label as main communication channel between consumers and
product, and it also implies a different amount of time spent looking at the labels. In fact, according
to statistics craft beer drinkers spend between four and four and a half minute compared to the half
minute spent for choosing an industrial beer (Brown, 2015).
Industrial breweries are responding to the craft brewery revolution by introducing in their offer
particularly flavoured beers. For instance, Anheuser- Busch American beer company launched the
Schoc Top and MillerCoors brewed with the same idea Blue Moon (Morris, 2014).
Although craft beer is a widespread growing trend in Europe, a specific cohort seems to be
particularly driving it: Millennials.
II.2. A recent European trend driven by Millennials
Millennials, also known as Generation Y, are identified with those born in the early 1980s until the
early 2000s and they represent 24% of the adult European population (Bryant, 2015; Stokes, 2015).
According to Nielsen Report (2007), beer is still considered as the favourite alcoholic beverage
among Millennials and the decreasing mass-produced beers trend in favour of craft beers seem to
have been leaded by them (Nielsen New Release, 2007). Craft beer is more complex and to a
certain extent more expensive compared to commercial beer and this may result less appealing to
this younger cohort. However, statistics give a different picture. In fact, the main reason of craft
beer popularity among this cohort seems to reside on ―tiredness‖ from usual beer tastes. As beer
market evolved, Millennials have also shifted their focus to flavour, characteristics and production
process suggesting that beer is more than something to drink. The same Nielsen report highlights
that Millennials consumers frequently ―seek new tastes and are willing to pay a premium for
alcoholic beverages‖ (Nielsen New Release, 2007, p.1). Thus, besides their reduced budget, there is
evidence that Millennials are willing to spend more for a quality craft beer instead of two blend
beers; what matters is that the decision must worth their money (Gosselin, 2010).
Moreover, according to Joe Thompson, president of the Independent Beverage Group, Generation
Y seems not to be as loyal as their parents were; rather than have a preferred beer they are more
likely to try new beers and brands (Bryant, 2015; Duva, 2014). This represents an important
possibility for craft brewers not facing the brand loyal customers that are frequently present in
more mature markets; at the same time it poses and important challenge in understanding how to
attract this specific cohort (Davis, 2015).
As suggested by the literature, label and identification with a certain brand image are the main tools
in the hands of craft brewers. Labels such as ―handmade‖, ―craft‖ and ―limited edition‖ are
generally perceived as indicators of higher quality by Millennials much more than their older
counterparts (Birth, 2015). Moreover, variety seems to pay off when dealing with craft beers,
limited-edition and seasonal beers also seem to attract Millennials, since they are perceived as
―special‖ (Gosselin, 2010).
Sources of information also differ compared to previous generations; Internet gave access to a huge
amount of information, comments, and opinions regarding the available offers. Millennials rather
prefer to do research in online blogs and social network pages such as Brew beer blog
(http://www.brewbeerblog.com/) where beer reviews together with craft beer events are available.
8
Recommendations from peers and family have also an important impact on Millennials’
consumption choice. Differently traditional advertising has shown to have reduced persuasive
effect over this marketing cohort (Gosselin, 2010; Page, 2015).
Lastly, as by definition of a trend, the craft movement is ―cool‖ and this definitely has an impact on
the overall image of the industry and the increase of its popularity especially among younger
generations (Bryant, 2015).
II.3. Craft beer: labels and trends
As previously mentioned, what makes particularly attractive craft beers to Millennials is certainly the
wide variety of tastes, although displaying a peculiar identity and characteristics seems to be more
important than ever in this industry (Label & litho, 2015). In this respect, labels play a pivotal role
in conveying specific characteristics related to the product.
Craft beer labels are present in a variety of styles, cut and stack labels made of different materials
and shapes (Crowell, 2013). The material used for the labels cover a wide variety with matt, glossy,
shiny colours and combination of them always in the pursuit of new eclectic arrangements to
distinguish themselves and standing out from the crowd (Gómez-Corona et al., 2016). Although
the design of the craft beer label should be peculiar and displaying the identity of the brand,
different trends can be detected in the industry. According to Jack Wright, president of Atlas labels
and Packaging, matt labels seem to be increasing over glossy ones (Crowell, 2013). Different studies
suggest how the material used in the label can boost customers’ attraction and consequently
enhance purchase intent (Avery Denninson, 2016; Connoly, 2015). In particular, a study run by
Package Insight, a university start-up based in Clemson, found that metallic label where higher
catching compared to paper, wooden and glossy ones. Another important consideration drawn
from the same study is that the level of attraction and the time spent in watching it (fixation time)
were good predictors of consumers’ purchase intent (Package Insight, 2016).
Besides the different attractive power, another important component of labels is the perception
related to different material combinations; for instance, metalized labels are considered as more
expensive while paper labels as cheaper (Connoly, 2015).
More and more craft brewers are displaying unconventional and provocative labels in terms of
graphic and language choice in an attempt to stand out from the crowd (Label & litho, 2015). Brew
Dog, the Scottish craft brewery and certainly one of the most well-known UK craft breweries, is
particularly known for its provocative labels and packaging. The ―Never-mind the Anabolics‖
campaign during the Olympic Games in London in 2012 has stated the success of the brewery.
Nonetheless, craft beers’ individualism does not always compel to outrageous labels and messages.
Simple and more traditional labels also stand out such as ―The Kernel‖ using simple materials that
reminds to tradition (Barnett, 2012). This supports the idea that standing out from the crowd can
be achieved through minimal design as through more elaborate ones.
Eventually, craft brewers interest should focus on how specific labels characteristics are perceived
by this target group and which image they convey related to the brand and, more important, to the
inner product.
9
II.4. The role of perception
Following out interest in beer labels design it is pivotal for our research to cover main concepts
necessary for understanding how consumers process label information. We are thus following
address the role of perceptual process and its implications.
Perception has been defined as ―the process of selecting, organizing, and interpreting sensations
into a meaningful whole‖ (Hanna & Wozniak, 2000, p.75). In other words, perception deals with
how inputs coming from the five senses are processed to understand the surrounding world
(Solomon et al., 2012). In the perceptual process, the consumer is exposed to an external stimulus
that arise his/her attention; the actual sensation happens when information is transferred from the
sense to the brain. Although all the five senses are involved in the perception process, visual sense
represents 80 % of what we perceive from the environment. Different combinations of colours,
shapes and sizes trigger different emotions and feelings (Hanna & Wozniak, 2000).
Of all the stimuli that surround the individual, only a share of them is perceived. In fact, the
―selective attention‖ principle is based on the idea that we are attracted by cues that trigger our
personal interest and beliefs and we thus devote our attention to. The process of perceptual
selectivity is displayed in (Fig. 2).
Fig. 2-Process of perceptual selectivity. Source: Hanna & Wozniak (2000)
Two different approaches have been highlighted from literature in which a person can derive
stimuli from: a bottom-up process and a top down process (see Fig. 3) (Hanna & Wozniak, 2000). In
―bottom-up‖ processing the result of the sum of stimuli is derived from physical characteristics of
the product (e.g. smell, colour); all together these stimuli evoke an image in the consumer’s mind.
―Top-down‖ processing is more dynamic since it involves consumers’ personal needs, beliefs and
values; in fact, consumer’s personal needs and expectations help in recognizing the stimulus based
on previous knowledge and thus give a meaning to the perception of the stimulus. In this case,
perception is not the mere result of physical stimuli coming from the product but it also involves a
higher level of individual’s measures.
The beliefs and experience that the consumer acquire are organized in schemata (e.g. product
category) that drive individual’s perceptual process and the interpretation of the information
coming from the new stimulus. Therefore, the interpretation of a new stimulus is subject to our
prior experience together with the expectations we have towards the specific product (―selective
interpretation‖). It is thus the combination of interpretation, expectations and intentions that allow
the consumer to derive the meaning from the product (Hanna & Wozniak, 2000). In this respect,
the similarity detected from the new stimuli may evoke associations to characteristics with which
the consumer is familiar with. An example could be to infer product quality related to the
perception of specific product cues (Blythe, 2008).
Moreover, perception coming from the outside world feeds consumers’ memory and increases
consumers’ knowledge. Consequently this stored perception has an impact on consumers’ attitude
Environmental
stimuli Selective exposure Selective attention Perception
10
and purchase intention (Solomon et al., 2012). It follows that basing perception of the mere five
senses action could hold to misleading results. In fact, despite the five senses play the main role in
the perceptual process, perception is also highly subjective and the interpretation differs from
person to person.
Common characteristics shared by consumers such as age, lifestyles, mental settings evoke
differences in the perception. On the other hand, despite the subjective nature of perception,
specific targets and age cohorts sharing common interests and characteristics suggest a similarity
among perception (Lorenzi-Cioldi, 2008). This supports the choice of selecting as target of our
research a market cohort (Millennials).
Perception is the starting point for consumers to build up their knowledge regarding different
products, brand, influencing beliefs and attitudes towards them and thus their purchase behaviour
(Blythe, 2013). It becomes essential to understand which stimuli most trigger consumers’ attention
and how their personal beliefs and needs impact the perception and interpretation of the product.
In this perspective, introducing similar characteristics of other products with which the consumer is
familiar with in terms of design, material used, colours may arise specific inferences (e.g. product
quality) related to the selected product cues (Bloch, 1995).
The concept of visual codes and perceived typicality, following addressed, will help in gain a better
understanding on how specific product category characteristics can affect consumers’ perception of
the product.
II.4.1. Categorical visual codes and perceived typicality
In the previous section we highlighted the importance of schemata in the perceptual process. As a
collection of beliefs and experience related to specific product category, they drive the perception
of displayed product characteristics. Related to this point are the concepts of categorical visual
codes and perceived typicality of a product that we are following going to discuss.
According to Orth and Malkewitz (2008), the overall perception of a product comes from a
―gestalt‖ (Orth & Malkewitz, 2008, p. 64) of different elements working together. Viewers perceive
Bottom- up
processing:
using beliefs and
expectations to
interpret sensory
information
Top- down
processing:
sensory information are
assembled and
integrated
Fig. 3-Bottom- up and Top-down processing. Source: Hanna & Wozniak (2000)
11
the basic elements constituting the product (e.g. colours, images) and cognitively collect them in a
more complex component eliciting different responses from the consumers (Bloch, 1995). Each
element constituting a specific product category has been identified as ―visual code‖.
Celhay et al. (2015), investigated the concept of visual codes for specific product categories.
Previous research focused on categorical visual codes only taking into consideration colours as a
cue (Celhay et al., 2015). However, several studies suggested the existence of other cues in which
visual codes should rely on to identify specific product categories. Illustration, layout (McNeal & Ji,
2003) and typography (Orth & Malkewitz, 2008) are other common characteristics that help in
visually identify a specific category. Categorical visual codes should thus be related as ―the packages
visual characteristics that are the most frequent within a product category‖ (Celhay et al., 2015).
Related to visual codes is the concept of typicality. Typicality has been defined as ―the degree to
which an item is perceived to represent a category‖(Loken & Ward, 1990, p.112). The more the
similarity of attributes with other category product the more the product will be considered as
typical of that category (Loken & Ward, 1990). The same authors support that typicality is particular
important in order to evaluate the extent to which products are remembered and compared
between one another and eventually selected for the purchase. In fact, typicality of the brand or
product should affect the probability of being included in a specific category and being used as a
comparison measure. Another point highlighted by Loken and Ward (1987) is that consumers seek
for typicality in the attributes that are considered as more salient related to the uses of the specific
category. Thus, the product should posses those familiar characteristics that are relevant to the
function that the category covers (Loken & Ward, 1987). In this perspective the focus of typicality
should narrow down to those specific salient characteristics, relevant for the category (Loken &
Ward, 1990).
Similarly Rosch and Mervis (1975) introduced the concept of ―perceived typicality‖, representing a
―cognitive process involving an evaluation of the extent to which a given object represents a given
cognitive category‖ (Celhay et al., 2015). Thus, consumers store in their memories what they
recognize from external stimuli in form of cognitive categories then they rank according to the level
of ―perceived typicality‖, to the similarity of representing a category.
As suggested by the word ―code‖, visual codes imply a de-codification process, understanding the
meaning that consumers associate to them. From previous considerations, it follows that packaging
that display visual codes ―typical‖ of the specific product category will look more familiar to the
viewer (Celhay et al., 2015). On the other hand when a label discriminate itself from a typical
product category, the it will appear as a more ―novelty‖ design (Rosch & Mervis, 1975). Few studies
have reported that typicality is connected with the overall attitude of a product. It seems that the
more familiar and typical the product is, the more it is appreciated and the more positive is the
attitude towards it (Barsalou, 1983, 1985; Nedungadi & Hutchinson, 1985).
In conclusion, visual codes together with the perceived level of typicality have important
implications for the perception of the holistic design characteristics; providing useful insights in
how to manage the perception of brand personality (Rosch & Mervis, 1975).
In light of these conclusions, we consider important to investigate the validity of visual codes in the
perception of craft beer labels; specifically if more typical/ traditional designs are associated with a
more positive attitude and which idea they convey related to the product. These issues will be
addresses in our research questions.
12
II.5. The importance of label
In nowadays society, aesthetic has a main role in all kind of products whatever their function is
(Holbrook & Anand, 1992; Holbrook, 1980). In fact, when choosing in between two products with
similar functions and price, consumers will generally buy the one that is considered as more
attractive to them (Kotler & Alexander Rath, 1984).
A considerable amount of studies have recognized that labels are the first communication channel
between producers and consumers. Design and the information provided by the label are among
the most important cues customers use when deciding to purchase a bottle of wine (Chaney, 2000;
De Mello & Pires, 2009; Thomas & Pickering, 2003; Thomas, 2000). Moreover, labels have shown
to be the most important indicator of intention of wine purchase following price cue (De Mello &
Pires, 2009).
In a retail environment, customers get in contact with the packaged product (Underwood &
Ozanne, 1998). Given that the level of attention in the store is temporary, one of the main function
of the label is to attract the attention and arise interest in the viewer who needs to be continuously
stimulated (Bitgood, 2000). Appealing packaging and labels can make perceive the product as more
―interesting‖ and ―unique‖ (Gómez-Corona et al., 2016, p.362). Therefore, the design of the
product, referred as the ―silent salesman‖, becomes the main communicator of the characteristics
related to the product and the brand (Dichter, 1957).
Bitgood (2000), identified different steps in order for a label to be considered successful. Firstly, an
―attracting power‖ which will push the customer to stop and check the label; secondly, an ―holding
power‖ referring to the reading time devoted to the label; thirdly, a ―social interaction power‖
which relates to collateral behaviours and lastly a ―communication power‖ referring to the level of
knowledge acquired which should be reflected in a positive attitude to purchase (Bitgood, 2000).
Consumer’s motivation in reading labels may be increased by limiting the number of words used in
it thus reducing the perceived effort of reading (Screven, 1992). In particular, labels arising
questions have shown to be effective attracting customers’ attention (Hirschi & Screven, 1988).
Moreover, the presence of 3-D objects and the format of the label are other important factors in
eliciting consumers’ response to the label (Bitgood, 2000). Another important aspect refers to the
―cognitive emotional arousal‖ elicited by the label that triggers the customer to read it and think
about its meaning. As previously referenced, consumers tend to be more attracted by familiar
characteristics and cues of their interest and it is to them that they devote their attention to
(Bitgood, 2000; Hanna & Wozniak, 2000). Both men and women evaluate craft beer bottle
appearance although there is evidence that women give more attention to extrinsic cues compared
to their male counterparts (Gómez-Corona et al., 2016).
The label exerts more than a mere attraction power, it serves as a way to ―talk‖ to the customers
and it expresses the essence of the product and the brand in which the consumer can identify with
(Label & litho, 2015). It seems thus important to understand how specific characteristics of a label
are perceived by customers and how they reflect the image of the brand.
13
II.5.1. Label perception and Brand image
Highly related to the label perception is the image consumers have towards a specifics brand which
is identified as ―a person’s view of what a company, brand or store is‖(Hanna & Wozniak, 2000,
p.100). As these authors highlighted, perception and good communication of a brand image can be
even more important than the actual product features and price.
According to Kotler (1994), there are three levels in which a product can be defined: ―core
product‖, ―tangible product‖ and ― augmented product‖. Core product represents the actual response
of the product to consumer’s needs. In the case of beverages such as wine, the product does not
respond to a mere satisfaction of thirst; it rather possesses a specific taste and takes with it the
enjoyment of the experience and a certain degree of ―intellectual prestige‖ related to the specific
beverage (Jennings & Wood,1994). The same seems to hold in the case of craft beer. Tangible
characteristic presented by the product are those information provided by the label that describe
the product characteristics and usually give some advice on how to consume it. For instance the
wine determined by vintage year, country of origin, grapes. We can argue that in the case of the
beer this would be represented by flavour characteristics, alcohol % and brewing style.
The augmented product represents the product competitive advantage over its competitors. It involves
a specific brand image, which can be enhanced by awards given to the product, prestige,
recommendation and the retail experience (Kotler, 1994).
In branding it is essential to being able to convey the essence of the brand and the label is an
extremely important part of it. Design of products has the power to generate evaluation of the
product based on its characteristic (Aaker, 1997; Orth & Malkewitz, 2008). Colour, size, texture of
label and the message displayed play a main role in the perceived identity of the brand (Label &
litho, 2015). In fact, design judgment usually refers to impressions related to the quality of the
product reflected in the brand and on a broader perspective, brand’s personality (Orth &
Malkewitz, 2008).
Brand personality is generally defined as ―the set of human characteristics associated with a brand‖
(Aaker, 1997, p.347). While product related characteristics serve more of a utilitarian function,
brand personality respond to a ―self-expressive‖ function (Keller, 1993). Coca-Cola is often
associated with ―coolness‖ as personality trait and generally all brands are associated with specific
personalities (Aaker, 1997). Literature suggests that the higher is the consistency between consumer
characteristics and brand personality, the higher is the inclination towards that specific brand
(Malhotra, 1988; Sirgy, 1982).
As highlighted by Harckham (1989), package acts as conveyor of the initial idea the consumer
forms about brand quality. In fact, despite being a way of attracting attention, pictures in labels also
help in communicating the essence of the product (Underwood & Klein, 2002). Pictures can thus
be the main channel in conveying to the consumer specific product characteristics and thus
enhancing a positive attitude towards the product (Underwood & Klein, 2002). This is what is
referred as ―incidental learning‖ mainly important in low involvement purchase decisions where
low effort is employed in the selection process (MacInnis & Price, 1987).
As Mike Lane, Lofton Label CEO, points out craft beer producers should question the image of
their brand, their identity and what they want to convey to their customers (Crowell, 2013). Lane
also affirms that label is a source of information related to the brand and supports the idea that
consumers highly rely on colours and images used in the label in their purchase decision.
14
Particularly, different authors suggest that label cues are often seen by viewers as important to
detect quality and the personality of the brand (Boudreaux & Palmer, 2007; Gluckman, 1990;
Jennings & Wood, 1994).
Label appealing is not confined only to the craft beer sector. The wine industry is trying to
renovating and appeal to younger generations by using catching design (Ivinski, 2000).
Traditionally, in the wine industry traditional labels often display vineyards and soft colours and are
usually considered as a synonym of high quality. Shape and size of the label, the image depicted, the
colours used, the message and the location on the bottle are all scanned by customers. Darker
colours elicit quality association while more colourful labels are usual referred as less ―serious‖ and
are connected to more ―frivolous‖ tastes (Boudreaux & Palmer, 2007).
It thus becomes important to understand how customers’ perceive different label and design
characteristics connected to the core product (Jennings & Wood, 1994). Moreover, by
understanding customers’ perceptions, producers can detect which cues convey an idea of higher
value and possibly adjust prices (Roy, Walker, & Cross, 1987). This is particularly important in the
case of wines and beer since the real product cannot be tasted until the bottle is opened.
Walsh et al. (1988), suggested that a successful design "acquires and incorporates the necessary
knowledge of what customers want, what can be most efficiently produced and what best fits in
with the company's image" (Walsh, Roy, & Bruce, 1988, p. 213).
II.5.2. Visual characteristics of label design
As previously mentioned, consumers’ attention is usually attracted from external inputs that can
help them in categorizing the product. While categorizing them the consumer is creating an opinion
of the characteristics of the product. These puzzles of information are collected from different
elements belonging mainly to label design (Piqueras Fitzman et al., 2011). Different visual
characteristics cooperate on the overall perception conveyed by a certain label: composition and
layout, colours, illustrations and name/typography used (Ampuero & Vila, 2006) .
With respect to the composition and layout, there is evidence that the lines among which the label
is structured may convey different associations to the viewers (Ares et al., 2011). For instance,
central layout in a label is usually related to tradition relying on the classic idea of symmetry
(Hurlburt, 1977) while asymmetrical layout is more related to modern-contemporary designs
(Roberts & Thrift, 2002). According to a wine label study carried out by Celhay et al. (2015) ―A
study of the visual codes of Bordeaux Grands Crus‖, the central composition of the label conveyed the idea
of a traditional, prestigious and classical product.
Colour is another main player in the arousing of emotions characterizing the product. Usually,
yellowing white backgrounds are perceived as signifiers of the age of the brand, also connected to
tradition. As a warmer colour (yellow) moreover tend to convey an idea of rurality and ecological
reminding of recycled paper. On the contrary, whiteness is usually perceived as an indicator of
product quality (Celhay et al., 2015) and gold colour is usually connected to the idea of luxury
(Lawes, 2002). The perception of different combinations of colours is another interesting research
field to be investigated.
15
Image in a package can enhance the attention of the brand especially in the case of less known
brands. In this way the product can more easily enter consumers’ consideration set and thus
increase its likelihood of purchase (Day, 1985; Underwood et al., 2001). Pictures attract more
attention compared to verbal information and are usually easier to recall (Bolen, 1984). They can
also enhance sensory information processes suggesting a smell, taste and look of the inner product
(MacInnis & Price, 1987). Moreover, pictures deliver aesthetic pleasure and this may result in an
overall positive attitude towards the product (Underwood & Klein, 2002).
Name is another important cue in label design to attract consumers’ attention and trigger
consumers’ reaction. There are no boundaries to the names that can be suitable for craft beers
although some common trends can be detected. For instance the use of geographical location,
namesake (e.g. George’s and Sons), hyperboles and puns are frequently used in craft beer’s name
(Label & litho, 2015). The name is a clear way to trigger different emotions, for instance,
provocative and unusual names may elicit stronger reaction on the consumer. It can also be the
case that the sound of the name reminds of specific natural sounds, or others. The typography also
convey a certain feeling; uppercase letters are thought to give importance (Blanchard, 1980).
II.5.3. Label as an extrinsic cue
Label in itself is an extrinsic cue defined as ―an attribute that is product-related but not part of the
physical product‖ (Szybillo & Jacoby, 1974). Consumers often rely on extrinsic cues, considered as
indicators of product quality, to infer its inner characteristics (Richardson et al. , 1994). This in
particular happens when the brand is unfamiliar to the customer or when a high degree of
uncertainty in the purchase is involved. Especially, when the consumer cannot try the product
(Zeithaml, 1988).
Generally, the term extrinsic cues refer to all those characteristics that describe the product without
taking into consideration the inner product; examples of extrinsic cues are price, country of origin,
producer.
Labels’ extrinsic cues elicit expectations on the viewers and those expectations influence
consumers’ perceptions of the beer. Therefore, extrinsic cues originating expectations also impact
the product experience in itself (Siegrist & Cousin, 2009). The information provided play a decisive
role in the expectations’ source (Sester et al., 2013). As a non-homogeneous product, craft beer is
available in different types and qualities which can be considered to a certain extent as objective
characteristics. On the other hand there are other more subjective characteristics that define the
inner product and they are the reflection of perceived attributes related to label characteristics
(Nelson, 2005).
To conclude, it seems particularly important to investigate the perception of specific product
characteristics related to selected label cues. Different cues will be investigated in the research,
trying to understand if differences related to genders, level of knowledge have an impact on the
perception of label cues among European Millennials.
16
II.5.4. Information in the label
Labels make themselves shelf appealing through their colours, shapes, position in the product
together with the information provided (Jennings & Wood, 1994). Several studies confirm the role
of label as an important source of information and as part of purchasing decision (Chaney, 2000;
Jennings & Wood, 1994)
As for wines and other beverages, one problem that craft drinkers face is that the quality of the
beer cannot be assessed until the product has been consumed. The exact taste and colour of the
product is unknown to the consumer by just looking at the bottle (Barber et al., 2006; Lockshin &
Hall, 2003). This to a certain extent explains the need for product information and remarks the
importance of the description appearing on the label in order to better understand the inner liquid.
(Unwin, 1999). Usually front labels are devoted the role of eye catching and ―evocation‖ while back
label is widely used to present technical characteristics and information (Barber et al., 2006;
Charters, Lockshin, & Unwin, 1999). Millennials wine drinkers seem seek for meaningful
information in the label therefore it becomes important for producers to understand which kind of
information they look for during their purchasing decision. Differences arise between females and
males, where females seem to be more attracted by label colour, picture and front label
characteristics compared to their male counterparts. The type of information also may differ
considering gender difference, pairing with food seem to be of interest (Barber et al., 2006).
Referring to the knowledge and information seeking, a distinction should be made between
information sources ―prior‖ and ―during‖ purchase. As previously mentioned, besides information
provided by the label, Millennial generation seek for information on the internet, websites and
reviews, which are combined with their previous experience (Chaney, 2000). In-store information
has shown to have an important impact on impulse buying behaviour, especially in a retail setting
(Chaney, 2000). Another important source of information is provided by personal sources,
referring to friends, family and peers recommendation (Kiel & Layton, 1981; Urbany, Dickson, &
Wilkie, 1989). The store personnel also cover an important function in providing source of
information although the use of their knowledge is not yet clarified by literature (Edwards &
Spawton, 1990). It thus seems to be important to understand where Millennials do search for
information for their craft beer purchase decisions.
Together with the information provided by the label, retailers play a pivotal role in the perception
of the product on the shelves.
II.6. Retailers
In order to reach the consumers, craft brewers can go through three processes (see Fig. 4). They
can decide to direct their production to wholesalers consequently reaching the consumers through a
retailer; they can opt to be wholesalers themselves -cutting one of the steps of the discussed three
tier- systems-; or thirdly, they can opt to operate though a brewpub, where the beers is generally
sold as draft beer.
17
Another way in which craft brewers can reach their consumers is through online channels. In fact,
craft beer industry has grown in an era in which online shopping represents a huge possibility for
brewers. Websites such as http://www.beersofeurope.co.uk/ display European craft breweries with price,
characteristics and shipments information.
For the purpose of the study, we focused on a retail setting where craft brewers are presented by
displaying their products on the shelves. Retail stores thus represent the main distribution channel
for craft brewers. In this context, besides from products being displayed on the shelves,
information and suggestions related to the goods are generally provided by the store personnel.
Therefore, it seems more and more important to create ―shelves of the future‖, identified with craft
beers being paired with food and valuable information provided by in store directions together with
valuable personnel (Rutishauser, 2015).
II.7. Theoretical overview
Craft beer is an increasing trend in the European beverage industry and Millennials have shown to
be the main actors in driving its success (Nielsen New Release, 2007). Specific characteristics have
been detected related to craft beer consumption behaviour of this cohort. Millennials usually like to
try new tastes and use different sources of information in their purchasing decision such as online
blogs, websites and peer recommendations.
In a setting in which few popular brands are known, craft brewers have the opportunity to stand
out from the crowd and one way to do it is by providing appealing labels conveying a peculiar
brand image and by providing the right level of information to their consumers (Gómez-Corona et
al., 2016; Sherman & Tuten, 2011). In particular, specific label design conventions have been
detected in craft beer industry: traditional, artistic/contemporary and provocative labels; all in the
attempt of gathering consumers’ attention and conveying a certain product image.
In this process, perception is the starting point for consumers to build up their knowledge
regarding different products influencing their beliefs and purchase behaviour (Blythe, 2013). In fact,
the perception of specific characteristics is subject to our previous knowledge and the level of
perceived typicality of the design related to specific product categories. From the displayed
characteristics consumers infer specific attributes related to the product, for instance regarding its
quality, and build a certain image related to the brand (Loken & Ward, 1990). Despite the subjective
nature of perception, specific age cohort have shown to share common interests and characteristics,
thus providing support for Millennials selection as the target of our research (Lorenzi-Cioldi, 2008).
Fig. 4-Brewery-consumer chain
Brewery Wholesaler Retailer Consumer
Brewery as a
Wholesaler
Retailer Consumer
Brewery as a
Brewpub
Consumer
18
Due to the lack of literature related to the specific craft beer field, the presented theoretical
background find the ground for theories in the wine literature related to Millennials perception of
label cues (see Table 1). At the same time, it attempts to identify trends going on in the market and
to highlight important aspects to be investigated in our research.
Authors Concept/s Definition
Blythe, 2013; Hanna &
Wozniak, 2000; Solomon et
al., 2013
Perception, schemata (f.e.
product category), perceptual
process
Perception is the process of selecting, organizing and
interpreting sensations into a meaningful whole; beliefs
and experience that consumers acquire are organized in
schemata (f.e. product category) and they drive the
individual’s perceptual process
Blythe, 2013 Perception- brand beliefs
Perception is the starting point for consumers to build
up their knowledge regarding different products and
brands influencing their beliefs and purchase behaviour
Celhay et al., 2015 Categorical visual codes
Categorical visual codes are ―the packages visual
characteristics that are the most frequent within a
product category‖
Loken & Ward, 1990
Perceived typicality
Perceived typicality as the ―degree to which an item is
perceived to represent a category‖
Chaney, 2000; De Mello &
Pires, 2009; Thomas, 2000
Label design and information
Design and information provided by the label are
among the most important cue in wine purchasing
decision
(Gómez-Corona et al., 2016) Label characteristics
Characteristics related to the product can be inferred
from label design (interesting, unique)
Kotler, 1994
―Augmented product‖, brand
image
―Augmented product‖ involves brand image, prestige,
representing the competitive advantage over
competitors.
Orth & Malkewitz, 2008 Brand personality
Design judgement usually refers to impressions related
to the quality of the brand and on a broader
perspective, brand personality
Celhay et al., 2015; Hurlburt,
1977; Roberts & Thrift,
2002; Lawes, 2002; ; Day,
1985; Loken & Ward, 1987;
Underwood, et al. 2001;
Composition and layout, colour,
image and name
Composition and layout, colour, image and name
represent visual characteristics that cooperate in the
perception conveyed by a certain label.
Siegrist & Cousin, 2009 Labels’ extrinsic cues
Labels’ extrinsic cues arise expectations on the viewers
influencing consumers’ perception of the beer and the
product experience
Barber et al., 2006; Gòmez
et al., 2016
Gender differences in the
perceptual process
Females seem to be more attracted by label appeal in
their purchase decision compared to their male
counterparts
Table 1-Theoretical overview. Source: Own.
As it will be further discussed (see Section III.4), a mixed approach consisting of a qualitative pilot
study and quantitative online questionnaire is considered to be suitable for the purpose of the
research. Specifically, the pilot study will attempt to provide a better understanding of the label
conventions detected in the craft beer market and it will serve to identify specific labels,
19
representative of the aforementioned conventions, to be used in the main study. Through the
information gathered via the online questionnaire, we will try to answer the following research
questions:
RQ1: How are specific label design conventions influencing consumers’ attitude and
purchase intent towards craft beer?
RQ1A: How consumers characterize craft beers when they are exposed to a specific label that presents a particular
configuration in terms of brand name and design style?
RQ1B: Does congruence between brand name and design style convention positively affect consumers’ attitudes towards
craft beer?
RQ1C: Does congruence between brand name and design style convention positively affect consumers’ purchase intent?
RQ2: Are there any differences in consumption habits according to gender, consumption
frequencies, and craft beer knowledge?
RQ2A: Are there gender differences in the importance given to specific label cues?
RQ2B: Does perceived importance of label cues change across different levels of craft beer knowledge?
RQ2C: Does perceived importance of label cues change across different levels of consumption frequencies
RQ 3: Which specific craft beer consumers’ segments can be detected inside the
Millennials’ cohort?
Information sources and brand loyalty behaviour from Millennials will be further investigated in an
attempt to shed lights in this under researched field and provide meaningful insights to craft
brewers.
20
III.Methodology
This section presents the research philosophy, purpose and approach underlying this thesis investigation. Further, the
research strategy, methods applied and data collection procedures are explained. Data analysis processes are also
described. Lastly, the reliability and validity of the research process is discussed.
III.1. Research Philosophy: Critical Realism
Research philosophy is related to the perspective from which an investigation is conducted, not
only in terms of selection of methods but also regarding the nature of the knowledge that will be
developed (Saunders, 2011). In this broad sense, theory assists researches in determining,
operationalizing and measuring the different variables under investigation and also by establishing a
basis to interpret findings (Malhotra et al., 2012). In other words, a research philosophy implies
certain assumptions or beliefs that will guide the investigation and will support the research strategy
(Guba & Lincoln, 1994, p. 105). For social investigations, Saunders (2011) describes four main
research philosophies: positivism, realism, interpretivism and pragmatism. As researchers we are
aware that the selection of a research philosophy ultimately depends on the research questions that
we are willing to address. Thus, since our aim is to explore perceptions and attitudes towards craft
beers in the European market overall and from a particular perspective (the labels); the critical
realism research philosophy was adopted.
This particular philosophy has strong ontological assumptions that primarily affect the
epistemological dimension of a research (i.e. the way results are interpreted and considered) rather
than the methodological selections since both quantitative and qualitative methods are commonly
applied in critical realism. Nevertheless, alike positivism, the philosophy of realism founds its basis
in scientific principles in order to develop knowledge. Realism can be divided into two streams:
direct and critical realism. Direct realism claims that our sensorial experiences depict the world
precisely. Conversely, critical realism rejects the assumption of things being experienced directly
through our senses and claims that what we experience, it is nothing but a representation or an
image of the real things and not the real things itself. In this sense, critical realism’ main ontological
assumption is that reality exists, to a certain extent, independently of the observer. It is, thus, infer
via ―social conditioning‖ (Saunders, 2011) or, in other words, reality is the result of the relationship
between the objects itself, the sensations they elicit and each individuals mental process (Saunders,
2011). Consequently, for critical realism the nature of knowledge is transitive; therefore, any
acquired knowledge is by definition inaccurate (Scott, 2007). Additionally, this implies that any
study can only occur at the ―intersection or vertex of agential and structural objects‖ (Scott, 2007,
p. 15), therefore, this relationship should be pondered by the researcher. Accordingly, from the
critical realist perspective it is important to perform multi-level studies (Saunders, 2011) to explore
the influence each one of them might have over the phenomenon under study.
This philosophy carries several implications in our research, firstly, our findings should be
constantly retested by future research (i.e. replicated) and new studies should also focus in different
stratums of social reality in order to consider the influence of diverse contexts; secondly, findings
need to be carefully interpreted taking into consideration not one but as many factors as possible
and yet, they should always be considered as fallible and biased by the researchers owns view of the
world. Thus, our thesis investigation will focus on a particular cohort (Generation Y), in a particular
21
geographical region (Europe) and within a particular extrinsic cue (craft beer labels). Moreover,
results will be confronted with demographics descriptors and consumers’ habits and preferences in
order to provide a more exhaustive picture of the context in which consumers perceptions react in
analogous ways.
III.2. Research Approach: Inductive
The approach selected for this thesis investigation was the inductive approach. An inductive
research is mainly characterized by the collection and analysis of data whether to develop theory
(Malhotra et al., 2012; Saunders, 2011) or to gain different insights of a phenomenon (Easterby-
Smith et al., 2008). Previous theories or conceptual frameworks are not the starting point of the
research (Saunders, 2011), on the contrary, the observed events are arranged in a theoretical model
(Malhotra et al., 2012) and are further correlated to the literature (Saunders, 2011). Consistently
with the critical realism philosophy, inductive studies emphasize the influential role of the research
context upon the nature and interpretation of the issue under study (Malhotra et al., 2012;
Saunders, 2011).
The selection of an inductive approach was mainly motivated by the lack of literature in the field of
study and by the researchers concern about the transitive nature of knowledge that requires to
consider a phenomen in a particular context. In that sense, the research was designed using a mix
method approach (qualitative and quantitative) in a way that conclusions can be drawn from data
collected and to limit the findings to a particular cohort in a specific context.
III.3. Research Design
According to Malhotra et al. (2012), the research design acts as framework that establishes the
foundations of the marketing research in a more detailed way than the research approach.
Therefore, it implies defining the required information, the research purpose and overall design, the
methods, data collection procedures, sampling processes and sampling size and data analysis
techniques. In the following subsection we will discussed this aspects in relationship with our thesis
investigation.
III.3.1. Research Purpose & Overall Design
Traditionally, according to Saunders (2011), three research purposes can be differentiated in the
field of the marketing research: exploratory, descriptive and explanatory. On the other hand,
Malhotra et al., (2012), differentiates between exploratory and conclusive designs. Exploratory
designs include either quantitative or qualitative explorations whereas conclusive design comprises
descriptive o causal studies. From this perspective, our investigation can be framed within an
exploratory design.
In exploratory designs the information is not precisely defined since the aim of the research is to
seek for understanding. Consequently, sample size is smaller and the research process may change
along the way (Saunders, 2011). To serve to our research purpose, the investigation predicted two
data collection methods. Firstly, a pilot study using qualitative data collection techniques was
22
conducted. The aim of the pilot study was to explore which categories of craft beer label designs and
brand name conventions Millennials could recognize and what motivated their decisions. Secondly, a
main study using quantitative techniques to gain further understanding regarding consumers’
perceptions, purchase intent and attitudes towards craft beers and their labels; and, to seek to find
different segments within the cohort, was be also performed.
A mixed approach was selected so that the pilot study can nourish the main study by providing
deeper understanding of the phenomenon and so that the realist facet of the research is enhanced.
III.4. Data Collection
For this thesis both, secondary data and primary data were collected. Secondary data are data that is
already available and it includes both raw and published data (Saunders, 2011) whereas primary data
are data specifically collected and tailored to the address the research question at hand (Malhotra et
al., 2012). In this investigation, the use of secondary data was gathered in order to get deeper insight
of the topic under investigation. The main sources of secondary data employed during the research
were online reports, articles and documentary written materials such as newspapers articles
published by brewers associations.
As previously mentioned, the research approach, design and purpose, to a certain extent,
predetermines the possible techniques for data collection. Questionnaires in the form of surveys are
one of the most common techniques when conducting business researches (Saunders, 2011) and
are also an often used way for collecting primary data in quantitative exploratory designs (Malhotra
et al., 2012). Therefore, for this research main study an online survey was conducted. For the pilot
study a qualitative approach was chosen so data were collected through interviews using the card
sorting technique.
For both studies, the primary data collection took place just once.
III.5. Research strategies
III.5.1. Pilot Study: Interviews using the card sorting technique
As Malhotra et al. (2012) clarifies, exploratory research can be employed, as a previous stage in a
research, when researchers need to gain insights regarding the research object to better address
their studies and, thus, define their plans of action.
To fulfil this secondary purpose of completing the main study the aim of the pilot study was, in a
broad sense, to support the findings of the main research by defining what is consider to be a
traditional, contemporary or provocative label, among Millennials in a craft beer context. These
categories were taken from the label design trends present in the market (see Bell, 2016; Simmons,
2016; White, 2015). In a narrower sense, the pilot study sought to, given these three preset
categories of craft beer label designs, determine what attributes Millennial’ associate to each one of
them. In other words, what Millennials’ think of when classifying a craft beer label design as
23
traditional, contemporary or provocative. Additionally, the pilot study contributed to the definition
of our sample labels designs and craft beer name conventions.
Pilot Study - Method
In order to categorize and describe the different craft beer styles, 22 interviews were conducted
using the card sorting technique. This technique is an enabling technique that is commonly used in
quantitative exploratory research when seeking to understand the reasons behind the categorization
choices (Ritchie et al., 2013). Thus, this method allowed us to clearly define the characteristics that
convey the idea of traditional, contemporary and provocative (see Section IV.1.2).
A total of 16 samples labels were categorised using the Card Sorting technique by 22 different
participants. The 16 stimulus labels (see Appendix C) were selected from existing craft beers
brewed in non-European countries (Australia, South Africa and USA) in order to reduce the
probability of creating sources of variations in the results due to reasons differently from the labels
themselves. In addition, to minimize third variables all the labels presented were IPA craft beers
within a range of ABV (alcohol by volume) of 4.5% to 7.8% and with highly recognizable craft
brewers excluded. Variations in designs in terms of colour, imaginary and typography were selected.
Variations orientation and material were avoided. All the labels were presented in their respective
bottles.
The sample labels were randomly assorted and given to the participants. Participants were asked to
classify the labels in one of the three given categories -Traditional, Contemporary/Artistic and
Provocative- and were given the choice to think of other categories other than the suggested ones.
Further, they were required to rank the sample labels within each category according to the degree
of which they consider that the label was representative of that particular group (e.g. from the most
to the least traditional). Lastly, they were asked to explain the reasons that motivated their choices.
Data collected was recorded and analyzed using descriptive statistics and content analysis
techniques. Confidentiality was ensured.
III.5.2. Main Study: Online Survey
The purpose of the main study was to collect data in order to explore the market group overall
consumption behaviours (emphasising the role of label cues in this process) for the means of
profiling different types of craft beer consumers and examine if different label designs potentially
affect consumers’ attitudes and purchase intent towards craft beers. For this purpose, a quantitative
approach was chosen so that the different attitudes and perceptions could be measured and
operationalised into variables to statically draw relationships between them. It can be argued that
qualitative techniques shall not be employed when performing exploratory research. However,
according to Malhotra et al. (2012), this practice is feasible if -as we intended- the exploration aims
to determine connections or patterns given a certain dataset.
Data were collected using a descriptive survey that took the form of an online self completion
questionnaire (see Appendix A). This method was selected because it allows researchers to gather
large amounts of data in a relative short period of time and is cost saving (Malhotra et al., 2012).
24
Pre-test
The questionnaire was pre-tested by 12 respondents and the thesis supervisor with the double
purpose of gaining insight so to improve the quality of the instrument and to detect potential errors
in its design. Based on the feedback received, some questions were slightly modified to increase
their clearness and reduce error due to misunderstandings.
Availability
The survey was available online from March 23, 2016 to April 09, 2016. It was promoted via
different social media (mainly Facebook and Instagram) and other online channels such as email
and whatsapp since it was available in a mobile-friendly version as well.
Questionnaire
The survey took the form of a self-competition online questionnaire and it was design and launched
by using Qualtrics. It consisted of seven (7) screening questions, six (6) questions regarding
respondent’s attitudes and purchase intent towards three sample labels and five (5) questions
regarding consumption behaviours and brand loyalty (see Appendix A)
Generally, the questionnaire was divided in three sections:
- Section 1: Screening and demographic data were collected including gender, age range,
nationality, perceived income and higher level of education achieved. Information
regarding the respondents’ level of knowledge and frequency of consumption of craft beer
were also gathered.
- Section 2: this section explored consumers’ evaluation of craft beer attributes and
purchase intent when exposed to different craft beer label configurations. For this set of
questions, participants were randomly assigned to one of three treatment groups. Each
group was exposed to 3 different sample labels. The sample labels within a group included
each one of the brand name conventions and each one of the design treatments. The sample
labels between each groups comprised the 9 different possible combinations between the
name and design conventions (i.e. label configurations). The composition of the groups
can be seen in Table 2. In this section, the method used by Sherman & Tuten (2011) to
study consumers’ perceptions towards wine labels was adapted to the craft beer context
and replicated.
- Section 3: this section included questions referring to the sources of information used by
the respondents prior and during purchase, the importance they assigned to different label
cues and brand loyalty.
25
The questionnaire design was maximized in order to increase the reliability and the internal validity.
For the multi-item questions, items were randomized to reduce order effects and control items
were also included (See Table 3). Different versions of fixed-response alternative questions were
used not only due to the fact that makes questionnaires more easily to administer and understand
but because the data collected is consistent and thus facilitates the analytical process (Malhotra et
al., 2012). In most of the cases the scale questions were formulated using a 7 point Likert-scale
since as demonstrated by Givon and Shapira (1984) improvements in reliability can be observed
when scales points increases towards 7-point scales.
Construct Items Type of Question Source/Adapted from
Subjective knowledge
Single Item.
How would you consider yourself in
term of craft beer knowledge?
5-point Likert Scale
(1) Totally new
(7) I’m an expert
(Park et al., 1994)
Overall Attitudes
Multi-Item
How would you describe this Craft
Beer?
Prestigious, desirable, cheap*,
ordinary*, high-quality, distinctive.
7-point Likert Scale
(1) Strongly disagree
(7) Strongly agree
(Sherman & Tuten, 2011);
(Boudreaux & Palmer, 2007)
αL01 = .736; αL02 = .785;
αL03 = .701; αL04 = .708;
αL05 = .713; αL06 = .710;
αL07 = .736f; αL08 = .723;
αL09 = .710*
Purchase Intent
Single Item.
How likely are you to purchase it in
the next occasion?
7-point Likert Scale
(1)Strongly disagree
(7) Strongly agree
(Sherman & Tuten, 2011);
(Boudreaux & Palmer, 2007).
* Reverse scored. ** See Appendix D
Table 3-Main Study. Reliability.
Sample Labels
The sample levels used in the questionnaire were designed according to the results reported by the
pilot study (see Section IV.1.1 for further details). For that purpose, the original labels were
modified and adapted in order to create the 9 different possible combinations between the three
selected brand names (―Apollo‖, ―Robo-Hop‖ and ―Arrogant Bastard‖ representing the traditional,
contemporary and provocative convention respectively) and the three label design styles. The sample
labels used in the main study can be found in the Appendix C.
Group Label Name Convention Design Treatment
Group 1
L01 Traditional name (―Apollo‖) Traditional Design
L02 Contemporary name (―Robo-Hop‖) Contemporary Design
L03 Provocative name (―Arrogant bastard‖) Provocative design
Group 2
L04 Traditional name (―Apollo‖) Contemporary Design
L05 Contemporary name (―Robo-Hop‖) Provocative design
L06 Provocative name (―Arrogant bastard‖) Traditional Design
Group 3
L07 Traditional name (―Apollo‖) Provocative design
L08 Contemporary name (―Robo-Hop‖) Traditional Design
L09 Provocative name (―Arrogant bastard‖) Contemporary Design
Table 2-Main Study: Brand name convention and design style treatment per group
26
III.6. Population & Sampling
Our population or target group is comprised by European Millennials that are regular or casual
craft beer consumers. Due to the size of the population under study, findings need to be
generalized from a representative sample to the larger population (Malhotra et al., 2012). Sampling
techniques are often divided in two categories: probabilistic or representative techniques and non-
probabilistic or judgmental techniques. In probabilistic samples, the probability of each sample of
being selected is equal and well known whereas in non-probabilistic samples the selection relies on
the judgment of the researcher (Saunders, 2011).
Due to time and resource constraints, we opted for the convenience sampling technique for both
studies. This technique consists in the researcher randomly selecting the sample, therefore, it is
consider a non-probabilistic technique (Saunders, 2011). According to Malhotra et al. (2012), a
convenience sample does not allow generalizations. However, Saunders (2011) argues that findings
can still be generalized to a larger population. Despite the limitations that the use of convenience
sampling implies (e.g. selection bias) the accessibility and the relatively low costs of using it,
encourage us to choose this type of sampling (Gravetter & Forzano, 2015; Malhotra et al., 2012;
Saunders, 2011).
III.7. Data Cleansing
Data collected were processed (reduced) in order to obtain an accurate dataset. Data from the pilot
study were analyzed and cleaned in Excel 2007 and data from the main study were gather via
Qualtrics and exported, analyzed and reduced in SPSS Statistics 23.
The sample size for the pilot study consisted of a total of 22 participants. All of them completed
the process and met the sampling criteria (European Millennials), thus, none of them was excluded.
For the main study, a total of 248 responses were collected of which 65 participants were excluded
due to incomplete responses, geographical reasons (out of the European Union), or because they
claimed to be non-users in terms of craft beer consumption. Thus, 182 valid responses (N=182)
remained.
III.8. Ethical Considerations
The investigation was performed following a series of ethical guidelines. In all cases, participants
were informed of the research purpose and were given the right to decide if they wanted to take
part in the research or not and also to discontinue their participation at any time. Confidentiality
was guaranteed by assigning a code to each participant and by pledging professional secrecy.
Finally, all data collected were used solely for research purposes.
27
IV. Empirical Findings
This section presents the empirical finding for both the Pilot Study and the Main Study. For the Pilot study both
qualitative and quantitative data were collected. For the main study, quantitative data were collected and analyzed
using SPSS. Due to the realistic philosophy of the research, data were analyzed by considering multiple moderator
factors.
IV.1. Pilot Study
The interviews using the card sorting technique were conducted between March 10 and March 20,
2016 in Jönköping, Sweden. A total of 22 participants were interviewed, half of which were female
and half were males between 21 and 26 years old and from 9 different European nationalities (see
Table 4).
Participant Country Age Gender Participant Country Age Gender
1 Sweden 21 F 12 Germany 25 F
2 Germany 26 F 13 France 23 M
3 Germany 24 M 14 France 24 F
4 The Netherlands 23 M 15 Germany 25 F
5 Spain 24 M 16 Germany 25 F
6 Germany 23 F 17 Italy 25 M
7 Germany 26 F 18 Spain 21 M
8 Sweden 23 F 19 Portugal 21 M
9 Germany 25 M 20 Germany 22 M
10 Latvia 21 F 21 Germany 23 M
11 Belgium 21 M 22 Belgium 23 F
Table 4-Pilot Study: Participants overview
IV.1.1. Sample Labels
One of the aims of the pilot study was to assist in the definition of the sample label design and craft
beer name conventions so to be used during the main study. The selection was assessed by using
descriptive statistics.
Participants were asked to classify the sample labels in different categories according to their
particular perception. For this purpose, three categories were suggested: traditional (T),
contemporary/artistic (C/A) and provocative (P). Participants were left with the choice of not
classifying a label if they considered it didn’t belong to any of the suggested categories. Except for
one participant that excluded two labels from these categories, the rest did not think about any
categories other than the ones provided. Afterwards, they were asked to rank the labels according
to the degree of representativeness of each category. For the analysis only the first 3 rank positions
were considered. Cumulative ranking frequencies were computed for each category using Excel
2007. Further, ranks were converted into scores (Rank 1 = 3; Rank 2 = 2; Rank 3 = 1) and scores
were summed up and computed for each label.
28
In Table 5, the frequencies and scores obtained per label are summarized (see Appendix B for
further details regarding the sample labels and their referring codes). Results show that labels L02
and L03 ranked among the 3 first places (f= 15, each) for the traditional category, followed by label
L05 (f =14). After computing the scores, L03 obtained the highest score in the traditional category
with 37 points. Further, label L07 (f=19) got the highest score for the contemporary/artistic
category with 44 points far better than label L08 (f=16) that obtained 38 points. Within the
provocative category, labels L14 (f=17) and L13 (f=15) were the ones that scored better with 36
and 34 points respectively thus label L14 was selected.
Labels that scored higher within each category were selected for the main study both in terms of
label design and brand name convention.
Label
Code
Frequencies per
Category
(Ranking from 1 to 3)
Frequencies per Rank Order per Category
Total Scores
Rank 1 3 Rank 2 2 Rank 3 1
T CA P T C/A P T C/A P T C/A P T C/A P
L01 8 0 0 0 0 0 4 0 0 4 0 0 12 0 0
L02 15 0 0 5 0 0 5 0 0 5 0 0 30 0 0
L03 15 0 0 10 0 0 2 0 0 3 0 0 37 0 0
L04 13 0 0 4 0 0 3 0 0 6 0 0 24 0 0
L05 14 1 0 3 0 0 8 0 0 3 1 0 28 1 0
L06 0 6 7 0 2 2 0 2 1 0 2 4 0 12 12
L07 0 19 0 0 9 0 0 7 0 0 3 0 0 44 0
L08 0 16 0 0 8 0 0 6 0 0 2 0 0 38 0
L09 0 8 0 0 1 0 0 2 0 0 5 0 0 12 0
L10 1 8 1 0 0 0 0 1 1 1 7 0 1 9 2
L11 0 1 12 0 0 2 0 0 6 0 1 4 0 1 22
L12 0 3 8 0 0 4 0 3 3 0 0 1 0 6 19
L13 0 0 15 0 0 6 0 0 7 0 0 2 0 0 34
L14 0 0 17 0 0 8 0 0 3 0 0 6 0 0 36
L15 0 4 3 0 2 0 0 1 0 0 1 3 0 9 3
L16 0 0 3 0 0 0 0 0 1 0 0 2 0 0 4
Total 66 66 66 22 22 22 22 22 22 22 22 22
Table 5-Pilot Study: Frequencies and scores per Label
IV.1.2. Definition of the Traditional, Contemporary and Provocative conventions
The second objective of the pilot study was to provide insights about which particular cues or
dimensions of a front label contribute in conveying the idea of a ―traditional‖, ―contemporary‖ or
―artistic‖ label. Participants were motivated to explain the reasons behind their selections,
particularly for those labels that they chose as the most representative. A double-entry table (see
Table 6) summarizing the main ideas associated to each category regarding four dimensions -level
of information, perceived typicality, visual codes and brand name- was created. The visual codes
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Final Thesis

  • 1. Millennials and the European craft beer market. MASTER THESIS WITHIN: Business Administration NUMBER OF CREDITS: 15 credits PROGRAMME OF STUDY: International Marketing AUTHOR: Nascimben, Sara (920827-T388); Pelegrina, Jimena (860729-T484) TUTOR: Pantelic, Darko JÖNKÖPING May, 2016 An exploratory study with an emphasis on the role of labels.
  • 2.
  • 3. Acknowledgements We would like to express our gratitude to all those who, in one way or another, contributed to the realisation of this thesis. Particularly, we would like to express our appreciation to our tutor Darko Pantelic for his support, critical feedback and overall guidance during the process. Further, we would like to thank our fellow students, especially Fernando Perera, Niels Den Broeder and Dionne Boerwinkel for their active participation during the feedback seminars and for helping us to continually advance in our thesis project. Finally, we would like to express our gratitude to our families and friends for their unconditional support. Sara Nascimben Jimena Pelegrina Jönköping, May 2016
  • 4.
  • 5. Master’s Thesis in International Marketing Title: Millennials and the European craft beer market: An exploratory study with an emphasis on the role of labels. Authors: Sara Nascimben Jimena Pelegrina Tutor: Darko Pantelic Date: 2016-05-23 Subject Terms: Consumer Perception, Extrinsic cues, Craft beer Labels, Millennials Abstract Background In Europe, the craft beer industry represents nowadays one of the faster growing segments of the beverage industry (Daneshkhu, 2014). The term ―Craft brewing‖ is used to identify traditional beer production, independent and small sized breweries (not exceeding 6 million barrels of production per year) (Warner & Erie, 2010). The increased number of craft breweries is linked to the new market trend characterized by differentiation of beer flavours. A specific cohort seems to be driving the craft beer popularity: Millennials, also known as generation Y. (The Brewers of Europe, 2013, p.27). Despite this increasing popularity, the research within the field of craft beer from a consumers’ perspective remains limited. Purpose The aim of this research is to gain deeper understanding regarding Millennials’ overall perceptions, attitudes and purchase intent towards craft beers –placing the emphasis on the role that craft beer labels have in this process- and to possibly identify different segments inside Millennials craft beer consumers. Method To fulfil the purpose of this thesis both qualitative and quantitative methods were applied. Interviews using the card sorting technique were conducted in order to further understand the different craft beer label conventions present in the market. In addition, an online questionnaire - where participants were exposed to three different craft beer labels- was used to explore Millennials’ perceived importance of craft beer label cues and to assess the effect that different brand name conventions and label designs have on this cohort’ attitudes and purchase intent. Main Findings Provocative labels are generally perceived as distinctive and unique and obtained higher attitudinal scores among Millennials. Conversely, traditional label -characterized by familiar and ―old style‖ designs- seemed to evoke less favourable attitudes among this cohort. Further, the finding suggests that consistency between brand name and label design convention does not necessarily lead to more favourable attitudes towards craft beers. Moreover, gender, level of knowledge and consumption frequency has an impact in the importance devoted to specific label cues. Lastly, within our sample, three segments of craft beer consumers within the Millennials’ cohort were detected by applying clustering techniques (―Brand switchers‖, ―Technical drinkers‖ and ―Information seekers‖).
  • 6.
  • 7. i Table of Contents I. Introduction ..............................................................................................................................................1 I.1. Background......................................................................................................................................1 I.2. Problem discussion.........................................................................................................................2 I.3. Research Purpose............................................................................................................................3 I.4. Delimitations....................................................................................................................................3 I.5. Definitions........................................................................................................................................4 I.6. Structure ...........................................................................................................................................4 II. Theoretical Background..........................................................................................................................6 II.1. Craft beer industry ..........................................................................................................................6 II.2. A recent European trend driven by Millennials.........................................................................7 II.3. Craft beer: labels and trends..........................................................................................................8 II.4. The role of perception....................................................................................................................9 II.4.1. Categorical visual codes and perceived typicality............................................................10 II.5. The importance of label...............................................................................................................12 II.5.1. Label perception and Brand image ...................................................................................13 II.5.2. Visual characteristics of label design.................................................................................14 II.5.3. Label as an extrinsic cue......................................................................................................15 II.5.4. Information in the label......................................................................................................16 II.6. Retailers...........................................................................................................................................16 II.7. Theoretical overview ....................................................................................................................17 III. Methodology...........................................................................................................................................20 III.1. Research Philosophy: Critical Realism.......................................................................................20 III.2. Research Approach: Inductive....................................................................................................21 III.3. Research Design............................................................................................................................21 III.3.1. Research Purpose & Overall Design ................................................................................21 III.4. Data Collection..............................................................................................................................22 III.5. Research strategies ........................................................................................................................22 III.5.1. Pilot Study: Interviews using the card sorting technique...............................................22 III.5.2. Main Study: Online Survey.................................................................................................23 III.6. Population & Sampling................................................................................................................26 III.7. Data Cleaning ................................................................................................................................26 III.8. Ethical Considerations .................................................................................................................26 IV. Empirical Findings.................................................................................................................................27 IV.1. Pilot Study ......................................................................................................................................27 IV.1.1. Sample Labels.......................................................................................................................27 IV.1.2. Definition of the Traditional, Contemporary and Provocative conventions.............28 IV.1.3. Contribution of the Pilot Study.........................................................................................29 IV.2. Main Study......................................................................................................................................30 IV.2.1. Response rate........................................................................................................................30 IV.2.2. Demographics.......................................................................................................................30 IV.2.3. Mean Scores: Attitudes and Purchase Intent towards different craft beer label configurations and brand name and design style conventions ...........................................................32 IV.2.4. Craft Beer Label Conventions: Analysis of Variance.....................................................33 IV.2.5. Perceived Importance of Cues and Craft Beer consumers Profile..............................37 V. Interpretation..........................................................................................................................................41 V.1. Attitudes and Purchase Intent towards craft beers from a label design perspective..........41 V.2. Differences in consumption habits according to gender, consumption frequencies, and craft beer knowledge ..................................................................................................................................43
  • 8. ii V.3. Craft beer consumer segments inside Millennials’ cohort......................................................45 VI. Conclusion and Managerial implications............................................................................................47 VI.1. Contribution...................................................................................................................................48 VI.2. Limitations......................................................................................................................................49 VI.3. Future Research.............................................................................................................................49 Appendix A. .....................................................................................................................................................57 Appendix B.......................................................................................................................................................60 Appendix C.......................................................................................................................................................61 Appendix D......................................................................................................................................................62 Appendix E. .....................................................................................................................................................82 Figures Fig. 1-Structure ..................................................................................................................................................5 Fig. 2-Process of perceptual selectivity. Source: Hanna & Wozniak (2000)............................................9 Fig. 3-Bottom- up and Top-down processing. Source: Hanna & Wozniak (2000)..............................10 Fig. 4-Brewery-consumer chain ....................................................................................................................17 Fig. 5-Main Study: Age and Gender.............................................................................................................30 Fig. 6-Main Study: Nationality.......................................................................................................................31 Fig. 7-Main Study: Education........................................................................................................................31 Tables Table 1-Theoretical overview. Source: Own...............................................................................................18 Table 2-Main Study: Brand name convention and design style treatment per group ..........................25 Table 3-Main Study. Reliability......................................................................................................................25 Table 4-Pilot Study: Participants overview..................................................................................................27 Table 5-Pilot Study: Frequencies and scores per Label.............................................................................28 Table 6-Pilot Study: Characteristic per label convention. Source: Own.................................................29 Table 7-Main Study: Perceived characteristics............................................................................................32 Table 8-Main Study: Overall Attitude and Purchase Intent Mean Scores and Standard Deviations.32 Table 9-Main Study: Normality Test and Levene’s Test results for attitudinal variables ....................34 Table 10-Main Study: ANOVA results for attitudinal variables..............................................................35 Table 11-Main Study: Normality Test and Levene’s Test results for Purchase Intent variables........35 Table 12- Main Study: ANOVA results for purchase intent variables ...................................................36 Table 13- Main Study: Craft beer consumption .........................................................................................37 Table 14- Main Study: Cross-tabulation gender- importance of cues.....................................................38 Table 15-Main Study: Clusters.......................................................................................................................40
  • 9. 1 I. Introduction This introductory section provides a general overview of the research subject. First, a brief background and the main reasons why this research is significant are specified. Thereafter, the purpose and the adopted perspective for the present thesis, together with the research questions are outlined. Lastly, relevant definitions and delimitations of the study are provided. I.1. Background Craft beers have been introduced in the 1970s in the US where nowadays they represent a successful and growing market. In fact, consumption has increased by 11 percent during 2014 and together with it the number of microbreweries and brewpubs (Davis, 2015). In Europe, craft beer industry has been more recently introduced and it currently represents one of the faster growing segments of the beverage industry (Daneshkhu, 2014). On the overall European beer market has been on a slightly decreasing trend over the period 2009- 2014. Despite the downward tendency, the number of active breweries has exponentially increased over the same period starting in 2009 with 3781 active breweries and reaching 7,091 in 2014 (The Brewers of Europe, 2015). Of these, almost 100% of the new breweries are craft beer producers whose presence on the market has more than doubled over the same period. It is also worth noticing how the positive trend of craft breweries is not confined only to traditional beer drinking countries such as Great Britain and Germany, but also to traditional wine drinking ones such as France, Italy and Spain (The Brewers of Europe, 2015). Craft brewing is a general term used to identify traditional beer production, independent and small sized breweries (not exceeding 6 million barrels of production per year) (Warner & Erie, 2010). Craft beer is characterized by unusual flavours and it is the result of an equilibrate mix of tradition and innovation, where traditional and non- traditional ingredients are mixed to produce peculiar tastes (Nielsen New Release, 2007). The term microbrewery, often used as a synonym for craft beer, it basically refers to the production threshold defining breweries producing less than 15,000 barrels per year, sharing the same characteristics as craft breweries but in a smaller scale. The increased number of craft breweries responds to a market demand that has seen a renewed interest for differentiation of beer styles. Despite being a general trend, a specific cohort has shown to drive craft beer popularity: Millennials, also known as Generation Y. (Bryant, 2015; The Brewers of Europe, 2013a). Among Millennials -those born in the early 1980s until the early 2000s- beer is the favourite alcoholic beverage (Nielsen New Release, 2007). As beer market has evolved it seems that this cohort has also shifted its focus to flavours, characteristics and production processes. The main reason seems to reside on tiredness from the usual tastes offered by mass-produced beers turning Millennials attention to new flavours and new brewery brands (Davis, 2015; Duva, 2014). Besides their reduced budget, there is evidence that Millennials’ are willing to spend more for a quality craft beer instead of two blend beers (Gosselin, 2010; Nielsen New Release, 2007). Beer is thus starting to be perceived as more than a simple social drink, reflecting attitudes of a generation that bases its preferences on a higher level of information (Brager, 2014; Brown, 2015). Perceived value becomes a key driver for this cohort who is willing to spend money if the product is worth it (Gosselin, 2010).
  • 10. 2 The lack of known brands in the craft beer industry suggests that consumers are particularly guided by the appeal and information provided by the label in their purchase decision (Brown, 2015). Moreover, consumers often infer specific attributes related to the product by perceiving specific label characteristics (Sherman & Tuten, 2011). Research highlights how labels such as ―handmade‖, ―craft‖ and ―small batch‖ are generally considered as indicators of higher quality (Birth, 2015; Gosselin, 2010). Besides new tastes, eye- catching labels and bottle designs are thus playing an important role on the popularity of craft beers; thus craft brewers are putting efforts in creating peculiar label designs and get consumers to try (Barnett, 2012; Brewers Association, 2016b). The importance of label design is even more relevant considering that Millennials tend to consume most of their drinks at home directing customers consumption choice to the shelves rather than bars and restaurants (Brown, 2015; The Brewers of Europe, 2013a). This fact highlights the important role that stores play in the decision making of Millennials, enhancing the importance of being noticeable in the shelves (Sandwith, 2015). Moreover, traditional advertising techniques seem to have reduced their persuasive power effect towards Millennials who prefer to do their own online research and rely on peers reviews (Gosselin, 2010; Page, 2015; Sandwith, 2015). As discovery and recommendation have become the new key drivers for beer consumption choice, breweries’ scope is to elicit passion on their consumers and to make them try the product (Chahal, 2015). In conclusion, Millennials are ―thirsty for novelty‖ (Nielsen New Release, 2007, p.2), suggesting that this cohort will have a great impact on the craft beer industry (Nielsen New Release, 2007). I.2. Problem discussion Craft beer increasing popularity seems to be affecting beer consumption trends (Aquilani et al., 2015). As Lo Monaco & Guimelli (2008) stated, changes in consumption habits are often correlated with changes in attitudes and perceptions towards a product. Accordingly, consumers’ motivations behind craft beer consumption do differ from traditional beer drinkers. Three factors seem mainly to motivate craft beer consumers: ―desire for more knowledge, new tasting experiences and to move away from mainstream beer consumption‖ and paired craft beer consumption with a desire for distinction and individuality (Gómez-Corona et al., 2016, p.358). As previously discussed, the emerging craft beer industry is one of the growing segments of the European beverage industry (AssoBirra, 2012, 2013). Its success has been attributed to different factors such as hyper-differentiation strategies (i.e. product variety) along with high resonance effects (Clemons et al., 2006), high levels of availability in the market, beer quality perception and competitive pricing (Kleban & Nickerson, 2012). Yet, the research within the field of craft beer from a consumers’ perspective is not vast. The literature in the field is insufficient specially when considering the European craft beer market. The only study we acknowledge related to the topic is the one carried out by Aquilani et al.(2015) that compares the motivations behind craft beer and industrial beer consumption with respect to Italian Millennials. However, no studies regarding the impact of craft beer labels on consumers’ preferences have been carried out in Europe even though Millennials’ are considered as the type of consumers that ―shop with their eyes‖ (Barber et al., 2006, p.85). In this respect, Gómez-Corona et al. (2016) while investigating craft beer consumption habits and attitudes in the Mexican market found out that extrinsic attributes (e.g. packaging and labels) can influence the craft experience positively when they are perceived as unique and authentic by consumers, independently of their gender.
  • 11. 3 That being said, the topic is worth studying and particularly in this field where craft brewers are being forced to adopt alternative communication channels (Clemons et al., 2006) since Millennials seem to be less influenced by advertisement and more by inspirational motives (Sandwith, 2015). I.3. Research Purpose The aim of this thesis is to investigate Millennials’ overall perceptions, attitudes and purchase intent towards craft beers -with a particular emphasis on the role that craft beer labels play in this process- and to try to identify potential segments within this cohort. To achieve the first objective, the research will place its focus on the different craft beer label conventions detected in the market. Specifically, we will try to investigate how specific craft beer label styles -traditional, contemporary and provocative- affect Millennials’ perception of craft beer characteristics. In addition to this, we will analyze if the consistency between brand name and design style positively strengthens the aforementioned effects. Further, in our attempt to identify specific segments inside this marketing cohort, different dimensions such as Millennials’ use of informational sources during and prior purchase and the importance assigned to specific label cues will be investigated. By relying on these dimensions we aim to identify different cluster (subgroups) within the cohort. Ultimately, with the information gathered we intend to (1) develop a series of normative guidelines for craft brewers and (2) to shed light in the under-researched field of craft beer. To fulfil all these purposes the following research questions will be addressed: Research Question 1: How are specific label design conventions affecting consumers’ attitude and purchase intent towards craft beer? Research Question 2: Are there any differences in consumption habits according to gender, consumption frequencies, and craft beer knowledge? Research Question 3: Which specific craft beer consumers’ segments can be detected inside the Millennials’ cohort? It is worth mentioning that the thesis will consider the European craft beer market and will be performed from a consumers-based perspective. Moreover, Millennials are considered as the most appropriate target group for the study since, as previously mentioned, this cohort is nowadays considered to be the one leading the shift from mass-beer to craft beer consumption (Bryant, 2015) I.4. Delimitations The exploratory nature of the research will allow providing valuable insights to the under- researched field. We acknowledge that the aforementioned research purposes can be achieved although limitation related to sample and criteria could arise. Limitations related to the study will be further discussed in Section VI.1 where specific directives will be provided for further research.
  • 12. 4 I.5. Definitions Brewpub: a restaurant –brewery where beer is produced primarily for restaurant and bar sale, at least 25 percent of the beer must be sold on site (Brewers Association, 2016a). Craft brewery: definitions are not always consistent, according to the Brewers Association it has been defined as small, independent and traditional. ―Small” used to refer to the annual production threshold of 6 million barrels or less per year. ―Independently-owned‖ from commercial breweries and employing ―traditional‖ ingredients fermentation methods with an emphasis on quality and flavours (Brewers Association, 2016b). Garrett Oliver, Brooklin Brewery brew master defined craft beer as ―beer brewed by traditional means with the goal of creating full, complex flavours‖ (Eating isn’t cheating, 2012). Craft beers compete with mass-produced beers in terms of quality and diversity instead of advertising (Brewers Association, 2016b). Microbrewery: ―Independent beer-brewing operations whose threshold of production is less than 15,000 barrels a year‖ (The Food Section, 2010). The term spread in the US in the 1980s where the trend started and it indicates breweries producing fewer than 15,000 beer barrels. Reflection of a flexible and experimental attitude in the brewing process (Brewers Association, 2016a). Perceived quality: is used to stress the fact that “quality judgments are dependent on the perceptions, needs and goals of the consumers [and refers to] the extent to which the product is perceived to be fit to provide a desired consumption experience” (Steenkamp, 1990) Extrinsic cues: they refer to product external attributes and information that are related to the product but they are not part of it (Steenkamp, 1990). Brand name convention: it refers to the often used styles for titling or naming a brand. In the context of this thesis we refer to three of these conventions that are popular within the craft beer market: traditional names, contemporary names and provocative names. Label design convention: refers to the often used styles or genres in label design. In the context of this thesis we refer to three of these conventions that are popular in the craft beer market: traditional designs, contemporary designs and provocative designs. Label configuration: within the context of this thesis, craft beer labels are decomposed in two dimensions: the brand name they portray and the visual codes they use encompassed in what we define as label design. Thus, label configuration refers to a label that presents a particular combination in terms of brand name convention and design convention (e.g. a label with a traditional brand name and a provocative design). I.6. Structure Fig. 1, illustrates the structure of the research. An introductory part highlights the importance of conducting the study, introducing the reader to the topic together with motivating the aim of the research and the specific research questions. The theoretical framework will provide a summary of theories related to the topic that will contribute to a deeper understanding of the research field and provide evidence for the research questions. The methodology section will deal with the description of the nature of the research and the research methods used to collect the data. In the specific case
  • 13. 5 a mix of qualitative (interviews) and quantitative research (online survey) will be used highlighting specific strengths of each methodology for the purpose of the study. In the empirical findings section, data collected from both the pilot study and online questionnaire will be analyzed and merely presented in providing answer to the research questions. In the conclusive and discussion parts, interpretation of obtained data will be provided together with managerial implications for craft brewers as main aim of the research. Limitations related to the study and suggestions for further research will also be provided in the conclusive section. Fig. 1-Structure Introduction Theoretical framework Methodology Data Analysis Conclusions Discussions
  • 14. 6 II. Theoretical Background II.1. Craft beer industry Craft beer industry originated in the US, where the industry had been growing all through the 1980s with the number of craft breweries increasing exponentially by the late 1980s and early 1990s (Swaminathan, 1998; Warner, 2010). Different factors contributed to the success of the craft beer industry; among them the period saw the emergence of a more educated class that sought for alternative tastes and aromas that mass produced beers couldn’t offer (Warner, 2010). This resulted in a spread consumption style focused on ―craftsman like, honest, authentic‖ (Brooks, 2010, p.83) characteristics thus enhancing the success of craft beer industry during 1980s and 1990s. Craft beer movement has crossed the Ocean taking a renewal to an industry that saw a period of stagnation during the last decades and it is turning into a European trend. In fact, despite the overall European beer market has suffered a decreasing trend across 2009-2014; the number of active breweries in Europe has more than doubled over the same period. This increase is mainly represented by the number craft breweries which in 2009 accounted for 2,373 and by 2014 reached 5,964 (The Brewers of Europe, 2015). Craft beer can be defined as an equilibrate mix of tradition and innovation in which traditional production styles stir with employment of non-traditional ingredients creating unusual aromas and flavours (Brewers Association, 2016b). Craft breweries are characterized by smaller production size (less than 6 million barrels per year) and what mainly discriminates them from commercial beers it is the peculiarity of tastes and quality of the product (Brewers Association, 2016a; Kleban & Nickerson, 2012). According to recent studies, craft beer consumption is primarily driven by the different flavours it offers (honey, chestnut flavours and others) and what motivates beer drinkers to consume it is the desire of trying new tastes than break with the common industrial ones (Aquilani et al., 2015; Gómez-Corona et al., 2016). This is in line with what is referred as the ―taste revolution’’ (Kleban & Nickerson, 2012). Moreover, mainly related to the raw materials used in the production process, craft beers are generally perceived as of higher quality compared to mass produced beers (Aquilani et al., 2015). This is reflected in an increased economic value perceived by customers which allows brewers to charge higher prices for their products (Kleban & Nickerson, 2012). Together with taste, there is a general increasing interest in acquiring a deeper level of knowledge while experiencing new flavours and brew styles (Gómez-Corona et al., 2016). The scope of craft brewers is thus to elicit passion on their customers through their products; this passion is something craft breweries also have due to the smaller size of the company and become the distinctive identity of the beer (Chahal, 2015). In this respect, besides peculiar flavours of craft beers as drivers of industry sales, there is evidence that eye- catching labels and bottle designs are playing an important role on the popularity of craft beers (Barnett, 2012). According to surveys by IBIS world, craft beer drinker tend to consume most of their drinking at home thus suggesting that a big share of purchase decision happens in the stores (Brown, 2015). This enhances the importance of retailers where most of the decision making and inspiration for consumers takes place, and the importance of being noticeable for the craft producer (Sandwith, 2015). In general, craft beer consumers are eager to discover new flavours and brands; while for commercial beers well known brands are available on the shelves for craft beers this is less the case.
  • 15. 7 This enhances the role of the label as main communication channel between consumers and product, and it also implies a different amount of time spent looking at the labels. In fact, according to statistics craft beer drinkers spend between four and four and a half minute compared to the half minute spent for choosing an industrial beer (Brown, 2015). Industrial breweries are responding to the craft brewery revolution by introducing in their offer particularly flavoured beers. For instance, Anheuser- Busch American beer company launched the Schoc Top and MillerCoors brewed with the same idea Blue Moon (Morris, 2014). Although craft beer is a widespread growing trend in Europe, a specific cohort seems to be particularly driving it: Millennials. II.2. A recent European trend driven by Millennials Millennials, also known as Generation Y, are identified with those born in the early 1980s until the early 2000s and they represent 24% of the adult European population (Bryant, 2015; Stokes, 2015). According to Nielsen Report (2007), beer is still considered as the favourite alcoholic beverage among Millennials and the decreasing mass-produced beers trend in favour of craft beers seem to have been leaded by them (Nielsen New Release, 2007). Craft beer is more complex and to a certain extent more expensive compared to commercial beer and this may result less appealing to this younger cohort. However, statistics give a different picture. In fact, the main reason of craft beer popularity among this cohort seems to reside on ―tiredness‖ from usual beer tastes. As beer market evolved, Millennials have also shifted their focus to flavour, characteristics and production process suggesting that beer is more than something to drink. The same Nielsen report highlights that Millennials consumers frequently ―seek new tastes and are willing to pay a premium for alcoholic beverages‖ (Nielsen New Release, 2007, p.1). Thus, besides their reduced budget, there is evidence that Millennials are willing to spend more for a quality craft beer instead of two blend beers; what matters is that the decision must worth their money (Gosselin, 2010). Moreover, according to Joe Thompson, president of the Independent Beverage Group, Generation Y seems not to be as loyal as their parents were; rather than have a preferred beer they are more likely to try new beers and brands (Bryant, 2015; Duva, 2014). This represents an important possibility for craft brewers not facing the brand loyal customers that are frequently present in more mature markets; at the same time it poses and important challenge in understanding how to attract this specific cohort (Davis, 2015). As suggested by the literature, label and identification with a certain brand image are the main tools in the hands of craft brewers. Labels such as ―handmade‖, ―craft‖ and ―limited edition‖ are generally perceived as indicators of higher quality by Millennials much more than their older counterparts (Birth, 2015). Moreover, variety seems to pay off when dealing with craft beers, limited-edition and seasonal beers also seem to attract Millennials, since they are perceived as ―special‖ (Gosselin, 2010). Sources of information also differ compared to previous generations; Internet gave access to a huge amount of information, comments, and opinions regarding the available offers. Millennials rather prefer to do research in online blogs and social network pages such as Brew beer blog (http://www.brewbeerblog.com/) where beer reviews together with craft beer events are available.
  • 16. 8 Recommendations from peers and family have also an important impact on Millennials’ consumption choice. Differently traditional advertising has shown to have reduced persuasive effect over this marketing cohort (Gosselin, 2010; Page, 2015). Lastly, as by definition of a trend, the craft movement is ―cool‖ and this definitely has an impact on the overall image of the industry and the increase of its popularity especially among younger generations (Bryant, 2015). II.3. Craft beer: labels and trends As previously mentioned, what makes particularly attractive craft beers to Millennials is certainly the wide variety of tastes, although displaying a peculiar identity and characteristics seems to be more important than ever in this industry (Label & litho, 2015). In this respect, labels play a pivotal role in conveying specific characteristics related to the product. Craft beer labels are present in a variety of styles, cut and stack labels made of different materials and shapes (Crowell, 2013). The material used for the labels cover a wide variety with matt, glossy, shiny colours and combination of them always in the pursuit of new eclectic arrangements to distinguish themselves and standing out from the crowd (Gómez-Corona et al., 2016). Although the design of the craft beer label should be peculiar and displaying the identity of the brand, different trends can be detected in the industry. According to Jack Wright, president of Atlas labels and Packaging, matt labels seem to be increasing over glossy ones (Crowell, 2013). Different studies suggest how the material used in the label can boost customers’ attraction and consequently enhance purchase intent (Avery Denninson, 2016; Connoly, 2015). In particular, a study run by Package Insight, a university start-up based in Clemson, found that metallic label where higher catching compared to paper, wooden and glossy ones. Another important consideration drawn from the same study is that the level of attraction and the time spent in watching it (fixation time) were good predictors of consumers’ purchase intent (Package Insight, 2016). Besides the different attractive power, another important component of labels is the perception related to different material combinations; for instance, metalized labels are considered as more expensive while paper labels as cheaper (Connoly, 2015). More and more craft brewers are displaying unconventional and provocative labels in terms of graphic and language choice in an attempt to stand out from the crowd (Label & litho, 2015). Brew Dog, the Scottish craft brewery and certainly one of the most well-known UK craft breweries, is particularly known for its provocative labels and packaging. The ―Never-mind the Anabolics‖ campaign during the Olympic Games in London in 2012 has stated the success of the brewery. Nonetheless, craft beers’ individualism does not always compel to outrageous labels and messages. Simple and more traditional labels also stand out such as ―The Kernel‖ using simple materials that reminds to tradition (Barnett, 2012). This supports the idea that standing out from the crowd can be achieved through minimal design as through more elaborate ones. Eventually, craft brewers interest should focus on how specific labels characteristics are perceived by this target group and which image they convey related to the brand and, more important, to the inner product.
  • 17. 9 II.4. The role of perception Following out interest in beer labels design it is pivotal for our research to cover main concepts necessary for understanding how consumers process label information. We are thus following address the role of perceptual process and its implications. Perception has been defined as ―the process of selecting, organizing, and interpreting sensations into a meaningful whole‖ (Hanna & Wozniak, 2000, p.75). In other words, perception deals with how inputs coming from the five senses are processed to understand the surrounding world (Solomon et al., 2012). In the perceptual process, the consumer is exposed to an external stimulus that arise his/her attention; the actual sensation happens when information is transferred from the sense to the brain. Although all the five senses are involved in the perception process, visual sense represents 80 % of what we perceive from the environment. Different combinations of colours, shapes and sizes trigger different emotions and feelings (Hanna & Wozniak, 2000). Of all the stimuli that surround the individual, only a share of them is perceived. In fact, the ―selective attention‖ principle is based on the idea that we are attracted by cues that trigger our personal interest and beliefs and we thus devote our attention to. The process of perceptual selectivity is displayed in (Fig. 2). Fig. 2-Process of perceptual selectivity. Source: Hanna & Wozniak (2000) Two different approaches have been highlighted from literature in which a person can derive stimuli from: a bottom-up process and a top down process (see Fig. 3) (Hanna & Wozniak, 2000). In ―bottom-up‖ processing the result of the sum of stimuli is derived from physical characteristics of the product (e.g. smell, colour); all together these stimuli evoke an image in the consumer’s mind. ―Top-down‖ processing is more dynamic since it involves consumers’ personal needs, beliefs and values; in fact, consumer’s personal needs and expectations help in recognizing the stimulus based on previous knowledge and thus give a meaning to the perception of the stimulus. In this case, perception is not the mere result of physical stimuli coming from the product but it also involves a higher level of individual’s measures. The beliefs and experience that the consumer acquire are organized in schemata (e.g. product category) that drive individual’s perceptual process and the interpretation of the information coming from the new stimulus. Therefore, the interpretation of a new stimulus is subject to our prior experience together with the expectations we have towards the specific product (―selective interpretation‖). It is thus the combination of interpretation, expectations and intentions that allow the consumer to derive the meaning from the product (Hanna & Wozniak, 2000). In this respect, the similarity detected from the new stimuli may evoke associations to characteristics with which the consumer is familiar with. An example could be to infer product quality related to the perception of specific product cues (Blythe, 2008). Moreover, perception coming from the outside world feeds consumers’ memory and increases consumers’ knowledge. Consequently this stored perception has an impact on consumers’ attitude Environmental stimuli Selective exposure Selective attention Perception
  • 18. 10 and purchase intention (Solomon et al., 2012). It follows that basing perception of the mere five senses action could hold to misleading results. In fact, despite the five senses play the main role in the perceptual process, perception is also highly subjective and the interpretation differs from person to person. Common characteristics shared by consumers such as age, lifestyles, mental settings evoke differences in the perception. On the other hand, despite the subjective nature of perception, specific targets and age cohorts sharing common interests and characteristics suggest a similarity among perception (Lorenzi-Cioldi, 2008). This supports the choice of selecting as target of our research a market cohort (Millennials). Perception is the starting point for consumers to build up their knowledge regarding different products, brand, influencing beliefs and attitudes towards them and thus their purchase behaviour (Blythe, 2013). It becomes essential to understand which stimuli most trigger consumers’ attention and how their personal beliefs and needs impact the perception and interpretation of the product. In this perspective, introducing similar characteristics of other products with which the consumer is familiar with in terms of design, material used, colours may arise specific inferences (e.g. product quality) related to the selected product cues (Bloch, 1995). The concept of visual codes and perceived typicality, following addressed, will help in gain a better understanding on how specific product category characteristics can affect consumers’ perception of the product. II.4.1. Categorical visual codes and perceived typicality In the previous section we highlighted the importance of schemata in the perceptual process. As a collection of beliefs and experience related to specific product category, they drive the perception of displayed product characteristics. Related to this point are the concepts of categorical visual codes and perceived typicality of a product that we are following going to discuss. According to Orth and Malkewitz (2008), the overall perception of a product comes from a ―gestalt‖ (Orth & Malkewitz, 2008, p. 64) of different elements working together. Viewers perceive Bottom- up processing: using beliefs and expectations to interpret sensory information Top- down processing: sensory information are assembled and integrated Fig. 3-Bottom- up and Top-down processing. Source: Hanna & Wozniak (2000)
  • 19. 11 the basic elements constituting the product (e.g. colours, images) and cognitively collect them in a more complex component eliciting different responses from the consumers (Bloch, 1995). Each element constituting a specific product category has been identified as ―visual code‖. Celhay et al. (2015), investigated the concept of visual codes for specific product categories. Previous research focused on categorical visual codes only taking into consideration colours as a cue (Celhay et al., 2015). However, several studies suggested the existence of other cues in which visual codes should rely on to identify specific product categories. Illustration, layout (McNeal & Ji, 2003) and typography (Orth & Malkewitz, 2008) are other common characteristics that help in visually identify a specific category. Categorical visual codes should thus be related as ―the packages visual characteristics that are the most frequent within a product category‖ (Celhay et al., 2015). Related to visual codes is the concept of typicality. Typicality has been defined as ―the degree to which an item is perceived to represent a category‖(Loken & Ward, 1990, p.112). The more the similarity of attributes with other category product the more the product will be considered as typical of that category (Loken & Ward, 1990). The same authors support that typicality is particular important in order to evaluate the extent to which products are remembered and compared between one another and eventually selected for the purchase. In fact, typicality of the brand or product should affect the probability of being included in a specific category and being used as a comparison measure. Another point highlighted by Loken and Ward (1987) is that consumers seek for typicality in the attributes that are considered as more salient related to the uses of the specific category. Thus, the product should posses those familiar characteristics that are relevant to the function that the category covers (Loken & Ward, 1987). In this perspective the focus of typicality should narrow down to those specific salient characteristics, relevant for the category (Loken & Ward, 1990). Similarly Rosch and Mervis (1975) introduced the concept of ―perceived typicality‖, representing a ―cognitive process involving an evaluation of the extent to which a given object represents a given cognitive category‖ (Celhay et al., 2015). Thus, consumers store in their memories what they recognize from external stimuli in form of cognitive categories then they rank according to the level of ―perceived typicality‖, to the similarity of representing a category. As suggested by the word ―code‖, visual codes imply a de-codification process, understanding the meaning that consumers associate to them. From previous considerations, it follows that packaging that display visual codes ―typical‖ of the specific product category will look more familiar to the viewer (Celhay et al., 2015). On the other hand when a label discriminate itself from a typical product category, the it will appear as a more ―novelty‖ design (Rosch & Mervis, 1975). Few studies have reported that typicality is connected with the overall attitude of a product. It seems that the more familiar and typical the product is, the more it is appreciated and the more positive is the attitude towards it (Barsalou, 1983, 1985; Nedungadi & Hutchinson, 1985). In conclusion, visual codes together with the perceived level of typicality have important implications for the perception of the holistic design characteristics; providing useful insights in how to manage the perception of brand personality (Rosch & Mervis, 1975). In light of these conclusions, we consider important to investigate the validity of visual codes in the perception of craft beer labels; specifically if more typical/ traditional designs are associated with a more positive attitude and which idea they convey related to the product. These issues will be addresses in our research questions.
  • 20. 12 II.5. The importance of label In nowadays society, aesthetic has a main role in all kind of products whatever their function is (Holbrook & Anand, 1992; Holbrook, 1980). In fact, when choosing in between two products with similar functions and price, consumers will generally buy the one that is considered as more attractive to them (Kotler & Alexander Rath, 1984). A considerable amount of studies have recognized that labels are the first communication channel between producers and consumers. Design and the information provided by the label are among the most important cues customers use when deciding to purchase a bottle of wine (Chaney, 2000; De Mello & Pires, 2009; Thomas & Pickering, 2003; Thomas, 2000). Moreover, labels have shown to be the most important indicator of intention of wine purchase following price cue (De Mello & Pires, 2009). In a retail environment, customers get in contact with the packaged product (Underwood & Ozanne, 1998). Given that the level of attention in the store is temporary, one of the main function of the label is to attract the attention and arise interest in the viewer who needs to be continuously stimulated (Bitgood, 2000). Appealing packaging and labels can make perceive the product as more ―interesting‖ and ―unique‖ (Gómez-Corona et al., 2016, p.362). Therefore, the design of the product, referred as the ―silent salesman‖, becomes the main communicator of the characteristics related to the product and the brand (Dichter, 1957). Bitgood (2000), identified different steps in order for a label to be considered successful. Firstly, an ―attracting power‖ which will push the customer to stop and check the label; secondly, an ―holding power‖ referring to the reading time devoted to the label; thirdly, a ―social interaction power‖ which relates to collateral behaviours and lastly a ―communication power‖ referring to the level of knowledge acquired which should be reflected in a positive attitude to purchase (Bitgood, 2000). Consumer’s motivation in reading labels may be increased by limiting the number of words used in it thus reducing the perceived effort of reading (Screven, 1992). In particular, labels arising questions have shown to be effective attracting customers’ attention (Hirschi & Screven, 1988). Moreover, the presence of 3-D objects and the format of the label are other important factors in eliciting consumers’ response to the label (Bitgood, 2000). Another important aspect refers to the ―cognitive emotional arousal‖ elicited by the label that triggers the customer to read it and think about its meaning. As previously referenced, consumers tend to be more attracted by familiar characteristics and cues of their interest and it is to them that they devote their attention to (Bitgood, 2000; Hanna & Wozniak, 2000). Both men and women evaluate craft beer bottle appearance although there is evidence that women give more attention to extrinsic cues compared to their male counterparts (Gómez-Corona et al., 2016). The label exerts more than a mere attraction power, it serves as a way to ―talk‖ to the customers and it expresses the essence of the product and the brand in which the consumer can identify with (Label & litho, 2015). It seems thus important to understand how specific characteristics of a label are perceived by customers and how they reflect the image of the brand.
  • 21. 13 II.5.1. Label perception and Brand image Highly related to the label perception is the image consumers have towards a specifics brand which is identified as ―a person’s view of what a company, brand or store is‖(Hanna & Wozniak, 2000, p.100). As these authors highlighted, perception and good communication of a brand image can be even more important than the actual product features and price. According to Kotler (1994), there are three levels in which a product can be defined: ―core product‖, ―tangible product‖ and ― augmented product‖. Core product represents the actual response of the product to consumer’s needs. In the case of beverages such as wine, the product does not respond to a mere satisfaction of thirst; it rather possesses a specific taste and takes with it the enjoyment of the experience and a certain degree of ―intellectual prestige‖ related to the specific beverage (Jennings & Wood,1994). The same seems to hold in the case of craft beer. Tangible characteristic presented by the product are those information provided by the label that describe the product characteristics and usually give some advice on how to consume it. For instance the wine determined by vintage year, country of origin, grapes. We can argue that in the case of the beer this would be represented by flavour characteristics, alcohol % and brewing style. The augmented product represents the product competitive advantage over its competitors. It involves a specific brand image, which can be enhanced by awards given to the product, prestige, recommendation and the retail experience (Kotler, 1994). In branding it is essential to being able to convey the essence of the brand and the label is an extremely important part of it. Design of products has the power to generate evaluation of the product based on its characteristic (Aaker, 1997; Orth & Malkewitz, 2008). Colour, size, texture of label and the message displayed play a main role in the perceived identity of the brand (Label & litho, 2015). In fact, design judgment usually refers to impressions related to the quality of the product reflected in the brand and on a broader perspective, brand’s personality (Orth & Malkewitz, 2008). Brand personality is generally defined as ―the set of human characteristics associated with a brand‖ (Aaker, 1997, p.347). While product related characteristics serve more of a utilitarian function, brand personality respond to a ―self-expressive‖ function (Keller, 1993). Coca-Cola is often associated with ―coolness‖ as personality trait and generally all brands are associated with specific personalities (Aaker, 1997). Literature suggests that the higher is the consistency between consumer characteristics and brand personality, the higher is the inclination towards that specific brand (Malhotra, 1988; Sirgy, 1982). As highlighted by Harckham (1989), package acts as conveyor of the initial idea the consumer forms about brand quality. In fact, despite being a way of attracting attention, pictures in labels also help in communicating the essence of the product (Underwood & Klein, 2002). Pictures can thus be the main channel in conveying to the consumer specific product characteristics and thus enhancing a positive attitude towards the product (Underwood & Klein, 2002). This is what is referred as ―incidental learning‖ mainly important in low involvement purchase decisions where low effort is employed in the selection process (MacInnis & Price, 1987). As Mike Lane, Lofton Label CEO, points out craft beer producers should question the image of their brand, their identity and what they want to convey to their customers (Crowell, 2013). Lane also affirms that label is a source of information related to the brand and supports the idea that consumers highly rely on colours and images used in the label in their purchase decision.
  • 22. 14 Particularly, different authors suggest that label cues are often seen by viewers as important to detect quality and the personality of the brand (Boudreaux & Palmer, 2007; Gluckman, 1990; Jennings & Wood, 1994). Label appealing is not confined only to the craft beer sector. The wine industry is trying to renovating and appeal to younger generations by using catching design (Ivinski, 2000). Traditionally, in the wine industry traditional labels often display vineyards and soft colours and are usually considered as a synonym of high quality. Shape and size of the label, the image depicted, the colours used, the message and the location on the bottle are all scanned by customers. Darker colours elicit quality association while more colourful labels are usual referred as less ―serious‖ and are connected to more ―frivolous‖ tastes (Boudreaux & Palmer, 2007). It thus becomes important to understand how customers’ perceive different label and design characteristics connected to the core product (Jennings & Wood, 1994). Moreover, by understanding customers’ perceptions, producers can detect which cues convey an idea of higher value and possibly adjust prices (Roy, Walker, & Cross, 1987). This is particularly important in the case of wines and beer since the real product cannot be tasted until the bottle is opened. Walsh et al. (1988), suggested that a successful design "acquires and incorporates the necessary knowledge of what customers want, what can be most efficiently produced and what best fits in with the company's image" (Walsh, Roy, & Bruce, 1988, p. 213). II.5.2. Visual characteristics of label design As previously mentioned, consumers’ attention is usually attracted from external inputs that can help them in categorizing the product. While categorizing them the consumer is creating an opinion of the characteristics of the product. These puzzles of information are collected from different elements belonging mainly to label design (Piqueras Fitzman et al., 2011). Different visual characteristics cooperate on the overall perception conveyed by a certain label: composition and layout, colours, illustrations and name/typography used (Ampuero & Vila, 2006) . With respect to the composition and layout, there is evidence that the lines among which the label is structured may convey different associations to the viewers (Ares et al., 2011). For instance, central layout in a label is usually related to tradition relying on the classic idea of symmetry (Hurlburt, 1977) while asymmetrical layout is more related to modern-contemporary designs (Roberts & Thrift, 2002). According to a wine label study carried out by Celhay et al. (2015) ―A study of the visual codes of Bordeaux Grands Crus‖, the central composition of the label conveyed the idea of a traditional, prestigious and classical product. Colour is another main player in the arousing of emotions characterizing the product. Usually, yellowing white backgrounds are perceived as signifiers of the age of the brand, also connected to tradition. As a warmer colour (yellow) moreover tend to convey an idea of rurality and ecological reminding of recycled paper. On the contrary, whiteness is usually perceived as an indicator of product quality (Celhay et al., 2015) and gold colour is usually connected to the idea of luxury (Lawes, 2002). The perception of different combinations of colours is another interesting research field to be investigated.
  • 23. 15 Image in a package can enhance the attention of the brand especially in the case of less known brands. In this way the product can more easily enter consumers’ consideration set and thus increase its likelihood of purchase (Day, 1985; Underwood et al., 2001). Pictures attract more attention compared to verbal information and are usually easier to recall (Bolen, 1984). They can also enhance sensory information processes suggesting a smell, taste and look of the inner product (MacInnis & Price, 1987). Moreover, pictures deliver aesthetic pleasure and this may result in an overall positive attitude towards the product (Underwood & Klein, 2002). Name is another important cue in label design to attract consumers’ attention and trigger consumers’ reaction. There are no boundaries to the names that can be suitable for craft beers although some common trends can be detected. For instance the use of geographical location, namesake (e.g. George’s and Sons), hyperboles and puns are frequently used in craft beer’s name (Label & litho, 2015). The name is a clear way to trigger different emotions, for instance, provocative and unusual names may elicit stronger reaction on the consumer. It can also be the case that the sound of the name reminds of specific natural sounds, or others. The typography also convey a certain feeling; uppercase letters are thought to give importance (Blanchard, 1980). II.5.3. Label as an extrinsic cue Label in itself is an extrinsic cue defined as ―an attribute that is product-related but not part of the physical product‖ (Szybillo & Jacoby, 1974). Consumers often rely on extrinsic cues, considered as indicators of product quality, to infer its inner characteristics (Richardson et al. , 1994). This in particular happens when the brand is unfamiliar to the customer or when a high degree of uncertainty in the purchase is involved. Especially, when the consumer cannot try the product (Zeithaml, 1988). Generally, the term extrinsic cues refer to all those characteristics that describe the product without taking into consideration the inner product; examples of extrinsic cues are price, country of origin, producer. Labels’ extrinsic cues elicit expectations on the viewers and those expectations influence consumers’ perceptions of the beer. Therefore, extrinsic cues originating expectations also impact the product experience in itself (Siegrist & Cousin, 2009). The information provided play a decisive role in the expectations’ source (Sester et al., 2013). As a non-homogeneous product, craft beer is available in different types and qualities which can be considered to a certain extent as objective characteristics. On the other hand there are other more subjective characteristics that define the inner product and they are the reflection of perceived attributes related to label characteristics (Nelson, 2005). To conclude, it seems particularly important to investigate the perception of specific product characteristics related to selected label cues. Different cues will be investigated in the research, trying to understand if differences related to genders, level of knowledge have an impact on the perception of label cues among European Millennials.
  • 24. 16 II.5.4. Information in the label Labels make themselves shelf appealing through their colours, shapes, position in the product together with the information provided (Jennings & Wood, 1994). Several studies confirm the role of label as an important source of information and as part of purchasing decision (Chaney, 2000; Jennings & Wood, 1994) As for wines and other beverages, one problem that craft drinkers face is that the quality of the beer cannot be assessed until the product has been consumed. The exact taste and colour of the product is unknown to the consumer by just looking at the bottle (Barber et al., 2006; Lockshin & Hall, 2003). This to a certain extent explains the need for product information and remarks the importance of the description appearing on the label in order to better understand the inner liquid. (Unwin, 1999). Usually front labels are devoted the role of eye catching and ―evocation‖ while back label is widely used to present technical characteristics and information (Barber et al., 2006; Charters, Lockshin, & Unwin, 1999). Millennials wine drinkers seem seek for meaningful information in the label therefore it becomes important for producers to understand which kind of information they look for during their purchasing decision. Differences arise between females and males, where females seem to be more attracted by label colour, picture and front label characteristics compared to their male counterparts. The type of information also may differ considering gender difference, pairing with food seem to be of interest (Barber et al., 2006). Referring to the knowledge and information seeking, a distinction should be made between information sources ―prior‖ and ―during‖ purchase. As previously mentioned, besides information provided by the label, Millennial generation seek for information on the internet, websites and reviews, which are combined with their previous experience (Chaney, 2000). In-store information has shown to have an important impact on impulse buying behaviour, especially in a retail setting (Chaney, 2000). Another important source of information is provided by personal sources, referring to friends, family and peers recommendation (Kiel & Layton, 1981; Urbany, Dickson, & Wilkie, 1989). The store personnel also cover an important function in providing source of information although the use of their knowledge is not yet clarified by literature (Edwards & Spawton, 1990). It thus seems to be important to understand where Millennials do search for information for their craft beer purchase decisions. Together with the information provided by the label, retailers play a pivotal role in the perception of the product on the shelves. II.6. Retailers In order to reach the consumers, craft brewers can go through three processes (see Fig. 4). They can decide to direct their production to wholesalers consequently reaching the consumers through a retailer; they can opt to be wholesalers themselves -cutting one of the steps of the discussed three tier- systems-; or thirdly, they can opt to operate though a brewpub, where the beers is generally sold as draft beer.
  • 25. 17 Another way in which craft brewers can reach their consumers is through online channels. In fact, craft beer industry has grown in an era in which online shopping represents a huge possibility for brewers. Websites such as http://www.beersofeurope.co.uk/ display European craft breweries with price, characteristics and shipments information. For the purpose of the study, we focused on a retail setting where craft brewers are presented by displaying their products on the shelves. Retail stores thus represent the main distribution channel for craft brewers. In this context, besides from products being displayed on the shelves, information and suggestions related to the goods are generally provided by the store personnel. Therefore, it seems more and more important to create ―shelves of the future‖, identified with craft beers being paired with food and valuable information provided by in store directions together with valuable personnel (Rutishauser, 2015). II.7. Theoretical overview Craft beer is an increasing trend in the European beverage industry and Millennials have shown to be the main actors in driving its success (Nielsen New Release, 2007). Specific characteristics have been detected related to craft beer consumption behaviour of this cohort. Millennials usually like to try new tastes and use different sources of information in their purchasing decision such as online blogs, websites and peer recommendations. In a setting in which few popular brands are known, craft brewers have the opportunity to stand out from the crowd and one way to do it is by providing appealing labels conveying a peculiar brand image and by providing the right level of information to their consumers (Gómez-Corona et al., 2016; Sherman & Tuten, 2011). In particular, specific label design conventions have been detected in craft beer industry: traditional, artistic/contemporary and provocative labels; all in the attempt of gathering consumers’ attention and conveying a certain product image. In this process, perception is the starting point for consumers to build up their knowledge regarding different products influencing their beliefs and purchase behaviour (Blythe, 2013). In fact, the perception of specific characteristics is subject to our previous knowledge and the level of perceived typicality of the design related to specific product categories. From the displayed characteristics consumers infer specific attributes related to the product, for instance regarding its quality, and build a certain image related to the brand (Loken & Ward, 1990). Despite the subjective nature of perception, specific age cohort have shown to share common interests and characteristics, thus providing support for Millennials selection as the target of our research (Lorenzi-Cioldi, 2008). Fig. 4-Brewery-consumer chain Brewery Wholesaler Retailer Consumer Brewery as a Wholesaler Retailer Consumer Brewery as a Brewpub Consumer
  • 26. 18 Due to the lack of literature related to the specific craft beer field, the presented theoretical background find the ground for theories in the wine literature related to Millennials perception of label cues (see Table 1). At the same time, it attempts to identify trends going on in the market and to highlight important aspects to be investigated in our research. Authors Concept/s Definition Blythe, 2013; Hanna & Wozniak, 2000; Solomon et al., 2013 Perception, schemata (f.e. product category), perceptual process Perception is the process of selecting, organizing and interpreting sensations into a meaningful whole; beliefs and experience that consumers acquire are organized in schemata (f.e. product category) and they drive the individual’s perceptual process Blythe, 2013 Perception- brand beliefs Perception is the starting point for consumers to build up their knowledge regarding different products and brands influencing their beliefs and purchase behaviour Celhay et al., 2015 Categorical visual codes Categorical visual codes are ―the packages visual characteristics that are the most frequent within a product category‖ Loken & Ward, 1990 Perceived typicality Perceived typicality as the ―degree to which an item is perceived to represent a category‖ Chaney, 2000; De Mello & Pires, 2009; Thomas, 2000 Label design and information Design and information provided by the label are among the most important cue in wine purchasing decision (Gómez-Corona et al., 2016) Label characteristics Characteristics related to the product can be inferred from label design (interesting, unique) Kotler, 1994 ―Augmented product‖, brand image ―Augmented product‖ involves brand image, prestige, representing the competitive advantage over competitors. Orth & Malkewitz, 2008 Brand personality Design judgement usually refers to impressions related to the quality of the brand and on a broader perspective, brand personality Celhay et al., 2015; Hurlburt, 1977; Roberts & Thrift, 2002; Lawes, 2002; ; Day, 1985; Loken & Ward, 1987; Underwood, et al. 2001; Composition and layout, colour, image and name Composition and layout, colour, image and name represent visual characteristics that cooperate in the perception conveyed by a certain label. Siegrist & Cousin, 2009 Labels’ extrinsic cues Labels’ extrinsic cues arise expectations on the viewers influencing consumers’ perception of the beer and the product experience Barber et al., 2006; Gòmez et al., 2016 Gender differences in the perceptual process Females seem to be more attracted by label appeal in their purchase decision compared to their male counterparts Table 1-Theoretical overview. Source: Own. As it will be further discussed (see Section III.4), a mixed approach consisting of a qualitative pilot study and quantitative online questionnaire is considered to be suitable for the purpose of the research. Specifically, the pilot study will attempt to provide a better understanding of the label conventions detected in the craft beer market and it will serve to identify specific labels,
  • 27. 19 representative of the aforementioned conventions, to be used in the main study. Through the information gathered via the online questionnaire, we will try to answer the following research questions: RQ1: How are specific label design conventions influencing consumers’ attitude and purchase intent towards craft beer? RQ1A: How consumers characterize craft beers when they are exposed to a specific label that presents a particular configuration in terms of brand name and design style? RQ1B: Does congruence between brand name and design style convention positively affect consumers’ attitudes towards craft beer? RQ1C: Does congruence between brand name and design style convention positively affect consumers’ purchase intent? RQ2: Are there any differences in consumption habits according to gender, consumption frequencies, and craft beer knowledge? RQ2A: Are there gender differences in the importance given to specific label cues? RQ2B: Does perceived importance of label cues change across different levels of craft beer knowledge? RQ2C: Does perceived importance of label cues change across different levels of consumption frequencies RQ 3: Which specific craft beer consumers’ segments can be detected inside the Millennials’ cohort? Information sources and brand loyalty behaviour from Millennials will be further investigated in an attempt to shed lights in this under researched field and provide meaningful insights to craft brewers.
  • 28. 20 III.Methodology This section presents the research philosophy, purpose and approach underlying this thesis investigation. Further, the research strategy, methods applied and data collection procedures are explained. Data analysis processes are also described. Lastly, the reliability and validity of the research process is discussed. III.1. Research Philosophy: Critical Realism Research philosophy is related to the perspective from which an investigation is conducted, not only in terms of selection of methods but also regarding the nature of the knowledge that will be developed (Saunders, 2011). In this broad sense, theory assists researches in determining, operationalizing and measuring the different variables under investigation and also by establishing a basis to interpret findings (Malhotra et al., 2012). In other words, a research philosophy implies certain assumptions or beliefs that will guide the investigation and will support the research strategy (Guba & Lincoln, 1994, p. 105). For social investigations, Saunders (2011) describes four main research philosophies: positivism, realism, interpretivism and pragmatism. As researchers we are aware that the selection of a research philosophy ultimately depends on the research questions that we are willing to address. Thus, since our aim is to explore perceptions and attitudes towards craft beers in the European market overall and from a particular perspective (the labels); the critical realism research philosophy was adopted. This particular philosophy has strong ontological assumptions that primarily affect the epistemological dimension of a research (i.e. the way results are interpreted and considered) rather than the methodological selections since both quantitative and qualitative methods are commonly applied in critical realism. Nevertheless, alike positivism, the philosophy of realism founds its basis in scientific principles in order to develop knowledge. Realism can be divided into two streams: direct and critical realism. Direct realism claims that our sensorial experiences depict the world precisely. Conversely, critical realism rejects the assumption of things being experienced directly through our senses and claims that what we experience, it is nothing but a representation or an image of the real things and not the real things itself. In this sense, critical realism’ main ontological assumption is that reality exists, to a certain extent, independently of the observer. It is, thus, infer via ―social conditioning‖ (Saunders, 2011) or, in other words, reality is the result of the relationship between the objects itself, the sensations they elicit and each individuals mental process (Saunders, 2011). Consequently, for critical realism the nature of knowledge is transitive; therefore, any acquired knowledge is by definition inaccurate (Scott, 2007). Additionally, this implies that any study can only occur at the ―intersection or vertex of agential and structural objects‖ (Scott, 2007, p. 15), therefore, this relationship should be pondered by the researcher. Accordingly, from the critical realist perspective it is important to perform multi-level studies (Saunders, 2011) to explore the influence each one of them might have over the phenomenon under study. This philosophy carries several implications in our research, firstly, our findings should be constantly retested by future research (i.e. replicated) and new studies should also focus in different stratums of social reality in order to consider the influence of diverse contexts; secondly, findings need to be carefully interpreted taking into consideration not one but as many factors as possible and yet, they should always be considered as fallible and biased by the researchers owns view of the world. Thus, our thesis investigation will focus on a particular cohort (Generation Y), in a particular
  • 29. 21 geographical region (Europe) and within a particular extrinsic cue (craft beer labels). Moreover, results will be confronted with demographics descriptors and consumers’ habits and preferences in order to provide a more exhaustive picture of the context in which consumers perceptions react in analogous ways. III.2. Research Approach: Inductive The approach selected for this thesis investigation was the inductive approach. An inductive research is mainly characterized by the collection and analysis of data whether to develop theory (Malhotra et al., 2012; Saunders, 2011) or to gain different insights of a phenomenon (Easterby- Smith et al., 2008). Previous theories or conceptual frameworks are not the starting point of the research (Saunders, 2011), on the contrary, the observed events are arranged in a theoretical model (Malhotra et al., 2012) and are further correlated to the literature (Saunders, 2011). Consistently with the critical realism philosophy, inductive studies emphasize the influential role of the research context upon the nature and interpretation of the issue under study (Malhotra et al., 2012; Saunders, 2011). The selection of an inductive approach was mainly motivated by the lack of literature in the field of study and by the researchers concern about the transitive nature of knowledge that requires to consider a phenomen in a particular context. In that sense, the research was designed using a mix method approach (qualitative and quantitative) in a way that conclusions can be drawn from data collected and to limit the findings to a particular cohort in a specific context. III.3. Research Design According to Malhotra et al. (2012), the research design acts as framework that establishes the foundations of the marketing research in a more detailed way than the research approach. Therefore, it implies defining the required information, the research purpose and overall design, the methods, data collection procedures, sampling processes and sampling size and data analysis techniques. In the following subsection we will discussed this aspects in relationship with our thesis investigation. III.3.1. Research Purpose & Overall Design Traditionally, according to Saunders (2011), three research purposes can be differentiated in the field of the marketing research: exploratory, descriptive and explanatory. On the other hand, Malhotra et al., (2012), differentiates between exploratory and conclusive designs. Exploratory designs include either quantitative or qualitative explorations whereas conclusive design comprises descriptive o causal studies. From this perspective, our investigation can be framed within an exploratory design. In exploratory designs the information is not precisely defined since the aim of the research is to seek for understanding. Consequently, sample size is smaller and the research process may change along the way (Saunders, 2011). To serve to our research purpose, the investigation predicted two data collection methods. Firstly, a pilot study using qualitative data collection techniques was
  • 30. 22 conducted. The aim of the pilot study was to explore which categories of craft beer label designs and brand name conventions Millennials could recognize and what motivated their decisions. Secondly, a main study using quantitative techniques to gain further understanding regarding consumers’ perceptions, purchase intent and attitudes towards craft beers and their labels; and, to seek to find different segments within the cohort, was be also performed. A mixed approach was selected so that the pilot study can nourish the main study by providing deeper understanding of the phenomenon and so that the realist facet of the research is enhanced. III.4. Data Collection For this thesis both, secondary data and primary data were collected. Secondary data are data that is already available and it includes both raw and published data (Saunders, 2011) whereas primary data are data specifically collected and tailored to the address the research question at hand (Malhotra et al., 2012). In this investigation, the use of secondary data was gathered in order to get deeper insight of the topic under investigation. The main sources of secondary data employed during the research were online reports, articles and documentary written materials such as newspapers articles published by brewers associations. As previously mentioned, the research approach, design and purpose, to a certain extent, predetermines the possible techniques for data collection. Questionnaires in the form of surveys are one of the most common techniques when conducting business researches (Saunders, 2011) and are also an often used way for collecting primary data in quantitative exploratory designs (Malhotra et al., 2012). Therefore, for this research main study an online survey was conducted. For the pilot study a qualitative approach was chosen so data were collected through interviews using the card sorting technique. For both studies, the primary data collection took place just once. III.5. Research strategies III.5.1. Pilot Study: Interviews using the card sorting technique As Malhotra et al. (2012) clarifies, exploratory research can be employed, as a previous stage in a research, when researchers need to gain insights regarding the research object to better address their studies and, thus, define their plans of action. To fulfil this secondary purpose of completing the main study the aim of the pilot study was, in a broad sense, to support the findings of the main research by defining what is consider to be a traditional, contemporary or provocative label, among Millennials in a craft beer context. These categories were taken from the label design trends present in the market (see Bell, 2016; Simmons, 2016; White, 2015). In a narrower sense, the pilot study sought to, given these three preset categories of craft beer label designs, determine what attributes Millennial’ associate to each one of them. In other words, what Millennials’ think of when classifying a craft beer label design as
  • 31. 23 traditional, contemporary or provocative. Additionally, the pilot study contributed to the definition of our sample labels designs and craft beer name conventions. Pilot Study - Method In order to categorize and describe the different craft beer styles, 22 interviews were conducted using the card sorting technique. This technique is an enabling technique that is commonly used in quantitative exploratory research when seeking to understand the reasons behind the categorization choices (Ritchie et al., 2013). Thus, this method allowed us to clearly define the characteristics that convey the idea of traditional, contemporary and provocative (see Section IV.1.2). A total of 16 samples labels were categorised using the Card Sorting technique by 22 different participants. The 16 stimulus labels (see Appendix C) were selected from existing craft beers brewed in non-European countries (Australia, South Africa and USA) in order to reduce the probability of creating sources of variations in the results due to reasons differently from the labels themselves. In addition, to minimize third variables all the labels presented were IPA craft beers within a range of ABV (alcohol by volume) of 4.5% to 7.8% and with highly recognizable craft brewers excluded. Variations in designs in terms of colour, imaginary and typography were selected. Variations orientation and material were avoided. All the labels were presented in their respective bottles. The sample labels were randomly assorted and given to the participants. Participants were asked to classify the labels in one of the three given categories -Traditional, Contemporary/Artistic and Provocative- and were given the choice to think of other categories other than the suggested ones. Further, they were required to rank the sample labels within each category according to the degree of which they consider that the label was representative of that particular group (e.g. from the most to the least traditional). Lastly, they were asked to explain the reasons that motivated their choices. Data collected was recorded and analyzed using descriptive statistics and content analysis techniques. Confidentiality was ensured. III.5.2. Main Study: Online Survey The purpose of the main study was to collect data in order to explore the market group overall consumption behaviours (emphasising the role of label cues in this process) for the means of profiling different types of craft beer consumers and examine if different label designs potentially affect consumers’ attitudes and purchase intent towards craft beers. For this purpose, a quantitative approach was chosen so that the different attitudes and perceptions could be measured and operationalised into variables to statically draw relationships between them. It can be argued that qualitative techniques shall not be employed when performing exploratory research. However, according to Malhotra et al. (2012), this practice is feasible if -as we intended- the exploration aims to determine connections or patterns given a certain dataset. Data were collected using a descriptive survey that took the form of an online self completion questionnaire (see Appendix A). This method was selected because it allows researchers to gather large amounts of data in a relative short period of time and is cost saving (Malhotra et al., 2012).
  • 32. 24 Pre-test The questionnaire was pre-tested by 12 respondents and the thesis supervisor with the double purpose of gaining insight so to improve the quality of the instrument and to detect potential errors in its design. Based on the feedback received, some questions were slightly modified to increase their clearness and reduce error due to misunderstandings. Availability The survey was available online from March 23, 2016 to April 09, 2016. It was promoted via different social media (mainly Facebook and Instagram) and other online channels such as email and whatsapp since it was available in a mobile-friendly version as well. Questionnaire The survey took the form of a self-competition online questionnaire and it was design and launched by using Qualtrics. It consisted of seven (7) screening questions, six (6) questions regarding respondent’s attitudes and purchase intent towards three sample labels and five (5) questions regarding consumption behaviours and brand loyalty (see Appendix A) Generally, the questionnaire was divided in three sections: - Section 1: Screening and demographic data were collected including gender, age range, nationality, perceived income and higher level of education achieved. Information regarding the respondents’ level of knowledge and frequency of consumption of craft beer were also gathered. - Section 2: this section explored consumers’ evaluation of craft beer attributes and purchase intent when exposed to different craft beer label configurations. For this set of questions, participants were randomly assigned to one of three treatment groups. Each group was exposed to 3 different sample labels. The sample labels within a group included each one of the brand name conventions and each one of the design treatments. The sample labels between each groups comprised the 9 different possible combinations between the name and design conventions (i.e. label configurations). The composition of the groups can be seen in Table 2. In this section, the method used by Sherman & Tuten (2011) to study consumers’ perceptions towards wine labels was adapted to the craft beer context and replicated. - Section 3: this section included questions referring to the sources of information used by the respondents prior and during purchase, the importance they assigned to different label cues and brand loyalty.
  • 33. 25 The questionnaire design was maximized in order to increase the reliability and the internal validity. For the multi-item questions, items were randomized to reduce order effects and control items were also included (See Table 3). Different versions of fixed-response alternative questions were used not only due to the fact that makes questionnaires more easily to administer and understand but because the data collected is consistent and thus facilitates the analytical process (Malhotra et al., 2012). In most of the cases the scale questions were formulated using a 7 point Likert-scale since as demonstrated by Givon and Shapira (1984) improvements in reliability can be observed when scales points increases towards 7-point scales. Construct Items Type of Question Source/Adapted from Subjective knowledge Single Item. How would you consider yourself in term of craft beer knowledge? 5-point Likert Scale (1) Totally new (7) I’m an expert (Park et al., 1994) Overall Attitudes Multi-Item How would you describe this Craft Beer? Prestigious, desirable, cheap*, ordinary*, high-quality, distinctive. 7-point Likert Scale (1) Strongly disagree (7) Strongly agree (Sherman & Tuten, 2011); (Boudreaux & Palmer, 2007) αL01 = .736; αL02 = .785; αL03 = .701; αL04 = .708; αL05 = .713; αL06 = .710; αL07 = .736f; αL08 = .723; αL09 = .710* Purchase Intent Single Item. How likely are you to purchase it in the next occasion? 7-point Likert Scale (1)Strongly disagree (7) Strongly agree (Sherman & Tuten, 2011); (Boudreaux & Palmer, 2007). * Reverse scored. ** See Appendix D Table 3-Main Study. Reliability. Sample Labels The sample levels used in the questionnaire were designed according to the results reported by the pilot study (see Section IV.1.1 for further details). For that purpose, the original labels were modified and adapted in order to create the 9 different possible combinations between the three selected brand names (―Apollo‖, ―Robo-Hop‖ and ―Arrogant Bastard‖ representing the traditional, contemporary and provocative convention respectively) and the three label design styles. The sample labels used in the main study can be found in the Appendix C. Group Label Name Convention Design Treatment Group 1 L01 Traditional name (―Apollo‖) Traditional Design L02 Contemporary name (―Robo-Hop‖) Contemporary Design L03 Provocative name (―Arrogant bastard‖) Provocative design Group 2 L04 Traditional name (―Apollo‖) Contemporary Design L05 Contemporary name (―Robo-Hop‖) Provocative design L06 Provocative name (―Arrogant bastard‖) Traditional Design Group 3 L07 Traditional name (―Apollo‖) Provocative design L08 Contemporary name (―Robo-Hop‖) Traditional Design L09 Provocative name (―Arrogant bastard‖) Contemporary Design Table 2-Main Study: Brand name convention and design style treatment per group
  • 34. 26 III.6. Population & Sampling Our population or target group is comprised by European Millennials that are regular or casual craft beer consumers. Due to the size of the population under study, findings need to be generalized from a representative sample to the larger population (Malhotra et al., 2012). Sampling techniques are often divided in two categories: probabilistic or representative techniques and non- probabilistic or judgmental techniques. In probabilistic samples, the probability of each sample of being selected is equal and well known whereas in non-probabilistic samples the selection relies on the judgment of the researcher (Saunders, 2011). Due to time and resource constraints, we opted for the convenience sampling technique for both studies. This technique consists in the researcher randomly selecting the sample, therefore, it is consider a non-probabilistic technique (Saunders, 2011). According to Malhotra et al. (2012), a convenience sample does not allow generalizations. However, Saunders (2011) argues that findings can still be generalized to a larger population. Despite the limitations that the use of convenience sampling implies (e.g. selection bias) the accessibility and the relatively low costs of using it, encourage us to choose this type of sampling (Gravetter & Forzano, 2015; Malhotra et al., 2012; Saunders, 2011). III.7. Data Cleansing Data collected were processed (reduced) in order to obtain an accurate dataset. Data from the pilot study were analyzed and cleaned in Excel 2007 and data from the main study were gather via Qualtrics and exported, analyzed and reduced in SPSS Statistics 23. The sample size for the pilot study consisted of a total of 22 participants. All of them completed the process and met the sampling criteria (European Millennials), thus, none of them was excluded. For the main study, a total of 248 responses were collected of which 65 participants were excluded due to incomplete responses, geographical reasons (out of the European Union), or because they claimed to be non-users in terms of craft beer consumption. Thus, 182 valid responses (N=182) remained. III.8. Ethical Considerations The investigation was performed following a series of ethical guidelines. In all cases, participants were informed of the research purpose and were given the right to decide if they wanted to take part in the research or not and also to discontinue their participation at any time. Confidentiality was guaranteed by assigning a code to each participant and by pledging professional secrecy. Finally, all data collected were used solely for research purposes.
  • 35. 27 IV. Empirical Findings This section presents the empirical finding for both the Pilot Study and the Main Study. For the Pilot study both qualitative and quantitative data were collected. For the main study, quantitative data were collected and analyzed using SPSS. Due to the realistic philosophy of the research, data were analyzed by considering multiple moderator factors. IV.1. Pilot Study The interviews using the card sorting technique were conducted between March 10 and March 20, 2016 in Jönköping, Sweden. A total of 22 participants were interviewed, half of which were female and half were males between 21 and 26 years old and from 9 different European nationalities (see Table 4). Participant Country Age Gender Participant Country Age Gender 1 Sweden 21 F 12 Germany 25 F 2 Germany 26 F 13 France 23 M 3 Germany 24 M 14 France 24 F 4 The Netherlands 23 M 15 Germany 25 F 5 Spain 24 M 16 Germany 25 F 6 Germany 23 F 17 Italy 25 M 7 Germany 26 F 18 Spain 21 M 8 Sweden 23 F 19 Portugal 21 M 9 Germany 25 M 20 Germany 22 M 10 Latvia 21 F 21 Germany 23 M 11 Belgium 21 M 22 Belgium 23 F Table 4-Pilot Study: Participants overview IV.1.1. Sample Labels One of the aims of the pilot study was to assist in the definition of the sample label design and craft beer name conventions so to be used during the main study. The selection was assessed by using descriptive statistics. Participants were asked to classify the sample labels in different categories according to their particular perception. For this purpose, three categories were suggested: traditional (T), contemporary/artistic (C/A) and provocative (P). Participants were left with the choice of not classifying a label if they considered it didn’t belong to any of the suggested categories. Except for one participant that excluded two labels from these categories, the rest did not think about any categories other than the ones provided. Afterwards, they were asked to rank the labels according to the degree of representativeness of each category. For the analysis only the first 3 rank positions were considered. Cumulative ranking frequencies were computed for each category using Excel 2007. Further, ranks were converted into scores (Rank 1 = 3; Rank 2 = 2; Rank 3 = 1) and scores were summed up and computed for each label.
  • 36. 28 In Table 5, the frequencies and scores obtained per label are summarized (see Appendix B for further details regarding the sample labels and their referring codes). Results show that labels L02 and L03 ranked among the 3 first places (f= 15, each) for the traditional category, followed by label L05 (f =14). After computing the scores, L03 obtained the highest score in the traditional category with 37 points. Further, label L07 (f=19) got the highest score for the contemporary/artistic category with 44 points far better than label L08 (f=16) that obtained 38 points. Within the provocative category, labels L14 (f=17) and L13 (f=15) were the ones that scored better with 36 and 34 points respectively thus label L14 was selected. Labels that scored higher within each category were selected for the main study both in terms of label design and brand name convention. Label Code Frequencies per Category (Ranking from 1 to 3) Frequencies per Rank Order per Category Total Scores Rank 1 3 Rank 2 2 Rank 3 1 T CA P T C/A P T C/A P T C/A P T C/A P L01 8 0 0 0 0 0 4 0 0 4 0 0 12 0 0 L02 15 0 0 5 0 0 5 0 0 5 0 0 30 0 0 L03 15 0 0 10 0 0 2 0 0 3 0 0 37 0 0 L04 13 0 0 4 0 0 3 0 0 6 0 0 24 0 0 L05 14 1 0 3 0 0 8 0 0 3 1 0 28 1 0 L06 0 6 7 0 2 2 0 2 1 0 2 4 0 12 12 L07 0 19 0 0 9 0 0 7 0 0 3 0 0 44 0 L08 0 16 0 0 8 0 0 6 0 0 2 0 0 38 0 L09 0 8 0 0 1 0 0 2 0 0 5 0 0 12 0 L10 1 8 1 0 0 0 0 1 1 1 7 0 1 9 2 L11 0 1 12 0 0 2 0 0 6 0 1 4 0 1 22 L12 0 3 8 0 0 4 0 3 3 0 0 1 0 6 19 L13 0 0 15 0 0 6 0 0 7 0 0 2 0 0 34 L14 0 0 17 0 0 8 0 0 3 0 0 6 0 0 36 L15 0 4 3 0 2 0 0 1 0 0 1 3 0 9 3 L16 0 0 3 0 0 0 0 0 1 0 0 2 0 0 4 Total 66 66 66 22 22 22 22 22 22 22 22 22 Table 5-Pilot Study: Frequencies and scores per Label IV.1.2. Definition of the Traditional, Contemporary and Provocative conventions The second objective of the pilot study was to provide insights about which particular cues or dimensions of a front label contribute in conveying the idea of a ―traditional‖, ―contemporary‖ or ―artistic‖ label. Participants were motivated to explain the reasons behind their selections, particularly for those labels that they chose as the most representative. A double-entry table (see Table 6) summarizing the main ideas associated to each category regarding four dimensions -level of information, perceived typicality, visual codes and brand name- was created. The visual codes