CONSUMER DEMAND
What do customers think about cage-free eggs? The evidence is clear.
The importance of animal welfare
The massive industry-wide shift toward cage-free has been primarily driven by customers. Over the past decade, market research has found that animal welfare is a central concern for Americans shopping for meat and animal products.
In 2022, Innova Market Research, a global market intelligence company, released their annual Top 10 Trends of issues of crucial importance for customers. They found that animal cruelty was the #1 concern among surveyed consumers in North America.
Earlier market research has generated similar findings. One 2018 study from Ketchum found that, for the third year in a row, animal welfare was one of the top three concerns among American consumers.
How many consumers does this represent? A survey from Lake Research Partners found that more than three-out-of-four consumers say they are concerned about animal welfare, and 74% of consumers are paying more attention to labels than they were five years ago.
What will customers pay for cage-free eggs?
Industry analysts are increasingly pointing out that switching to cage-free isn’t merely the right thing to do — it’s also good business.
“Our job is to produce what our customers—and our customers are retail customers—and what the ultimate consumer wants. And a lot of that is cage-free today.”
Max Bowman, CFO of the nation’s largest egg producer (Cal-Maine foods) in an interview with the Wall Street Journal
One 2013 study from the Journal of Agricultural and Resource Economics found that most participants recognized battery cages as cruel and were thus willing to pay more to switch to cage-free. The average premium they were willing to pay was $0.50 a dozen, well exceeding the estimated costs of producing cage-free eggs at the time.
A more recent 2018 study from Jayson Lusk, professor of Agricultural Economics at Perdue University, found an even higher willingness to pay — in a survey of 2,000 consumers, the average premium customers would pay for cage-free eggs was an additional $1.16 per dozen.
Market trends
Customers’ increasing concern with the treatment of animals on farms has resulted in an unprecedented shift in market composition and regulation.
The USDA releases monthly reports on the state of the egg market in the United States. Those reports have shown that the percentage of the total egg market that is cage-free has risen from 5% to 39% in eight years.
Figure created by Samara Mendez, data available at https://osf.io/z2gxn/
