This study employs a discrete choice experiment to examine preferences for functional dairy product attributes and willingness-to-pay estimates with a focus on heterogeneity among con-sumers in Germany. The intent of this paper is to estimate preference heterogeneity by linking stated preference choice data not only to socioeconomic characteristics but also to attitudinal statements in a latent class framework. The empirical results indicate the existence of class-specific preference heterogeneity based on the consumers’ attitude towards functional foods emphasizing the importance of attitudinal data in explaining consumers’ choice behavior. Our estimates demonstrate that within a class consumers’ preferences are in accordance with their responses to attitudinal statements, that is functional food skeptics prefer non-functional dairy products, while functional food advocates have a negative preference for non-functional dairy products. The findings also show that all consumers place high value on dairy products en-riched with known functional ingredients such as omega-3 fatty acids. Finally, we find that different groups of consumers reveal differing preferences for the same set of health benefits.


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