Consumers’ valuation of a live video feed in restaurant kitchens for online food delivery service

Abstract

With the rapid development of online food delivery (OFD) service around the world, food safety issues are emerging. Traditional information-provision methods cannot alleviate the information asymmetry between consumers and restaurants in OFD service; therefore, a new approach must be found to increase consumers’ information and gain their trust. Live Kitchen, a live video feed in restaurant kitchens, offers a new idea for providing food safety information through network technology. Using data from 683 respondents in Beijing and Shanghai in China, we examine consumers’ valuation of Live Kitchen for OFD service by utilizing choice experiments and random parameter logit models with error components in WTP space. The results suggest that (i) consumers are willing to pay for Live Kitchen, more than traditional information-provision methods of license publicity and food safety supervision publicity, (ii) Live Kitchen can convey food safety information on OFD service to consumers, allowing them to draw a positive inference about the food safety of OFD service, and (iii) the application cost of Live Kitchen is much lower than the implied welfare gain.