The Impact of Introducing Experiential Factors on Willingness to Pay a Premium at Fairs: An Application of the Contingent Valuation Method

Abstract

Purpose - This study aims to investigate the effect of introducing experiential factors on the willingness to pay a premium at fairs with a case study of International Horticlture Goyang Korea 2023. Design/Methodology/Approach - The study utilized a contingent valuation method (CVM) to derive willingness to pay a premium. An online survey was conducted among general participants of International Horticlture Goyang Korea 2023. A total of 1,090 responses were collected, and 628 valid responses were used for CVM analysis. Findings - As a result of the analysis, the per capita willingness to pay (WTP) a premium for International Horticlture Goyang Korea was estimated at KRW 2,081.12. Based on this, the amount of additional revenue that can be generated through experience fee revenue in the future can be estimated at 832,440,000 won (assuming an average of 400,000 visitors). Research Implications - This study is significant because it explored the economic aspects of holding a sustainable fair. The results show that participants are willing to pay a premium for the experience. Based on these results, it is expected that additional revenue can be generated, and in the future, financial independence and economic sustainability can be secured.In addition, this study is significant in that it introduces willingness to pay a premium , which has been used mainly in the tourism sector, to the exhibition and trade fair sector. It can serve as a cornerstone for research on willingness to pay a premium that can increase the value of trade fairs in the future.