Consumer preferences for attributes in sweet beverages and market impacts of beverage innovation

Abstract

Consumption of sugar-sweetened beverages (SSB) is considered as an important risk factor for the development of overweight and obesity in populations worldwide, with a particular focus on the risks in the younger parts of the population – children and adolescents. Together with fiscal measures and information tools, innovation-based approaches such as the development of sugar-free or sugar-reduced versions of established beverages and development of new beverage products have been used to reduce this challenge, but the effects of product innovation on sugar intake are not well understood from the literature, as previous studies have largely ignored substitution effects of product innovation in the beverage domain. The objective of the present study was to investigate the potential effectiveness of product innovation as a strategy to affect consumers' intake of energy from sweetened non-alcoholic beverages. Using household panel shopping data from approximately 3000 Danish households over the years 2006–2014, we developed a hedonic pricing approach to estimate the influence of product attributes on consumers' utility, based on observed data for Danish households' purchases of sweet drinks. Overall, the study found that beverages’ degree of sweetness positively affected the satiation effect of beverage consumption and in turn made the demand for these beverages less sensitive to e.g. price changes or introduction of competing products, whereas the energy density of the beverages positively affected the demand sensitivity to market changes. Findings like these can be useful for assessing market effects as well as environmental and public health impacts of changes to the market environment.