Going healthy: how product characteristics influence the sales impact of front-of-pack health symbols

Stijn Maesen,Lien Lamey,Léon Jansen,Anne Ter Braak

doi:10.1007/s11747-021-00796-w

Abstract

Manufacturers increasingly adopt health symbols, which translate overall product healthiness into a single symbol, to communicate about the overall healthiness of their grocery products. This study examines how the performance implications of adding a front-of-pack health symbol to a product vary across products. We study the sales impact of a government-supported health symbol program in 29 packaged categories, using over four years of scanner data. The results indicate that health symbols are most impactful when they positively disconfirm pre-existing beliefs that a product is not among the healthiest products within the category. More specifically, we find that health symbols are more effective for (i) products with a front-of-pack taste claim, (ii) lower priced products, and (iii) private label products. Furthermore, these results are more pronounced in healthier categories than in unhealthier categories. Our findings imply that health symbols can help overcome lay beliefs among consumers regarding a product’s overall healthiness. As such, adding a health symbol provides easy-to-process information about product healthiness for the consumer and can increase product sales for the manufacturer.

Highlights

Manufacturers increasingly adopt health symbols, which translate overall product healthiness into a single symbol, to communicate about the overall healthiness of their grocery products
Overall effect of a health symbol addition and interplay with perceived category healthiness Given that all continuous variables are mean-centered, and that all dichotomous variables are effect coded, the Addition variable gives an indication of the performance impact across the average of all moderating predictors, for an “average product” in an “average category,” As expected, and in line with the model-free evidence and previous research (Dubois et al, 2021; Nikolova & Inman, 2015), we find the main effect of adding a health symbol on product sales to be positive and significant (β1 = .121, p < .01), and we find that this effect is significantly larger in healthier than in unhealthier categories (β5 = .460, p < .01)
This research studies the impact of adding a front-of-pack health symbol, signaling that the product is a healthier option within the category, on product sales

Summary

Introduction

Manufacturers increasingly adopt health symbols, which translate overall product healthiness into a single symbol, to communicate about the overall healthiness of their grocery products. Manufacturers and retailers are legally obliged to include detailed nutritional information on the packages of foods, typically depicted by the well-known Nutrition Facts Panel This information appears insufficient to guide consumers to healthier product choices (Balasubramanian & Cole, 2002; Moorman, 1996). Because health symbols summarize overall product healthiness into one indicator, consumers are no longer required to integrate information on multiple nutrients to determine overall product healthiness (Talati et al, 2016). This is helpful for consumers at the point of purchase (Newman et al, 2014). A meta-analysis by Ikonen et al (2020) shows that health symbols are helpful for consumers to identify product healthiness (Ikonen et al, 2020)

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