Adding value through health claims: an empirical analysis of the Italian yogurt market

Francesco Bimbo

Research output: Thesisinternal PhD, WU

Abstract

In recent years policymakers have aimed to increase the general awareness regarding the link between diet and health, providing food companies with an opportunity to add health-enhancing features in order to differentiate their products. The European market of these products, referred to here as functional foods, is regulated according to the European regulation 1924/2006 on nutrition and health claims on foods.

Even though the European functional foods’ market has grown steadily over the last 20 years, more than 3 out of 4 new functional products are withdrawn from the market within two years from launch. Indeed, firms have to overcome three main obstacles to market health-enhancing products successfully. First, consumer-related factors, such as the heterogeneity of consumer acceptance of, and preferences for, new functional products; second, firms' difficulties in selecting the optimal attribute profiles to meet consumer demand for health features and; third, firms' difficulties to target consumers with a high enough willingness to pay to ensure the profitability of those investments needed to develop and market functional products.

The general objective of this thesis is to assess quantitatively the implicit price of health claims as well as to generate new knowledge that will inform firms on how to target consumers with higher WTP for functional products.

This thesis uses the Italian yogurt market as a case study for three reasons. First, yogurt is considered intrinsically healthy and it is one of the most credible carriers of functional ingredients: the category of fermented functional dairy accounts for nearly 43 per cent of the total functional products’ market. Second, among European countries, Italy saw the launch of the highest number (592) of new healthy products in the period 2005-2009; the majority of the new products introduced were functional yogurts benefiting digestive health (336), the immune system (99) and cardiovascular health (65). Third, the Italian yogurt market is characterized by a high level of differentiation with respect of health attributes, with manufacturers offering a variety of products carrying health claims, appearing suitable to analyze the problem at hand.

The results of this thesis show that in the Italian yogurt market the implicit prices of “risk reduction” claim is higher than that of “general function” ones (respectively, +222.6% vs +85.5% of the baseline alternative’s price in the case of cholesterol reduction health claim), and in three out of four cases, health claims supported by familiar brands have higher implicit price than those supported by less-familiar ones. Those results confirm findings collected in the systematic literature review which highlights a consensus that claims supported by familiar brands as well as “risk reduction” (vis-à-vis “general function”) ones increase consumers’ acceptance of functional dairy products. The results also point out that “natural” and “organic” claims lead to implicit prices which are (approximately) +46.6% and +102.0% over the price of the baseline alternative, comparable to those of some of the health claims. Other results indicate that manufacturers operating in the Italian yogurt market investing in credence attributes (health claims, organic and natural) gain the ability to target consumers with higher WTP by including two or more products carrying credence attribute in their portfolio. Lastly, the findings of this thesis reveal that consumers’ body image dissatisfaction, along with not reading food labels and lower knowledge about leading functional yogurt brands, are associated with lower number of functional yogurt packages purchased by Italian yogurt consumers using a virtual shelf setting.

Original languageEnglish
QualificationDoctor of Philosophy
Awarding Institution
  • Wageningen University
Supervisors/Advisors
  • Oude Lansink, Alfons, Promotor
  • Bonanno, Alessandro, Co-promotor
Award date5 Sep 2017
Place of PublicationWageningen
Publisher
Print ISBNs9789463434508
DOIs
Publication statusPublished - 2017

Keywords

  • milk products
  • yoghurt
  • food products
  • health foods
  • business economics
  • consumer preferences
  • nutrition labeling
  • italy
  • europe

Fingerprint

Dive into the research topics of 'Adding value through health claims: an empirical analysis of the Italian yogurt market'. Together they form a unique fingerprint.

Cite this