Beefing up labels

Consumers in the UK are willing to pay a higher premium for healthier and more sustainable beef mince than those in Spain, a new study by researchers at Scotland’s Rural College has found.

However, customers in both countries were willing to pay more for mince with a low fat content, and also placed a higher value on products labelled local or national over those marked organic.

The study, published in the journal Nutrients, is the first of its kind to investigate how consumers trade-off the fat content of a product against its origin, type of production and the level of greenhouse gas emissions (GHG) produced.

It compared how individual labels complemented or competed against each other and looked at consumer preference, and willingness to pay, for beef mince products with different labels including low fat, local, imported, organic and low GHG, in both the UK and Spain.

In both countries, consumers were willing to pay a price premium for products labelled with a desirable attribute. However, UK customers would pay a significantly higher premium for low fat (UK: €3.41, Spain: €1.94), or low GHG (UK: €2.05, Spain: €0.96) products, while Spanish shoppers placed more value on local (UK: €1.54, Spain: €1.61) and national (UK: €1.33, Spain: €1.37) products. Consumers in both countries valued the labels local or national above organic (UK: €1.02, Spain: €1.09).

The demographic also varied between the two countries with elderly people in the UK more willing to pay a price premium for desirable attributes such as low fat, local, organic and low GHG, while young consumers in Spain led the demand for low fat, moderate fat and local beef mince.

The study, which was carried out by SRUC in partnership with the Centre for Agro-Food Economics and Development in Spain, found that consumers in the UK value the coexistence of the labels low fat, low GHG, local and organic differently to their Spanish counterparts. The only exception is the coexistence of the labels low fat and local.

The findings will help the producers and marketers of healthier and more sustainable food products to differentiate their products in the food market. They will also be useful for policy makers who are interested in promoting healthy and sustainable diets.

In addition, the results will help researchers and consultants better understand consumer choices of healthier and more environmentally friendly food products.

Lead researcher Faical Akaichi, a research economist at SRUC, said:It is often reported that consumers do not ‘walk the talk’ and that there is a gap between what they say in research studies and what they do in real market because of the hypothetical setting of a survey or lab experiment.

“Although this may be partially true, in the real market consumers also make different trade-offs before deciding which product to buy. For example, in a survey I might truthfully say I am concerned about climate change and am willing to pay a premium for foods produced with lower carbon footprint. However, I may end up buying a food product produced with high carbon footprint because it is healthier and I value the health-related attributes more than the environment-related attributes.”

The study was funded by the Scottish Government’s Rural and Environment Science and Analytical Services Division (RESAS) as part of the Strategic Research Programme 2016–2021.

Posted by SRUC on 31/01/2020

Tags: Cattle, Research, Food and Drink
Categories: Natural Economy | Consulting and Commercial