Literature Review and Project Specification - Dissertation Example

?An exploration into the role of nutrition information in influencing consumer choice Introduction There have been considerable efforts from the government and from people involved in food production to move the source of control to the consumer itself in selecting the food they want to consume. Labeling of nutrients is one major progressive step taken in this direction to move that control. Since the introduction of such nutrient information, people have become more conscious of what they eat and what their families consume. (Cowburn & Stockley, 2004) Manufacturers on the other hand are then forced to provide quality foods as the consumer’s choices become more discretionary every day. However, form the management perspective, there have been no concrete findings on the empirical data which details the degree of impact the nutritional information of a product has on the choice of consumers. Several researches have been done and many are still in progress concerning this specialization. This literature review is aimed at discussing some of the research results achieved in the past and in the process, identify the research topic based on which the project will be panned out. The literatures that are reviewed for the subject in consideration were selected based on two criterions – ‘how’ and ‘what’ from the consumer perspective. That is, what exactly the customer requires to be present in the nutrition labels and how do they understand and use the nutritional information given to them. Research on nutrition labeling started way back in the 60’s when the ‘product characteristics theory’ was first proposed by Lancaster. (Lancaster,1966) According to his theory, for a customer, a product’s utility values can be garnered from its attributes itself instead of utilizing the product directly. But, as a matter of fact, even after 40 years, there is still some resistance to his theory. Silberberg and Suen in their published article in 2001 have mentioned that the practical implementation of his theory is very difficult since the valuation of the attributes to obtain information is extremely difficult to achieve. (Silberberg & Suen, 2001) All these speculations were put to rest when Lazardis and Drichoutis in 2005 modified Lancaster’s theory in such a way that the food products turned out to be the measurable attributes. The reason for considering it is because of the feasibility of applying it practically and the ease of effort required in the valuation of its attributes. (Drichoutis, Lazaridis, & Nayga, 2005) Out of the several attributes of food, the nutrient value took its prominence when Darby and Karni introduced it as the credence attribute in the year, 1973. (Darby & Karni,1973) This attribute was then transformed and brought under the concept of ‘search attributes’, forcing governments of several nations to introduce nutrition label on all packed food products. However, countries belonging to the European Union brought in such rules only after 2003. (Darby & Karni,1973) Nutritional information does not end with a mere list of vitamins and minerals; instead it also includes the detailed information pertaining to the type of vitamins, percentage and additional facts about them. One reason that is given for this change is the increase in the numbers of people affected by several deficiencies and health related issues. Obesity and Chronic diseases like heart problems top the chart, urging people to be more cautious and conscious of what they intake. (Nayga,1996) European heart network (EHN), through their research article, brought out some valid information regarding the topic under discussion. (European Heart Network, 2003) According to their findings, people belonging to the upper strata of the society, people who are health conscious and people with just a keen interest are those who seek for the nutrient information and get influenced in their choice. Also, there study states that those kinds of searches are not done regularly and is highly influenced by time and lack of knowledge about the product itself. Their understanding of the information present is often at the basic level, according to the study. The actual usage of such information comes only in case of unknown products and for people who search for a specific presence of a nutrient in the food. These results indicate that the usage of nutrient information for selection of food is still sporadic among the consumers. (European Heart Network, 2003) Stigler, the inventor of cost-benefit approach is of the opinion that the usage of nutrient information is inversely proportional to the cost of the product. (Stigler,1961) Further, some researchers like Bender and Derby, initiated a new set of differences in the nutrition information, providing the separation of ingredient facts and nutrient facts of the products. (Bender & Derby,1992) This was further explored by Nayga on the subject of ‘label usage’ in the year 1999. (Nayga,1999) Another major sub-topic of this research is the age of the consumers. Findings suggest that older people just look at the entire labeling as a single set of information whereas the younger generation put to use both the nutritional and ingredient information for the selection of food. This was further ascertained by Burton and Andrews when they affirmed about the old people’s usage. (Burton & Andrews, 1996) However, it must be mentioned that researches have taken a double standard in deciding about the relationship between age and nutrition influence. The reason for such a situation is the consideration of the health based habits of both the younger and older people. (Burton, Biswas, & Netemeyer, 1994) Nayga (1999) made a valid point by stating that consumers’ who belong to the nutrition information using group, often use it just to ensure themselves of taking the right food and, the idea of nutritional facts actually instigating them to buy a product is a rare phenomenon. The other factor that has been researched upon is the effect of time. Time constraints play a huge role as the customers who belong to different economic levels spend different amount of time in choosing their product. This brings into the context, the next factor – economic status of the consumers. The selection of food varies greatly based on the economic status. For example, an unemployed person may never think about trying different choices or be conscious of what he intakes, which clearly nullify the role of nutrient information. On the other hand a working person or a matriarch may spend time considering and evaluating the health vales of each product. (Leung & Miklius,1997) To summarize, several factors that play critical roles in determining the use of the nutrient information have been discussed but the actual effects of those factors often varies and provides a conflicting result, majorly due to the lack of time, data and limited scope of the subject. (Viswanathan,1994) But, it could also be mentioned that there are some factors that show ubiquitous results at all time. The scope of research and the parameters involved have been quite vast yet limited. A wider range of factors need to be taken into consideration for researching purposes, in order to get a picture about the topic under study. Given the factors that have been discussed above, it comes to my attention that time pressure is one of the critical factor in deciding the influence of nutrient information on consumer’s choice. Aim of the research The aim of my research project focuses on minimizing the time spent by customers on studying nutrient information by identifying the most prominent data that the customer looks to see on the nutrition information, categorized by the type of the product. Objectives of the research The project focuses on achieving three major objectives. They are: To provide a suggestion for the product developers and market regulators, an idea of what to highlight most on the nutritional information in accordance with the type of the product. To minimize the pressure of time affecting the sales of a product, especially of the products that are relatively new to the market. To evaluate the relation between time pressure and economic situation. Research method With the budget constraint of ?50 and a time constraint of three months, the best possible approach to conduct this research is through an online survey. A relevant questioner can be prepared based on the requirements of the research and the consumers can be requested to deliver their response to those questions. In addition, polls can be conducted and the consumer’s opinion about the whole research can be gathered including a request for providing solution. The collected information can be stored and retrieved anytime and based on which, several regression techniques can be applied to analyze the data and determine solutions according to the objectives. There are several advantages associated with doing an online survey. (Moser & Kalton,1971) First of all, it is cheap and 3 months duration is an ample lot of time to conduct the survey. Ease of management as data is stored in the backend in the form of tables, allowing for an easy evaluation. Promotion is easy as lot of pictures and awareness information regarding health issues can be given. Easy to publicize across people and allows for a wide range of consumers to cast their opinion from their own comfort zones. Easy accessibility and requires a very small amount of time with respect to the consumers Its fast and data is highly reliable. Although, irrelevant to the current research topic, security of information will be extremely high and the confidentiality of data is always maintained. (Moser & Kalton,1971) There are also certain disadvantages like people providing false information or irrelevant answers. There is also a possibility of most consumers skipping the survey as there is no manual intervention. But, the advantages comfortably overweigh the disadvantages, making it the best available method to conduct this research. Potential respondents and getting access to them The potential respondents are the large number of internet users. Fortunately, technology has advanced so much that there is availability of internet connection in every household. Since every consumer is equipped with basic internet skills, there is a huge potential to cater the survey across several parts of the world. There are also several methods to make them aware of the survey. One such approach is publicizing in social networking websites and in e-commerce websites. These websites allow for such adverts, either for free or at very low cost. (Iarossi, 2006) These are sites which are frequently visited by millions of users. Another approach to attract the consumers is through manual publicity and sending mobile alerts by providing the link in the message. The important attribute of the survey is the time taken to complete it. As long as it takes very minute amount of time, there is always attention for it from consumers through knowledge sharing. (Iarossi, 2006) Problems affecting the success of the project There are some problems that may prove as hindrances to the success of the project. They are: Unavailability of the necessary resources to conduct a survey There may be possibilities of unavailability of domain and data storage options to conduct the survey online. In such cases, the default option would be to do a manual survey. But other options like free hosting in university websites and in open discussion forums can be used for conducting it online. (Iarossi, 2006) The complexity involved in the selection of questions for the survey and organization of the questions One way of mitigating this problem would be to do a proper research on how surveys are conducted and how questions are derived according to the requirements. The problem of managing the data Proper management of data is required. Database analysts can be consulted on how to organize the collected information in tables so that data can be easily retrieved. The cost involved in hosting a survey Some domains may request huge sums of money to host surveys. In such cases, as mentioned above, a manual survey is the default option. The availability of tools to perform the analysis of the collected data Tools which are open sourced and are available for free and in trial purposes can be used to analyze the collected information. Irrelevancy of the answers. There is every possibility for consumers to provide junk answers. Protocols must be assigned on how such information can be deleted through proper validation rules. Conclusion Concerning the research project, the aim and the objectives of the project has been clearly specified along with the description of the method that can be used to carry out the research. In addition, the possible hurdles have also been listed out along with their solutions. References Darby, M. R., and Karni, E. (1973). Free competition and the optimal amount of fraud. Journal of Law and Economics, 16(1), 67-88. Bender, M. M., and Derby, B. M. (1992). Prevalence of reading nutrition and ingredient information on food labels among adult Americans: 1982-1988. Journal of Nutrition Education, 24, 292-297. Drichoutis, A. C., Lazaridis, P., and Nayga, R. M., Jr. (2005). Nutrition knowledge and consumer use of nutritional food labels. European Review of Agricultural Economics, 32(1), 93-118. Nayga, R. M., Jr. (1996). Determinants of consumers' use of nutritional information on food packages. Journal of Agricultural and Applied Economics, 28(2), 303-312. Lancaster, K. (1966). A new approach to consumer theory. The Journal of Political Economy, 74(2), 132-157 Silberberg, E., and Suen, W. (2001). The structure of economics, A mathematical approach (3rd ed.). New York: McGraw-Hill. Stigler, G. J. (1961). The economics of information. The Journal of Political Economy, 69(3), 213-225 European Heart Network (2003) A Systematic review of the research on consumer understanding of nutrition labelling, EHN, Brussels. Cowburn and Stockley (2004) Consumer understanding and use of nutrition labelling: a systematic review, Public Health Nutrition, 8(1), pp 21-28 Iarossi, G. (2006). The Power of Survey Design: A User's Guide for Managing Surveys, Interpreting Results, and Influencing Respondents. Washington, D.C.: The World Bank. Moser, C.A. & G. Kalton. (1971). Survey Methods in Social Investigations. London: Heinemann Educational Book Limited. Burton, S., Biswas, A., and Netemeyer, R. (1994). Effects of alternative nutrition label formats and nutrition reference information on consumer perceptions, comprehension, and product evaluations. Journal of Public Policy & Marketing, 13(1), 36-47. Leung, P., and Miklius, W. (1997). Demand for nutrition vs. demand for tastes. Applied Economics Letters, 4, 291-295. Nayga, R. M., Jr. (1999). Toward an understanding of consumers' perceptions of food labels. International Food and Agribusiness Management Review, 2(1), 29-45. Viswanathan, M. (1994). The influence of summary information on the usage of nutrition information. Journal of Public Policy & Marketing, 13(1), 48-60 Burton, S., and Andrews, J. C. (1996). Age, product nutrition, and label format effects on consumer perceptions and product evaluations. The Journal of Consumer Affairs, 30(1), 68-89. Read More