Walk down a grocery store aisle these days and it can feel like you’re traversing the Las Vegas strip: eye-catching signs of every shape and color hope to reel you in to what they’re selling. And much like those neon billboards, labels on food packaging may be useful advertising or more for show.
These types of labels and packaging are not necessarily maliciously intended, but sometimes they may simply restate information that’s already implied in other labels in the hopes of improving awareness. For example, if a carton of milk is labelled with the USDA Organic seal, does another decal proclaiming the product is also “non-GMO” add real value since organic products are always non-GMO?
Michigan State University scientists tested this question among dairy consumers at local grocery stores by surveying what they were willing to pay for a half-gallon of milk with various labels. The group was specifically interested in how the presence of non-GMO and animal welfare labels in addition to an organic label affected consumer preferences.
They found that the redundant labels, both for non-GMO and animal care, were valuable to consumers. In fact, shoppers were willing to pay about 30 cents more per half gallon for those labels in addition to the already-premium price of organic milk. This was even after it was explained that the labels were stating information that technically was already there.
The study, which was published in Applied Economic Perspective & Policy, also simulated if that consumer preference resulted in greater market share than products that offered fewer traits than the comprehensive label. Again, the redundant labels proved valuable, as the researchers concluded that it could help organic participants recapture 3% to 7% of the market from products that only offer non-GMO or animal welfare standards.
In the end, the value of redundant labelling persisted for some consumers but not all, even after they recognized that the labels were essentially saying similar things. Some consumers appreciate the reassurance that another, perhaps more explicit, label provides. At the same time, education strategies to share with shoppers what more comprehensive labels mean can still prove useful. Finding the right balance of information can be useful to answering consumer questions about dairy foods, perhaps particularly in the organic sector.