Search Farmer Goes to Market

Search Site
Wednesday January 17, 2018

The truth about menu nutrition labeling

Despite a temporary postponement of the U.S. Food & Drug Administration's plans to require menu items at chain restaurants be labeled for nutritional content, the agency continues moving forward with the proposed regulation. The National Grocers Association--with the backing of some midwestern Congressmen who introduced federal legislation in November to specifically exempt grocery stores and other related businesses--has raised several important questions about how the regs should apply to grocers: Did Congress intend to cover them? Can service departments of groceries rightly be considered restaurants? Can independent supermarkets be considered chains? And what will the paperwork requirement do to grocers?

But amid those questions about the practicality and implementation of the regulations, a larger question appears to be going unanswered, even unasked: Do menu labels even work to meet the stated goals of making consumers healthier?

Some recent research casts that answer in doubt.

London School of Economics economist Matteo M. Galizzi examines the new school of thought behind such practices as menu labeling under the umbrella of "behavioral economics," including interventions like financial incentives to get healthy, sin taxes, nudges and information labels. When it comes specifically to information labels in that overall matrix, he writes, it's not difficult to argue that information-based policies sound perfectly logical, whether you look at them through the new lens of behavioral economics or through the traditional lens of conventional economics: The more information, the better, when it comes to making better decisions and plans. Right?

“Yes and no," Galizzi writes. "But mainly no.”

How can such a logical theory as informational labeling fail, he considers? Three reasons:

  1. Merely providing more information may be perfectly effective in raising awareness, he says. But that awareness doesn't necessarily lead to significant and sustained change in behavior. Whether it's full calorie-specific labeling or simply red-light/yellow-light/green-light schemes, direct evidence on the effectiveness of the both systems is relatively scarce, his review of the research demonstrates. Giving shoppers pure calories and nutritional information has been shown to make only a minimal or modest impact on food purchase and behavioral change. And giving them traffic-light type information tends to produce only a substitution effect, the research says: Consumers tend to avoid really bad foods, but they only switch to a less-bad "yellow-light" food, rather than going fully to healthiest options. And when they do switch, they tend to switch to healthier options within the same categories, but they rarely radically alter the overall structure of their diet enough to make changes in their health, he says.
  2. Mere information release can actually trigger unintended consequences. Not only is simple nutritional or calorie labeling unlikely to have beneficial effects, it's been shown to cause inadvertant behavior that completely offsets the possible benefits. A 2012 study in Philadelphia, for example, that aimed to shift consumers toward zero-calorie drinks by one of several methods found giving shoppers calorie counts on beverage choices actually caused consumption of suger-sweetened drinks to increase, not decrease. Another study from 2006 found similar results with labels indicating low fat: Labeling products as low-fat caused a 50 percent, 84-calorie increase in overall food consumption.
  3. Information like menu labeling only works when it really understands consumer behavior--a tough job. For example, one reason labeling fails is because subjects underestimate the true calorie content of "healthier" snacks by as much as half and thus feal less guilty about eating too much of a not-so-healthy food. Similar failure to predict consumer attitudes confound portion-size control, he notes. Consumers given identically large portions of spaghetti ate significantly more when it was labeled “regular” than when it was labeled “double-size" in a 2013 study. And a "health-halo" effect also confounds many labeling intentions, he notes. When asked to rate the taste and caloric content of yogurts and crisps, subjects estimated that the food labelled as “organic” had significantly lower calories than food labelled “regular,” even when they were identical. That effect implies high-fat, high-sugar foods labeled organic would give consumers license to eat more than is healthy for them.

Oklahoma State University ag economists asked a sampling of more than 1,000 consumers in February two questions about some common "authorities" regarding livestock and meat production:

  1. How much do you know about these sources?
  2. How much do you trust them?

These 15 sources were ranked on a scale from “nothing” to “a great deal."

Click the thumbnail below to see where each ranks on the typical consumer's trust scale.

Who do consumers trust?

Do farmers markets really improve farm incomes?

Farm-to-consumer marketing programs like the Nebraska Department of Agriculture’s Buy Fresh Buy Local Nebraska and USDA's Know Your Farmer Know Your Food are founded on the premise that increasing the number of food shoppers who buy directly from farmers helps the economic viability of small farms. "Whether consumers are purchasing tomatoes at a local farmers' market or picking some apples at a roadside stand, they are contributing back to their local economy," said Casey Foster, ag promotion coordinator with the state agriculture department.

But you may be surprised to find that cherished assumption has little scientific backing.

Ag Economics researchers from Louisiana will publish a study in an upcoming issue of the journal Agricultural Economics challenging the widely held notion that encouraging the food chain to cut out the supermarket middleman makes for healthier economics for farmers. In contrast to the “plethora” of journal articles studying the consumer at direct outlets like farmers markets, the researchers say, research is almost nonexistent about the behavior of the farmers themselves and how direct marketing affects their farm business income.

Specifically, no previous studies the Louisiana team uncovered focused on how farmers’ management and marketing skills affect their decisions to use either roadside stands, or on-farm stores, farmer’s markets or community supported agriculture programs, vs. less-direct markets like direct sales to local grocers, regional distributors and state branding programs, or some combination of the two. None of the studies they reviewed have examined the impact of marketing and management skills on the financial performance of the farmers’ business when they market through such non-conventional channels.

So the Louisiana researchers pulled data from the nationwide 2008 Agricultural Resource Management Survey collected by the Economic Research Service and National Agricultural Statistics Service of USDA. After excluding data for farms organized as non-family corporations or cooperatives and farms run by hired managers, their results found:

  • One in 10 of the farmers used only direct-to-consumer selling like roadside stands and community supported agriculture subscriptions. Seven percent used indirect methods like selling to a local grocer. Four percent used some combination of the two. That leaves 79 percent of farms in the 2008 figures using no direct-to-consumer sales.
  • Farmers who sold direct reported earnings that were on average significantly lower than earnings from the other marketing strategies. The average earnings of $273,011 are about 75 percent lower than earnings for farmers who do not engage in any direct sales.
  • Their statistical analysis at least implies that farmers with higher skills or more experience in marketing likely prefer to sell through intermediate channels, like selling to a local supermarket. Farmers in the direct-only category typically were those using the fewest marketing techniques compared to others. More than half of the exclusively direct-to-consumer farmers did not use any advanced marketing tools like marketing advisory services, options, futures, on-farm storage, contract shipping, networking or farmer cooperatives. The researchers suggested this may be due to the fact that selling through intermediate markets often places specific quality and quantity requirements on them, which necessitate the use of those more advanced marketing skills in order to succeed.
  • Overall farm sales for farmers who sold only directly to consumers actually fell--by an average of 2 percent. That compares to a 20.5 percent growth rate for farmers with no direct sales.

Prescribing vegetables and fruits for better health

Research has shown that more than half of shoppers who come in to fill a prescription will also buy related food products in the same trip. For instance, while picking up heart medicine, they buy a quart of low-fat milk. More affluent elderly shoppers, coupled with increased prescribing and awareness about preventable chronic disease, presents opportunities for the supermarket as "wellness center" to cross-sell wellness-related items. And to make the picture even better, when asked by the International Food Information Council to name the foods they thought offered health benefits beyond nutrition, 1,000 consumers didn't leap to the obscure. Instead, they named the basics found on your aisles: Fruits and vegetables; fish, fish oil, seafood; milk and dairy; whole grains, oats, oat bran and oatmeal; fiber; green tea; meat, red meat and chicken; water; herbs and spices; and nuts.

So why not take the opportunity to more obviously connect the dots?

A program in seven states throughout the United States and the District of Columbia has attempted a novel effort to do just that, by working with local health clinics to "prescribe" fruits and vegetables to patients suffering chronic disease--typically diabetes related to obesity or unhealthy eating habits. Health clinics and farmers markets work together to enroll overweight and obese children in the program. During each monthly visit with a health-care provider, the participant gets a "prescription" for $1 per day per family member, which can only be redeemed for locally grown produce at the partnering farmers market.

For the 2012 program, the most recent results available, follow up surveys showed:

  • More than 90 percent of patients said they were eating more fresh fruits and vegetables as a result.
  • Healthcare workers who asked patients during each visit to describe their daily fruit and vegetable consumption found 55 percent were eating more fruits and vegetables at their final visit than at their first.
  • Plus, 38 percent of child patients decreased their Body Mass Index between their first and last visit.

Although the Wholesome Wave program was intended to promote better access to Farmers Markets, which gives it a political mission, an independent community supermarket could learn much about adopting the concept into its own marketing program. Lessons learned:

  • Focus on community. The program likely succeeds because it is community-based. It encourages partnerships between doctors, nutritionists, community health workers, farmers, farmers market operators, and community members. Local, community-focused supermarkets should have a natural leg-up on that approach.
  • Take ownership. The local grocer will likely have to coordinate the program to see the benefits from it. In the states where the concept has worked, it has been spearheaded by an organization known as Wholesome Wave, an advocacy group for small farms, local food systems and farmers markets. The group does not advocate for better access to produce through supermarkets, beyond advocating for general increases in SNAP funding. Instead, it promotes farmers markets as healthier, higher quality sources than supermarkets. Grocers interested in capitalizing on the interest will have to pull together interested health providers and public or private funding sources to underwrite the program.
  • Use your store nutritionist as the point person. The Wholesome Wave program puts nutritionists in connection with the health-care provider and, in some cases, a community health worker who discuss the importance of healthy eating and active living, with a focus on the importance of eating fresh fruits and vegetables.
  • Survey, survey, survey. Collecting and analyzing data from participants about the changes in their food habits and health indicators is an integral part of the current programs. It also helps justify continued funding. Data collection occurs throughout program implementation, for about 16 to 20 weeks during the peak of farmers market fruit and vegetable season. Primary care providers track weight, Body Mass Index, and fruit and vegetable consumption at each, compiling it all into a secure online database all participating clinics can access for generalized data.

Click here for more information.

Buy local food? Why?

"Nebraskans spend $4.4 billion on food each year. Yet only 10 percent stays in our state," laments Nebraska's agrarian populists at the Center for Rural Affairs. "Shouldn’t we expect most of the food we purchase to come from our state?"

Consternation over the excessive "food miles" your products travel in order to get from the farm field to your store have led those like the Center's authors to argue to consumers and regulators that food systems can only be sustainable and socially just if they originate within a set number of miles. But one vexing problem remains: How exactly to define the vague and soft term "local."

"'Local food' or 'regional food,'" the Center's authors have written, "have no precise definitions, nor is it legally defined in the way that legislation has defined 'organic.'  Some consider 'local' to describe food from a 50-mile or 100-mile distance from where it is sold. Others say a one-hour drive from the market or other place where sold. Thus, it is important to define what is meant by 'local' when using the term in food marketing or sales."

With so much confusion over a basic definition, what's a local-centric grocer to do?

Ignore it. Here's why.

Several interesting articles from one scholarly journal have recently attempted to get their hands around the meaning from both an academic's and a consumer's point of view. Some valuable lessons can be taken for the grocer interested in appealing to that class of shoppers:

  • In "Food miles, local eating, and community supported agriculture: putting local food in its place," Pennsylvania's Kutztown University scholar Steven Schnell argues that focusing on food miles cheapens and causes us to miss what's really important about why citizens seem to yearn for local food. "The dialogue over food miles...," he says, "has largely centered not on complex reality, but on a caricature, and a single variable stripped of its context." Local eating is not really about mileage, Schnell believes; it's about connecting people to a community. Trying to assign an ideal number of miles oversimplifies a complex process in which shoppers are trying to connect with  particular producers, particular markets, particular environments and particular people. Food, he believes, is simply one part of that "narrative" they tell themselves about where they fit in the world.
  • In "CSA membership and psychological needs fulfillment: an application of self-determination theory" a group of University of Wisconsin ecologists examine the pyschological needs driving why consumers join Community Supported Agriculture buying programs, subscription-based direct-buying programs that connect local shoppers with local farms. Through interviews with those buying members about why they join and leave CSAs, they suggest those local-buying programs meet shoppers' needs to feel independent and in control of their own lives, capable and competent in providing for themselves, and related to people and communities surrounding them. Although the Wisconsin researchers concede they have only scratched the surface of the deep psychology behind local food buying, they suggest the field is ripe for further research, including if, why and how shoppers better meet those psychological needs by shopping at a farmers market vs. at a supermarket.
  • In the article "Beyond agriculture: the counter-hegemony of community farming," British social scientists approach the motivations of local food buying by considering it as a new form of liesure activity, in which shoppers are at heart attempting to exert some rebellion against authority by participating, vicariously though it may be, in growing their own food. Sort of like an avid golfer who eventually turns a sport into work in order to set himself apart by excelling at something others cannot do, local-food advocates who are so involved they go so far as to volunteer their time to help plant and harvest at local community-supported farms are similarly disguising a non-essential liesure activity as hard work that sets them apart from the power anonymousing forces of modern society. By participating in local farming, they are "busy constructing meaningful lives outside of conventional work and leisure activities that bear all the hallmarks of a big leisure project, although it is no longer understood (or performed) in these terms," they write. "...the majority of the participants in the CSA did not routinely view their activities and deployment of time as leisure per se. Rather, they viewed their participation as a part of their wider lives, part of their personal project...[that] speaks to others about who we are, what we hold to be valuable and how we can make a difference.’’

What does that all mean to grocers looking for opportunity in the local food department?

In this broader sense, "local" is a double-edged sword for locally owned, community grocers. You can't fake the authenticity consumers are longing for when they buy local. So the fact that 90 percent of locally sourced food is originating with farms grossing more than a quarter million dollars annually puts grocers riding that train at risk of appearing to be inauthentic. On the other hand, if consumers are looking for a means to stay rooted in time and place via a sense of community, few retailers are in better position to lead that than the community focused grocer.

As this essay explains, if true, then the "food" portion of the "local food" movement may be a case of the marketing tail wagging the dog. Grocers who see locally sourced food as only a small part of fulfilling their commitment to the community, through community relations, employee relations and true contributions, will put themselves in the lead in capturing the loyalty of those local-focused consumers, regardless of how many miles the food they offer travels to get to them.

S5 Box