Evaluating Consumer Response To Labels And Packaging In The Market For Baby Foods

The landscape of the baby food industry in the United States has evolved significantly in recent years. Demand for organic baby food continues to grow rapidly, and in addition, non-GM labels, and the new packaging innovation, pouch, are very popular among baby food consumers. Previous studies on baby food have been focused on determining the consumers' willingness to pay for the organic and other nutrition attributes. This study firstly uses hedonic pricing model to investigate the premiums that purchasers are willing to pay for the organic label, the non-GM label, and the pouch packaging. Second, I use a Tobit regression to explore the relationships between the organic, non-GM, pouch baby food purchasing shares and household characteristics and purchasers' shopping behavior. The results from the hedonic pricing model show that baby food purchasers paid a premium of 2.6 cents per ounce for the organic label, and 2.9 cents per ounce for non-GM label. It is interesting to see that the price premium for the non-GM was higher than organic. And baby food purchasers paid a premium of 13.8 cents per ounce for the new pouch packaging compared with the plastic tub packaging. The results from the Tobit regression models show that younger purchasers, those with high incomes, those with fewer children, and those with more free time are more likely to purchase organic and non-GM baby food. Higher education would increase consumers' preference for organic baby food, but has no significant effects on consumers' preference for non-GM baby food. In terms of geographic factors, consumers from the Pacific region have strong preference for both organic and non-GM baby food. ii