What consumers want industry to provide in healthy food alternatives for children

1. Foods for children:
What should industry offer tomorrow?
Linda Ettinger Lieberman, Dvora Chaiet,
Nadya Livshits, Howard R. Moskowitz
Moskowitz Jacobs Inc.
Batool Batalvi, SB&B Marketing Research
IFT Chicago, July 15, 2013

2. How to create healthier foods for
children
Foods for children are getting a lot of attention.
The food industry has to respond to parents’ concerns.
• A lot of focus will be on marketing to children
• What issues resonate with parents most?
• Which products are perceived as best for children?
• What food products will command higher prices?
• Psychological foundations of research …
• Empathy … the mine of ideas
• Experiment … The acid test
• Running the experiment
• What do parents most want for their children?
• Different mind-sets offer major opportunities

3. Where do we begin?
• We need to have a deep understanding of what parents want.
• Most marketing efforts remain peripheral and superficial.
• Focusing on what, not on the parent-child relationship.
5 KEYS™ EMPATHY … holistic qualitative research paradigm
emerging from nutrition economics.
• Explores psychic apparatus of parents.
• Uses a hybrid mix of qualitative techniques.
• Methods engage parents, elicit responses, generate insights.
• A disciplined, qualitative process.
Empathy and Experiment™:
Psychology of empathy and the science of experiment

4. Foundation for Mind Genomics® IdeaMap®.net
• Modeled on science of genomics, informatics technology
• The three roots of RDE:
• Experimental psychology
• Driving power of business
• The world-view of social science
How Rule Developing Experimentation (RDE) operates
• Extracts ideas as basis of the stimuli to be tested
• Both objective (topical) and subjective (experiential) insights used
to create elements to be used in vignettes
• Runs structured tests which mix and match elements (ideas)
• Discover winners … messages which float to the top.
• Uncovers mind-set segments
• Create a typing tool to assign a person to a segment.
How to create healthier foods
for children

5. DEVELOP Child oriented SURVEY STIMULI AND QUESTIONS
What
Parents
Demand &
Will Pay for
ANALYZE SURVEY RESULTS→ Mind Genomics® IdeaMap ®.net
INTERNET invitation
Mind Genomics ®
IdeaMap.net
SURVEY
IDENTIFY Parents as target market
Total
Sample
Seg 1 Self
Driven Online
Banking
Seekers
Seg 2
Technology/
High Security
Seekers
Seg 3
Collaborative
Online Seekers
Seg 4 Personal
Touch with
Technology
Base Size: (267) (105) (50) (59) (53)
Constant: 31 34 28 31 26
OC1 Connect online in 'real time' with a customer rep via instant
messaging, voice over IP or video conferencing via your
computer 0 2 2 5 -13
OC3 Faster loan application process…work in real time online with a
loan officer 0 0 -8 12 -8
OC4 Our bank's customer service reps will help you browse and use
our online banking services -1 0 -6 10 -10
OC2 Use our online tool to find and schedule at your convenience an
online working session with an expert such as investment broker,
insurance agent, and/or loan officer -3 1 -11 6 -12
ON3 We will answer all your requests in 'real time' by email, instant or
text messaging 1 7 -11 3 -1
ON4 We offer 'On demand' status reports for services requests (e.g.,
loan application) delivered to you via e-mail, text or instant
messaging
1 6 -4 -3 0
ON2 No more paper mail... We will send you statements and images of
transactions securely by email -2 5 -17 -5 2
ON1 We allow you to pay bills securely using your mobile devices (cell
phone, PDA, Blackberry, etc.) -4 2 -13 -9 -2
BR3 We offer a bank-issued smart card so we can recognize you
entering the branch and process your needs faster 4 2 6 -3 13
BR4 Choose a secure eye or finger security scan to identify you
immediately in-branch and at ATM 4 3 10 -1 3
BR2 We have the most secure biometric system that identifies you as
you enter the branch so we can process your needs faster 2 -1 8 -5 6
BR1 We will recognize our customer's mobile phone signal when
entering a branch so we can recommend appropriate bank
products, promotions and special services -4 -3 -6 -11 2
Online Collaborative
Online Other
In-Branch Recognition
No more paper mail – we will send you copies of statements by secure e-mail
Securely manage your account by PDA, Internet of automated telephone
Our banks customer services reps will help browse & use our on-line services
Manage all your banking needs with a state of the art kiosk and be confident
that live help is available if you need it
No more paper mail – we will send you copies of statements by secure e-mail
Securely manage your account by PDA, Internet of automated telephone
Our banks customer services reps will help browse & use our on-line services
Manage all your banking needs with a state of the art kiosk and be confident
that live help is available if you need it
MARKET SEGMENTATION SEGMENTATION WIZARDMARKETING PHRASES
The steps of the RDE process

6. Raw materials: Sample Elements from Silos A-C
Silo A: The product
Less cane sugar and high fructose corn syrup, and no artificial sweeteners
No or low bad fats, which may reduce risk of heart disease
Less or no added salt, which may help reduce blood pressure
Added Omega-3 and Omega-6 fatty acids, which may increase brain function
More fiber to improve digestive health
More calcium and vitamins…known to help bone growth
Silo B: The package
Smaller portion packages help control weight
Family-sized/bulk food packages indicate recommended children's portion
Bulk food packages contain separately wrapped single portions
Wide array of healthy food options for common family favorites
Children's health/nutrition needs explained on package label
Package shows children's serving in portion food plate
Silo C: Good for you
All natural ingredients … a food you feel good about feeding your family
Good for children … helps build brain power
Good for children … helps build and maintain muscles
Good for children … keeps them slimmer
Good for children … gives them more energy
Good for the whole family

7. Elements combined into vignettes = small ‘ad’
Rated on 2 questions ‘pleasing the reader’
and ‘price would be paid’ Note: The price is randomized

8. A marketing panel study
(diverse group, n = 301)

9. • Each respondent rated 48 vignettes
• Vignette first rated on ‘pleased’ – 9 point scale
• Vignette then rated on ‘dollars extra would pay’ – select a dollar value
• Slope of the simple equation: Extra $ = a + b (Pleased)
-3 -2 -1 0 1 2 3 4 5
Dollar value for unit of pleased
Each circle =
respondent
How many more dollars will a person pay for being ‘pleased’ by
what the industry promises?
Will people pay extra for vignettes which
‘please’ them?

10. Reading the numbers: Which elements please?
Which raise willingness to pay (WTP)?
••Pleased = probability that a person will be pleased (rating 7-9)
• Constant = baseline of % being pleased without any
elements in the vignette
• Each element contributes its own percentage of people
being pleased
• Dollar value = incremental willingness to pay (WTP), over and
above the specified $86 purchase when the element is introduced
into the vignette

11. What pleases people most …
And how much extra money will they pay?
Pleased Price
Constant 34
All natural ingredients … a food you feel good about feeding your family 12 1.30
Less cane sugar and high fructose corn syrup, and no artificial sweeteners 11 1.36
Insurance premium reduction for completion of healthy cooking and eating class 10 1.42
More calcium and vitamins…known to help bone growth 10 1.20
No or low bad fats, which may reduce risk of heart disease 10 1.26
Added Omega-3 and Omega-6 fatty acids, which may increase brain function 10 1.25
Supermarket cash register reduces prices that stretch your budget when you buy
healthy foods 10 1.26
Earn coupons for free or reduced-price healthy foods with each week's food
purchases 7 1.38
Government improves nutritional quality of school meals 5 1.29
Farmer's market and food vendors accept coupons for healthy food purchases 7 1.22
Promotion of healthy food choices at all types of stores…club, supermarket, 7-11,
QuickChek, etc. 6 1.20
Good for children … keeps them slimmer 7 1.19
Less or no added salt, which may help reduce blood pressure 8 1.15
More fiber to improve digestive health 5 1.15
Good for children … helps build brain power 9 1.12
Good for the whole family 4 1.07
Manufacturer works with government and community about new food portion sizes 8 1.02

12. Dividing our respondents into mind-economic groups
(cognitive-economic segments)
Seg1 Seg2 Seg3
111 83 107
Average price would pay across all 36 elements 0.96 1.02 1.04
Seg1 : Values help by government , store, and school
Promotion of healthy food choices at all types of stores…club, supermarket, 7-11,
QuickChek, etc.
2.25 0.75 0.46
Vending machines in schools and elsewhere should show calorie counts for all items
offered for sale
2.02 1.04 -0.28
Manufacturer works with government and community about new food portion sizes 1.97 0.93 0.10
Government improves nutritional quality of school meals 1.87 0.52 1.27
Earn coupons for free or reduced-price healthy foods with each week's food purchases
1.83 0.76 1.40
Seg2 : Values better packaging
Smaller portion packages help control weight 0.02 2.90 0.35
Package shows children's serving in portion food plate 0.01 2.43 0.15
Children's health/nutrition needs explained on package label -0.11 2.21 0.35
Wide array of healthy food options for common family favorites -0.14 2.17 0.56
Bulk food packages contain separately wrapped single portions 0.06 2.14 0.64
Seg3: Values better food & focus on the children
Less cane sugar and high fructose corn syrup, and no artificial sweeteners 1.18 1.00 1.84
All natural ingredients … a food you feel good about feeding your family 0.99 1.06 1.82
Free "Feeding the Kids Workshop: Raising Happy, Healthy Eaters" for parents at local
elementary/middle school
-0.03 0.69 1.77
Good for children … helps build and maintain muscles 0.39 0.69 1.75
Free "Feeding the Kids Workshop: Raising Happy, Healthy Eaters" for parents at local
community center
0.10 0.79 1.66

13. Primaries: Different Parent Mind-Sets:
What They Want and Don’t Want
• Segment 1: Will pay for help by government,
store and school
• Segment 2: Will pay for better packaging
• Segment 3: Will pay for better food, focuses
on the children
Each one of you in this room belongs to one of the
three primary mind-sets
•Which one are you?
•Which one is your potential customer?
•What will YOU create for that customer?

14. Identifying the mind-set of parents
It’s not who they are, it’s their mind
• You know what appeals to parents
• But when a parent is in front of you ..
– To what segment does that person belong
• And ...how are you going to communicate ..
– What will you say?
• And how do you know it’s convincing
– Promoting better health for children
– Saying the right thing is as important as doing the
right thing

15. The ‘typing wizard’

16. What is your neuro-economic segment?

17. • With corporations and food policy on the defensive,
use knowledge about what’s important to people
• Use it to redesign packages
• Create a PR campaign using targeted, impactful,
• 1:1 communications by knowing a person’s mindset
•But how?
•Don’t wait to find linkage between a person and
• a mind-set using ‘big data’
• Mind-type people, e.g., as part of a supermarket chain
• loyalty program, or as a game on the web
• Send each person a particularized message based on
• the mind-type (mind segment) to which he belongs
From Data to Food Policy and Strategy
Identify and Use these Mind Sets

18. Key Learnings
• We can subject ‘what industry should do’ to a S-R experiment
• Provide vignettes of what’s to be done
• Get ratings of ‘pleased’ and ‘amount would pay’
• Deconstruct ratings into element contributions
• People will pay more for what they like
• People differ in how much they’ll pay for a unit of liking
•Typically $1 - $2 for one unit of being pleased
• It’s all in the elements
• On average, an element will increase payment by about $1
• This holds for most subgroups
• It’s hard to get above $1.50 for an element
• You can make people happier and get more by mind-set segmentation
• Not on the average ...it’s still $1 on average
• But you can get far more than $1.50 for the ‘right elements’ by segmenting
your respondents into mind-types

19. Going to the next stage
• Let’s move beyond the obvious..to the next step… portion size and
perhaps satiety
• Our data suggest portion size is relevant but not ‘crucial, burning’
issue
– Not too much attention will be paid
– Nor effort put in to figure out how to reduce portion size
– Yet it’s relevant and important
• Collaborative work being funded by Ajinomoto
– WHAT to communicate to reduce portion size..food, situation,
benefit
– Stay tuned ...