Staff Writer
News & Views
Does food labelling help or hinder consumers?

The clean eating trend has encouraged a number of consumers to be more conscientious about what they buy — which has in turn motivated a growth in “free from” marketing. But at what point does this stop being helpful to customers?

Take, for instance, ”premium water” brands BLK and Clara. Both label their product as “gluten free,” which somewhat disingenuously implies that other water contains gluten. The truth is, of course, all water is free from gluten. Attributing a lack of gluten to your product as some kind of USP takes advantage of the consumer’s knowledge gap and suggests that this brand of water is better for your health than any other. (BLK is also labelled as organic, zero carb, and kosher.)

“While some labels provide useful information that is not readily detectable by consumers, others contain misleading claims that exploit a knowledge gap with consumers and take advantage of their willingness to pay a premium for so-called process labels,” says Brandon McFadden, Assistant Professor of Food & Resource Economics at the University of Florida.

It’s one thing to develop a gluten-free variant of something which would usually contain gluten, and then market it as such for consumers who have a dietary intolerance. But to needlessly label something like bottled water as free from carbs or gluten ends up creating more questions than it answers. Ultimately, this kind of “fake transparency” does not actually inform consumers about what they are buying.

And while some categories of food labelling are strictly regulated, like “organic,” “hormone-free” and “free range,” others leave room for interpretation.

“Gluten-free has become synonymous with healthy and this has seeped into general consumer perception,” writes blogger The Angry Chef. “The majority of people purchasing gluten-free products do not have an intolerance and only do so because they believe they are picking a healthier option. Unfortunately, unscrupulous [brands] are happy to jump on this bandwagon, realising that ‘free-from’ is one of the few areas of grocery in huge growth. Free-from claims give the opportunity to charge large premiums for little extra cost, so offering the potential for increased margins.”

We may soon start seeing more of this sort of thing, with a new law taking effect next year which will require GMO labelling mandatory on a range of foods. McFadden is concerned that this will signal to consumers that certain foods are bad (even though the FDA has ruled that GE foodstuffs are safe) and lead to brands labelling their products as GMO free, once again exploiting the “asymmetric information” wherein the seller knows more about the product than the buyer. “My worry is that consumers will become ever more mystified as more businesses make increasingly absurd claims on their labels so that their products stand out from the competition in the grocery store aisle,” he says.

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