Soft drink makers could end up swallowing a £10m bill for no good reason by embracing the Food Standards Agency (FSA) recommendations for new slim-line 250ml drinks.
In its latest escapade into behavioral choice theory, the FSA does not just want manufacturers of sugary drinks to produce smaller packs – no, it wants 250ml cans and bottles.
There are plenty of mini-cans on the market but these are too mini for the FSA. The government agency is pushing for a genuine alternative to the standard 330ml can.
Because there are currently very few 250ml cans on the market, introducing the new size is likely to prove expensive. Jill Ardagh, director general of the British Soft Drinks Association (BSDA), estimates that adapting can lines and other costs involved in making the change in the UK could add up to more than £10m ($15.2m).
To justify such a financial burden on industry, the FSA should have some pretty conclusive arguments on its side.
It argues that making smaller pack sizes more widely available will encourage consumers to make healthier choices.
Unpacking this argument reveals certain flaws. The FSA has at least recognised one of these by updating its final recommendations to include the requirement that 250ml packs should offer proportional value for money compared to larger formats.
To use the vocabulary of behavioral economists Richard Thaler and Cass Sunstein, this should help ‘nudge’ people in the direction of 250ml cans.
But will the people who consume too much sugary food and drink switch to the smaller pack size or will the new format be embraced only by the health conscious? And even if unhealthy consumers do pick up 250ml cans, will that choice encourage them to drink more sensibly?
Here behavioral science throws up some unexpected results that seriously undermine the whole FSA approach to portion sizes.
Intervention changes perception
On their “Nudge” blog, Thaler and Sunstein recently pointed readers in the direction of studies published in the Journal of Consumer Research suggesting that smaller pack sizes may actually encourage people to make eat and drink more.
In one study, researchers at the Technical University of Lisbon gave people packets of crisps in different sizes and sat them down to watch episodes of “Friends”, telling them that the study was about TV advertising.
This exercise revealed that smaller packs were more likely to fuel temptation. The researchers suggested that this may be because people believe that small packs help them “regulate hedonic, tempting consumption,” whereas larger packs, on the other hand, trigger concern about overeating.
As the FSA and the media talk more and more about portion size and the need for smaller, healthier pack sizes, the more likely it is that a desirable relationship between pack size and healthy choice will break down and even invert.
Playing up the health virtues of small pack sizes and the dangers of multipacks and big fizzy drink bottles will change the way people view different pack sizes. The FSA could succeed in making people vigilant about big pack sizes only to unintentionally encourage people to consume too many small cans and crisp packets.
Perhaps the FSA will have to learn from economists that the only really reliable economic law is that as soon as you try to rely on and manipulate an economic law that law will break down.