In 2008, New York City mandated all chain restaurants to post the calories of items on their menus. The intent was to induce consumers to choose healthier items in the restaurant.
A forthcoming study in the journal Marketing Science, published by the Institute for Operations Research & the Management Sciences (INFORMS), investigated whether the calorie posting on menus has broader spillovers by influencing consumer evaluations of the restaurant.
The study found that health mentions about the foods increased significantly in online reviews after the calorie posting regulation. The result suggests that calorie posting can not only shift consumers towards healthier alternatives when inside a restaurant but can also have spillover effects on other customers reading the reviews by potentially redirecting them towards healthier restaurants and food items, according to a news release from INFORMS.
The study, "The Effect of Calorie Posting Regulation on Consumer Opinion: A Flexible Latent Dirichlet Allocation Model with Informative Priors," was co-authored by Dinesh Puranam of the University of Southern California, Vishal Narayan of the National University of Singapore and Vrinda Kadiyali of Cornell University.
The authors analyzed 761,962 online reviews for 9,805 restaurants posted on a restaurant review website in New York City from 2004 to 2012. Using text mining methods, the authors examined any change in the mentions of health in the reviews over time before and after the calorie posting rule went into effect.
To rule out the possibility that the uptick in health mentions was simply due to increased public interest in health issues over time, they compared the change in topics discussed for chain restaurants to those for non-chain restaurants that were not mandated to post calorie information. The authors found a significant increase in the proportion of reviews that discussed health for chain restaurants relative to non-chain restaurants.
The authors also explored, in greater detail, the source of the increase in health topics. They found that it was largely driven by new reviewers who were previously not active in posting reviews but began to post more reviews after the mandate took effect.
Puranam noted, "interestingly, the increase in health discussion in opinions was not confined to restaurants in more affluent localities, commonly associated with more health-conscious consumers. This is an encouraging sign of the success of the rule across the socioeconomic divide, especially given the greater incidence of obesity among lower socioeconomic classes."
New York City recently expanded the rule beyond chain restaurants to also include fine-dining restaurants.
Narayan said, "Our result that calorie postings on menus impact online reviews is significant for this rule expansion, since consumers are even more likely to consult reviews for fine-dining restaurants than for chain restaurants that they habitually visit. Whether this will have an impact on calorific content of items on fine-dining restaurant menus, of course, remains to be seen."
Kadiyali cautioned that more work is needed to study whether the increased discussion of health topics actually does lead to greater choice of healthier restaurants.
"It is possible that the health-conscious consumers may choose healthier restaurants, while the less health-conscious may avoid them. In this case, health benefits across the population may be ambiguous. Nevertheless, our study suggests that online reviews are a useful place to look for potential changes in consumer behavior due to this rule," she said.
The complete paper is available at http://pubsonline.informs.org/stoken/default+domain/MKSC-PR-10-2017/full/10.1287/mksc.2017.1048.
Marketing Science is a peer-reviewed, scholarly marketing journal focused on research using quantitative approaches to study all aspects of the interface between consumers and firms. It is published by INFORMS, a leading international association for operations research and analytics professionals.