University of Arkansas

Walton College

The Sam M. Walton College of Business

Episode 17: Scot Burton, Distinguished Walton Marketing Professor, Discusses Labeling and Packaging Regulations

March 27, 2019  |  By Matt Waller

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Scot Burton is a Distinguished Professor and Tyson Chair in Food and Consumer Products Retailing at the Sam M. Walton College of Business. Professor Burton's research interests include consumer health and welfare issues, price perceptions, consumer response to advertising and sales promotion, and measurement issues associated with survey research. Scot has over 100 refereed journal articles in various publications. Scot received his B.B.A. and M.B.A. from the University of Texas at Austin and his Ph.D. in Marketing from the University of Houston.

Episode Transcript

[music]

00:08 Matt Waller: Hi, I'm Matt Waller. Dean of the Sam M. Walton College of Business. Welcome to BeEpic. The podcast, where we explore excellence, professionalism, innovation and collegiality. And, what those values mean in business, education and your life today?

00:25 Matt Waller: I have with me here today Professor Scott Burton, a professor in marketing and he has published more than a 100 refereed journal articles in top journals, like Journal of Marketing, Journal of Marketing Research, Journal of Consumer Research. In fact, he's co-editor in chief of the Journal of Public Policy and Marketing. Professor Burton has also received many awards, not only for research, but also for teaching. I know, you've been just a fantastic researcher as long as I've known you. And, you've done some really relevant research, it's both relevant and also very theoretically rigorous and based on real strong empirical methods. So, you've done a lot of studies on labeling and packaging and warnings and so forth. And of course, this is something that affects all of us. And, has lots of policy, it has policy implications, it has implications for marketing, for companies. And, implications for research, per se. But would you mind telling us just a little bit about that?

01:41 Scott Burton: Sure. So, I first got interested in this, probably back in the early 1990s. And so, I historically had done a lot of stuff related to promotion and pricing. And, I had a lot of expertise in survey methodology and experimental designs. But I read an article in the paper that I saw that the FDA was revising the nutrition facts panel. And for the first time, they were gonna have a standardized format for presenting nutrition information. And I looked at some other components of this and I go, "This is really a pretty complex piece of information we're providing to consumers." And I'd always been interested in, how information was communicated to consumers. So, I decided that this would be kind of an interesting thing to do research on. Even though I knew very little about nutrition.

02:32 Matt Waller: What year was that?

02:34 Scott Burton: Probably about 1991 to 92. That's when I first became interested in this. And, so I looked at some of the questions that the Food and Drug Administration was asking. You could go and look on, in the Federal register when they had a list of things that they were interested in and considering. You also saw other NGOs and organizations that were suggesting formats that might be used for providing nutrition information to consumers. So, I looked at those things and came up with the design and when I finished that study I ended up, this was back before internet was used for everything. I actually put a copy in the mail of those results to the FDA, and they ended up actually looking at the research. And, it was kinda interesting because I just sent it off into what I thought would be a blackhole probably. But I ran into a woman at a conference in Washington DC about a year later, and she said, I started talking to her about what she did and I said, "Oh, I did something related to this and I sent it off to somebody and I never know what it happened to it." But it was research that I thought could be potentially relevant. And she goes, "I actually got that paper."

[laughter]

04:00 Scott Burton: She said. And I started to read it, and I was walking down the hall with it. And I saw my boss, who was head of research for the FDA, for nutrition issues. And he goes, "What do you had there?" And she said, "Well, I had this thing, some academics sent me and I read the abstract to me. And she said, "He took it out of my hands, ran down to hall and shut his door." So I don't know what happened to it, but anyway, he at least seemed interested in the abstract I had written. This is how I initially got involved with some of the people interested in nutrition at the FDA and they became familiar with my research. And so, I provided this to him before it went into the actual formal review process where result went published a couple of years later.

04:52 Matt Waller: I've known you for 25 years and you've never told me that story. [laughter]

04:57 Scott Burton: You know, I don't tell it that often, but it was kind of...

05:00 Matt Waller: It's a good story.

05:00 Scott Burton: Yeah, it was. Although it was good for me 'cause it did influence me where I go. If I can do research like this, that they think is potentially helpful and that had an influence on my thinking about the types of projects that I might be interested in doing.

05:21 Matt Waller: Do you remember that specific study?

05:24 Scott Burton: Oh yeah. A fair amount about it, in any way. So essentially, when I had... This is kind of an example of an old versus a new nutrition facts panel. And so, this is where the research will be currently going to see if this makes a difference, but they have various components in ways of providing information, they were interested in, and you could... Then run different types of experimental designs, re-manipulated the aspects within the nutrition and facts panel. And look at the nature of kind of what the differences might be.

06:02 Matt Waller: So, Scott is showing me the nutrition facts panel. There's two of them side-by-side. These are the facts panels that say, "serving size is two-thirds of a cup or 55 grams servings per container." And, it gives you the calories per serving, total fat cluster. We've all seen these before, and then down at the bottom, they used to have information about some other things like total fat, saturated fat, cholesterol and then they changed it. This is what they changed it to, right?

06:37 Scott Burton: They're now changing it to this and it's not required until the end of next year. They kind of delayed it. But if you look at a lot of product packages today, because it has been delayed, many of the product package will have this new format on it.

06:50 Matt Waller: Yeah and to me Scott, this new format looks like a lot of the formats I've seen.

06:56 Scott Burton: Well that's because they have changed it because they made the delay at the point in time after companies had already planned on having it introduced.

07:07 Matt Waller: I see.

07:07 Scott Burton: So a lot of companies where they go, works to their advantage or they think it really doesn't matter, they went ahead and made the change. And so you can tell the difference in terms of the greater emphasis on calories, greater emphasis on serving size, including information on added sugars and some of these types of specific changes that really is on information they felt like maybe consumers were overlooking or not paying enough attention to.

07:36 Matt Waller: Now, total sugar I understand. What's added sugar? Just added.

07:42 Scott Burton: Yeah, so that's more or less artificially added sugars that don't come naturally in the food.

07:48 Matt Waller: Okay.

07:49 Scott Burton: And so like sodium, sugar can be a taste enhancer. So in many cases, they add sugars and that's something that is not necessarily thought to be a very healthy thing to be doing.

08:02 Matt Waller: So how do you do research Scott, on something like this where you've got two different types of panels of information.

08:10 Scott Burton: Well truthfully it's more complex than that and most of the things we do are gonna also relate to information that's included on the front of the package. So on the front of the package, and I have a number of different examples here you can see various types of information, sometimes it might not have any nutrition information. But now we're seeing instances in which they're adding nutrition information on the front of the package.

08:36 Matt Waller: Yeah I've seen that.

08:37 Scott Burton: To make it easier for consumers to find and use.

08:41 Matt Waller: So you've done research on, a lot of packaging used to never included nutritional information on the very front but now you are starting to see things like calories per serving, fat per serving, these kinds of things.

08:57 Scott Burton: And there's many different formats in which you can present that information. This is a big issue world wide. You can look at some of the examples, but sometimes they have what we call variative type components where they help the consumers see the relative objective helpfulness of the entire product. They have things that are just going to be kind of these nutrient declarations, which we consider reductive, so they take the information from the back of the package. Include things that are the most important, move them to the front of the package, where they're easier for the consumers to see and access while they're in the store. And then they have things like traffic light type variative disclosures which are either green, red or yellow. To indicate how each nutrient fairs in terms of it's healthfulness, and these various types of front of package information are being examined and used in different parts of the world. And so in the United States, the FDA is very interested in this, and clearly food manufacturers are very interested in this too. So it's helpful to consumers.

10:09 Matt Waller: So, would you mind giving me an example of an experiment you might do that would be somehow related to this?

10:18 Scott Burton: Sure. So one of the things we can do is run things that are online experiments where we have packages that are developed that will vary the types of front of package information that's included on the front of the package. We then have information on the back of the package, which relates to the nutrition facts information. That will vary the healthfulness of the product. So you can manipulate the levels of calories, saturated fat, sodium, etcetera. And then you can see how these two things potentially interact with information on the back of the package and the front of the package. And ideally the front of the package, information helps people better identify more helpful products, makes that clear to them and hopefully when they become more aware of the healthfulness of the product, that carries over to actual purchase intentions, and choices. So these are the types of things that we can look at both in online experiments and because we have our retail laboratory downstairs, we can actually pull shoppers in and have them make choices where there's different types of nutrition information available on the front of the package or our shelf talkers.

11:37 Matt Waller: I know in the United States, we have a real problem. I think this is a problem globally now of obesity. And it looks like you've brought something about obesity. And we live in a state that has a real obesity problem. This is showing that this is the percentage of people that are obese, is that right?

12:00 Scott Burton: Correct.

12:00 Matt Waller: So it says that in Arkansas, we have greater than 35% of the people are obese. And so the states that are high in obesity are, Iowa, Oklahoma, Arkansas, Louisiana, Mississippi, Alabama, and West Virginia. And then you've got the other extreme, you've got states that are really low like, it looks like Hawaii, Colorado and Washington DC are 20 to 25% obese.

12:31 Scott Burton: Yeah. And 20 to 25 years ago, you would have seen almost all of the states that were under those levels. And so the nature of the increase, obesity is about doubled over the last 25 years. And so they have some real nice maps that shows this progression over time in how obesity has increased. But in the newspaper two days ago they just ran a thing. Arkansas had improved, we were down to 35%, we'd gone from number 48 to number 46. And so it was good to see some improvement. Unfortunately, obesity rates remain very high. And there's about 70% of the people in the United States now are either overweight or obese. And we're seeing the obesity issue becoming more and more an issue not only in the United States, but globally.

13:25 Matt Waller: So does nutritional information on packaging, help shoppers, consumers make better decisions?

13:35 Scott Burton: Well, it helps certain types of consumers make better decisions. So it is related to consumers level of health consciousness or nutrition motivation. So they have to feel like it's important for them. And you do get a lot of variance in terms of how important that information is to consumers. I also do a lot of research on calorie labeling, for restaurant foods. I've done this over the last 15 years or so. And so as we started to see obesity increase, it was associated with increases in the number of times per week people were dining out of the household, and because of that, there had never been required information for disclosures in restaurants before. That was one of the things when the Nutrition Labeling Education Act was passed in 1993, they were exempt for many types of disclosures that would be necessary.

14:36 Scott Burton: And so this became a bigger issue and so we had county labeling in restaurants, it was just enacted, and became available in all of chain restaurants in United States with 20 locations or more in May. And so our research on the restaurant side of providing nutrition information, shows that you get the types of results that policy makers would like to see, for those people that are health value oriented. So they care about what they eat, they're using the information to make lower calorie type decisions. But in some of the research we have it suggests that it goes the opposite direction for people that are very interested in quantity and taste. So back when I was in my 20s and I used to run five miles every day. I didn't care about what I ate, I was very hungry, I had a tendency to kinda go, "Well, if it's low in calories, I'm not sure that's something that's appealing to me." And so for certain people with certain types of lifestyles they may need and want higher levels of calories.

15:54 Scott Burton: So, for some people that are more interested in having a high quantity of food, or perhaps trying to maximize the best taste possible, when you provide calorie information it tends to lead them to select the higher calorie types of food. So, on balance, it tends to help some people. Other people, and perhaps these are people that it doesn't matter, but they can end up getting more higher-calorie type selections when you provide them with calorie information.

16:30 Matt Waller: That is really interesting. I never knew that.

16:33 Scott Burton: Well, it's forthcoming research and so it will be forthcoming and out in 2019.

16:41 Matt Waller: How many years have you been doing research on this sort of thing?

16:49 Scott Burton: 25 years or so. And so again I'm interested in information communication to consumers broadly speaking. And essentially this goes back to when I did a lot of advertising studies and promotional related studies, as far as back as my banking career. But it's also something I've been interested in and became more and more interested in as it relates to consumer health and welfare over the last 20 to 25 years. And I slowly also moved into some of the things related to tobacco types of information communicated to consumers, in terms of graphic warning information that may be more influential in helping smokers to think about quitting and helping adolescents to consider not starting to smoke.

17:43 Matt Waller: The smoking research, the warnings on the labels, are you finding similar for that in the nutrition?

17:58 Scott Burton: Not really. I mean with the smoking type studies that we've done, we find the types of information disclosed is very different. So with smoking we've been interested in these graphic warnings that we don't see in the United States, but we do see in some 105 countries around the world that have visual pictorials, that kind of demonstrate the nature of health issues related to smoking. So you can make this very graphic. They become very noticeable. And so our research says that those tend to be effective in convincing people to at least consider not starting to smoke or considering quitting.

18:49 Matt Waller: So when you do research like this, I know you're an expert in research methodology as well, and you teach it to our doctoral students, and of course, you're co-editor in chief of the journal, so methodology is very important to you. When you're doing this kind of research with experiments, how do you... So if you have a question, then you've got to design an experiment to look at, how does that process work?

19:24 Scott Burton: Well, you first consider the nature of what you want to manipulate and the specific factors involved, and then you think about, based on that, how can I pull these things together to come up with the design? You think about, okay, are there individual difference characteristics that you want to monitor? So we talked a little bit about health consciousness, we've talked a little bit about people that are oriented towards high levels of quantity or superior taste, these are all background characteristics that you want to measure and think about how the things you would manipulate on a package, on a restaurant menu, might affect these different groups of people in very different ways. And then, you think a little bit about the nature of the process that might be involved. So a lot of the research that we do, we think about are there intervening variables that are going to be important? So, when you think about nutrition labeling, you might think about, "Well, the direct outcome might be something such as how helpful or unhelpful do they perceive the product to be?"

20:37 Scott Burton: You then want that to carry forward into their purchase intentions and choices, so you can lay out a string of specific outcome variables that end up being a chain of effects, that you'd like to be able to see and then with some of the sophisticated type software that's available now, you can think about for this chain of effects, that we'd like to see across different outcome variables, how does that differ across different segments of consumers that are out there?

21:09 Matt Waller: I didn't know they had such software.

21:11 Scott Burton: You need to sit in on my PhD seminar. [chuckle]

21:14 Matt Waller: That is great.

21:16 Scott Burton: Yeah.

21:16 Matt Waller: Well, I know you have a lot of expertise with experiments, with human subjects, and you need it to look at these kinds of questions, because there's a lot of more nuanced issues that are hard for someone who doesn't do this kind of research to see, and so, I would imagine that taking your research and publishing an academic journal you can spell all that out and other researchers that have your kind of skills, they read it and they understand it, but I know you also do a lot, obviously, 'cause you consult to the FDA and so forth, you have to take a lot of what you're finding and figure out how to communicate like you've been doing to me just now, and I know...

22:09 Scott Burton: I've been trying to do that to you.

22:10 Matt Waller: Yeah, exactly. [chuckle] And I know as a researcher myself, that's very hard to do sometimes, people want simpler answers than the real world really can provide in many cases.

22:22 Scott Burton: Yeah, absolutely, and so that's one of the nice things about being a co-editor, where we have people that actually have jobs where they take the information that comes out in journal articles, particularly for a journal like the journal of public policy and marketing, where we have things that are relevant to many consumers, and are of interest to many businesses too. They take the information from the journal article and condense it down into a nice press release where they're able to use that press release to kind of hit a broader segment of the population and probably explain it, in many cases, in a better fashion than the researchers might be able to do. And the researchers also obviously can work with these PR people to be able to come out with things that are technically correct, but presented in an understandable manner. We do have other types of outlets.

23:23 Scott Burton: So, one of our Ferner package labeling studies that we had that was published in the journal of consumer research, we had a Rectors business review came to us and say, "Here's what we do, we find things within the business journal arena, targeted academics, we take that information, we're interested in you condensing that information and writing something for our publication." So that allows you to take your own studies, cut them down, present them in a way that's not so academic, that has a broader readership for these types of outlets, probably much like we do here at the university of Arkansas.

24:08 Matt Waller: Scott, I know you've done research on processing claims, first of all, explain what that is and then talk a little bit about some of the findings.

24:18 Scott Burton: Okay. Businesses today in many cases are interested in what they consider clean label claims, and so clean label is a term that I don't know how definitively is defined anywhere, but it would include things like no GMOs, no artificial ingredients, no synthetic ingredients, all natural, organic. So all these things that indicate to a consumer that the product is made from real food and it's not synthetic and then it's going to be something that, in many cases, they'll consider to be natural and helpful. Some of these claims like organic, are closely regulated. Other claims like natural, is not closely regulated and so the true meaning to consumers often times is not clear, so consumers have an idea and they make inferences about what it should mean, but it's not necessarily regulated tightly. So, sometimes when you buy a product that says natural chicken in it or something like this, or all natural ingredients, you need to be a little bit suspicious about what that means exactly. And so this is an emerging trend and it's clearly as you look at packages today, you see a lot of instances where these types of processing claims are available.

25:48 Matt Waller: Has there been very much research on these kinds of topics? In terms of how these claims affect consumer or shoppers decisions?

26:00 Scott Burton: There's a lot of things that are emerging out there. In some of the processing claims, there's a lot of research on, such as organic. So, the organic claim and little logo you see on product packages has been regulated by the USDA for about a decade, and so clearly is something people pay a lot of attention to in a marketplace. And there's been quite a bit of academic research on things like that. Things like all-natural claims. There are studies that have looked at the effect of all natural claims. They are fairly robust in terms of their influence, and people do see these certain processing claims as interrelated, so when they see a all-natural claim, they think that the product is probably more likely to be organic, and more likely not to contain artificial ingredients, likely to not have artificial coloring, things like those. But, the overall specific claims, there's some research on some of them, a lot of research on others, and little research I think, on some of the others. So things like non-GMOs, things like that. Those have been emerging of interest probably in the last five years, and we'll see more and more on claims like that.

27:20 Matt Waller: When you do consulting for the US Bureau of Labor and Statistics or the FDA, what kind of things do you work on or help them with?

27:31 Scott Burton: One example, a company that was working with the FDA on the new nutrition facts panel, they come to me and do an interview essentially, with a list of questions, and go, "We know this is coming out. What do you think the most important aspects are to communicate to consumers? How can those aspects be communicated to consumers most effectively? How can we work to maximize the impact overall, of making the change from this old format to a new format?" I worked on something a few years ago for the FDA, where they were interested in, we provide this warning information on new drugs to physicians, how do we actually get that in a format, in a communication vehicle that they will pay attention to it? So certainly, as you see, many of these new drugs have warnings. There's lots of indications of potential problems. Doctors are very busy people.

28:34 Scott Burton: When they see new drugs out there on the market, it's not clear that they always pay as much attention to all the different potential problems that could be associated with the drug. And so, being sure that that information actually is delivered to them in a format that they will pay attention to it, is a big issue to the FDA. And so, kind-of like as a dean, where you have a thousand emails every day, you have to decide which ones you're gonna pay attention to, and which ones you're not gonna pay attention to. And so, if you have physicians that have or are seeing patients all day long, it's not clear how much time or effort they put into necessarily understanding all the warnings on all the new drugs that are made available to them.

29:21 Matt Waller: Scott, you hold the Tyson chair in food and consumer products retailing. Would you explain just a little bit about the chair, and how it's used, that sort of thing?

29:33 Scott Burton: Well the chair is used in many ways to help me support my own research, to give me some time to be able to do the research that I wanna do. When I wanna collect data, when we wanna kinda design something in the lab, I have the opportunity to be able to create stimuli and create packaging that we would like to be able to use in the lab. And again, a lot of my research overlaps in terms of retailers interest in the way, a lot of research I do can be positioned in terms of implications that are of direct interest to retailers and consumer package manufacturers, as well as of interest to the Food and Drug Administration, the various types of NGOs. So, lots of times, those don't end up in the same identical journals, but you can collect data that is multi-faceted, that is of interest to both of those different sets of constituencies. I also support some of my students, so when students need money, potentially to go to a conference, and our department may not have the money to fund them to be able to go, I think it's something important for them. It allows them to do some things, maybe they couldn't do otherwise. And it also helps support me to travel, to go to conferences to do things for, go to DC and talk to people and I need to do that.

31:00 Matt Waller: Thank you so much, Scott, this has been really interesting, I appreciate it.

31:03 Scott Burton: Thank you, Matt, I appreciate having the opportunity.

31:08 Matt Waller: Thanks for listening to today's episode of the BeEpic podcast from the Walton College. You can find us on Google, SoundCloud, iTunes, or look for us wherever you find your podcasts. Be sure to subscribe and rate us. You can find current and past episodes by searching BeEpic podcast, one word. That's B-E-E-P-I-C podcast. And now, be epic.

Matt WallerMatthew A. Waller is the dean of the Sam M. Walton College of Business, Sam M. Walton Leadership Chair and professor of supply chain management. He is also the host for the Be EPIC Podcast for Walton College.

 

Walton College's EPIC values -- Excellence, Professionalism, Innovation and Collegiality -- are the heart of Dean Waller’s podcast. Since the beginning of the series, Waller has interviewed business professionals, industry experts, CEOs and Walton College students to bring listeners first-hand accounts directly from the entrepreneurial world.

 

Waller is an SEC Academic Leadership Fellow and coauthor of “The Definitive Guide to Inventory Management: Principles and Strategies for the Efficient Flow of Inventory across the Supply Chain,” published by Pearson Education. He is the former co-editor-in-chief of Journal of Business Logistics. His opinion pieces have appeared in Wall Street Journal Asia and Financial Times.

 

Waller received an M.S. and Ph.D. from Pennsylvania State University and a B.S.B.A., summa cum laude, from the University of Missouri.





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