Health Creates Wealth? The Use of Nutrition Claims and Firm Financial Performance

Abstract

Prior research has investigated consumers’ perceptions of nutritional information but does not detail how the use of nutrition claims on product packages maybe associated with a manufacturer's financial performance. Using data from 38 firms, the authors find evidence that a firm's stock market performance and sales relate significantly and positively to both the degree of nutritional emphasis and the specificity of nutrition claims on product packages but relate negatively to the diversity of nutrition claims the company uses across its products. The findings provide important managerial implications to help businesses obtain financial gains through the use of nutrition claims. They also suggest that aligning the labeling policy could be a profitable long-term route for marketers, and it is necessary for policy makers to pay attention to firm performance. The insights regarding the economic benefits of using nutrition claims from a marketing–finance perspective provide further implications for policy makers to encourage firms to offer nutritious products and make nutrition information more accessible for consumers.

Note:
Funding Information: This research did not receive funding.

Conflict of Interests: No competing interest.

Keywords: Nutrition claims, Health claims, New products, Firm value, Tobin’s Q

JEL Classification: M31