Health Claims as Communication Tools that Enhance Brand Loyalty : The Case of Low-Fat Claims within the Dairy Food Category

During the last decade a strong consumer interest has emerged for food products with health protecting or enhancing properties. In this connection, health claims are used as communication tools conveying the health message of a product and further constituting the means of a brand's differentiation strategy. Brands carrying a health claim are thus expected to have an advantage over their counterparts. In this study, we aim to investigate whether health claims, with emphasis on the low-fat claims, can act as a means to improve the performance of brands and further enhance their loyalty levels. Based on stated preference data using a purchase intention scale (i.e. Juster Scale), a set of Brand Performance Measures (BPMs) are empirically estimated to describe the market structure of two dairy product categories and their respective sub-categories that were defined according to health-related attributes: a) fat content; b) enrichment; and c) way of processing. Then, the Dirichlet model's fit to the empirical data is examined, leading to the theoretical estimation of loyalty measures. Findings suggest that, on average, brands with a low-fat claim perform better in the market compared with their high-fat counterparts. Moreover, in comparison with other health-related attributes the fat content attribute exhibits slightly higher loyalty, signifying the importance of the "low-fat" claim as a means of communication