A Segmented Hedonic Analysis of the Nutritional Composition of Fruit Beverages

Given the increased importance consumers and manufacturers have placed on the functional nutrients found in fruit beverages, as well as the changing federal guidelines on fruit beverage consumption, this study sought to determine whether specific nutrients garner price premiums in fruit beverages sold in the US. Using the National Household Food Acquisition and Purchase Survey, hedonic price models for fruit juice and fruit drinks are estimated to determine whether specific nutrients, product characteristics, packaging type and acquisition characteristics are associated with price premiums. Based on the results from the hedonic price models, three generalizations are made about the price premiums for nutrients and sugar in fruit beverages: (1) all nutrients garner premium prices in fruit juice, (2) sugar and select nutrients garner price premiums in non-diet fruit drinks and (3) all nutrients and sugar are associated with negative price premiums in diet fruit drinks. Findings further suggest that product attributes such as brand, flavor, organic labels, diet labels and package type, and acquisition characteristics such as store type, region, season and payment type are associated with price premiums in fruit beverages.