Tailoring compensation effects of health-unrelated food properties

•Increasing flavor intensity may compensate for the loss in taste of healthier foods.•Three boundary conditions determine if compensation effects emerge (or not).•A combination of adaptive conjoint analysis and sensory preference tests is applied.•Analyses uncover four distinct segments reacting differently to compensation attempts.•Attractiveness of the optimized healthy variant also depends on product configuration.

With the steady rise of the adiposity epidemic, there are increasing calls to stimulate healthier food choices. This is difficult, however, because consumers hold the nearly universal belief that healthy foods are less tasty. To increase their attractiveness, optimizing certain health-unrelated food attributes may help compensate for the loss in taste that is caused by the reduction of fat or sugar. The overall objective of this paper is to examine the boundary conditions under which such compensation effects emerge. Using the example of cookies, we examine how compensation effects depend on (i) the consumer segment, (ii) the configuration of the food product, and (iii) the type of evaluation process. This paper empirically tests compensation effects for optimized flavor intensity. We apply a combination of adaptive conjoint analysis and sensory preference tests. Market simulations and sensitivity analyses demonstrate that the intricate interplay among the three contingency variables is far more important than the question of whether compensation effects emerge or not. The analyses uncover four distinct segments and they show that compensation effects depend on which type of health-related attribute is reduced and whether the health-unrelated attribute is improved intrinsically or extrinsically.