Tuesday, March 23, 2010

Cash and Calories

A little-noted feature of the new health care bill was inserted with no partisan rancor and the full support of industry. In the name of bending the cost curve, every restaurant chain with 20 or more outlets must hereafter post calories on its menus (and menu signs, for drive-thrus). "Nanny state" do-goodism? Not according to the National Restaurant Association, a lobbying group. The Association's Sue Hensley explained, "That growing patchwork of regulations and legislation in different parts of the country has been a real challenge, and this will allow operators to better be able to provide their information." New York City and California already require calorie information.
The point of the new regulation is to encourage healthier eating, of course. One recent study found scant evidence that New York's law had done any good. But there may be another reason why the restaurant industry likes the new law. It's more about the bottom line than waistlines.
Experiments in human decision making show that we're subject to information overload, especially where numbers are concerned. When calories are printed on the menu, the consumer has fewer cognitive resources to devote to judging prices. It's much like the "misdirection" employed by magicians. The sudden appearance of a scantily clad assistant in a puff of smoke gives the magician cover to slip a rabbit into his hat.
Above is a "Weight Watchers" menu from a popular restaurant chain. Notice that this includes not only calories but grams of fat and fiber — along with price. That's four sets of numbers for each item. (The prices are in smaller print than the nutritional data!) And of course, you have to factor in how much you like each item, too. Anyone who conscientiously tried to use all this information would need a spreadsheet. In most cases, we give up and just pick something we like. That's fine with restaurants. In that moment of capitulation, we tend to ignore price, often ordering something more expensive than we might have.

1 comment:

  1. You see the same in areas like electronics and software. Comparison charts are great ways of accentuating feature and characteristic differences, brining the eye there, and hopefully having the consumer ignore higher prices. Non-linear feature versioning is a deceptive and effective way to do this.