Differences in composition of seemingly identical branded products: Impact on consumer purchase decisions and welfare

The issue of Differences in Composition of Seemingly Identical branded products (DC-SIP) refers to the case of "goods [being] marketed in the Single Market under the same brand or trademark but with differences in content, composition or quality in individual EU Member States" (European Commission, 2017a). The main concern is that "in some parts of Europe, people are sold food of lower quality than in other countries, despite the packaging and branding being identical", as stated by President Juncker (European Commission, 2017b). In this report we aim to analyse whether and how this issue affects consumers. We do so in economic terms, by analysing how consumer purchase decisions and consumer welfare are affected by the fact that the same brand owner offers seemingly identically branded food products but having different properties. Based on the conceptual and empirical knowledge developed in the fields of economics, marketing and consumer psychology, we build a conceptual framework to analyse the formation of consumer quality perceptions, purchasing decisions and welfare. We look into the different factors that shape food quality perception, how these may differ across countries and individual consumers, and relate these to the issue of DC-SIP. Finally, we analyse the impact of disconfirmation of consumers' expectations and the role of unfairness in consumer decision making and welfare to understand consumers' reactions to DC-SIP.