Where would General Mills be without toddlers? In churches to restaurants, generations of moms have furtively pulled out little bags of Cheerios to keep young ones entertained, as they learn to grasp small pieces of “good-for-you” food and transport them to their mouths. Cheerios has long been positioned for its health attributes. A recent introduction, Banana Nut Cheerios, is a classic “functional food,” as it notes it is made from whole grains and features the front-label functional food-type claim: “Can Help Lower Cholesterol & Reduce the Risk of Heart Disease.”
Indeed, consumers of all ages are driving what continues to be one of the biggest trends of all, foods positioned for health.
A Cambridge, Mass. and Palo Alto, Calif.-based consulting firm, Scientia Advisors, predicts an annual compound growth rate of 7% through 2012 for functional foods (defined by the firm as foods “fortified with naturally-occurring ingredients that provide health benefits beyond basic nutrition”). This is about twice the 4% growth rate it predicts for conventional foods and pharmaceuticals. The growth translates to a predicted $195 billion in global sales, 52% more than in 2006. The U.S., Scientia says, is responsible for some 40% of global growth.
Functional food sales estimates differ, in part, due to differences in how such foods are defined. However, sources generally agree on positive category growth and that the U.S. forms the largest market. (See chart “Functional Food and Drink Market Value” from Business Insights.)
Bob Jones, principal consultant at Scientia, catalogued category drivers as including “increasing scientific evidence of functional foods’ effectiveness; increased media publicity encouraging consumer adoption; an aging population with growing chronic health needs; and food companies’ ability to work in a regulatory environment that increasingly requires scientific substantiation of claims being made.” Lastly, he listed “innovation” in efficacious new ingredients, along with the fact that companies are “making commercially successfully products that taste good, are affordable and can be found in the supermarket.”
Designing functional food products around consumer desires is becoming increasingly sophisticated. For example, Tree Top Inc. recently launched trim, a line of creatively flavored fruit juice-based drinks with in-demand nutritional ingredients. Tree Top used automated software that provides instant feedback into a matrix of product attributes. Using an online consumer survey, Tree Top learned what characteristics were most important to consumers, says John Baranowski, manager of technical services with Tree Top and the lead food scientist who created trim. “It helped me focus on what consumers wanted in a blended juice,” he says. The goal was to have a perfectly formulated product with key benefits most demanded by consumers, such as a full serving of fruit in the 8oz container.
Additionally, “satiety and weight control were high on their list,” says Baranowski. Functional ingredients that support those goals were then chosen to be formulated into the beverage. Fiber was included, because it promotes a full feeling of satiety and also helps regulate blood insulin, by avoiding glucose peaks that come from simple carbohydrates. Chromium was incorporated, because it enhances the effects of the hormone insulin, promoting a healthy metabolism. Other ingredients include HCA (hydroxycitric acid), a naturally derived plant extract shown to potentially suppress appetite; and L-carnitine, which helps convert fatty acids into energy in the muscles. “It was a challenge to get ingredients into a 60-calorie product, as well as provide satiety and a fruit serving,” says Baranowski.
Conveying a functional product’s benefits to consumers is also challenging. A recently issued paper, the Hartman Group’s POV (Point of View), is titled “Opportunities in Functional Foods” and analyzed consumer reactions to functional foods’ marketing messages. Hartman defined functional foods as “any food or beverage designed and/or marketed with a health benefit (physical or emotional), implicit or explicit.” It states that fortified foods, such as those with vitamin A and D fortification, are the cultural foundation on which functional foods are built. Functional foods are different from fortified foods, in that consumers perceive the list of potentially healthy ingredients/nutrients in functional foods changing almost annually. Among other observations, the Hartman POV opines that consumers react very differently to what it calls nutrient “plays” (e.g., rich in omega-3 fatty acids) vs. functional benefit plays (e.g., helps naturally regulate the digestive system).
Nutrient marketing plays rely on health associations being commonly understood, such as that fiber will aid digestion or relieve constipation. The Hartman POV provided a litany of nutrients falling into this group: calcium, whole grains, fiber, vitamins C, B, D and E, soy protein, oats and omega fatty acids. FiberOne takes this approach. On the other hand, “functional benefit marketing” works better for nutrients less well-known and that address a “low-risk” health need better than modern medicine. That is, they fall into a mindset of “it can’t hurt and it might help,” something similar to what the dietary supplement category has done. Activia uses this concept. Important functional benefits leading into this category include “digestive function,” “immune function” (not auto-immune disorders), “mental alertness/focus,” “energy” and “satiety.”
Brian Keating, founder of Denver-based Sage Group, a natural products development consultancy for some 20 years, makes similar observations on consumer understanding of various nutrients. “Most consumers know calcium fortifies skeletal strength and many know Ginkgo biloba supports brain health,” says Keating. “For years, we have helped companies position and promote nutritional products. However, antioxidants still leave many consumers scratching their heads. They may understand antioxidants reduce cancer risks or slow aging, yet have no idea how they work.” It is very similar to electrolytes in sports drinks; most consumers still do not fully grasp how these substances support health, they just trust manufacturers that they are beneficial, says Keating.
Whether a product takes a nutrient or functional food “play,” a key element is that a specific health benefit is involved. A December 2008 Packaged Facts report titled “Food and Ingredient Trends Addressing Specific Diseases and Other Health Conditions” matched up ingredients with health issues. For example, whole grains target cardiovascular disease, cancer and high cholesterol; soy addresses bone health and osteoporosis; berries target infection; and fish and omega-3 fatty acids target heart disease and the central nervous system.
Foreseeing this major trend several years ago, the NutraSolutions section of Prepared Foods magazine’s December issue now carries an annual “Ingredients for Health Reference.” It is a listing of health conditions, along with commercially available ingredients appropriate for formulations targeting those issues. To mention just three examples, cardiovascular health ingredients included proprietary, branded versions of vitamin K2, flavanol-containing cocoa, oat-soluble fiber, a lycopene complex, omega-3 fatty acids and phytosterols. Secondly, cognitive health ingredients included a branded cocoa extract and omega-3s. Thirdly, for digestive conditions, ingredients available from suppliers included branded dietary fibers, prebiotics, cranberry juice and hydrocolloids for gluten-free formulations. (To see the online version, type in “Ingredients for Health Reference” in the search field on www.PreparedFoods.com or www.NutraSolutions.com.)
Products Positioned for Specific Conditions
Indeed, products overtly positioned for specific health conditions are on the increase. (See chart “Changing Health Positions” from Mintel Global New Product Database, GNPD). An example is seen in new products with added calcium claims vs. those with bone health claims. That is, although bone health products are down slightly in number from 2006-2008, products noting the addition of calcium, a key component of bone health, have fallen more rapidly.
For any given major health condition, a variety of ingredients can be marketed to be of assistance. Again, looking at bone health positionings, Monterey Mushrooms’ Sun Bella Sliced White Fresh Mushrooms notes on the front label that they “provide 100% of the Daily Allowance of vitamin D, which is essential for strong bones.” Mintel’s GNPD also reports that Western Family Complete Plus has just launched a strawberry-flavored Balanced Nutritional Drink with “calcium, magnesium and vitamin D…to maintain healthy bones, teeth and cartilage,” and Roundy's Organics Split Pea Soup’s front label notes that “green peas contain vitamin K that helps maintain healthy bones.”
One health product category, weight management, is growing in sizeâ€”along with the girth of Americans. Category nuances include an increased number of products positioned for satiety, along with many also positioned as energy products. Both claims influence ingredients chosen for their formulations. For example, Slim, just introduced by Next Generation Waters, is another weight-control product, with ingredients similar to Tree Top’s trim. Slim contains chromium, in the form of chromium polynicotinate, Garcinia cambogia rind extract, calcium (as hydroxycitrate), a gram of fiber and green coffee extract.
Both processors and ingredient suppliers alike show increased interest in products for “satiety.” A. Elizabeth Sloan, Ph.D., president of San Diego-based Sloan Trends Inc., notes that verbiage such as “appetite suppressant,” “benefiting satiety,” “sustained energy,” “lasting satisfaction” and “appetite control” are being used on products to imply satiating abilities. Next Generation Waters Slim makes the claim of “infused with appetite suppressants that helps curb appetite and promote healthy cholesterol and serotonin levels.”
Mintel’s GNPD notes that in New Zealand, General Mills, under the Old El Paso brand, just introduced Wholegrain Tortillas, with three times the fiber of a regular tortilla, and notes that whole grains “can help keep the heart healthy, promote good digestion and keep the appetite satisfied for longer.” Back in the U.S., Galaxy Brands’ Linny Mac Snack Bars touts the fact that they are “high in fiber and protein, low in calories and glycemic index” and are “said to satisfy appetite and to be suitable for a calorie-controlled diet.”
High-protein products have taken a sharp increase in numbers in the last year or two. (Again, see Mintel’s chart “Changing Health Positions.”) Many target the needs of athletes--but the cheer, “Low-carb lives!” may also be appropriate. Like the Linny Mac Snack Bar, formulations strive to reduce quickly digestible carbohydrates that create peaks in blood insulin levels (which result in greater hunger). These lower-glycemic products often have enhanced fiber levels, along with heightened protein amounts. Other examples include Tight Curves Multi-Purpose Protein for women, which “supports low-carbohydrate diets, helps tone muscle, increases endurance and improves the quality of hair, skin and nails.” Also, repackaged Product Partners’ Beachbody P90X Chocolate Peanut Butter Protein Bars are “said to be a smart alternative to snacks or fast food options, and naturally support fat-loss goals whilst delivering healthy fuel to tone muscle.” Its listed proteins include soy and whey protein isolates and calcium caseinate.
Beyond proteins, suppliers offer specialized ingredients for weight control. Examples include IdeaVillage’s Slim Shots Weight Loss Management Liquid Appetite Controller “to reduce feelings of hunger for up to eight hours and to reduce the calorific intake by almost a third.” It contains a patented emulsion of highly purified oat and palm oils that creates satiety through the ileal brake mechanism.
Looking through the GNPD at weight-loss supplements introduced in the last few months, a wide variety of ingredients appear, some that can be used in food, some not. For example, Slimquick Laboratories’ Naturals Weight-Loss Dietary Supplement “helps women to lose weight by reducing excess water retention, balancing female hormones, reducing stress, increasing metabolism, increasing energy and providing antioxidants.” Its ingredients include green tea extract, as well as yerba mate, soy extract with 40% isoflavones, Asian ginseng extract and antioxidant sources that include açai and pomegranate extract and blueberry fruit. The stimulants green tea, yerba mate and caffeine, along with a selection of botanicals, also appear in Iovate Health Sciences’ Six Star Muscle Drenalin Hardcore World's Hardest Hitting Fat Burner, said “to increase key fat-burner hormones with rapid-release liquid gel technology.” BioQuest’s BetaStax Weight Loss Supplement, which provides “a powerful biochemical edge to achieve serious results from diet and training programs,” contains fenugreek extract; conjugated linolenic acid (CLA), which has achieved self-affirmed GRAS status with FDA notification; and, again, chromium polynicotinate (among many other components).
Research provides various levels of support for these ingredients. For example, in February 2009, a study linked the consumption of green tea (catechin) to enhanced abdominal fat loss in adults performing moderate-intensity exercise (Maki, KC, et al. 2009. J. Nutr. 139: 264-270).
While such supplements seem removed from food and beverage product development efforts, this segment of the nutritional industry bears close watching.
Is a Bad Economy Good News?
Just as the foodservice industry often serves as a crystal ball for up-and-coming foods and beverages chosen for taste, texture and other sensory attributes, the dietary supplement industry provides clues into emerging nutritional ingredients and functional food trends…although careful analysis must also be applied.
For example, many to most categories of dietary supplements showed a strong increase in sales through the end of November 2008. (See chart “Soaring Supplement Sales” from Information Resources Inc., IRI). Two key exceptions, however, are hot areas in foods. IRI’s objective data indicates sales declines in dietary fiber and antioxidants supplements, while Mintel’s GNPD shows steadily increasing numbers in foods and supplements making antioxidant claims; both statistical and “anecdotal” evidence points to fiber’s popularity. For example, General Mills’ Fiber One snack bars was an Information Resources Inc. 2008 Pacesetter, having racked up $64 million in first-year sales. (See the editorial in this March 2009 issue of Prepared Foods for more discussion.) Still, from probiotics to omega-3 fatty acids, the dietary supplement industry has accurately prophesized many food trends.
A Packaged Facts report titled “Nutritional Supplements in the U.S.” paints a rosy picture for supplements that may translate for consumable health products, in general. It notes that the “economic downturn of 2008 notwithstanding, the U.S. market for nutritional supplements is poised for healthy growth, with sales forecast to climb 39% from 2007-2012 to reach $8.5 billion, following a major rebound in 2006-2007.” Even as consumers tighten their “discretionary spending belts,” the “strong preventive healthcare angle of supplements and the market’s sizeable component of better-off demographics, including aging Baby Boomers,” will continue to support it. Sage Group’s Keating sees the struggling economy influencing and even creating opportunities for the functional foods industry, as well.
Both the dietary supplement and functional foods industries share a value proposition challenge with consumers, says Keating. In the past, there has been ongoing debate over whether consumers will ultimately prefer pill or food forms for their nutrients, and for the next few years, economics will be a big contributing factor in this equation. Limited personal nutrition budgets will require there be precise communication to consumers that they are getting maximum value for their purchases.
Functional foods may now enjoy a brighter future, partially due to consumers seeing them serving as an acceptable part of their homes’ food staples, and also rationalizing their “food role” as incentive for economic trading-down from supplements (which, in turn, are sometimes a trade-off from pharmaceuticals). First, consumers forced to limit cost purchasing outlays may view a box of omega-3-fortified cereal as less of an up-front investment than supplements. “Consumers don’t necessarily see more value in a functional food than in a dietary supplement, but they may view them as a way to spend fewer dollars on their total nutritional expenditures,” says Keating. Secondly, people are spending more time trying to obtain their nutritional needs from fewer products. If a product--food or supplementâ€”integrates a number of nutritional components, consumers will look at it as a cost-efficient way to get a multitude of healthy constituents into their diets.
Dietary supplement niche products have tended to state multiple health benefits for a long time. However, more traditional supplements also will be influenced. “With an eye towards stretching tight personal budgets, consumers will lean towards purchasing multi-vitamins, instead of one vitamin, or reach for combination supplements of mixed carotenoids rather than just one,” says Keating.
Supplements have excelled at blending benefits, while placing an emphasis on educating consumers. Here are a few examples that also support upcoming trends.
* Mood enhancement. Carter Reed’s Relacore Extra Maximum Strength Formula Stress Reducer is formulated to “reduce stress, reduce mild anxiety, improve the mood, fight mid-day fatigue and increase energy,” notes Mintel’s GNPD. Stimulant ingredients are not used, and the non-sedating formula explains that “there is a link between stress, high levels of cortisol and accumulating body fat.” Here, mood enhancement is linked to weight management. Both are “on-trend” health benefits. Mood is a “soft claim,” when compared to ones like “heart health.” It is less regulated and offers less risk.
* Cosmeceuticals. Nestle’s Glowelle is described by the company as “a beauty drink dietary supplement that helps fight the signs of aging by nourishing your skin from within.” Ingredients in one variety include pomegranate extract, quercetin, green and white tea extracts, CoQ10, vitamin E, lutein, lycopene, zeaxanthin, grape seed extract, maritime pine bark extract and goji berry extract, among others. An April 2007 Datamonitor report put the European and U.S. cosmeceuticals market at $8.2 billion at that time and predicted a compounded annual growth rate of 5.4% from 2006-2011. Keating notes that skincare products are increasingly being rolled-out on an anti-inflammatory basis, rather than as moisturizers.
* Anti-inflammation. Basic Ele-ments Thrive Omega Enhance Dietary Supplement, which the GNPD notes was introduced in January 2009, contains flaxseed oil and notes that omega-3 helps reduce inflammation, improve cholesterol profile and lower blood pressure. While inflammation is a positive body defense mechanism, it is also linked to diseases such as cancer, cardiovascular disease, diabetes, immunology and neurological disorders, and even obesity. Beyond omega-3s and certain “nutraceutical” additives, formulations that help to reduce insulin response (or maintain blood sugar levels), such as by use of dietary fiber through reduced-sugar levels, will be of interest. Visit www.PreparedFoods.com and type in “Can Processed Foods Save America from Itself?” to see Dr. Barry Sears’ presentation on this subject at Prepared Foods’ 2005 New Products Conference.
* Body ecology. Despite the historical presence of probiotics in fermented dairy products, the supplement industry has touted the benefits of these microbes for decades. The food industry is now catching up. Pierre’s Ice Cream Company recently introduced Yovation™ premium, probiotic frozen yogurt in six flavors. “Yovation was inspired by the growing consumer interest and popularity of probiotic products and the recognition by the medical community of the benefits of probiotics,” says Laura Hindulak, Pierre’s director of marketing, a point also made in the company’s press release. The product uses a spore-forming probiotic that better survives processing steps and the human digestive process. Prebiotics and synbiotics (probiotic/prebiotic combinations) will also grow in consumer recognition. Although research more strongly supports the benefits of probiotics (ranging from immune enhancement to reduced obesity), on a broader scale, it is only one example of how scientists better comprehend the impact the biological environment has on human health.
Keating offers a few last trend insights. “Spices are the new tea,” suggesting their popularity with formulators and consumers makes them ripe for major category growth, as occurred with tea in the last few years. Research is validating their many health benefits. Examples include rosemary as an antioxidant, cinnamon for diabetes prevention, turmeric for inflammation reduction and ginger for digestive health. “Spices function as preservatives, enhance organoleptic properties and also improve health,” says Keating.
He also notes that clues into future opportunities for nutritional products can be gathered from the pharmaceutical industry. Last fall, Pfizer announced they were focusing research on six areas: cancer, pain, inflammation, diabetes, Alzheimer’s disease and schizophrenia. Most, if not all, have a dietary connection.
The health of a nation rests not only in the medical community, but in the food and nutritional industries as well. NS
Going Global: Mexico’s Functional Foods Market
A new GAIN Report from the USDA FAS titled “Mexico, Market Development Reports, Market Snapshot: Health Food Market, 2009” notes that Mexico’s health food market is rapidly developing, due to increased per capita income and consumer awareness of the benefits of a healthy diet. This market segment is estimated at about $1 billion per year and is expected to grow at an average annual rate of 10%. Currently, 70% of the foods are produced domestically, and 30% are imported, with 65% of those from the U.S. These products are now primarily soy products and soy ingredients, food and fiber supplements, power bars and ready-to-eat meals.
The primary consumers of such health foods are 20- to 50-year-olds, with incomes to afford them (some 5% of the population of 108 million). The segment includes foods such as “low-calorie, low-fat, low-carbohydrate, high-fiber, high-protein, vitamin-enriched, gluten-free, etc.,” but not “light” products that use artificial sweeteners, notes the report. Beyond nutritional bars and other currently popular health foods, meal replacements, whole-grain bakery products, breakfast cereals, pastas and nut/grain mixes, and many other bottled or canned products have good prospects. The fastest-growing sector is in the production of soy products.
A quick review of Mintel International’s GNPD provides examples of products introduced in the last six months, such as Mexico’s Theleon Green Tea, with claims of antioxidant properties and benefits regarding headache relief, cancer prevention, obesity and arthritis, improved eyesight and memory, digestion of fat foods, stimulation of the immune system, cavity prevention and “help with breathing.” New Nestle Chamyto 1+1 Yoghurt Sabor a Fresa con Cereal (Strawberry Yogurt with Cereal) has been launched with “a prebiotic formula that is said to strengthen intestinal flora” (1.3% inulin). Also, Allnat Nutrition S. A. de C. V. has a new package for its S’Milk branded soy milk mix that is high in protein, low in fat and possesses the digestive enzymes papain and bromelain. For more information, see www.fas.usda.gov/gainfiles/200901/146327015.pdf.
On the Web: NUTRITIONAL INGREDIENT TRENDS
* www.scientiaadv.com/scientia_pressRelease_115.html -- Scientia Advisors’ release on functional food sales predictions
* www.hartman-group.com/hartbeat/2009-01-14 -- Hartman Group POV on health messages
* www.packagedfacts.com/Food-Ingredient-Trends-1767539 -- Press release on “Food and Ingredient Trends Addressing Specific Diseases and Other Health Conditions” report
* www.NutraSolutions.com -- Type in with quotation marks “Healthful Ingredients: Drive New Products” to see trend predictions from 2008