Health and Wellness on Everyone’s List
Interest in eating healthfully remains a global consumer trend for the foreseeable future. It is a reflection of aging demographics in developed economies, as well as consumers’ growing understanding that diet directly impacts health. It might even have aspects of sustainability: Eating more plant components, such as skins, hulls and seeds, could improve utilization of agricultural resources. What is more certain, however, is that predictions for the nutritional products segment are, well, healthy.
The June 2011 report, “Future Directions for the Global Functional Foods Market,” by Leatherhead Food Research, notes the functional food and drink market (defined as products making specific health claims) was estimated at just over $24 billion dollars in 2010. The report predicted a compounded annual (year-on-year) growth rate of 4-5% in the next few years that would reach almost $30 billion by 2014.“World Nutraceutical Ingredients,” a November 2011 report by the Freedonia Group, relays annual growth of this segment at 8.5% for the 2005-2010 time period. It predicts 7.2% annual growth for the years 2010 to 2015. Overall, Freedonia sees world demand for nutraceutical ingredients reaching $23.7 billion in 2015. (This figure is not in conflict with Leatherhead’s, in that it includes nutraceutical ingredient sales for healthful products beyond those defined as “functional foods.”)
Leatherhead’s report further notes the types of health claims most popular on a global scale have been “energy/mood enhancement,” “gut health” and “heart health,” although there is strong growing interest in “weight control” and “immunity.” Bone health and anti-aging claims have been relatively rare in food products, with the majority of claims appearing on supplements.
The “Prepared Foods’ 2012 R&D Trends Survey: Functional Foods and Beverages” addresses the topic, as it asks the magazine’s primarily U.S. and Canadian audience: “In the next two years, how important are the following issues when developing food/beverage and/or dietary supplements?” “Weight management” ranked at the top—perhaps a sign of Americans’ dubious distinction of having one of the most overweight populations on earth. (See “Obesity: America’s Number One Food Issue,” in Prepared Foods’ December 2011 issue [online at http://tinyurl.com/6m2mzty].) “Cardiovascular health” came in second, followed closely by “digestive health,” then “diabetic benefits,” and finally “energy performance” and “cognitive health.”(See chart “What’s the Issue?”)
Ingredients for Healthful Processed Foods
Consumers tend to associate certain ingredients with specific health benefits. For example, calcium and vitamin D are closely linked with bone health. Emphasis on specific health conditions helps boost interest in ingredients with related health benefits. Other ingredients garner a positive connotation, although their exact benefits may elude consumers.
One intriguing product packed with “good-for-you” components is Campbell Soup Co.’s recently launched V8 Energy Shots. The product sits at the nexus of several consumer trends, such as interest in energy-providing foods and supplements; the understanding that fruits and vegetables are “good for you” (it contains nine fruit- and vegetable-derived ingredients); and comes in popular shot-size packaging (a convenient form of portion control).
For sweetness, the product relies on fruits and vegetables, such as apples (naturally high in fructose), sweet potatoes, strawberries, raspberries and others, plus a touch of sucralose. It fortifies that ingredient base with green tea extract (a caffeine and antioxidant source) and B vitamins, often found in branded energy drinks from Red Bull to Monster. There also is fortification via added antioxidant vitamins C and E and the vitamin-A precursor, beta-carotene.
Antioxidants have been among the top ingredients covered in Prepared Foods’ functional foods surveys for the past three years. Specifically, the survey for 2012 asked, “During the next year, do you expect the following ingredients to become more, or less important to your company’s product line?” Other ingredient categories that continue to vie with antioxidants for the top position are dietary fiber and omega-3 fatty acids. (See chart “Ingredients for Widest Use.”)
Additional ingredients indicated by more than half of industry respondents as having increased importance to their product line include: probiotics (55%), prebiotics (52%) and fruit extracts (51%). Such extracts and other fruit- and vegetable-derived ingredients are positively perceived by consumers. The International Food Information Council’s (IFIC) “Functional Foods/Foods for Health Consumer Trending Survey” asked the question: “What is the (first/second/third) food or food component that comes to mind that is thought to have health benefits beyond basic nutrition?” Some 70% of respondents cited fruits/vegetables; 18% mentioned fish/fish oils; and 16% said dairy. Only 3% said vitamins and supplements. The study notes that, with such an (unaided) question, consumers are more likely to name foods or food groups, rather than specific food components.
However, when consumers were asked specifically, “For each of the following food components or nutrients, please tell us whether you are aware that that food component or nutrient is thought to provide [heart-health] benefits,” omega-3 fatty acids came out on top in the IFIC study, with 85% saying they were aware of its heart-health benefits. Other ingredients associated with heart health included: monounsaturated fats (76% aware), potassium (76% aware) and soy protein/soy (64% aware); 50% were aware of the association between plant sterols and heart health. Only 43% said they were aware of the association between fiber and heart health.
The percent of respondents expressing interest in proteins and related ingredients all increased in 2012, compared to the 2011 Prepared Foods’ survey. Some 49% of respondents claimed proteins would increase in importance for their company’s product line(s), up from 41% in 2011; specialized whey protein increased to 41% of respondents, up from 30%; and even amino acids “with specific health benefits” increased to 40% of respondents, up from 32%.
Although there are several reasons for increased interest in protein, weight control is a prime one. For example, PureFit Inc. claims its nutrition bars “are an integral part of The PureFit Fat-Burning System.” The product has 18g of protein provided by soy protein isolates and soy crisps (soy protein isolate, tapioca starch and salt).
In the IFIC survey, 86% of Americans indicated they were aware of protein’s health benefit in weight management and in providing a feeling of fullness. IFIC notes this was a statistically significant increase over its 2009 poll.
Freedonia’s “World Nutraceutical Ingredients” report basically agrees with the results of the Prepared Foods’ survey. Freedonia notes that, globally, “proteins, fibers and various specialized functional additives will remain the top-selling group of nutraceutical ingredients,” with proteins posting the fastest gains.
The report also adds that naturally derived substances, consisting of herbal and botanical extracts and animal- and marine-based derivatives, will command the fastest growth among the major groups of nutraceutical ingredients. This also is reflected in Prepared Foods’ survey in regards to botanicals—42% said they’d be increasing in importance, up from 38% in the 2011 survey.
The “Ingredients for Widest Use” chart from Prepared Foods’ survey makes year-to-year comparison of results from the 2010, 2011 and 2012 surveys; however, a related but slightly different question was asked in 2010. Statistical significance was not calculated for year-to-year changes, but certain general trends emerge.
For example, respondents show the greatest enthusiasm for ingredients applicable to a broad range of formulations (e.g., components with antioxidant properties), while ingredients that are applicable for a narrower range of nutritional products—such as phytosterols/stanols, glucosamine, conjugated linoleic acid (CLA) and beta- alanine—had significantly fewer respondents saying they would have increased use.
Industry Voices Challenges
The Leatherhead report advises on several key points for this market segment. It notes European health claim regulations are under scrutiny, and the future of other global regulations will impact packaging claims (and what can be relayed to consumers in regards to product benefits). Secondly, with stricter regulations, the communication of scientific backing of health claims will grow in importance. Consumers also are becoming savvier about the concept of “scientifically proven.” Thirdly, “clarity of product positioning and specific benefits” needs be communicated to consumers.
In Prepared Foods’ survey, more than 100 comments were submitted in response to the question: “What do you see as the greatest barrier to success in trying to launch a new functional food, beverage or nutritional supplement into the marketplace?” Some challenges mentioned are typical of any new product introduction: “Meeting manufacturing capabilities to produce a consistent product that delivers the advertised benefit;” “Number of competing products already in the market;” “Marketing and advertising cost;” and, for companies distributing products internationally, “Using ingredients that are acceptable in world-wide markets.” One commenter’s lament was: “Slotting costs of 1.2 million [dollars just] to get your product placed on the shelf.”
Other responses were more typical of functional products and supplements’ barriers to success: “Trying to find the next ‘it’ project; trying to stay ahead of the competition and protecting our IP [intellectual property],” says one person. “Varying requirements from consumers…different ages, different deliveries, which equals too many products,” opines another. In general, most comments fell into distinct categories.
n Consumers: In general, consumers “get it.” That is, the “2011 IFIC Functional Foods Survey” reports that 87% believe certain foods (including supplements) have health benefits. However, a large number of comments from the industry in Prepared Foods’ survey were related to barriers such as consumer acceptance, education, and awareness of products and their benefits. “Believability,” writes one person. “Today’s retail market is flooded with claims [such as] digestive health (e.g., Activia) and cholesterol-reduction, and I think consumers are getting wise to the fact that in order to reap the benefits, you need to eat a particular product three times per day, every day!” Another wrote: “Overcoming misinformation and misleading claims that run rapid [sic] across the Internet.” Still another offers: “Communicating with consumers, given the regulatory environment and nature of [a] benefit that is difficult to understand.”
Finally, one respondent appears to have “had it” with mainstream shoppers. “The people who need it most are not shopping in the health food aisle; if I could put a stick in it, batter it with high-fructose-flavored corn meal and fry it, then stick it in the frozen food section, I might have a chance, but that would defeat 95% of the benefits.”
* Cost. The cost to develop, research and launch a nutritional product was another often repeated comment. Some notable examples include: “Clinical studies to prove to the consumer the promised benefits [is a barrier]. It takes too long to execute studies (expensive too) and sometimes results are not fully clear.” “Costs of ingredients are higher than traditional ingredients.” “Cost; it is brutally expensive to launch a new product on the market; ingredient costs are through the roof and unfortunately that cost gets passed on down to the consumer; it will be hard for me to introduce a new product without it carrying a premium price; I will worry about sales of that item.”
* Good Science. Many comments were in line with Leatherhead Food’s point on the necessity of sound science. “Identifying compelling product claims that are backed by science and can withstand regulatory scrutiny,” was a typical response. “Helping Marketing to find the best way to market it, then teach the consumer about the benefit in a way they can understand but still maintains good science,” summarized one respondent.
* Sensory. A challenge unique to functional foods and beverages, as opposed to dietary supplements in pill form, is that of obtaining acceptable sensory properties. “It is often difficult to fortify foods with efficacious amounts of functional ingredients; for example, adding 50mg EPA or DHA may fool some consumers, but it is more of a marketing tool than a full consumer benefit,” says one product developer. Another simply writes: “Negative taste, texture, color and smell.”
Indeed, “taste” ranked a very close second to “expense” as the top barrier to the consumption of more functional foods in the 2011 IFIC study. A product recently launched by the company myCeuticals LLC, myRejuvi~La, contains a complex (and expensive) set of antioxidant ingredients (trans-resveratrol, curcumin, green and white tea, and a blend of superfruits). In the promotion of its benefits, one website points to results of a Harvard University study published November 28, 2010, in Nature, suggesting a “diet with the right antioxidants and stress relievers can actually rejuvenate telomeres.” Telomeres are beneficial DNA “caps” that protect the ends of chromosomes, which in turn are related to aging. What did consumers think? On websites such as iherb.com, all comments made were about its taste.
* Regulatory. One of the most often mentioned barriers to success in Prepared Foods’ survey involved aspects of regulations. “Legal and regulatory; making claims that are substantiated and for which you won’t be sued by consumers or challenged by the FTC or FDA,” one person wrote. “Regulatory excess,” simply said another.
Regulations control the information communicated to consumers, such as what ingredients can be used (and in what amounts/types), and define documentation that constitutes scientific support for safety claims. However, regulation control differs around the world, making an additional challenge for multinationals.
In the U.S., types of claims differ depending on if a product is marketed as a food or a dietary supplement. The Leatherhead report comments, “The U.S. functional foods market differs from its counterparts in other areas of the world due to the high popularity of dietary supplements amongst large sections of the population. This has led to high levels of awareness regarding the anti-cancer properties of certain botanicals. Another major market drive has been the use of permitted FDA structure-function claims associated with certain ingredients and medical conditions, particularly within the heart-health section.”
Implications for Success
As with so many things, barriers can seem to be overwhelming. And yet, the market for functional foods and nutritional products is robust and predicted to grow. IFIC provides a list of implications to its research results along with “take away” advice for the increased consumption of healthful (functional) products. It notes there are a variety of sources that influence a person’s decision to try a new food or food component, and “medical and nutrition professionals have been identified as critical to consumers’ success in building healthful diets and lifestyles.” IFIC concludes that an understanding of consumer insights toward functional foods helps in the tailoring of motivational messages and suggests that “advice should be focused on the individual, helping them to bridge their knowledge-behavior gap.” NS