Can West follow East's functional lead?

Japan is the cradle of functional-food products, and now is successfully marketing stress-busting and beauty-enhancing versions. Simone Baroke examines the factors in this new development, and its potential for Western markets

The Japanese have one of the world's highest per capita expenditure levels of functional packaged foods and beverages, $119 per capita in 2006, compared to $95 in the US, according to Euromonitor International. New product development involving functional ingredients generally begins in beverages, which are quick and easy to consume. In the West, the bulk of functional foods is marketed on claims of heart, bone and brain health, focusing on ingredients such as plant sterols, calcium and omega-3 fatty acids. The concepts of gut health and enhanced immunity have also successfully caught on, as attested to by the colonisation of supermarket shelves by an army of probiotic yoghurts and yoghurt drinks. In Japan, however, a whole host of functional drinks are targeted toward two more elusive concepts: stress busting and beauty enhancing.

The Pressure Is On
The reason? Undoubtedly, it is the modern Japanese lifestyle — 65-hour work weeks and three-hour daily commutes on overcrowded trains are a normal part of Japanese work culture. In Japan they even have a word for death from overwork, 'karoushi,' and every year some 150 salaried employees toil their way into an early grave. The pressure on children to perform well on exams is enormous, and after-school attendance at special 'cram schools' is mandatory if children are to stand a chance of gaining a foothold on the corporate career ladder.

Although Japanese women are still largely excluded from corporate careers, the pressure on them is no less. It just takes a different form: to be svelte and beautiful at all times, at any age. In addition, the diet of young Japanese people is nutritionally inferior to that of their grandparents. Although it provides more calories, it lacks many nutrients and is therefore more likely to lead to obesity and chronic disease. To make up for the nutritional shortfall and compensate for the nutrient-depleting ravages of stress, consumers turn to functional products and particularly functional drinks, which are most convenient to consume on the run.

The National Drink, Redux
Green tea is Japan's national drink, and, according to Euromonitor International data, it held two thirds of total leaf-tea-value sales in 2006. The Japanese perceive green tea as one of the healthiest beverages, and its natural health benefits are well documented by scientific research. The active constituents appear to be catechins, which act as antioxidants in the body and may help prevent heart disease and cancer, and are being heavily marketed for their purported anti-ageing and weight-loss-inducing properties. And while the Japanese don't seem to like their leaf tea tampered with, on the ready-to-drink (RTD) front it's an entirely different story. Manufacturers have been riding the wave by launching RTD teas with added catechins, such as Kao Corp with its Healthia Green Tea.

Suntory's oolong tea, Kuro Oolong Cha, reportedly contains twice the amount of oolong polyphenols found in ordinary oolong tea, which is said to prevent the absorption of fats. The product was a massive hit in 2006: six million cases were sold in the first six months after launch.

It comes as no surprise that, in the period from 2002-2006, Euromonitor International recorded an average increase of 42 per cent per annum in RTD functional-tea-value sales in Japan, while leaf-tea sales increased by a far less impressive two per cent per year on average.

Water — A Girl's Best Friend
The fewer calories contained in a beverage, the better, at least as far as most women are concerned — whether they are Japanese or not. Sales of bottled water in Japan have risen by an average of seven per cent per year over the 2002-2006 period. What is most notable about the Japanese bottled-water market, however, is the proportion of functional waters: nearly half of all bottled water sold in 2006 was categorised as fortified/functional, totalling a staggering $1.4 billion in 2006 value sales. This compares to less than 10 per cent of total bottled water that was fortified or functional in the US in the same year.

Japanese women are demanding consumers who want extra benefits from their water, and they are getting them: Asahi Soft Drinks launched Gyu-gyutto Shimikomu Collagen Water in November 2006. The progressive breakdown of collagen, which is part of natural ageing and also caused by free-radical damage and sun exposure, makes the skin sag and wrinkle. The company claims that each 350ml PET bottle contains 2,800mg collagen (as collagen peptide for better absorption), to make up for the 2,000mg, which are destroyed on a daily basis in the body. Lion Corp has launched Kenbisouken Kyupurun, a collagen-enriched juice drink ('a beauty drink for soft and supple skin'), which also contains flavagenol, another prominent anti-ageing antioxidant. Collagen is so popular that it now appears in a wide variety of Japanese products, including confectionery.

Relaxing the Brain
The Japanese have no time for relaxing with the help of breathing exercises in a darkened room, with soothing music in the background. Instead, they are trying to calm their anxiety-ridden brains by ingesting products with added GABA (gamma-aminobutyric acid), the brain's major inhibitory neurotransmitter. Interestingly, this trend appears to have begun in chocolate confectionery rather than in beverages, which is unusual for Japan. It could be argued that chocolate and GABA make for a perfect combination, as many women associate eating chocolate with relaxation.

Beverages with added GABA are now on the rise according to Euromonitor International's latest research. In June 2006, Lion Corp launched two tomato-vinegar drinks with added GABA. The first is Gussumin (under the Kenbisouken brand), which is promoted as 'designed to support the health of women living in the stressful modern world,' and is meant to be consumed before going to sleep. The drink has only eight calories, which means that at least it will not counteract its alleged effects by stressing out those weight-conscious Japanese women.

The other Lion Corp launch is the Guronsan Tomato no Akazu drink, which, apart from GABA, has added kudzu, an extract from a Japanese vine said to have an effect on the GABA receptors in the brain. It is worth pointing out that vinegar drinks are big business in Japan, and that they are mainly consumed by women who want to 'maintain health.'

Will it catch on in the West?
Beauty-enhancing and stress-busting dietary supplements have long been available in the West to a dedicated audience via specialist retail outlets, mail order and the Internet. But will these substances make it to the Western mainstream in the form of functional foods or beverages? Some are already trying to break through. One example is Beverage Partners' much publicised 2006 US launch of Enviga, with the claim that the green-tea-based beverage is proven to burn calories through the action of epigallocatechin gallate, which supposedly speeds up metabolism and increases energy use. However, there is much scepticism yet to overcome, and the company (a joint venture between Nestlé and Coca-Cola) has received fierce lashings of criticism from several fronts. In February 2007, the consumer pressure group CSPI (Center for Science in the Public Interest) filed a lawsuit to stop the company from making what the group considers to be spurious and deceptive claims.

The market climate in the West is generally much less conducive to functional products than that in Japan. Japan was the first country to recognise functional foods as a distinct category in 1991, with the introduction of the FOSHU (Foods for Specified Health Use) system, allowing such products to make definitive health claims. However, many manufacturers opt for making soft claims, not backed by much in the way of scientific evidence, and the Japanese government is not generally inclined to curb a flourishing business. The regulatory environments in the West are, by comparison, far more strict with regard to health claims, a situation much berated by the industry, which complains that it can take years (not months or weeks like in Japan) to bring new functional products to market.

Western consumer acceptance of functional products is also relatively more conservative than in Asia, but with increasing exposure and sufficient marketing support, Euromonitor International suggests this reluctance could eventually be overcome. The 'little bottle' functional-dairy drinks market has taken off, so the ball is rolling. There is no reason why Western women would not want to try products touted to improve their complexions or help them de-stress at the end of a long work day.

Simone Baroke is a health and wellness market analyst at Euromonitor International.

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