According to market research company Mintel, the US sugar and sweetener market is worth $4.3 billion, and 18 per cent of those sales are for sugar substitutes. Sugar and sweetener sales increased 6 per cent between 2006 and 2008, with the greatest increases seen in sugar substitutes and molasses/honey.

As far as market movement goes, those are relatively modest gains. In a country with a greying population and health conditions like diabetes and obesity reaching epic proportions, one might expect sugar substitutes to be flying off store shelves. But the data show that simply hasn't been the case.

"The sugar substitute market was transformed by the widespread introduction of Splenda (sucralose) in 2003," Mintel explains, in one of a series of reports it has issued in the past two years on the sweetener market. Since then, however, "the market has stabilised."

Market shares in sugar substitutes changed very little during 2007-08, and the market has shown "little in the way of innovation," Mintel says. On the up side, natural sweeteners have the potential to appeal to consumers trying to avoid 'artificial' products, the reports conclude.

Looking ahead
What innovations have been made in alternative sweeteners — and how much room is there for growth? The short answers are: not a lot, and a great deal.

According to Mintel, the sugar substitute market has remained fairly static in recent years, with Splenda continuing its dominance with a 60 per cent share of FDMx sales in tabletop sweeteners in 2008.

The biggest news from the natural segment has come from the arrival of agave and stevia. Also being marketed as 'natural' is cane sugar, which is positioned as 'better' than refined white sugar because it is not processed to the same extent.

"Splenda — at 60 per cent — is by far the top brand choice of households using sugar substitutes," Mintel reports. "Low-GI sugar is a product development that would appeal to 45 per cent of respondents. Other alternatives or enhanced sweetening products that are of interest to respondents are sugar alternatives with added health benefits, vitamins, minerals, or low GI."

Research by the Natural Marketing Institute (NMI) suggests a growing wariness for artificial sugar replacers like sucralose — which is a sentiment natural sweeteners could try to capitalize on. In NMI's 2008 Health and Wellness Trends Survey of 5,700 people, 57 per cent agreed with the statement 'I am concerned about the negative side effects of artificial sweeteners.' That was up from 46 per cent in 2002.

For natural-sweetener companies, this trends nicely with another finding of NMI's survey: More consumers are watching sugar consumption. In 2008, 58 per cent of respondents reported watching the sugar intake in their diets, up from 46 per cent in 2002.

"Regarding consumer interests and demand for natural alternative sweeteners, I think it is there, and it will be in the future," says Greg Stephens, vice president of Strategic Consulting at NMI. "Consumers need to be educated and the products need to be supported by convincing research on the safety of the products. There will always be a segment of the population that will not use them, but there will be segments that will, and we have a nice consumer segmentation model that demonstrates this."

Over at food science and nutrition marketing strategists Corvus Blue, its forecasters also see a gap between what is being offered, and what consumers are wanting.

"While there is an opportunity in the market and in consumer tummies for agave and stevia, there is also plenty of room for yet another player(s) claiming to be the holy grail of sweeteners," says Kantha Shelke, PhD, founder and principal of Corvus Blue. "Why is that? Because no sugar replacer, natural or otherwise, has been proven to replicate the taste and functionality of sugar. To this date no other molecule can do what sugar can do and that holds true also for those in the pipeline."

Communicating the message
The future of the natural sweetener market will be the art and science of formulating products that require less sugar, and where the label will not have to carry the 'baggage' of additional ingredients that every sugar replacement system comes with, Shelke says.

"Consumer trust in the new 'all-natural' sweeteners has not kept up with all the hype and marketing," she explains. "Consumers rightly question the cleanness and the purity and the effect of the rebaudioside-A or Reb-A or Rebiana or Truvia or Purevia or whatever other fancy name that stevia is going by these days. While some consumers are turned off by the aftertaste of some sugar replacers, others are concerned by the warning labels that accompany them, and yet others by the long list of flavours and adjuncts that accompany them. To many, the country of origin is also a concern."

Because natural sugar alternatives are not magic bullets, they are being used as part of sugar replacement systems, which combine with flavour and bulking agents for particular food types: bakery, beverage, etc. "The result is a much longer ingredient label and a food product that does not quite match the original favourite," Shelke says.

The market performance of sugar replacers is further compounded by the gingerly manner with which manufacturers are launching their products. "That no big brand has added stevia or agave to flagship products (except, of course, for Tropicana's Trop 50) conveys a certain tentativeness to consumers who in turn are unwilling to unconditionally embrace the natural sweeteners," she says. "The adage 'the best consumers are educated consumers' still holds true today.