Consumers still willing to pay price premiums where they perceive brand value, reports BENEO-Orafti

January 13, 2010 - (Morris Plains, NJ) - BENEO-Orafti, world market leader in the production and marketing of prebiotic ingredients from chicory, has released its latest findings from consumer research conducted in the US and Germany. BENEO-Orafti concludes price premiums can be realized for functional food brands if consumers understand and value the associated health benefits.

According to New Nutrition Business’s key trend predictions for 2009, it was predicted that if consumers could feel the benefits, and if those benefits represented value for money, then they would be brand loyal despite the economic conditions in which they found themselves. This trend was found to be true in BENEO-Orafti’s consumer research, carried out in the UK, Spain and France at the beginning of the credit crunch. Almost a year later, BENEO-Orafti’s consumer research, designed to monitor the end user’s perceptions of premium-priced functional foods, has shown that there is still a willingness to pay more, particularly in the arena of digestive health and calcium claims.

Calcium absorption claims still proving popular BENEO-Orafti tested a range of claims on respondents and not surprisingly, more familiar health benefits are still proving popular. When asked to rate a variety of ingredients that users found appealing, calcium absorption featured in the top four in the US and German surveys for both men and women (alongside “protects your heart,” “keeps your digestive system healthy” and “reinforces natural defenses”).

Although popular as a health benefit, the BENEO-Orafti survey sought to test whether a range of calcium benefits would actually translate into potential purchases. In Germany, it was found that when used on the packaging of a well known yogurt, a calcium claim made the product more popular with regular users and occasional users, as well as with non-users. It was found that 66% of all the respondents were more likely to buy the product with the accompanying calcium benefit and the same number were prepared to pay a premium for it. This preference was also reflected in the US survey, where 79% of all respondents were more likely to buy a well-known cereal product that had a suggestion of a calcium benefit on the packaging and 60% of them would be prepared to spend more on this premium-priced product. The types of reasoning from consumers for their choice of a cereal with added calcium benefits included: "This breakfast cereal is more appealing to me, because it shows an added benefit that is important to me," "I am getting to the age where calcium and bone density is more of an issue to watch,” and “I would tend to buy something that might help in this area and my kids can use all the calcium they can get."

Digestive and bone health claims remain strong The same tendencies seem to apply to digestive health claims, as “keeping a digestive system healthy” rates as one of the top four benefits for both men and women in the US and in Germany. As would be expected, a popular vehicle for digestive benefits for both sets of respondents was cereals. In Germany, 67% would buy a well-known cereal brand that communicated a digestive health benefit over and above the same product without any specified claim, and 70% would be happy to pay a higher price premium for this product. There were similar findings in the US, where 79% of the respondents would be more likely to buy a cereal that had stronger bone messaging on it and 60% would be prepared to pay a premium price for it. In addition to more traditional products, respondents liked digestive health claims on a range of products such as cereal bars and fruit juices.

Tim Van der Schraelen, BENEO-Orafti Marketing and Communication Manager, comments: “We tested a number of claims to see which ones consumers see as relevant. We have subsequently been able to show that if potential buyers see a benefit as relevant to their life, they are willing to pay more for it even in times of crisis. The results show that there is still a strong and very profitable market for those looking to create relevant functional foods. Not only has this new consumer research provided BENEO-Orafti with a valuable consumer insight tool that is helping the company plan future product developments, but it can also be used by the company’s business partners to develop attractive food concepts that appeal to a wide range of potential consumers.”

Editors Note:
German and US survey results based on quantified surveys conducted online in July 2009 with 1,000 male and female respondents, between the ages of 18-64, for each survey.

Note to Editors:
A decade of research
BENEO-Orafti’s 2008 consumer insight study is the 15th piece of consumer research commissioned by the company over the past decade. BENEO-Orafti’s consumer expertise currently spans four continents and 14 different countries and has been carried out both quantatively and qualitatively. This, coupled with decades of accumulated scientific knowledge, has allowed BENEO-Orafti to develop a key strength in the translation of science into consumer-friendly language which has the ability to successfully market functional products.

About BENEO-Orafti
BENEO-Orafti is part of the BENEO-Group and a division of the Südzucker Group. BENEO-Orafti is the world leader in the production and sale of functional food ingredients derived from chicory. The company's Orafti® inulin and oligofructose products have been scientifically proven to improve the balance of the body’s intestinal flora by stimulating its own beneficial bifidobacteria, helping the body to absorb more essential nutrients, such as calcium, from the diet.

Orafti ingredients can be the basis for well-balanced food products that improve digestive health and the feeling of well-being. With a head office in Tienen, Belgium, BENEO-Orafti operates in more than 75 countries and has production units in Oreye (Belgium) and Pemuco (Chile).

For further business information, please contact:
[email protected]

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