In this health-savvy nation where only 12 per cent of the populice is obese, functional foods are a hot commodity. Christiana Benkouider explores the trends in the fortified confectionery, dairy and bakery segments
The Dutch are considered to be one of the healthier and more active nations in Europe. This can be seen, for instance, in the relatively low — albeit rising — levels of obesity in the country. With obesity rates (namely people with a BMI of 30 or more) at 12 per cent, the Netherlands is nowhere near the levels reached in the UK, where more than one quarter of the population is now considered obese.
Nevertheless, in the Netherlands, as elsewhere, issues such as stress or diseases related to fast-paced lifestyles are becoming more prevalent. Indeed, hectic lifestyles have led to deteriorating eating habits among the Dutch with fast food consumption and on-the-run snacking becoming increasingly commonplace.
On the other hand, Dutch consumers are also increasingly aware of the need to re-focus on healthy nutrition, and according to the latest research from Euromonitor International, products such as functional foods meet this demand for healthier ?good for you? alternatives without compromising on convenience.
In spite of the absence of an accepted definition of functional foods in Dutch law, there is consensus on what lies at its core: a growing acceptance of the role of diet in disease prevention and even treatment. Hence functional foods can be said to provide a health benefit over and above the normal nutritional role of foodstuffs. While the legal framework in the Netherlands is strict in terms of products that can be distributed and registered, laws over fortification have lessened in recent years, allowing a gradual change.
According to the latest research from Euromonitor International, the Dutch market for fortified and functional foods surpassed the $384.27 million mark in 2004, making the Netherlands the sixth-largest functional foods market in Europe. Over a third of sales stemmed from confectionery due to the long established and mature market for medicated boiled sweets, while functional gums were also particularly dynamic. Other key product areas include dairy, through the strong performance of probiotic yoghurts and snack bars.
Euromonitor?s analysis of the Netherlands market suggests that products that focus on vitamins and energy in their packaging prove to be very successful. Dutch consumers are attracted to the idea of eating or drinking a satisfying product that is healthy and also boosts energy levels.
Medicated sweets and gums
Functional confectionery was one of the fastest-growing products within health and wellness confectionery in 2003 and 2004, fuelled by greater attention to medicated confectionery. These products command large sales in the country, valued at $149.9 million in 2004 and creating double-digit growth, according to Euromonitor. This performance has been underpinned by intense advertising and improved distribution and exhibition.
One key aspect that benefited the expansion of health and wellness confectionery is that Dutch consumers are becoming more health conscious and are willing to purchase products that help them heal or prevent disease. The main brands such as Anta Flu have as high distribution and brand awareness as sugar confectionery, but with added value. Anta Flu, one of the best-selling products in medicated confectionery, is a long-established brand widely distributed in all the major Dutch supermarket chains and drugstores like Kruidvat or Etos.
Other major brands with a long-established presence and steady advertising support include Fisherman?s Friend and Vicks, the latter gaining even higher promotional support in the past two years, with a more extensive presence in impulse channels.
Fortified products including those enriched with vitamins or those that provide more energy exist in the market and are represented by brands such as Nimms2 and Dextro Energy.
In chewing gums, the success of whitening or cleansing formulas from main brands Sportlife and Stimorol, both with whitening extensions, Xylifresh and V6, has given an additional boost to awareness of functional confectionery in recent years. Effective advertising campaigns used real dentists recommending the products and aim to profit from the fact that consumers in the Netherlands are very much inclined toward prevention in dental health matters. These products already enjoy high distribution and brand loyalty, with private labels having a smaller impact than in other food categories.
Calcium and probiotics
Campina is one of the largest functional dairy manufacturers in the Netherlands, present with Campina Calcium Plus, a skimmed milk enriched with calcium, which has received extensive advertising support in recent years. This product has been particularly well received by older consumers, with sales not only stimulated by advertising but also by medical recommendations. Campina Plus? packaging was renewed in 2003 to show more information about the formula?s benefits, including messages such as ?for stronger bones.?
Within dairy drinks, brands like Yakult and Actimel also enjoy a major presence as functional products that help maintain a balance of the gut flora. Yakult has intensified promotional campaigns since 2002 with informative brochures, television commercials and the introduction of a low-fat version.
In 2004, Unilever introduced two extensions of its successful functional fats brand Becel Pro Activ, extending the brand into milk and yoghurt and marking a new trend within functional dairy products in the Netherlands. These introductions were made in response to the 2003 introduction by Campina of Vifit Choless Control, considered to be the first yoghurt of its kind, with a formula that helps to reduce cholesterol levels. Becel Pro Activ claims to have the same effects. These new products brought a new concept into dairy products. Vifit is also the largest player in calcium-enriched drinking yoghurts with brand extension Calcimel.
While functional foods are rapidly increasing in popularity in such sectors as dairy products or confectionery, in bakery it is still largely underdeveloped. It should be noted that Euromonitor?s health and wellness research excludes enriched breakfast cereals where fortification with certain vitamins has become standard practice and no longer offers a point of differentiation among manufacturers, nor an incentive to purchase the product among consumers.
In late 2003, however, Unilever innovated the bakery sector by introducing a white bread called Blue Band Goede Start. The product was introduced in September 2003 in association with leading supermarket retailer Albert Heijn. Blue Band Goede Start is the first white bread with the nutritional elements normally available in brown bread. It contains all the vitamins and fibres available in brown bread, including vitamins B1, B3 and B6; iron; zinc; and a special component called inulin, a starch that comes from wheat.
The brand slogan was key to induce consumer awareness and was placed on the product packaging: ?the only white where brown is inside.? Consumer panels were used to test the product and found that in terms of taste, it was just as good as white bread but with the added benefits of the healthy attributes of brown bread.
Dutch bread is dominated by the consumption of naturally healthy brown bread, with white bread accounting for less than 20 per cent of total demand. With this launch, Unilever aimed to create new value and new consumers, in for example, children.
What does the future hold?
Euromonitor predicts a compound annual growth rate of nine per cent for functional foods between 2004 and 2009, compared to just three per cent for packaged foods overall. Above-average growth is forecast for the functional bakery, oils and fats, and dairy sectors, while functional confectionery is likely to slow down in terms of growth, but nevertheless remains a major contributor to the market.
Christiana Benkouider is head of health and wellness research at Euromonitor International, a leading provider of global consumer market intelligence with offices in London, Chicago, Singapore and Shanghai. www.euromonitor.com Respond: [email protected] correspondence will be forwarded to the author.