Functional foods and beverages that provide a benefit consumers can actually feel will be best placed to weather the global economic downturn, according to one of the world's leading industry experts.
Unveiling a new report - Ten Key Trends in Food, Nutrition & Health 2009 - Julian Mellentin, director of consultancy and publisher New Nutrition Business, said: “In tough times the single most important factor consumers will take into account in choosing a functional food or drink will be whether it delivers a benefit they can feel. When people can feel the benefit that is being offered to them, they can see that they are getting value-for-money."
The importance of “feel the benefit” already underpinned many successful brands in the good times and it would become even more important with people being careful about how they spend their money.
“The best examples of the power of ‘feel the benefit’ are energy drinks and products for digestive health. It’s no coincidence that these are already the two largest segments of the functional food and beverage markets worldwide.”
The energy drink market in the US is worth $6 billion (€4.8 billion) and is still growing at 10% a year. Ten of the top-20 functional food and beverage brands in Japan are for energy or digestion. The single-biggest functional brand in Japan is Otsuka’s Oronamin C energy drink.
Energy drinks deliver a benefit – a shot of energy – that can immediately be felt. If the 20-somethings who want to party all night can feel that benefit they become – as they have done for Red Bull – loyal consumers.
Digestive health products have the same advantage. With probiotic and fibre-fortified products you very quickly find out whether a product is effective or not by whether it makes you feel “better inside”. Hence brands such as Activia and Actimel have become global successes.
Conversely, “Products that lack a quick and easy-to-feel effect could be in trouble,” Mellentin observes, giving the example of omega-3 milks: “In Australia sales of omega-3-fortified milks have been falling – in one case by 33% this year. Omega-3 is an essential nutrient, but it doesn’t give a benefit that you can see or feel.”
Each year since 1995, Julian Mellentin has forecast and analyzed trends in food, nutrition and health. “This year is different,” says Mellentin, “with a growing worldwide recession. The effect of a slowdown will be to reinforce the core trends and sweep away the fads”.
Mellentin’s 10 Key Trends for 2009 are:
1. Digestive health: the biggest trend
2. Feel the benefit: what consumers want most in recessionary times
3. Weight management: a bright future for foods that make you want to eat less
4. Energy: new markets waiting to be discovered
5. Naturally healthy and free-from: what everyone wants
6. Fruit: the future of functional foods
7. Kids nutrition: make parents’ lives easier
8. Healthy snacks for the “me” generations
9. Ultra-loyal consumers: niches to help brands ride the recession
10. Packaging innovation delivers premium prices
This report also includes 5 Micro-Trends:
3. Skin and beauty
4. Mood food