December 1, 2004

15 Min Read
Sports nutrition gains ground among couch potato public

Beverages designed to boost sporting performance increasingly appeal to people who are more likely to watch sports on TV than actually play them. Shane Starling investigates how sports nutrition is becoming mainstream

Whether it is cricket in Australia, football in Europe or basketball in the US, there?s no doubt people around the world have an insatiable appetite for spectator sports. But when it comes to actually taking part, this enthusiasm quickly wanes — less than 10 per cent of people in Western countries play a sport on a regular basis. It seems watching the Athens Olympics on the couch is one thing; getting off it to go for a run is another matter altogether.

Yet conversely, interest in healthfulness has never been higher among varying parts of the population. It could be argued that people want to be fit and healthy, without putting in the hard work. In this environment the sports nutrition category has rapidly expanded, particularly in bars, although beverages record the greatest sales volumes. Sports drinks have become the dominant functional beverages category as increasingly health-obsessed consumers comb the market for products they believe will contribute to their greater well being.

Such drinks, along with sports foods and supplements, are perceived as just another branch of the health foods category, the consequence being that many sports nutrition products are not being consumed for their intended purpose, ie, to rehydrate, recoup lost nutrients and assist muscle recovery.

?It is among lifestyle- and appearance-orientated groups that the sports drinks sub-category will grow, rather than among the more serious sportspersons,? observes research company Datamonitor in a recent report. Datamonitor also noted the sports beverages market has been boosted, rather than cannibalised, by the rise of energy drinks in the 1990s.

Persuasive and pervasive marketing by multinationals has propelled sports drinks brands into the mainstream, making them, along with bottled waters, legitimate challengers to the soda hegemony. Powerade (Coca-Cola), Gatorade (PepsiCo) and Lucozade (GlaxoSmithKline) have become household names in many parts of the world, and their consumption is now just as likely to occur in household kitchens as sports clubs or gymnasiums.

?Their health positioning no longer serves to limit them, but instead gives them an edge over drinks such as carbonates, which are seen as having a negative impact on health,? states Euromonitor International in its 2003 global report on functional foods and beverages. Improvements in taste have assisted this shift. It?s a change reflected in the marketing strategies of beverages like Gatorade, launched in the early 1970s and aimed almost exclusively at young sportsmen. It is now positioned as a mainstream unisex lifestyle product. Sub-branding such as Gatorade?s Propel Fitness Water — a low-calorie, enhanced water aimed more squarely at rehydrating exercisers that has notched annual sales of more than $100 million since its 2002 inception in the US — retains a more sports-oriented image with its catch line ?Is it in you?? But this product and others like it are also being embraced by the non-exercising mainstream.

Researcher Frost & Sullivan estimates the US sports beverages market at $2.91 billion with a 10 per cent growth rate until 2010, when predicted revenues will top $5.67 billion. Euromonitor valued the world market at more than $14.5 billion in 2003.

Swimming in the mainstream
?Traditional?sports drinks like Gatorade are mainstream now, with national distribution in all verticals,? says Arizona-based beverages specialist Jim Tonkin of Tonkin Consulting. ?For instance, golfers and office workers are drinking?sports drinks because they are widely available and they?know about sodium, potassium electrolytes and other purported benefits through the advertising platforms. So clearly the market is growing and no longer just for muscle heads and serious athletes.?

In Western Europe, drinks consultancy Zenith International observes that the sport drinks market has grown from 225 million litres in 1998 to 477 million litres in 2003 (valued at almost $1.25 billion) and foresees continued strong growth until at least 2008, when volumes will exceed 750 million litres. ?Greater product choice together with increasing consumer health awareness bode well for the future, but smaller brands risk being marginalised unless they focus on effectively communicating their benefits,? says Zenith?s research director Gary Roethenbaugh.

In the US market, such a challenge is being taken up by brands such as Ajinomoto?s AminoVital, SoBe Sports System, EAS AdvantEdge HP High Performance Recovery Drink, Odwalla Simple Sports Drink, Hydrade Beverage Co?s Hydrade and Pacific Health Labs? Accelerade, which are emerging to fill gaps left by the bigger players. Beverages like AminoVital are heading a Western wave of protein-based sports drinks that have been favoured in Japan for some years.

Kings of convenience
A lack of convenience may be the reason mainstream consumers have yet to embrace pre-mix powders that have been popular among gym-goers and endurance athletes for decades. ?The marketing of lozenges, ready-to-drink (RTD) formulations, nutrition bars, bottles with sports caps and drinks in pouches demonstrates how convenience is driving the market,? says Mintel in a 2003 report on the UK sport drinks and supplements market.

While slugging back an AminoVital at your desk over lunch or while walking the dog might be cool and life affirming (especially among teens and post-teens at whom much of the marketing is directed), mixing up your own brew at home is far too much hassle and way too technical to ?get it in you?. Despite widespread predictions of the powders market continuing to decline, many brands offer both RTD and powdered forms so as not to alienate the very exercising elite who remain a core part of the sports product-buying public.

Solgar UK is one supplements company that would never forsake its powdered supplements. Its ?Whey to go? powder has doubled sales in recent years, according to marketing manager Marie Kendall, although this may have something to do with it not being marketed directly at athletes. ?We wouldn?t want to pigeonhole ?Whey to go? because there are so many other uses for it. Sportspeople and gym-users are probably the main consumers of ?Whey to go? but, for example, it is also very popular with people recovering from hospital stays.?

Niche strategies
Although efficacy does not seem to particularly concern consumers or even athletes at present, it is likely to grow in importance. While not all products can prove they boost sports performance or recovery from physical activity, those that can possess an inherently powerful marketing tool to compete with established players in any particular market. Mainstream brands like isotonic drink Lucozade in the UK carry slogans such as ?brain energy in a bottle? and cite clinical studies to back up the claim, even if they only refer to the effect of glucose on brain function.

New US beverages such as Accelerade and AminoVital define themselves by their protein-based efficacy and cite studies to prove it in marketing campaigns and on Web sites. In Accelerade?s case, it flags a patented carbohydrate/protein ratio of 4:1, which aids both muscle recovery and the rate at which carbohydrates are absorbed by muscles during performance, thereby aiding endurance — a potentially compelling claim for proteins. AminoVital makes similar claims. Both are available in RTD and powdered forms.

Much work is being done on the ingredients front to create new opportunities in sports nutrition products. This research effort has led to products such as high-complex carbohydrate and high-protein bars; new variations on isotonic, hypertonic and hypotonic drinks; and supplement forms such as pills, gels, sweets and RTD shakes that deliver easily digestible nutrition.

Some of the buzz ingredients finding their way into contemporary sports products include: caffeine (often from botanical sources such as green tea and guarana); taurine; branched chain amino acids (including serine, leucine, isoleucine, arginine, lycine, L-glutamine and L-carnitine); creatine; alpha-lipoic acid; conjugated linoleic acid; alpha glycerylphophorycholine; co-Q10; rhodiola; echinacea; soy peptides (forming the basis of drinks such as Calpis? Peptide Power in Japan); and vitamins K and P.

The whey ahead
Typically, what is breaking in the West has already broken in Japan. Leatherhead Food International put the Japanese amino acid market at $1.15 billion in 2003, up by 38 per cent from 2002. Kirin?s Amino Supli was one strong performer, in part due to efficient distribution and clear targeting of women. It also spawned a large number of copycat products, such as Asahi?s Amino Sai, according to Euromonitor.

Interest in protein is being buoyed by the rise of low-carb diets, and other protein forms are being used in a wider range of products and being consumed by new segments of the population, most innovatively in drinks. Infusing beverages with protein has traditionally been problematic as viscosity, cloudiness and pH instability issues often arose. This is changing.

Carbery Food Ingredients in Ireland has developed a patented clear whey ingredient it says overcomes these problems. ?It?s primarily going into RTD nutritional beverages at the moment, but we are working closely with some of our key customers to perfect other applications,? says Noel Corcoran, sales and marketing director. ?We are constantly tracking and anticipating consumer trends. Some of our key sport foods customers have visited our R&D applications facilities to work with our protein and flavour technologists.?

Such service can come with premiums attached. ?It depends on the mineral content; the degree of flavour masking required. There can be modifications that are quite costly,? Corcoran says.

Avril Twomey, marketing executive at Irish dairy ingredients firm Glanbia, says ?Proteins will be the next generation of sports drinks. Athletes eat a lot of protein anyway, and there is a lot of science out there to say that protein helps muscles recover.?

Ohio-based proteins specialist Europroteins is moving rapidly into this area with refined casein ingredients that have potential in drinks, baked goods and bars. ?We keep our casein in a natural state so that it has much better functional properties,? says Benoit Turpin, US national sales manager. ?We are negotiating some major launches with these products.?

Dutch ingredients giant DSM recently showcased a fragmented casein ingredient-based recovery drink among Dutch footballers and Olympians to good results. Previous trials indicated ?a five per cent better average performance level in athletes who had drunk the DSM recovery drink compared with those who had taken an ordinary, sugar-based sport drink.?

?It needs a carbohydrate in the same product in order to work. It doesn?t provide the energy — it merely accelerates the process of turning carbohydrates into energy,? notes Juriaan Tas, DSM?s Dutch-based communications manager. DSM developed an enzyme that can cleave casein proteins in such a way that protein?s bitter taste is almost totally neutralised.

Understanding the US market
Donald F Wilkes, president and CEO of California-based beverages specialist Blue Pacific Flavors, casts his eye over the US sports drinks market

What products do you think are succeeding?
Success is relative. Gatorade Propel appears to be a tremendous success, as it both capitalised on the women?s sports drinks platform as well as a lifestyle trend?toward lighter calorie and refreshment. When you are up against Gatorade or Powerade, it is extremely difficult to compete with Pepsi?s or Coke?s global distribution and marketing. However, entries that offer real science-based innovations like Hydrade or AminoVital may successfully carve out a niche in this category.

Who is buying sports beverages in the US?
If you follow the current marketing campaigns in the US, much of the positioning for Gatorade is toward a younger 18-24 target market, and these ads are targeting inner-city ethnic groups, which are the core influencers in both music and sports culture.?Much of this is based on tying the use of the brand to a specific urban culture or emotion. However, the latest Gatorade ads are moving away from this and focusing on science-based?athletic?endurance. Targeting the male market,?Gatorade uses a successful tag line that challenges its viewer: ?Is it in you?? This suggests sports beverages are being marketed both to urban consumers as well as athletes.?

How important is efficacy??
Science is critical in defining the key uniqueness of your product entry in this category. Without the science to back up the brand?s positioning, it is virtually impossible to compete in the sports drink segment with any level of success.

For more information visit

The view from Europe
Europe is still a bright spot for sports nutrition, says Christian Eckel of Wellness Business Partners.

The European market for sports nutrition products continues to grow and is an attractive part of the food supplements industry. This growth is fuelled by ever-increasing consumer awareness of health, wellness and fitness. But the market is still diverse and very fragmented. Although regulatory harmonisation is under way, doing business in Europe still means working on a country-by-country basis. Apart from individual market maturity, most European member states also differ in legislation, consumer trends and distribution channels.

EU harmonisation is clearing up some of the governmental obstacles that companies currently face; however, many still have to cope with additional national and European requirements in order to obtain approval for their products. In particular, a mooted EU directive on ?foods intended to meet the expenditure of intense muscular effort, especially for sports people? may see many products currently on the market deemed illegal. Such restrictions include limiting creatine use to 3mg a day and curtailing the use of amino acids.

Consumer behaviour in Europe is strongly influenced by food scandals, the ongoing discussion on doping in sports and regional sporting differences. While northern Europe focuses on cardiovascular fitness, southern Europe and Eastern Europe are still very bodybuilding oriented. However, in most markets, consumers are willing to accept a price premium for sports nutrition, a fact that obviously fuels the attractiveness of this industry.

Distribution channels differ, too. For example, unlike the UK, you would have a hard time finding sophisticated sports supplements in a German drug store or natural food store; the preferred channel of distribution is health clubs and some retailers that specialise in sports.

Sports nutrition in Germany is still predominantly an ?expert?s nutrition? and thus consumed (and bought) during or for exercise only. Consequently, the classic mass-market channels and specialist stores are unable to dominate the market like in other functional foods categories, except perhaps in the drinks category.

There are few brands available across Europe: Isostar, Gatorade, Powerade for drinks; PowerBar for bars. The vast majority of products are still manufactured by national suppliers, which compete with ?me-too? or private label products in all channels.

As sports nutrition is, in many cases, still considered ?food? there are few barriers of entry for new competitors.

A tour across Europe

Germany has the largest European economy and due to its large consumer base, sports nutrition has substantial growth potential. Depending upon the segment, growth rates range between 5-10 per cent annually. The regulatory environment is still restrictive and successful market entry can be achieved only with in-depth market knowledge. Distribution through health and fitness clubs is particularly strong; only drinks and a few bars are typically available on mass market.

The UK still has the most dynamic sports nutrition market in Europe. The legal and regulatory business environment is business friendly. The market is highly competitive with most major US and European brands competing across all sales channels.

The Netherlands is similar to the UK regarding the legal and regulatory environment and has become a beachhead for many US companies. Because of the small market size (population 16 million), the Netherlands is not the most attractive market. However, it has become a haven for distributors who want to circumvent local regulations in other European countries.

Spain has well-developed sports nutrition, weight loss and fitness markets. Sales channels include mass market, drugstores, health clubs and sports nutrition stores. The regulatory environment is among the more restrictive.

France?s sports market is still behind those in the UK, Germany and Spain. Accordingly, sports nutrition markets have much unfulfilled potential. Legal restrictions still make fortification and label claims difficult. Thus, France is considered a difficult entry point for multinationals.

Eastern Europe & Russia have economies still in the early second phase of the market life cycle, but are quickly catching up. However, consumers have limited spending power. Distribution is usually still limited to health clubs and specialised sports nutrition/fitness stores. There is some mass and drugstore channel penetration in the more advanced economies like Hungary, Poland, Slovakia and the Czech Republic.

Christian Eckel is a managing partner at Wellness Business Partners in Frankfurt, an investment banking and advisory firm focused on the global healthy living industry.
Respond: [email protected]

All correspondence will be forwarded to the author.

What will the sports nutrition company of the future look like?
?Its products will be more widely distributed, giving it a more significant presence in the mass market and conventional grocery stores. Most likely, manufacturing will be pharmaceutical-grade, and high-quality clinical studies will support entire lines of products. Product delivery mechanisms will be more varied and targeted at the need of specific consumers. It will probably garner a percentage of revenues outside the US, as undeveloped markets overseas offer growth potential to companies that have grown up in the more mature US sports market. The successful company will be much more than a single-application product company, but rather a total healthy lifestyle company that sells supplements, foods, other products and even information in many forms (books, videos, courses, the Web, etc.) to meet the needs of its enlightened consumers.?

From Nutrition Business Journal?s ?2004 Sports Nutrition and Weight Loss? report


Subscribe and receive the latest updates on trends, data, events and more.
Join 57,000+ members of the natural products community.

You May Also Like