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Gone are the days when snack bars served only as a mid-afternoon snack, holding hunger over until dinner time. Consumers want their snack bars to actually do something … a lot of something. Snack bars, yogurts, beverages, shots and more are now a nutritional vehicle for immune health, digestive health, weight management, protein … you name it. And just as postmodernism shrugged off the austerity of modernism and reintroduced aesthetics, eclectics and ornamentation, functional foods and beverages circa 2011 are adding the “aesthetics” back into food. Both form and function matter. Consumers are looking for diversity, functionality and a whole lot more.
The Market Pulse
As the market trembled a little when stocks fell in early August—bringing back memories of the 2008 recession—financial insiders reassured the industry of its integral role in consumers’ health care regimen. And, if that wasn’t enough, numbers talk louder than insiders. While other industries have been limping along, functional foods managed to not only stay on their feet, but to take make a few strides. Nutrition Business Journal reported functional foods grew 4.6 percent in 2010, pulling in $39 billion in sales, as compared to $37.3 in 2009. Global Industry Analysts (GIA) is predicting the global market to exceed $130 billion by 2015.
To say this market is a well-oiled machine is not an overstatement. It’s clear—from Baby Boomers to health-conscious consumers alike, product functionality is in high demand. According to Steve French, managing partner at Natural Marketing Institute (NMI), Baby Boomers have been acute growth drivers of functional foods because of their uncertainty about the future of health care (seven out of 10 Boomers said they’re taking a more active role when it comes to health), and in an attempt to delay aging and prevent disease. Boomers are interested in health-condition-specific products.
“In the United States, growth in the functional food and beverages category is being driven by a number of factors, including an aging population, high health care costs and a heightened consumer awareness of the link between diet and health,” said Stephen Moon, CEO, Provexis plc.
NMI’s 2011 Healthy Aging Boomer Database found they would be more likely to purchase foods/beverages if they offered a specific health benefit—cholesterol/heart; immunity/joint pain/cancer prevention/energy booster; and toxic cleanup/cleanse digestive track—in primary, secondary and tertiary order, respectively. A total of 75 percent of Boomers wish all foods had some type of health-boosting claim, and more than 25 percent of them feel functional products can be used instead of medicines.
This market definitely has Boomers’ attention; but, the problem remains; this market is heavily reliant on ingredient knowledge. Restrictions on food and beverage label claims can make the conversation between consumer and manufacturer difficult and quite possibly non-existent if shoppers don’t understand the product’s benefits and how it’s going to help them lead a healthier lifestyle. Therefore, it is imperative consumers understand the benefits of specific ingredients, rather than relying on label claims, French stressed. Thank goodness consumers are tenaciously seeking healthier lifestyles, right? French cited omega-3s and probiotics as examples: even though 60 percent of Boomers know omega-3s benefit the heart, 27 percent can’t cite any omega-3 benefits; and only 33 percent know probiotics benefit digestion and 44 percent don’t know any probiotic benefits.
Patrick Luchsinger, industry specialist for Stepan Lipid Nutrition, echoed French’s findings, stating: “Consumers need to grasp the health benefits associated with a given ingredient in order to appreciate its relevance and premium pricing. Manufacturers of functional foods need to consider what actions they can take to better educate potential consumers and provide this level of understanding.”
