Looking at the data, it seems like a clear-cut case for probiotics. Growth is to be found in emerging markets rather than in developed ones; however, in terms of future opportunities, the situation is more complex. Chronic disease, which leaves no country unscathed, is highly likely to create a new leverage point for a new generation of probiotic products.
Emerging Markets Most Dynamic
Ingredient data from Euromonitor International reveal that 13 of the 15 markets in which probiotic culture volumes delivered the most dynamic growth during the 2008 to 2013 period were emerging economies, led by India, Egypt, Romania, Algeria and Colombia.
Indian probiotics volume consumption increased 14-fold between 2008 and 2013, albeit from a miniscule base of just 0.4 tons in 2008, and virtually all of this ended up in drinking yogurts.
Looking at the latest health and wellness data for Indian pro/prebiotic yogurt retail value sales, these shot up from INR63 million (USD $1 million) in 2009 to INR748 million (USD $12 million) in 2014, making India the second most dynamic market for this type of product, by value, after Venezuela.
Yakult Honsha leads the Indian market, with an overwhelming 82 percent value share in 2013. The strong growth was driven by frequent TV advertisements run by Yakult to generate awareness and convince price-conscious Indian consumers that the brand was worth its premium price.
India’s consumer base is notoriously sensitive. Indeed, around 40 percent of India’s yogurt and sour milk consumption is based on unpackaged products bought loose from small neighbourhood dairy parlours. As the country’s modern retail environment develops and disposable incomes continue to grow, packaged probiotic yogurt brands will also benefit, although it will probably take quite some time before India approaches anything close to European or U.S. consumption levels.
Developed Country Consumers Worried About Chronic Disease
In developed markets, where both the awareness of probiotic products as well as per capita spend on health and wellness products are comparatively high, probiotics face a different set of challenges.
In much of Europe, for exampleowing to the EU’s infamously stringent health claims regulations, which have not found in favor of probioticsconsumption is slipping in many markets. Our ingredients data show that Greece, Austria, the Netherlands, Belgium and Germany are among those countries where probiotic cultures are suffering the fastest volume declines. (In the case of Greece, the country’s dire economic situation is causing virtually all premium-positioned food and beverage categories to contract.)
Despite this, plenty of growth opportunity is still left in those seemingly saturated markets. Developed market consumers, accustomed to a wide range of health and wellness-positioned products gracing their supermarket shelves, are growing ever more demanding.
Combined with progressive population aging, this means a steadily rising number of people are becoming increasingly fearful of the impact of chronic disease on their lives, including the cost and side effects of conventional drug treatments. Consequently, they are looking for either prevention or at least some way of slowing down the speed of their physical decline.
And probiotics may be part of the answer. Previously positioned primarily as aids to digestive wellness and as immunity boosters, probiotics need to break out of these confines if they want to resonate with the health concerns of the modern-day consumer base.
Modulating the Microbiome
The human body is inhabited by more than 100 trillion microbes, amounting to a combined weight of around 2 kg. Besides the nose, mouth, skin and the urogenital tract, the overwhelming majority of these organisms, as every probiotics-savvy person knows, is found in the gastrointestinal (GI) tract, and is often referred to as the "gut microbiota."
There is plenty of research that convincingly suggests that an unfavourable gut microbiota composition promotes obesity and chronic disease, including metabolic syndrome, which is characterised by central obesity (“apple shape"), elevated blood pressure and disturbed blood lipid profile and insulin resistance. According to the U.S. National Institutes of Health (NIH), a person with metabolic syndrome is twice as likely to develop heart disease and five times more prone to develop diabetes.
A 2014 study, carried out by Georgia State University and Cornell University and published in Gastroenterology, found altered microbiota fosters low-grade inflammation, a core underlying factor believed to trigger many types of chronic diseases, including metabolic syndrome.
These findings add further to the growing body of evidence pointing to the gut microbiome as a prime therapeutic target. It is known that certain types of probiotic bacteria (as well as prebiotic fibres that feed intestinal bacteria) can alter their composition, resulting in positive health outcomes for the individual.
Undeniably, the amount of research effort that still needs to be channelled into this field before efficacious probiotic strains can be identified and scientifically validated in order to satisfy the world’s regulatory bodies, is nothing short of formidable. However, considering the predicted long-term global surge in chronic disease rates, the potential uptake for such products is just too vast for this promising area to be ignored.
Emerging Markets Also Ready for New Probiotics
Although emerging markets may not be perceived as lucrative launch pads for the next generation of “microbiome modulating" probiotic products at this point, it is important to consider that their chronic disease burden is already on a par with those of developed markets. Hence, they must not be neglected by probiotics players’ new product development, marketing and distribution efforts.
Our Countries and Consumers data show, for example, that China’s mortality incidence from diseases of the circulatory system was ahead of the United States in 2013 with 256.8 deaths in 100,000 compared to the United States’ 252.7 deaths. Diabetes prevalence in Saudi Arabia, Egypt, Turkey and Mexico is also way ahead of the United States and Western Europe in those aged 20 to 79, and the number of overweight/obese people in China was already two-and-a–half times that of the United States in 2013. By 2018, India will have surpassed the United States.
Once food and beverage products positioned as probiotic microbiome modulators are ready to “go live," so to speak, emerging markets should not be left out of the equation. Rather, they need to be carefully chosen to assess the size of the potential consumer base, in terms of health concerns and spending power, and also its location and concentrationfor example, around its major urban centers.
For information on formulating with probiotic foods, as well as the current state of the market, download INSIDER’s Probiotic Digital Pulse.
Ewa Hudson ([email protected]) is global head of health and wellness research at Euromonitor International.