While health and wellness remain the biggest drivers of new product development in food and drink, the focus on healthy eating continues to shift, and the evidence is apparent in NPD trends noted in recent months. What might be termed ‘minus’ claims (low in fat, calories, sugar, etc.) were once the mainstay of health positioning, but the number of new launches bearing such claims globally remained stagnant in 2008 in food, and grew only a little in drinks. The incidence of ‘plus’ claims on new product launches (for example, vitamin fortification) fell by up to 20% over 2008. Some areas of functional foods saw growth, but overall account for only a small percentage of introductions globally.
Natural and pure are becoming healthy eating ideals for many consumers who look for holistic, genuine nutrition they can trust rather than the yo-yo of dieting and weight loss regimes. The simplest things in life can have the biggest impact, it seems. In 2008, on-pack claims relating to ‘natural’ appeared on 23% of global food and drink introductions, up from 19% for food and 21% for drinks in 2007. The increase pushed natural positioning into the number one slot as most popular on-pack claims. And some parts of the world saw a much higher incidence than others. In the UK, for example, natural claims were noted on more than one in three new food and drink products.
‘Natural’ can mean many things to many people, but whether we like it or not, it’s increasingly perceived as part of the health and wellness picture. Products carrying a ‘no additives/preservatives’ claim reached 14% of all food and drink launches globally in 2008. The claim has moved from the ingredients panel to the front of pack as a key selling proposition for consumers seeking less processed or more natural, everyday food and drink.
While natural claims were once the domain of smaller, specialist suppliers, major companies are now involved. Unilever in the US extended its Ragu brand of pasta sauce with the Fresh & Simple line, labelled as all-natural, with no preservatives or added sugar, but still highly convenient (it can be microwaved in the pouch in 90 seconds).
Nestlé has been extending its Maggi NaturPur range of soups, stocks and seasonings in Europe – all recipes are natural and contain organic ingredients, with no flavour enhancers, colourings or preservatives. The company also extended its La Laitière brand of luxury yogurts in France with an organic line. PepsiCo introduced Pepsi Raw in the UK, a cola made with sparkling water and natural ingredients and extracts, including cane sugar and apple juice, which is free from artificial colours, preservatives, flavours and sweeteners. In the US, the line has just been launched as Pepsi Natural.
Staying with beverages and the major players, the US market has already seen the launch of products from Coca-Cola (Sprite Green) and PepsiCo (SoBe Lifewater) using stevia, labelled as an all-natural, zero-calorie sweetener.
Ethical and environmental claims grew almost out of nowhere in 2007 and the early part of 2008, as companies sought to emphasise their eco-friendly and social responsibility credentials. Such claims nevertheless appeared on only 4% of all food launches last year. Penetration was higher in drinks categories (7%), thanks largely to the presence of ethically sourced coffee, tea and cocoa beverages, yet there’s still a gap between the level of ‘noise’ around the issue, and real action from brand owners.
On the environmental side, most activity recently has focused on packaging – lightweight packaging and refill packs – rather than product formulation. Some innovative approaches have been noted, such as Nestlé’s refill pack for Nescafé coffee in Japan – a cartonboard tub that fits onto the original jar for easy, spill-free dispensing. In beverages, packaging reuse has been a focus, with innovative reusable bottles from companies large and small.
Plup in Finland introduced spring water in a 400ml doughnut-shaped reusable bottle, while Kraft in the US used a ‘refreshingly eco-friendly’ bottle to contain 10 stick packs of Kool Aid instant drink mix.
While Fairtrade and Rainforest Alliance certification continue to grow, we’re also seeing some development in local ethical marketing. Often, this simply relies on the promotion of locally sourced ingredients, but occasionally strays into what might be termed ‘Fairtrade at home’. In France, major milk supplier Candia introduced a 1-litre pack of milk branded Oui Aux Petits Producteurs, supporting small family farms in the Massif Central region of France.
Many functional ingredients appear to run in fashions. Omega-3 DHA was one of the stars of the food ingredients world in 2007-08, as diverse companies formulated products of all kinds to provide mental function benefits. Most omega-3 enriched foods were aimed at children, and many ran into criticism over ‘meaningful’ levels of fortification, a factor which has somewhat limited the potential for the ingredient’s development.
In late 2008, Kellogg in the US launched Live Bright, a snack bar that addresses the problem via prominent labelling stating that it contains 100mg of DHA omega-3 – ‘five times more than most Americans get in their daily diet’ – and referring to DHA to help support a healthy brain in the same way that the body needs calcium for strong bones. The bar is also targeted at adults rather than children, and comes in indulgent flavours such as chocolate-vanilla.
Antioxidants of all kinds also seem to be in the headlines in recent months, with more and more new products stating that they contain antioxidants from diverse sources. These include products featuring antioxidants as an added ingredient, such as Kellogg’s FiberPlus Antioxidants Chewy Bars with vitamin E and zinc, just launched in the US, as well as foods naturally rich in antioxidants – for example, Wattie’s Frozen Vegetable Super Mix in New Zealand, containing spinach, broccoli, red peppers, carrots and green beans, a natural source of antioxidant vitamins A, C and E.
Superfruits such as pomegranate, goji or acai remain popular in food and beverage categories, but we also note wider promotion of natural antioxidants from cocoa and coffee, including many examples from major companies. Green tea extracts are also used in a variety of beverages. Claims linked to antioxidants are nearly as diverse as the sources of those antioxidants, ranging from preventing cell ageing to supporting the immune system, via heart health and skin health.
Functional foods are rarely out of the news, but over the past year, it has been some of the newer, niche areas that have drawn the most attention, such as foods claiming to offer anti-ageing benefits, mood foods, and beauty foods and beverages in particular.
In the US, Regeneration Wholefoods launched Anti-Aging Bar – a nutritional bar using a combination of antioxidant-rich, organic superfruits and ‘age-defying’ DMAE (dimethylaminoethanol, an ingredient found mainly in skin creams and dietary supplements). It’s claimed to nourish the body from the inside to give the skin, body and mind the food it needs to slow ageing.
Pharmaceutical ingredients have also found their way into other food and beverage applications. Dreamerz Foods in the US introduced both chocolates and an instant pomegranate drink mix featuring PharmaGaba (gamma-amino-butyric-acid) and the sleep-regulating hormone melatonin.
Beauty foods have been in the news recently for good reasons and bad. On the negative side, Danone announced the withdrawal of its Essensis yogurt, said to nourish skin from the inside out using a combination of borage, green tea, vitamin E and exclusive probiotics. It was a little ahead of its time perhaps, and an ambitious move into mainstream retail outlets. On the other hand, Nestlé launched Glowelle, a premium beauty drink based on a proprietary blend of antioxidant vitamins (A, C and E), real tea, phytonutrients, and botanical and fruit extracts. This sells in a ready-to-drink format at $7 for a one-a-day 237ml bottle, but is designed for sale exclusively through department stores, potentially alongside expensive skin and cosmetic treatments.
Other areas of the food industry have also had their ups and downs. As long ago as 2004, Kraft Foods in the US pioneered the concept of ‘100 Calorie Packs’ – small, single-serve packs of crackers or cookies each designed (and clearly labelled) to deliver just 100 calories. The idea was well received by the US consumer, resulting in 100 calorie packs in just about every food and beverage category imaginable. The US market for 100 calorie snack packs alone grew from nothing to $200m in just three years, but the concept struggled to make it out of North America. Early attempts in Europe focused on savoury snacks and chocolate bars, but with limited take-up in a market where balanced nutrition rather than calorie counting had fast become the norm.
Kraft Foods is now making an attempt at portion control in Europe, focusing on permissibility in indulgent sweet snacks. The company has launched Milka and Toblerone branded 100 calorie packs in parts of continental Europe, including France and the Netherlands. Cleverly, the new lines build on the indulgent flavours and ingredients of the well-known chocolate brands, but offer a slightly differentiated experience. Toblerone Crispy, for example, comprises a bag of tiny triangular pieces made from biscuit and nougat, coated in milk chocolate (close enough to the original product, yet also different enough to stand alone).
The past 12 months have seen the development of some innovative products based on flavour and texture, notably in Asia. Japan was taken by a trend combining sweet and salty flavours, with several high-profile salted chocolate introductions. Among them were McVitie’s Salt & Chocolate Digestive Biscuits from Meiji Seika Kaisha, using an accent of salt to bring out the chocolate’s sweetness.
The same company also launched salad rice crackers coated with white chocolate, described as a marriage of interesting flavours including rice, salt, soy sauce and chocolate. In the west, a small US producer called Vosges introduced Mo’s Bacon Bar, a premium dark chocolate bar with pieces of applewood smoked bacon, designed to appeal to the experimental and experiential chocolate connoisseur.
RW Garcia launched Tortilla Chips flavoured with pomegranate, blueberry and cranberry for a fruity-savoury-sweet flavour profile. In beverages, Coca-Cola in Japan introduced Fanta Shaker, a lightly carbonated soft drink formulated with pieces of jelly (it should be shaken before serving to mix the jelly pieces and release the carbonation for a completely different drink experience). Coca-Cola also extended its popular Aquarius sports drink brand in Japan with a jelly drink ‘shot’ version, in a 180ml pouch pack, designed to provide sports nutrition for sustained energy or recovery in just five seconds – a marriage of novel texture and science-based delivery.
Regardless of any other trend, one subject has dominated all business discussions over the past few months: the recession. Early indications are that levels of new product development are down – the number of introductions reported by Mintel’s Global New Products Database fell in the last couple of months of 2008, in most categories.
Going forward, we may see numbers pick up, but largely as a result of safe, incremental product development (new flavours and sizes) rather than breakthrough innovation and the launch of new brands.
We’ve already witnessed the growth of discount retailers, and the emergence of the discount brand as another tier in mainstream supermarkets. Competition on price is bound to become tougher, but price isn’t the whole answer. In 2009 and beyond, consumers will opt for brands that offer a clear benefit and good value for money, whether at the budget or at the premium end of the market.
Some premium segments will come under pressure – organic food, for example – while others may perform relatively well. Consumers may not be able to afford new leisure goods, a holiday or a car, but they will seek to treat themselves with affordable indulgences such as quality food and drink.
The recession will act as an important driver in some parts of the food market. Consumers will spend more time in the home and will eat out less often and/or more cheaply – the concept of dining in instead of eating out. More than half of US consumers in Mintel’s research recently indicated that they’re now spending less at restaurants as a result of changes in the economy. This creates huge opportunities for alternatives to restaurant meals, and cost-effective yet luxury food for entertaining in the home. Convenience foods designed for cooking (not heating) are just one expression of this.
Simultaneously, there’s a resurgence of interest in home cooking, provoked partly by the endless array of TV programmes and celebrity chefs. Kits and convenience foods that take out steps but maintain involvement are likely to do well. Examples can be noted in every category. In baby food, for example, Heinz has its Cook at Home line of sauces in the UK and Australia made with ‘baby friendly’ ingredients that can be stirred through your own fresh ingredients to create homemade food quickly and conveniently.
So, although consumers are having to pay more attention to their spending, this offers many possibilities of creating restaurant-quality foods for consuming at home. This will take the form of both up-market ready meals and the partly-prepared, ingredients-based solutions that make whipping up an impressive meal easier and quicker.
David Jago is editorial director of the Mintel International Group, which produces the Global New Products Database – a web-based database capturing information on new packaged consumer goods products, including ingredients, nutritional information, pricing and packaging.
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