Archive for category: Supplements & Nutraceuticals

On-The-Go Habits Putting Pressure on Ingredient Manufacturers

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During the CAGNY conference in Florida, Food Dive sat down with ingredient manufacturer, Ingredion, to talk about insights into how CPG companies are planning for growth and adapting to changing consumer preferences. The CEO of Ingredion, Jim Zallie, believes that on-the-go consumption habits are the most challenging for the ingredient industry. The lucrative market opportunity is leading new players in the restaurant and retailer industry to compete with well-known CPG brands.

The Grab-and-Go is Stressing Ingredient Companies to Adapt

Jim Zallie told a consumer analyst group that the grab-and-go market, as well as food ordered online, has reached $110 billion globally. In just one year, from 2015 to 2016, the amount of U.S. on-the-go purchases grew by 56%. Zallie told the audience that this is critical to ingredient companies because of the importance of developing high-quality products that deliver the right texture and maintains heat.

Ingredion North American President, Jorgen Kokke says that texture claims on packaging have increased by over 90% in the past five years.

“We can talk about health trends… We can talk about cost and affordability and sustainability, but underneath all of that, [food] always has to taste good and be fun. And that’s where texture comes in. … We say it’s as important as flavor.”

Jorgen Kokke

Pockets of Growth in Functional On-The-Go Foods

Zallie believes there are “pockets of growth in the food anywhere space.” He points to the fresh refrigerated space as a critical example. The freshly prepared food category is generating over $25 billion in sales annually according to the Supermarket Guru. The clean label trend and simple ingredient trend play significant roles in the development of functional on-the-go foods. With 62% of consumers now looking for recognizable ingredients on the label, it’s imperative to use things they understand.

NutriFusion developed the GrandFusion product line for this very reason. We saw the way synthetic vitamins were reading on the label and thought there had to be a better way. With our products, consumers read fruits and vegetables instead of chemicals, so it makes a lot more sense to them. See the graphic below. If you are interested in learning more, visit our R&D page and download the GrandFusion resource kit to get started with product development.

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New Survey Reveals Why Consumers Buy Plant-Based Dairy Alternatives

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Comax Flavors introduced survey last summer to better understand consumer perceptions around plant-based dairy alternatives. Comax surveyed 1,000 adults in the United States last July that said they used plant-based dairy products at least three days a week.

Why are Consumers Buying Plant-based Dairy Products?

This question about purchase behavior was at the center of Comax’s survey. They found that for most (48%) consumers, the flavor was the top reason why the purchased the plant-based alternatives. The most frustrating takeaway for the dairy industry was that 36% of consumers bought plant-based dairy products because of the perceived health benefits. Dairy industry veterans are annoyed because they believe that cow’s milk is nutritionally superior.

 

The survey also took a look at health and wellness as well as animal welfare to understand better why the rapid growth in plant-based dairy products. They found that the younger generations (millennials and Gen Z) were more concerned and influenced by animal welfare. As a result, they are purchasing more plant-based products all around.

The Plant-Based Category Continues to Soar, and Dairy Fights Back

Non-dairy milk sales have soared over 61% in the past five years to an estimated market size of $2.11 billion in 2017. In that same period, regular dairy milk sales have dropped by 15% to $16.12 billion in 2017.

 

The dairy industry is not going down without a fight and is pursuing a variety of options to challenge the new plant-based dairy alternatives. They are taking plant-based beverages to court over the word “milk” much like how Unilever challenged Just Mayo over the use of “Mayo” in the name. It will be interesting to see how this plays out.

The dairy industry is also trying to diversify with innovative products including carbonated or fizzy milk products. The new products have a longer shelf life than traditional milk which hits on one of the plant-based dairy’s competitive advantages.

Plant-based dairy products are not going anywhere anytime soon. It’s interesting to see why consumers are buying them and it turns out the flavor is the significant factor. The dairy industry will have their hands full trying to slow down this plant-based boom.

Inspired by www.fooddive.com

New Study: Mice Lost Weight and Lowered Cholesterol with Fiber Supplement

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The Holy Grail drug to effective weight loss has yet to be discovered. But recently, a new study conducted by the researchers from the Georgia State University might change the way we will deal with weight loss. The secret? The fermentable fiber inulin.

What did the Study Analyze?

To conduct the study, the researchers fed mice with a supplement containing inulin and observed the progress. After a few weeks, those that consumed the inulin supplements showed reduced metabolic syndrome even when fed with a high-fat diet. Those that were fed with the fiber had decreased weight gain, better cholesterol levels, and a limited spike in their blood sugar levels.

But aside from inulin, there are still other compounds in fiber-rich foods that make them good for the overall gut health. For instance, resistant starch called amylose is found in fiber and has the ability to protect against genetic damage that can lead to colon cancer. It can also help fight against Type 2 diabetes.

A multitude of studies have underestimated the role of dietary fibers in weight loss. But only recently did scientists find out that dietary fibers play a role in the growth of good bacteria in the gut or colon. Studies show that those who consume a high-fiber diet are able to balance their blood sugar level, lower cholesterol levels, lower the risk of heart problems, and have better digestion than those who consume high protein-rich foods.

The role of fiber in maintaining good health has always been touted by many health experts.  But it is only recently that most consumers have started to eat more fiber. In fact, market research indicated that 87% of the consumers consider it to be healthy and 60% of the respondents actively seek products containing more fiber.

Fiber is Growing as an Important Health Claim

 

Food and beverage manufacturers have quickly responded to the demands of the consumer for more products that contain high amounts of fiber. Currently, products like Fiber One ice cream and Activia yogurt contain high amounts of fibers. Other beverage companies have also followed suit and started adding soluble fiber into their beverages.

Aside from the food industry, the trend has also reached government institutions. This is the reason why the US Food and Drug Administration is thinking of releasing a new Nutrition Facts label about putting the measurements of dietary fiber on food products. Unfortunately, the institute has not yet fully defined what counts as dietary fiber.

It is interesting to take note that fiber-rich foods are not only popular among older consumers but also the millennial generation. Younger consumers particularly millennials are consuming high-fiber products because of their touted health benefits. This opened opportunities for companies whose target markets are the millennials and younger consumers to produce products that are rich in fiber.  These include Dannon, General Mills, and Tale & Lyle.

The thing is that consumption of soluble fiber has been found to be very effective in improving not only the weight loss capacity of individuals but also their overall health. Fiber is gaining traction because consumers are getting more conscious about their food choices.

Inspired by www.fooddive.com

Check out our GrandFusion Plus Fiber product to get the benefits of 12 vitamins from fruits and vegetables and a good source of fiber claim.

Daymon Report: Private Label Brands Are Booming

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Daymon, global consumer retail, and private label brand agency, recently published its first Private Brand Intelligence Report. In the report, Daymon analyzes how retail brands and private label brands are competing based on proprietary survey data, category research, and expert insights.

Significant Findings in the Private Brand Daymon Report

Daymon’s analysis found some interesting insights for private label brands and some dangerous ones for national brands. The agency found that 81% of shoppers buy private label brands on every or almost every shopping trip. 85% of consumers in the study indicated that they trust store brands as much as their national counterparts. On top of these shopper stats, private label brand sales are up 4% over national brands in the past 12 months.

Daymon CEO, Jim Holbrook, believes that this is a “renaissance period” for store brands. He attributes this growth in private label to the way retailers are creating one-of-a-kind brands that national competitors are even having a time emulating. Grocery discounters like Aldi and Lidl are causing turmoil for traditional retailers because of their low cost, organic private label brands. The report concludes that the majority of shoppers (60%) want retailers to create more private brands in the fresh products category. Consumers can expect retailers to listen and start competing more aggressively in this category over the next 36 months.

Private Label is Disrupting Retail in a Big Way

 

The Private Label Manufacturer’s Association reports that store brands make up 17% of all grocery sales with a market size of $150 billion. Retailers like Aldi and Target have changed the way consumers think about private label. They now often recognize these store brands with quality and trust. National products are finding it tougher and tougher to compete with lower cost alternatives that are built on transparency and trust.

However, the private label market is facing some inside challenges. Brandless, San Francisco-based e-commerce startup, offers 115 “brandless” private label brands for the same price. For only $36, consumers can get free shipping all year on all orders.

As private label gets more competitive, it’s imperative for retailers to get savvy and compete even more. Simple ingredients and clean label products will be a win-win for store brands. Download our GrandFusion R&D Resource Kit to learn more about how our products can help you stand out from the crowd.

M&A Strategies are Evolving in Small Brand Acquisitions

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Big CPG companies have been focusing on growth through acquisitions the past few years. They see small brands as an opportunity to tap into a growing customer segment that they currently have little access to. However, the transition from a small brand into the big company structure can lose the “craft,” and “authentic” feel that makes those brands so successful. 2018 is the year when mergers and acquisitions teams will evolve and apply tactics that ensure the small brand keeps its quality and authentic feel.

How are Mergers & Acquisitions Tactics Evolving?

 

M&A teams are finally noticing that some of the small brand’s most loyal consumers see these deals as the brand “selling out to the man.” These loyal customers matter, because are typically the people that helped the company grow so fast. It is important for big CPG companies to keep brands “local” and maintain the product’s integrity after an acquisition. M&A Teams are focused on the following to keep small brands authentic feel:

  • Keep the founder and initial innovator to maintain the appearance of a healthy marriage. This is important to building continued trust with loyal customers.
  • Basing the purchase price on post-sale performance as well as making small investments in multiple small brands.
  • Allow small brands to continue to operate independently by not buying them outright. Look at Mars’ recent investment in KIND.
  • As soon as the sale is complete, both companies should be working together to tell the future plans for the brand. Look at how General Mills and Annie’s accomplished this over the years.

These Relationships are About Maintaining the Look and Feel

Risks in M&A exist for both the buyers and sellers. The small brands fear that the large company will ignore their mission and vision in pursuit of profits, and big companies fear they will never recoup a return on their investment. The M&A teams are telling both parties to focus on maintaining the look and feel of the brand. Keep the price the same, keep the packaging the same, keep the ingredients the same, at least for a little while. The bottom line here is if it ain’t broke, don’t fix it.

Inspired by www.fooddive.com

CFI Finds Only 33% of Consumers Trust The Food System

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The Center for Food Integrity (CFI) released a new study, A Dangerous Food Disconnect: When Consumers Hold You Responsible  But Don’t Trust You, that looks at some damaging statistics on the food system. First and foremost, the study revealed that 33% of consumers do not trust the food system, which is down from 47% in 2017. This is alarming and further supports the movement by food companies to be more transparent and create products with simple ingredients.

Food Companies Placed Last on List of Most Trusted Information in the Food System

The new CFI study is important because it showcases the disconnect between what consumers think and what food companies across the industry are actively doing to ease their concerns. On the list of most trusted sources for food safety information, food companies ranked dead last with food regulators taking 8th on the list, and farmers ranking 3rd on the list. Surprisingly, family and physicians ranked as the most trusted sources of food safety information.

 

Roxi Beck, Director of the CFI, believes food companies have to further their mission of product transparency. She suggests inviting consumers to the farms and manufacturing facilities to build more trust. She also suggests large CPG companies be wary of touting their large size and global scale as it often viewed as a warning sign to consumers today. The small brands are taking advantage of this and winning big time.

Investing in Transparency Efforts and Technology

Multiple food companies and suppliers in the food system are looking at new blockchain technology to lead the transparency effort. Companies like Cargill have tested blockchain to allow consumers to trace their Thanksgiving Turkey back to the farm it was raised on. This is a step in the right direction.

Other companies are looking for ways to better tell their brand stories to lead transparency efforts. Marketing teams across food brands are selling this hard up the ladder because they know how important trust is to purchase decisions and long-term brand loyalty. The bottom line will grow as food companies and their brand focus on building more trust with consumers.

Inspired by www.fooddive.com

Tactile and Multisensory Foods Could Be Top Trend For Brands in 2018

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Tactile and multisensory experiences are all about feeling and hearing the connection. Phil Lempert, The Supermarket Guru, believes we have evolved, and 2018 is a particular year for brands to take advantage of the tactile approach. A multisensory food will appeal to more than consumer’s taste buds. Brands will look to add features and experiences that appeal to the hearing and visual senses.

Tactile Brands Will Be More Memorable

The clean label trend is here to stay, but Phil believes consumers are at peak food information overload. It’s time that foods move to a more intellectual connection with visual and auditory cues. Foods that enable sounds like chopping, stirring, chewing and crunching will give consumers a food euphoria every time.

Brands Already Implementing the Tactile Approach

The crunch of a crisp snack echoes in our brain, and we subconsciously resonate with it in the future. Also, think about the crisp taste of a beer, but enhancing that with virtual reality as Guinness recently did.

Sensory marketing is nothing new, but Phil makes an excellent point that this trend will gain steam after the focus on ingredients, clean labels, and more over the past few years. Sampling is one of the critical ways to implement a multisensory marketing approach at retail and food events. Costco has been using this technique for years to drive sales in specific products and categories.

Tactile and multisensory approaches will be food and beverage brands secret weapon in 2018. Watch and listen for more!

Inspired by www.supermarketguru.com

1/3 of Protein Bars Have as Much Fat as a Krispy Kreme Donut

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Has the New Year, New You health and wellness trend hit you this year? How many protein shakes, protein bars and workouts are you taking in? Well, if you love the taste of your favorite protein bar, you might want to look at the label a little closer. Protectivity, a U.K. based health, sports, and travel specialists revealed in new research that more than 33% of all protein bars have more saturated fat than a Krispy Kreme donut.

How Protectivity Analyzed 56 Protein Bars

Protectivity created a fitness food index to help people look at the protein, carbohydrate, sugar, and fat content to look at a variety of products including protein bards. The index shows that protein bars often contain large amounts of sugar and fat. They found that 10 of the 56 bars analyzed contained more sugar than a Krispy Kreme donut.

Nutritional shakes and bars have been one of the most active markets over the past five years. From 2010 to 2015, the category grew at 10% year over year. In 2016, the market reached over $9 billion in sales around the world. It’s safe to say that these formulas of high fat and sugar content will not last long as protein bars have typically been seen as part of the clean eating trend.

Large CPG Companies Acquiring the Nimbler Bar Brands

It’s evident that the smaller brands are catching the eye of the giant CPG companies. These brands have already created formulas that meet consumer needs with low sugar, low fat, and great taste. Big CPG sees no reason to reinvent the wheel and instead believes the acquisition is the best way to gain market share. Last November, Mars took a minority stake in KIND bar. Kellogg acquired RXBAR to grow its clean label protein bar offerings for over $600 million in 2017. The nutritional bar market is hot, and we expect more acquisitions in this area in 2018.

Consumers Must Recognize Protein Bars as a Meal Replacement, Not a Snack

Brands must educate consumers on protein bars and nutritional products. Many of these products are not formulated to be eaten as a casual snack but as a meal replacement or a post-workout fuel. Brands should be concerned about the high levels of fat and sugar because if consumers don’t see results, they will switch to another favorite food solution. 2018 and 2019 should be the years that these brand focus on adding healthier ingredients and formulating these bars to be more reliable nutritional products for consumers.

Inspired by www.fooddive.com

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