‘Cheap’ functional foods set to grow, says Euromonitor

By Lorraine Heller

- Last updated on GMT

Related tags: Nutrition, Euromonitor

Private label and cheaper product formulations will be key to driving the market for functional food and beverage products, according to market analyst Euromonitor.

Speaking to NutraIngredients-USA.com, Euromonitor analyst Ewa Hudson said this was one of four key trends expected to set the global market scene moving forward.

According to Hudson, health trends in western countries will be driven by a shift towards prevention, which will have a knock-on effect on the types of functional food and beverages sought by consumers.

“There’s been a big shift from treatment to prevention as people can’t really afford to be sick. Innovation in functional foods is based on this movement towards preventative healthcare,”​ she said.

In the first of a series of articles examining the four trends highlighted by Euromonitor, NutraIngredients-USA.com looks at the consumer move towards addressing health via nutrition – cheaply.

Cheaper products

“Private labels and the cheapest functional food options are growing as people are looking to spend less.”

Yogurts are a good fit for this category, she said, as they are one of the more affordable functional foods – “more expensive than regular yogurts but cheaper than supplements, for example”.

Other products that fit in here include fortified drinking yogurts, functional spreadable oils and breakfast bars or energy bars. According to Euromonitor data, these categories have already witnessed strong growth over the past five years.

Yogurts, bars and spreads

The analyst valued the global market for functional yogurts and drinking yogurts at $11.3bn in 2004. By 2009, this figure grew to $20.4bn.

Breaking down the different product applications within this category, the figures reveal a 128 percent growth in pre-and probiotic spoonable yogurt during the period, from $3.3bn in 2004 to $7.6bn in 2009 (18 percent CAGR). Other functional spoonable yogurt sales grew even more: 421 percent from just under $1bn in 2004 to just under $5bn in 2009 (39 percent CAGR).

Pre- and probiotic drinking yogurt grew 44 percent from $7.8bn to $11.2bn in the period (8 percent CAGR). Other functional drinking yogurt saw the greatest sales growth of 1179 percent, increasing from around $0.8bn in 2004 to just under $11.8bn in 2009 (67 percent CAGR).

In the same five-year period, global sales of granola and muesli bars increased 66 percent (11 percent CAGR) from $1.8bn to $3bn. Breakfast bars sales increased 47 percent (8 percent CAGR) from just under $1.8bn to $2.6bn. Energy and nutrition bar sales grew 28 percent (5 percent CAGR) from $1.8bn to $2.3bn. In contrast, sales of fruit bars fell 1 percent from $0.9bn to around $0.8bn. Sales of ‘other’ snack bars grew 8 percent (2 percent CAGR) from $0.82bn to $0.88bn.

Sales of functional spreadable oils and fats grew 54 percent (9 percent CAGR) from $11.9bn in 2004 to $18.3bn in 2009.

More trends

Other trends highlighted include an expansion of probiotics into other health categories and applications, beauty from within and a renewed focus on weight management. To read those articles, click here​ .

Related topics: Markets

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