Table of Contents
Introduction and Abbreviations
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- Definition
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- Figure 1: Explanation and examples of health claims
- Consumer research
- ACORN
- Abbreviations
Premier Insight
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- Market opportunities
- Sports
- Little lunchboxes
- Boosting the image of frozen and convenience foods
- Responding to the need for credibility
- Self diagnosis
Executive Summary
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- Market reaches one billion
- Yogurt and juice drinks grow fastest
- New breed of consumer
- Healthy choice
- Rapid market expansion
- Legal benefits
- Large companies dominate…
- ...own-labels move in
- Consumer buy-in
- Gender differences
- Visible AB slant
- A functional future
- Current trends persisting, market could double in size
Market Background
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- Consumer awareness
- Prevention is better than cure
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- Figure 2: Agreement with lifestyle statements on health, by gender, 2001-05
- Attitude versus action
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- Figure 3: Agreement with lifestyle statements on health, by gender, 2001-05
- Good intentions
- The health phenomenon
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- Figure 4: UK growth rates of healthy food and drink products, by sector, 2000-05
- Low-carb and GI
- Organics
- Cross-over between free-from and functional
- Functional foods – the evolution
- Health goes mainstream…
- A different approach
- …or food with function?
- Science – claim and counter claim
- Legislative issues
- Novel foods
- The Joint Health Claims Initiative (JCHI)
- Labelling and claims
Market Size and Segmentation
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- Value tops one billion
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- Figure 5: Estimated UK retail sales of functional food and drink products, 2000-05
- The price of health
- Varying performance
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- Figure 6: UK retail sales of functional food and drink products, by sector and value, 2001-05
- Soya soars
- Yogurt drinks go down well
- Children are the future
- Juice is next big thing
- Older categories slow down
- Significant ‘others’
- Growth rate comparisons
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- Figure 7: Growth rates of overall food and drink categories compared to growth rates of functional food and drink products, 2003-05
- Functionals grow fastest
- Functional water struggles for credibility amongst consumers
- Price sensitivity varies by category
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- Figure 8: Price comparison between functional and mainstream spreads, 2006
- Figure 9: Price comparison between tropicana juice variants, 2006
The Supply Structure
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- Dairy
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- Figure 10: Leading brands in the dairy category, functional ingredient and basic health claim, 2006
- Company/brand activities (dairy)
- Alpro/Provamel
- Danone SA
- Unilever UK (Flora)
- Benecol (McNeil Consumer Nutritionals)
- Müller
- So Good International
- Yakult
- Own-label
- What’s next for the dairy sector?
- Probiotic yogurts continue to evolve
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- Figure 11: Timeline showing launch of adult probiotic drinks
- Drinks
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- Figure 12: Leading brands in the drinks category, functional ingredient and basic health claim, 2006
- Company/brand activities (drinks)
- Glaxo SmithKline (GSK)
- Tropicana (Pepsico International)
- Red Bull Co
- What’s next for drinks?
- Cereals
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- Figure 13: Leading brands in the cereals category, functional ingredient and basic health claim, 2006
- Company/brand activities (cereals)
- Jordans
- Kellogg
- Cereal Partners UK (Nestlé)
- Quaker Oats
- Other (bread and eggs)
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- Figure 14: Examples of other leading brands, functional ingredient and basic health claim, 2006
- Company/brand activities (others)
- Allied Bakeries
- Warburtons
- Dean’s Foods Ltd
- Organic and functional crossover could cause confusion
New Product Trends
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- Figure 15: New product launches in functional foods by food category, January 2005-06
- Beverages and dairy lead NPD
- Dairy moves comfortably into own-label
- Beverages
- Omega 3
- Children’s products
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Advertising Expenditure
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- Adspend doubles
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- Figure 16: Main monitored media advertising expenditure on functional foods in the dairy sector, 2001-05
- Adspend reflects buoyant sector
- Expenditure by brand
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- Figure 17: Main monitored media advertising expenditure on functional foods in the dairy sector, by top brands, 2001-05
- NPD and brand extension drive adspend
- Actimel challenges probiotic drinks
- Flora pro.activ spreads
- Muller adds to range
- Expenditure by media type
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- Figure 18: Main monitored media advertising expenditure on functional foods within the dairy sector, by media type, 2001-05
- Growth of press and radio
- Expenditure by quarter
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- Figure 19: Main monitored media advertising expenditure on functional foods within the dairy sector, by quarter, 2005
- A summer-time message
Distribution
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- Multiples in charge
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- Figure 20: Estimated retail sales of functional food and drinks, by distribution channel, 2001-05
- Multiples take on function
- Mixed welcome for own-label
- Pricing issues
- Shelf space grows
The Consumer
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- Push or pull?
- Who is in the driving seat?
- Health headlines dominate the media
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- Figure 21: Examples of health-related news headlines, 2004-06
- Relevance of health issues
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- Figure 22: Health issues of concern, November 2005
- Gender bias
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- Figure 23: Health priorities, by gender, November 2005
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- Figure 24: Repertoire of number of health concerns, November 2005
- Targeting the healthy wealthy
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- Figure 25: Relevance of health issues by socio-economic group, October 2005
- Age concern
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- Figure 26: Relevance of health issues by age, October 2005
- Targeting younger consumers
- The consumer lifecycle
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- Figure 27: Relevance of health issues according to mean age, November 2005
- Obesity scores highly
- A different type of pester power
- The family way
- Age-specific targeting
- The media has a huge impact and mostly seems to affect ABs
The Consumer – Detailed Demographics
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- Relevance of health concerns
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- Figure 28: Health issues of concern, November 2005
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- Figure 29: Top 5 health issues of concern, by demographic sub-group, November 2005
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- Figure 30: Top 5 health issues of concern, by demographic sub-group, November 2005
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- Figure 31: Health issues of concern, by demographic sub-group, November 2005
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- Figure 32: Health issues of concern, by demographic sub-group, November 2005
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- Figure 33: Health issues of concern, by demographic sub-group, November 2005
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- Figure 34: Health issues of concern, by demographic sub-group, November 2005
- Cross-analysis
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- Figure 35: Cross-analysis of health concerns, November 2005
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- Figure 36: Cross-analysis of health issues of concern, November 2005
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- Figure 37: Mean age of health concerns*, November 2005
The Consumer - Attitudes and Enthusiasm
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- Figure 38: Attitudes to functional foods, November 2005
- Conviction is key
- Positive progress
- Purchasing behaviour
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- Figure 39: Attitudes to functional foods, November 2005
- Converting ‘never buys’
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- Figure 40: Agreement with the statement ‘I never buy functional foods’, by gender, age, socio-economic group, and employment status, November 2005
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- Figure 41: Agreement with the statement ‘I regularly buy functional foods’, by gender, age, socio-economic group, November 2005
- Age and understanding
- Creating consumer typologies
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- Figure 42: Consumer typologies, November 2005
- Buyers (36% of sample)
- Cynics (14% of sample)
- Casual Interest (12% of sample)
- Proof Seekers (7% of sample)
- Not Interested (31% of sample)
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- Figure 43: Consumer typologies, according to above-average relevance of health issues, November 2005
- Converting non-users to new users
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Attitudes and Enthusiasm – Detailed Demographics
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- Attitudes to functional foods
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- Figure 44: Attitudes to functional foods, by demographic sub-group, November 2005
- Figure 45: Attitudes to functional foods, by demographic sub-group, November 2005
- Figure 46: Attitudes to functional foods, by demographic sub-group, November 2005
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- Figure 47: Attitudes to functional foods, by demographic sub-group, November 2005
- Cross-analysis of attitudes to functional foods
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- Figure 48: Cross-analysis of attitudes to functional foods, November 2005
- Figure 49: Cross-analysis of attitudes to functional foods, November 2005
- Figure 50: Consumer typologies, by demographic sub-group, November 2005
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- Figure 51: Consumer typologies, by demographic sub-group, November 2005
- Figure 52: Consumer typologies by health concerns, November 2005
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- Figure 53: Repertoire of health concerns, November 2005
The Future and Forecast
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- Market development
- Consumer development
- New platforms
- New ingredient trends
- Naturally functional
- The backlash?
- Opportunities ahead
- If current trends persist, market could double in size by 2010
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- Figure 54: Forecast for the expenditure on functional foods, at current and constant prices, 2005-10
- Factors used in the forecast
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