Confusion reigns in crowded yoghurt drinks market

The once buoyant functional yoghurt drinks market has been faltering since 2005, with consumer confusion and scepticism cited as the main reasons for the downturn, according to Mintel.

By the end of 2005, the sector was worth £250M, which dropped to £243M by the end of 2007, said the market researcher. Its comments come in response to Danone's announcement that it was withdrawing its 'skin-enhancing' yoghurt.

Essensis was launched in France, Spain, Belgium and Italy in early 2007. Danone claimed that ingredients such as borage oil, vitamin E and antioxidants from green tea, "feed the cells" of the surface layer of the skin - nourishing from within.

The sector was driven by a greater health awareness among consumers, high levels of new product development and big marketing budgets, which have propelled functional foods into the mainstream of consumer consciousness, according to Mintel.

Yoghurt drinks offered retailers a high-value line in the chilled cabinet and were, as a result, given a generous allocation of space and so "earlier market growth encouraged a number of new entrants to jump on the bandwagon", said Mintel. "The proliferation of products and claims caused consumer confusion and many consumers have left the segment. This left too many products with vague health messages that lacked resonance with consumers fighting for space, and retailers selling more on promotion, devaluing the sector's value."

Subsequently Danone's Danacol, which used an omega- 3 supplementation, as well as Flora's pro.activ blood pressure mini drink - were removed from the market. "They simply added to the clutter without a clear market-differentiating benefit," added Mintel.

Danone, however, said that the failure of Essensis was because consumers were no longer prepared to spend money on non-essential products.