Key points
Europe is a tough place to do business in functional foods, especially since the arrival of the Nutrition and Health Claims Regulation.
Market analyst Canadean contrasts the situation in Europe with that of Japan. Until March 2014, the European Food Safety Authority (EFSA) had only approved 254 health claims out of the 2,242 submitted. On the other hand, total approvals in Japan reached over 1,100 by early 2014 – almost five times higher.
While the EFSA’s scrutiny has proved to be a major stumbling block for many contenders –probiotic and antioxidant claims are among the most high-profile casualties so far – even those ingredients that have cleared the EU-level regulatory hurdles, may still face challenges. The most recent example is the phytosterols/stanols, whose cholesterol-busting powers have been flagged up on products such as margarines and yogurts for years.
The French food safety authority (ANSES) rejected the previous scientific consensus in recent weeks, publishing a report saying that “…as regards public health, the available data did not make it possible to consider foods fortified with phytosterols/stanols as a suitable way of preventing cardiovascular disease”. It remains to be seen what impact the ANSES report has in practice, but manufacturers are concerned.
Delayed not stifled (Return to top)
Despite such challenges, Canadean analyst Ronan Stafford believes the regulatory environment in Europe has delayed development in functional ingredients, rather than stifled it completely. Evidence from the clinical trial has lagged the EFSA’s approvals process by between six and 10 years and the next five years will therefore bring more-definitive outcomes on permissible claims for various ingredients.
“Companies are now more experienced with making claims, and can follow best practice from those claims that have been approved. They’ve also had time to complete studies that are more likely to meet the EFSA’s standards – it is the time needed to design and run these studies that is producing the lag in approvals for ingredients such as probiotics,” he says.
“As a result of stringent regulation, Europe has effectively become the global hub for functional food and drinks clinical trials. Europe is a can’t-miss market for most manufacturers and the ability to gain EFSA approval stands them in good stead for gaining approval in most other markets.”
So what are the key benefits currently being targeted by functional foods developers in the EU? “Maintaining a healthy heart is the main reason why consumers use functional food and drink products (35%), with the related lowering of blood pressure/cholesterol close behind (24%), both driven by over-45s,” says Mintel’s Chris Wisson, who compiled the analyst’s latest report on consumer attitudes toward functional food and drink. He also says older customers are more likely to use functional products daily.
Touting brain health (Return to top)
Meanwhile, brain health is being touted by some observers as another key target among ageing consumers. Although interest in cognitive benefits has yet to translate into multiple product launches, the recent introduction of Brainwave drinks in the UK is leading the charge.
“Brainwave’s the only product I’ve seen so far targeting this niche, but it wouldn't surprise me if there are many similar products in the pipeline,” says Stafford. “If you look at the types of claims approved by the EFSA, claims regarding cognitive health and the central nervous system have been among the most successful.
“Most of these approved claims relate to vitamins and minerals – iodine, zinc, iron, vitamins C, B2, B6, and B12. But the sheer number of successful claims (about twice as many approved claims as for digestive health or for bone health) does point towards a number of companies that have identified cognitive health as a key growth opportunity.”
Younger customers have very different priorities, according to Wisson, typically opting for energy-boosting products and those that aim to improve appearance.
In fact, according to a recent report from New Nutrition Business, understanding the attitudes of different types of consumers is fundamental to the success of functional foods.
Director Julian Mellentin says that the usual attributes of taste and convenience are the main drivers of functional sales in the mass market, so premium-priced, “technical” products should initially consider targeting a highly-motivated niche instead. “Targeting a motivated and specific group enables you to refine your communications, deliver a clear message and, if you are successful, get a foothold in the market,” he says.
He divides consumers into “technology consumers”, “lifestyle consumers” and the mass market. For example, if you have a lactose-free product, it may be wise to establish a solid niche among the medically lactose-intolerant first, then target lifestyle consumers and only later consider the mass market.
“Technology consumers are an excellent launchpad they are few in number, can be reached through very targeted marketing, they are willing to pay a premium for your product if it actually delivers the benefit they are looking for and they are very loyal,” says Mellentin.
Beverages out in front (Return to top)
Whatever the benefit being targeted, there are clearly some types of product that are the preferred delivery vehicles for functional ingredients.
Beverages are the most widespread functional products, used by 43% of adults, followed closely by yogurts (36%), says Wisson. “Breakfast is a key occasion for functional brands, with high usage of products typically associated with breakfast, such as bread, cereals and spreads (as well as juices and yogurts),” he says.
Stafford also highlights beverages as the most important carrier for functional ingredients: “Consumers are familiar with turning to beverages for functional benefits, mostly energy boosts, rehydration, and digestive health, or even just calcium from milk or vitamins from fruit juice.
“Beverages are also very convenient and quick to consume an important aspect as busy consumers look to fit more activities into the same amount of time in a day.”
In contrast, the lack of a “health halo” around some types of products means they’ll never provide a successful way of delivering active functional benefits. However, even manufacturers of indulgent products are only too aware of the health and wellness trend, with regulators and pressure groups calling for lower salt, sugar and saturated fat formulations.
For these products, claims such as lower-fat or lower-salt can actually be off-putting for consumers and this is leading to increased demand for technical ingredients that enable clean labels and healthier reformulation, without impacting on taste.
Conor Cahill, head of science and innovation at Dawn Farms, which supplies meat products, says native starches, sea salts and meat broths are being used to combat any taste/texture and shelf-life compromises.
“There is a demand for protein to fuel a healthier, more energetic lifestyle and, in my view, both functional and fortified products are now a key part of any innovation pipeline.”