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    Features

    Driving Product Innovation to Meet Modern Lifestyles

    Consumer demand for taste and convenience will be essential to the success of functional foods and beverages.

    Driving Product Innovation to Meet Modern Lifestyles
    Driving Product Innovation to Meet Modern Lifestyles
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    Peter Leighton, Vice President of Product Strategy at Complete Nutrition and Founder of Abunda06.02.14
    Hall of Fame hockey player Wayne Gretzky, when asked what separated him from other players, said “A good hockey player plays where the puck is. A great hockey player plays where the puck is going to be.” This sentiment encapsulates the one behavior that separates exceptional companies from most others. Market makers understand that minor differences and slight improvements aren’t real innovation, and real innovation is what drives profits. However, the only way to innovate truly is to aim for where the market is going to be and address an unarticulated need.

    Through the use of many analytical tools such as ethnographic research and Cross Impact Analysis, I have identified some foundational trends that offer several ripe opportunities for innovation and growth. These trends include a growing desire for self-care, increased emphasis on fitness, an orientation toward convenience (grab-and-go), nutritional solutions, the connection between food and health, the growth of nutricosmetics (beauty from within), healthy snacking, raw foods and a trend toward ecological activism.

    When analyzed, these trends illustrate four specific market opportunities that are screaming for innovative products and unique solutions.

    Lifestyle Antidotes
    By now if you haven’t figured out that consumers are not going to change their lifestyle behaviors radically, you have your head in the sand. We all know that we need to exercise more, eat fresh fruits and vegetables and increase fiber. Yet we don’t do it. We’re looking for ways to avoid the hard work that’s required to change our poor lifestyle behaviors. Instead we seek an antidote for our lifestyle.

    Functional Foods
    As consumers seek to justify or rationalize their behaviors, savvy marketers are delivering solutions in the form of functional foods. These are tasty and convenient foods and beverages that have a positive wellness orientation, delivering more than simple nutrition. Healthy snacks, breakfast on-the-go and fortified foods allow consumers to continue their lifestyle behaviors while mitigating their negative impact.

    Simplification
    Living a complex and stressful life, many consumers are seeking simplification. This can be delivered in several ways, but the end result is delivering to users an intuitive, thoughtful nutritional solution that can be easily integrated into their life. Without dumbing down the science, this requires leveraging consumer beliefs and understanding, while delivering a thoughtful solution.

    Personalization
    What do you give the “Me Generation?” They want personalization. Personalized nutrition is now possible based on advances in research, discovery and delivery. Through simple biological tests we can identify key markers of health concern and then customize a nutritional solution specifically for the individual. This is one area prime for commercialization.

    Beyond these four market opportunities, there are some ongoing product trends that will continue to show strong growth.

    Antioxidants
    The U.S. market for products carrying an antioxidant claim is estimated at more than $1.2 billion and they are among the top five health components that consumers want in their food products. About 29% of U.S. adults are seeking high-antioxidant groceries, and 44% of women buy skin care or cosmetic products that promote their antioxidant content. Mintel reported that new antioxidant product launches for both food and food/dietary supplements increased by about 10% between 2010 and 2011.

    Current awareness of antioxidants is very high, and while few understand exactly what they do, most recognize antioxidants as “good.” However, industry is now conducting more studies on condition-specific benefits, including cardiovascular health, skin health, cognitive function, blood-sugar balance, weight management and inflammation.

    We are now seeing the development of a new and powerful class of antioxidants, such as synthetic triterpenoids, which have demonstrated the ability to block the development of Parkinson’s disease.

    Fiber
    About 72% of U.S. adults are trying to increase their fiber intake. Fiber is crucial to maintaining a healthy, optimum digestive system, and it helps control cholesterol, blood sugar and regulates appetite while supporting weight loss. Consumers are recognizing these benefits: 84% are aware that fiber is beneficial for weight loss, 79% healthy digestion, 43% heart disease, 39% risk of cancer and 36% healthy blood-sugar levels.

    However, there is a gap in the market when it comes to awareness and actions. It is generally recommended that an individual should consume about 30 grams of dietary fiber per day, preferentially from foods, not supplements. However, most adults only average about 15 grams/day, or approximately half the recommended amount.

    Probiotics
    Probiotics represent one of the fastest growing sectors in functional foods. Global volume consumption is more than three times that of omega-3s, making probiotics the most successful functional ingredient in packaged foods after vitamins and minerals.

    Global demand for probiotics was $27.9 billion in 2011 and is expected to reach $44.9 billion in 2018, growing at a CAGR of 6.8% from 2013 to 2018. The lion’s share of probiotic sales has been in foods and beverages, with annual growth forecasted at 7.6% through 2015.

    Approximately 81% of Americans ranked probiotics as the most important nutrient in 2011, according to the International Food Information Council, and 57% of shoppers want to learn more about probiotics and immune health, which is recognized as a secondary benefit after gut health.

    However, the current understanding and acceptance of probiotics, as strong as they are related to gut health and immune function, are just the tip of the iceberg. Vastly outnumbering our other cells, more than 100 trillion microbes inhabit the human body. New research into the connection between the microbiome and chronic disease is advancing at a fast pace. MetaHIT, a 4-year, €22 million, EU-funded study, and the U.S. National Institutes of Health’s Human Microbiome Project are just two examples.

    The MetaHIT study has shown that the make-up of the human gut microflora may have a significant impact on the development of type 2 diabetes, leading to development of probiotic strains that are demonstrating positive effect on metabolic disorders and obesity.

    Scientists have discovered a link between gut microbiota and obesity, noticing that microbial populations in the gut are different between obese and lean people, and when obese people lose weight their microflora changes to that of a lean person. Two hormones responsible for sending hunger signals to the brain were found to not function properly without adequate levels of probiotics in the body. For example, decreased levels of probiotics result in a decrease in leptin production, which increases the urge to overeat and results in weight gain.

    Canadian researchers found that probiotics not only boosted “good” bacteria in the gut of chronic fatigue syndrome (CFS) patients, but also led to a significant decrease in their depression and anxiety symptoms. The researchers believe that probiotics “crowd out” the more toxic stomach bacteria linked to depression and other mood disorders.

    Moreover, researchers are finding cardiovascular benefits with certain strains of probiotics. For instance, L. reuteri NCIMB 30242 may help reduce LDL and total cholesterol levels.

    Probiotics are even showing great benefit for conditions such as oral health, as several strains have shown promise against gingivitis. Recently, oral lactic acid bacteria and bifidobacteria have been isolated and characterized for various oral health purposes, including caries, periodontal diseases, and halitosis. S. salivarius K12 and M18 may actually help fight common oral care problems by producing a natural protein that stops the growth of the bacteria that results in bad breath. Lactobacillus paracasei was found to be effective against the main bacteria associated with tooth decay.

    Phytosterols
    Phytosterols are plant-derived compounds that are similar in structure and function to cholesterol, but phytosterols actually inhibit the intestinal absorption of cholesterol.

    While statins work by reducing cholesterol synthesis by inhibiting the rate-limiting HMG-CoA reductase enzyme, phytosterols reduce cholesterol levels by competing with cholesterol absorption in the gut, a mechanism that complements statins. Demonstrating synergistic benefit in statin users, phytosterols further reduce cholesterol levels by about 9% to 17%. An obvious market exists considering the number of statin users.

    In the U.S., FDA concluded that when consumed in the range of 1 to 3 grams in enriched foods, phytosterols resulted in statistically significant (5-15%) reductions in LDL cholesterol levels relative to placebo. FDA also concluded that a daily dietary intake of 2 grams per day of phytosterols (expressed as non-esterified phytosterols) is required to make an authorized health claim relating phytosterol consumption to cholesterol lowering and cardiovascular disease (CVD) risk. The European Food Safety Authority (EFSA) concluded that blood cholesterol could be reduced on average by 7-10.5% if a person consumes 1.5 to 2.4 grams of plant sterols and stanols every day. Scientists found the effect is usually established within the first 2-3 weeks.

    The global market for phytosterols was estimated to be worth more than $391.5 million in 2010 and is expected to exceed $887.8 million by 2018, forecast to grow at a CAGR of 9.5% from 2013 to 2018. Europe is currently the biggest market for phytosterols, accounting for approximately 51% of the global market in 2011, followed by North America.

    PUFAs (Essential Fatty Acids)
    Global sales of polyunsaturated fatty acids (PUFAs) exceeded $1.86 billion in 2011 and are predicted to see a 13.6% CAGR for 2012 to 2016. One wild card is the acceleration of pharmaceutical essential fatty acid (EFA) products hitting the market, which will likely drive stronger growth for functional foods and beverages, but may have a negative effect on the supplement market. Time will tell whether that market will also kick into overdrive.

    Research shows that PUFAs reduce inflammation and may help lower risk of chronic diseases such as CVD, cancer and arthritis; mounting data also support cognitive health benefits. Several clinical studies suggest that diets rich in omega-3 fatty acids lower blood pressure in people with hypertension. Fish oil has been shown to lower levels of triglycerides and to lower the risk of death, heart attack, stroke and abnormal heart rhythms in people who have already had a heart attack. Fish oil also appears to help prevent and treat atherosclerosis by slowing the development of plaque and blood clots, which can clog arteries.

    Trends to Watch
    After analyzing consumer lifestyle trends and perceptions, demographic data, product sales and ethnographic research, I can offer the following additional trends that are affecting the consumer nutritional market.

    Better Breakfasts. Consider the fact that 31 million Americans, about 10% of the U.S. population, do not eat breakfast. Driven by a need for convenience for time-starved consumers, this trend is all about packing the right blend of nutrition and function into a convenient and delicious serving occasion.

    Nutricosmetics & Cosmeceuticals. Whether it’s beauty from within or functional ingredients for topical use, this is a growing trend that will be continuing. Fueled by an anti-aging and self-directed healthcare mindset, consumers are getting very savvy to new advances in botanical research and are looking for new solutions. In 2011, U.S. sales of skin care cosmeceuticals reached $4.7 billion, and the cosmeceutical hair care category is estimated at $3 billion. (For more on this market click here.)

    Healthier Snacking. About 74% of people surveyed believe that “natural” means “healthier.” Guilt reduction is the driving force as consumers don’t want to give up on snacking, but they want to feel better about the snacks they consume. Yet they will not give up on the taste factor and convenience that is the cornerstone of snacking. The global snack foods market will reach $334.7 billion by 2015.

    Boosting Reality. Experiential products that can deliver a boost to life such as energy or mood alteration often see dramatic consumer response. While one may consider alcohol as the poster child for this trend, there are many nutraceuticals that pack an experiential punch. The paradox is that the more experiential the product, the more likely it is to bump heads with regulatory barriers.

    Trend Monger. Using food as a badge of sophistication or as an ethical statement, there is a movement toward the exploration of more esoteric, cultural foods, especially ones that provide a unique ethical story such as fair trade, heirloom, varietal, etc.

    Eco Warrior. Taking the Trend Monger one step further, there is consumer interest in using food choice as a means of activism.
    This includes thoughtful sourcing of ingredients, manufacturing and packaging, as this trend is driven by an intense interest in using the product as a means of driving social change. Sustainable ingredients, raw foods, negative carbon footprint and minimal packaging are some keys to this trend. 


    Peter Leighton is vice president of product strategy at Complete Nutrition and founder of Abunda, an integrated consulting group, delivering management and strategic solutions to growth-oriented companies. He has nearly 30 years of experience in consumer products, nutraceuticals and biotechnology. He has been responsible for many successful brands on the market, and has been an early leader in the areas of functional foods and science-based nutraceuticals. He can be reached at peter@abundasolutions.com; www.abundasolutions.com.
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