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    Features

    Fresh Opportunities for Digestive Health Products

    Companies should align new development with evolving consumer needs.

    Fresh Opportunities for Digestive Health Products
    Fresh Opportunities for Digestive Health Products
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    Simone Baroke, Contributing Analyst, Euromonitor International10.03.16
    Mention digestive health ingredients and people often immediately think of probiotics or fiber. However, “traditional” digestive health positioned products, like probiotic yogurt and whole grain bread, are caught in a paradox. Although they are firmly associated with digestive wellness, they also contain components that are no longer compatible with a digestive health positioning in the eyes of a growing number of consumers.

    Global business intelligence provider Euromonitor International believes that for digestive health positioned packaged food and beverage products to thrive, the industry needs to focus more on product diversification—both within traditional categories and also penetrating into currently underdeveloped ones, like beverages.

    Yogurt Lacks Dynamism
    According to Euromonitor International’s Health and Wellness data, digestive health prime positioned packaged food and beverage products amounted to $70.5 billion in global retail value sales in 2015, up from $63.1 billion in 2010, based on fixed 2015 U.S. dollar exchange rates and constant prices. Yogurt and sour milk products accounted for one third of this and, naturally, healthy high-fiber bread for just over another third (35%).

    Note that except for naturally healthy high fiber and sour milk products, for a product to be counted in this category, it needs to be explicitly positioned as beneficial for digestive wellness; merely being labeled as probiotic or containing live bacterial cultures is not sufficient for inclusion in this data set. However, since probiotics/live bacteria are inextricably linked with gut health benefits in many consumers’ minds, it makes sense to look at the performance of the probiotic yogurt category as well.

    Viewed from a global perspective, probiotic yogurt delivered a nice and steady 6% CAGR over the 2010-2015 review period (based on fixed U.S. dollar 2015 exchange rates and constant prices), reaching worldwide value sales of $30.8 billion in 2015. In several core geographies, however, the category’s performance was not quite so dynamic.

    In the U.S., values contracted by 2% over the review period, while they suffered 7% and 5% declines, respectively, in Western and Eastern Europe. A factor that surely didn’t help was that probiotics cannot seem to secure a health claim in the EU. Even the mere mention of the word “probiotics” on packaging is forbidden. It has to be pointed out, however, that overall yogurt didn’t perform well in Europe at all over the review period, and so it was not just the probiotic contingent of the offering that showed a lackluster performance.

    Don’t Forget Cheese
    Product diversification ought to be part of a viable growth strategy, both for probiotics and for digestive health positioned products. Probiotic cheese, for example, may have good potential in the long term. Probiotic ingredients are a very good fit with cheese since, like yogurt, it’s a fermented product, produced by the action of bacteria. In other words, probiotic cheese can easily be positioned as “natural,” which is an important attribute in terms of consumer acceptance.

    There are a number of smaller players nestling into the emerging category. One of them is The Probiotic Cheese Company based in New Hampshire, which offers Probiotic Cheddar Cheese Bites in Original and Savory Pepper flavors. The words “the new fit food” and “the natural sugar free, zero carbohydrate, high protein snack” are prominently emblazoned on the front of the pack, thus leveraging some of the key current health and wellness trends. On the back, immune and digestive health benefits are mentioned.

    The product, which contains probiotics supplied by specialist probiotic ingredients company Ganeden, is the brainchild of Mark Windt, who, besides being a physician, is also a long-standing member of the American Cheese Society, for which he advocates the many health benefits of probiotics.

    The company envisages pregnant women and the elderly, who often suffer from digestive troubles—in particular from constipation—to count among its primary target audience. The addition of probiotics to cheese and the subsequent repositioning of the product as a digestive health offering may help cheese to overcome its reputation as being rather on the “heavy” side and difficult to digest.

    Opportunities In Beverages
    Compared to dairy and bakery, beverages constitute a very small segment of digestive health prime positioned products, amounting to just $243 million globally in 2015. The bulk of this (73%) comes from juice and most of the remainder is accounted for by bottled water.

    Beverages, however, have enormous potential for development in the digestive wellness area, because they possess a distinct advantage over dairy and bakery: beverages are (usually) free of the substances that many health and wellness-conscious shoppers are keen to avoid, namely wheat, gluten, dairy and lactose. Fashionable nutritionists often blame these components for all manner of chronic digestive discomforts, from postprandial bloating to Irritable Bowel Syndrome (IBS).

    Whether exclusion diets are warranted, medically speaking, in all but a relatively small number of cases, is a matter of ongoing debate, but the fact of the matter is this: consumers whose sense of well-being constantly languishes below par want to experiment with dietary approaches. Since diet, digestion and well-being are intimately linked, it is hard to dismiss this rationale out of hand. Also, many of those not actually adhering to a strict exclusion diet still believe that products eschewing dairy, wheat, etc., may be healthier and easier on their digestive systems. As a result, the free-from market continues to boom, impelling manufacturers of health and wellness products wanting to tap into growth areas to adapt their offerings accordingly.

    In the realm of beverages, launch activity has been rather interesting of late. For instance, California-based premium juice manufacturer Suja Juice is set to introduce its new range of organic Suja Drinking Vinegar in the U.S. Flavors include Strawberry Balsamic, Lemon Cayenne and Hibiscus Ancho Chile.

    The products contain cold-pressed fruits and vegetables, apple cider vinegar, stevia for extra sweetness and GanedenBC30 probiotic ingredient for immune and digestive health benefits. These benefits are also among those ascribed to apple cider vinegar, a long-standing, traditional home remedy. This launch follows the debut of Suja Pressed Probiotic Water earlier this year, also featuring GanedenBC30 and marketed as “made for loving your guts.”

    It is also worth mentioning that beverages have one more advantage over packaged foods, namely in terms of consumption occasions. For digestive health products to be effective, they usually need to be consumed frequently (i.e., at least once a day), as in the case of probiotic yogurts. With beverages, the daily consumption message should be even easier for consumers to implement. People may not fancy a yogurt product every single day, but everyone manages without any problems to consume fluids several times daily. Beverages are extremely versatile and digestive health positioned offerings can be presented in every conceivable format, from neutral-tasting waters to juice drinks, ready-to-drink teas and even hot drinks.

    In conclusion, digestive health is not about to lose its relevance, either for consumers, or for manufacturers. The same applies to probiotic ingredients, despite having experienced several setbacks in recent years, particularly on the health claims front in the EU. For manufacturers, the key is to pay close attention to consumers’ ever more complex individual needs, focusing their new product development efforts on the products that health and wellness-conscious buyers actually want, such as free-from offerings, and in the formats that encourage frequent consumption.


    Simone Baroke is a long-standing contributing analyst at Euromonitor International specializing in the global health and wellness and fresh food markets. For further insight contact Ewa Hudson, global head of health and wellness research at Euromonitor, at ewa.hudson@euromonitor.com; www.euromonitor.com.
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