Functional Foods and Beverages - US - November 2006

Abstract

The U.S. marketing environment for functional food and beverages is complex. On the one hand, the scientific medical community continues to churn out studies confirming the role of diet in the cause and prevention of disease. Government has made it easier than ever to place health claims on food and beverage labels, and health-consciousness among the general population is at an all-time high. On the other hand, people have very emotional relationships with food. The fact that obesity has reached epidemic proportions is the only evidence we need that knowledge doesn't always translate into action.

Furthermore, despite these products' added value, consumers often treat functional products like conventional foods and beverages, with taste, price, and convenience often weighing more heavily than nutritional value in purchase decisions.

In this report, Mintel examines in detail 10 segments and numerous sub-segments that compose this market, with coverage of virtually every functional brand tracked by IRI, and reveals how several small, dynamic segments are generating excitement in a market that is otherwise dragged down by sluggish sales in a couple of very large segments.

Consumer profiles are also revealed, with older functional food and beverage users demonstrating high levels of regular consumption and Hispanic consumers emerging as disproportionately high users of certain products.

Functional foods and beverages are products that make a distinct, written health claim. They may be enhanced in some way, for example with added ingredients like soy or calcium, or which have been enhanced through the act of processing, for example yogurt with added cultures to have a beneficial effect on the body in general or on a particular function of the body.

Functional foods and beverages are also those which have added ingredients to produce a specific health benefit, as defined by the FDA, and may bear approved claims from the FDA. This is a key factor in Mintel's definition- products must have added benefits to be included. In this way, Mintel is able to measure the activity of products that are produced specifically for the functional market.