Functional Foods - UK - March 2008

Table of Contents

• Issues in the Market
• Definition
• Excluded
• Vitamin and Mineral fortification
• Superfoods
• Exclusions to the excluded
• Others
• Four key themes
• Abbreviations
• Market in Brief
• Market growth slows...
• ... as natural products come to the fore
• Promotional support lower
• Market outlook positive
• Internal Market Environment
• Key points
• Consumers proactive in managing their health
  • Figure 1: Agreement with selected lifestyle statements, 2003-07
• Prevention better than cure
  • Figure 2: Attitudes towards healthcare, 2003-07
• Too busy to be healthy?
  • Figure 3: Agreement with selected lifestyle statements, 2003-07
• Broader Market Environment
• Key points
• Changing population dynamics setting a backdrop
  • Figure 4: Effect of the changing make-up in demographics of the UK population on the market for functional foods, 2007
• More regulation of health claims
• Competitive Context
• Key points
• So many ways to be healthy
  • Figure 5: Market size and growth for selected healthful foods, 2002-07
• Superfoods a more direct competitor
• Vitamins and mineral supplements
• Costs to the NHS
• Strengths and Weaknesses in the Market
• Strengths
• Weaknesses
• Market Value and Forecast
• Key points
• Market growth slows
  • Figure 9: Market value for functional foods, 2002-07
  • Figure 10: UK retail sales of functional food and drink products, by sector and value, 2005-07
• Yogurt drinks
• Yogurt pots
• Yellow fat spreads
• Breakfast cereals
• Juice, drinks and bottled water
• Soya dairy-alternative products
• Eggs
• Other products
• The future
• Functional vs. naturally healthy
• Consumers want more credibility
• Forecast
• Healthy but slower growth
  • Figure 11: forecast of the functional foods market, 2002-12
• Health to remain a crucial market driver
• Demographic changes to promote growth
• Beauty products to aid future growth
• Slower growth predicted
• Factors used in the forecast
• Product Positioning
• Key points
• Premium yogurt claims command premium price
  • Figure 12: Prices of pot yogurts with functional claims compared with other yogurts, 2008
• Price premium less obvious in newer markets
  • Figure 13: Prices of selected grocery products with functional claims compared with other conventional product, 2008
• Companies and Products
• Key points
• Principal functional food brands
  • Figure 14: Leading functional food brands with a heart health claim, 2008
  • Figure 15: Leading functional food brands with a digestive health claim, 2008
  • Figure 16: Leading functional food brands with a general health claim, 2008
  • Figure 17: Leading functional food brands with other health claims, 2008
• Companies with major functional food brands
• Danone SA
• Actimel
• Activia
• Danacol
• Essensis
• McNeil Nutritionals
• Benecol
• Unilever UK (Flora)
• Flora
• Müller Dairy (UK) Ltd
• Vitality
• Müller Corner
• Müllerlight
• Provexis
• Yakult UK
• Companies with functional food variants
• Conival plc
• Kellogg
• Allied Bakeries
• Noble Foods Ltd
• Alpro
• Dairy Crest
• So Good International
• Tropicana (PepsiCo International)
• Warburtons
• Yeo Valley
• Brand Communication and Promotion
• Key points
• Adspend big but on the decline
  • Figure 18: Promotional spend on main functional food brands, by category, 2003-07
• Yogurt spend reducing
• Flora dominates spreads spend
• Promotional spend on liquid milks drops substantially
• Breakfast cereals and breads pushing hard
• Cheese the new growth area?
• Channels to Market
• Key points
• A considered purchase
  • Figure 19: Estimated retail sales of functional food and drinks, by distribution channel, 2003-07
• Own-label has not developed
• The Consumer -- Purchasing Behaviour
• Key points
• Yogurts and spreads lead the way
  • Figure 20: Functional Food product purchased, January 2008
• ABC1s prefer yogurts and C2s go for spreads
• Consumers don' t define functional foods
• The functional breakfast for younger consumers?
• Functional for children
• Repertoire analysis
  • Figure 21: Number of different types of functional foods bought for self, January 2008
• Appendix: Introduction
• Glossary of terms
• Advertising data
• Appendix -- Internal Market Environment
  • Figure 27: Agreement with selected lifestyle statements, by demographic sub-group, 2007
  • Figure 28: Agreement with selected lifestyle statements, by demographic sub-group, 2007
• Appendix -- Broader Market Environment
• Changing population dynamics
  • Figure 29: UK population changes in socio-economic status and age, 2002-12
  • Figure 30: UK population changes in household size, 2002-12
  • Figure 31: Health conditions controlled or prevented through my diet, by socio-demographics, January 2008
  • Figure 32: Health conditions controlled or prevented through my diet, by socio-demographics, January 2008
• Appendix -- The Consumer -- Purchasing Behaviour
  • Figure 33: Functional foods ever purchased, by detailed demographics, January 2008
  • Figure 34: Functional foods ever purchased, by detailed demographics, January 2008
• Repertoire analysis
  • Figure 35: Number of functional foods bought for self, January 2007 (row %)
  • Figure 36: Number of functional foods bought for self, by health conditions respondents try to control/prevent through diet, 2008 (column %), January 2008
  • Figure 37: Number of functional foods bought for self, by types of products bought, January 2008 (column %)