New categories at play
The first quarter of 2013-2014 saw Dabur launching a host of new products and variants across geographies, all of which have received encouraging response. In the domestic market, Dabur launched India’s first drinking yoghurt under the brand Réal Activ, besides a range of super-fruit juices under the brand Réal Supafruits. The quarter also saw the launch of India’s fi rst gel-based facial bleach under the brand OxyLife. In the overseas market, Dabur launched a range of hair care products like shampoo, conditioner, hair oil and hair colour under the brand Vatika, besides a range of Fem hair removal wax.
Soft drink concentrate maker Rasna launched four variants of Rasna Fruit Fun at starting price point of Re 1 for two glasses in Nagpur Orange, Alphonso Mango, Shikanji Nimbupani and Chowpatty Kalakhatta flavours, this summer – all at the same affordable pricing. Claimed Piruz Khambatta, the company’s Chairman and MD, “Rasna has always maintained constancy in its pricing strategy, and Rasna’s new range of fl avours are also priced at an economical price.”
The company had undertaken extensive research to identify fl avours which consumers would enjoy, and would be familiar with, such as Kesar Elaichi and Shahi Gulab Rose on the premise that consumers tend to identify and relate certain ingredients with a specific region more strongly than others. Following its foray into the ready-to-drink fruit juice segment with the launch of Ju-C, there will be more launches of new products in the coming months, one of which will be vitamin added water, informed Khambatta.
Shift to Health and Safety
Consumers have become aggressive in demanding better and safer food products and are willing to pay higher for goodness of health. This reflects opportunities mainly into product innovation, specialised products and product extension for various existing food processors or new entrants. According to Technopak Advisors, there is always a need for product innovation as consumers now a days would not just like safe but useful additives as well. The emphasis of usefulness has slowly shifted from useful in processing or useful for manufacturer to useful for consumers.
The research advisory envisages that changing consumer dynamics in terms of elevated spending pattern and health consciousness will “seed the demand for new, narrowly tailored food products in the market.” For instance, for players operating in the health and wellness product segment, the development of new ingredients has enabled processing of new, value-added products, yet issues remain with different process ability, acceptance and shelf life. It is also important for the food processors to communicate the potential health and wellness benefits to the target consumer segment.
With more companies focussing on products with a strong health and wellness quotient, marketing efforts on branding and communications will also increase, which will further fuel consumer awareness of healthier options. For instance, a couple of years back, Nestlé communication stated that “the company is shifting from an agri-food business to an R&D-driven nutrition, health and wellness company” (which validates the changing behaviour of major food processors). Similarly, many other food processing majors like Kellogs, PepsiCo, and Coca-Cola have transformed their product offering with a health and wellness element.
Validating Claims of Healthy Offerings
Introductions of foods and drinks making a high protein claim are almost three times higher in the US than anywhere else in the world, accounting for 19 percent of global new product launches in 2012. This makes the US the biggest market by far for high protein products, as India and the UK follow with 9 and7 percent, respectively, of new food and drink launches with high protein claims in 2012.
Products launched in the US with both a high protein and vegan claim have shown a steady increase since 2008, posting 54 percent growth in the past fi ve years (to 2012). As per research by Mintel, high protein products appear to be one of the most sought after nutritional choices from balancing diet, building muscle, to weight loss, and they are also tapping into the wider satiety trend (87 percent of US consumers indicated satiety as an important food attribute). Demand for high protein products is also coming from consumers who are avoiding animal sources of protein for either health, environmental, or ethical reasons. According to Nirvana Chapman, global food science trend analyst at Mintel, “The opportunity exists for value brands to add cost-effective protein to products to entice a larger consumer segment.”
In addition to a large number of launches, foods making high protein claims span a wide array of categories, well beyond naturally protein rich foods such as meat, poultry, and fish. Snacks, for example, dominate the category – accounting for 20 percent of the high protein food and drink new product launches in the US in 2012, followed by meal replacement and other fortified drinks (17 percent) and spoonable yogurt (15 percent). Protein use in meal replacement and sports beverages making high protein claims posted a 37 percent growth in the past five years.
Globally, the percentage of food and drink products launched with a slimming claim in the past fi ve years are trending upwards. Mintel’s research shows triple digit growth – up 140 percent between 2008 and 2012 globally. “In the weight management industry, there is an upward trend towards products that combine whey protein, peptides, and calcium for weight loss. Manufacturers can capitalise on this opportunity to educate and entice consumers with protein to meet various needs,” said Chapman.
According to Mintel, new product development declined by 12 percent in North America during 2012, with brands responding to falling consumption of meat, poultry and fi sh, particularly in the US. Product numbers are, however, still higher than in 2008, thanks to a 54 percent year-on-year increase in 2010.
Patronising Green, Natural and Organic
Research by Technopak reveals that consumers are demanding green products and patronising brands that have adopted green practices. In most developed countries, they are becoming more concerned about how and where products are produced, including details of the consumption of energy during production and distribution and energy effi ciency of retail sales operations.
As a result, trends such as organic and naturally grown foods, sustainable agriculture, energy efficient manufacturing equipment, transport and retail and eco-friendly packaging are gaining importance in the food processing and agriculture industry. More and more food and beverage companies are realising that going green not only fulfils social responsibility but also contributes to profit in the long run. Examples include organically grown fruits and vegetables, snack chips and beverages made with solar-heated water and oil, biodegradable packaging (from glass jars to plastic bottles and paperboard cartons to flexible packages).
A Mintel report on the sauces and stocks category reveals that natural claims continued to be made by brands, who are keen to bundle these products with artisanal features and ingredient provenance. as demand for these type of products is increasing. But according to Mintel, given the controversy and cynicism around all-natural claims, it would be more suitable for products to be positioned as pure, simple and free from certain ingredients, rather than all-natural. In fact, low-in claims such as reduced-salt, -calorie and -fat products are in particular demand.