Ranjan Sharma Functional Dairy Beverages Market Trends …users.telenet.be/bart3/Danone/Ranjan%20Sharma%20-%20Functional... · Lifestyle, consumer marketing beverages ... Malaysia

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Market Trends and Opportunities for Functional Dairy Beverages

Ranjan Sharma


Outlines

• Introduction and background• Current market trends in functional

dairy beverages• Opportunities & strategies• Challenges• Conclusions


Introduction and background

• Resources for market intelligence and trends• Food specific

• New Nutrition Business • Novis e-Newsletters • Nutritional Business Journal• Food Technology magazine• Functional Foods and Nutraceuticals magazine• Just-Food/Just Drinks.com• Health Focus Strategy• Others….

• Food inclusive• Nutraceuticals World magazine• Mintel (e.g. GNPD database)• Market research companies (Datamonitor,Euromonitor, BCC, Market Research, etc.)


Introduction

• Resources for market intelligence and trends• Food company Websites

• Media releases• Annual reports

• Other resources• Other media Web sites (newspapers, TV, Research

Journals, etc.• Trade journals• Company profiles (e.g. IBISWorld, Hoovers, etc.)• News feeds (e.g. RSS feeds)


Introduction

• There is a massive amount of information and often confusing for manufacturers and consumers

• Nutritional and clinical studies are abundant and highly relevant, but can be biased and inconclusive

• There are a number of food fads that affect the whole food value chain• E.g. low-carb is OUT and low-GI is IN


Consumer and market trends

New Nutrition Business*

1. Health2. Intrinsic health3. Good foods, bad

foods4. Good carbs, bad

carbs5. Personalised

nutrition6. Bars and beverages7. Daily dose and

packaging innovation8. Out of supplement

aisle9. Asia for inspiration10. Kids nutrition crisis

Food Technology**

1. Quick fix2. Drive & Go3. Inherently healthy4. Premium foods5. Farm-friendly,

organic, natural6. Ethnic flavours7. Grazing8. Low or no claims9. Self medication with

food10. Global brands

USDA***

1. Pleasure2. Convenience3. Health4. Well being5. Ethics

*New Nutrition Business, Dec-Jan 2005** Food Technology, April 2005***USDA GAIN Report E35067 Apr 05


Summary

• Three most identified trends/drivers for functional foods innovations• Pleasure• Convenience• Health

• Each of these drivers require in-depth analysis and compliance to succeed in the market


Summary - Three key drivers/trends

Pleasure

Health

Convenience

•Nutrition•Low claims (fat, calorie, sod., carb etc)•High claim (e.g, Ca, fibre, omega 3, etc)•Physiological functional claim

•Packaging•Pack size•Availability(Time/place)

•Taste•Flavour•Colour•Texture


Global functional foods market

Global functional foods & beverage sales, 2003

0

5

10

15

20

25

30

Beverages Dairy Bakery & snacks

Sales 2003, US$ billion Growth % (CAGR 1998-2003)

Euromonitor, 2004


Functional food major markets, 2003

Global functional foods & beverage sales

02468

101214

Japa

n

USA UK

German

y

Italy

France

Brazil

US$

, bill

ion

Euromonitor, 2004


Global functional foods by functionality

Global functional foods by functionality 2003

42%

19%

18%

10%

2%9%

Sport & enery

Added vitamins, minerals orsupplementsPromotes intestinal health ordigestionAdded calcium

Lowers cholesterol

Other

Euromonitor, 2004


US functional foods - 2003

922.8Total85.2All other41.1Tea & coffee drinks

102.5Dairy & dairy alternatives

62.2Juices132.3Snacks & bars14.2Breads & grains195.3Sports & energy drinks

Growth rate (% vs 2002)

Size (US $ billions)

Category

Nutrition Business Journal


Functional dairy products - Market share 2003

48%

37%

14% 1%Liquid & powder milk

Yogurt & chilleddessertsOils & fats

Cheese

Global functional dairy products

Euromonitor, 2003


Dairy companies of today!

www.natrel.ca


Trends & innovations in the dairy beverage market

• Pleasure & indulgence• Lifestyle, consumer marketing beverages• Functional, health and wellness beverages• Adult medical/complete nutrition• Sports & performance


Pleasure & indulgence

• Flavoured milk• Milk-coffee drink• Milk-tea (Chai Latte)


Flavoured milk trends – recognised confectionery brands


Flavoured milk – targeting kids

Bubble gum Flavour carbonated(Mac Farms)

Concentrated milk(Regilait, Fr)

Swerve (Coca-cola)

Cadbury


Dairy-coffee beverages

Caffe Latte(Emmi, Swiss)

Cappucino(Starbucks/Pepsico)

Namyang(Korea)

Meiji, Japan

Nestle,Japan


Dairy-tea beverages

Oregon Chai

Starbucks

Lipton Chai


Lifestyles & consumer marketing beverages

• Low-fat• Fat-free• Low-carb• Organic• GM-free


Low-fat milk

Low-fat, lactose free


Fat-free milk


Low-carb dairy beverage


Organic dairy beverages

Organic Valley, US Rachel’s UK

Paul’s, Australia

Candia, Fr


GM free milk

Tiroler, Austria

UK Consumers Willing to Pay More for rBGH-Free Milk (genetically engineered growth hormone rBST(recombinant bovine somatotropin).


Functional, health and wellness beverages

• Fortified with• Minerals (Calcium, Magnesium, Iron)• Omega-3 fatty acids• Conjugated linoleic acids (CLAs)• Phytosterol• Lactoferrin• Peptides

• Milk rich in melatonin• Probiotic yoghurt drinks


Fortified milk - calcium


Fortified milk – Mg & Iron

Mg (Candia, Fr) FeMg (Lactalis, Fr)

Fe (Meiji Love)


Fortified milk - Omega –3 fatty acids

Candia,France

Natrel,Canada

PB Foods, Australia

Nestle,Malaysia

Anchor, NZ


Neilson, Canada

Fortified milk - Omega –3 fatty acids

Dawn, IrelandSt Ivel advance (Dairy Crest UK)


Beverages with dairy bioactives

CPP and IgG rich milk


Fortified milk – Conjugated Linoleic Acid (CLA)

NaturLinea, Spain


Fermented milk – peptides

Peptides (Valio)


Milk with phytosterol

Phytosterol (Unilever)


Melatonin rich milk

UK Finland UK

www.night-time-milk.com


Trends in functional yoghurt drinks

• Probiotic• Yoghurt smoothie• Lactoferrin• Plant extracts• Antioxidants• Fibre• Peptides


Probiotic drinking yoghurt revolution

http://www.actimel.com

http://www.yakult.com.au

www.OzScientific.com39 As reported by Group Danone Health Commitment and Fact Book, March 2005

www.OzScientific.com40 As reported by Group Danone Health Commitment and Fact Book, March 2005



Probiotic drinking yoghurt

National Foods, Australia

Emmi, ItalyNestle, Japan

Danone


Probiotic innovation

LifeTop Straw(Biogaia, Sweden)

LifeTop Cap (Biogaia, Sweden)


Drinking yoghurt with phytosterols

Flora Proactiv(Unilever)

Benecol (UK)

Benecol (Valio)

Emmi

Blue Bunny (US)


Innovations in drinking yogurt

LecithinYoghurt drink(Alpenmilch Saltzberg) Aloe Vera

(Emmi)

Bonne Nuit with plant Extracts (Novandie, Fr)


Innovations in drinking yoghurt

With Mg (Danone,Belgium)

With green tea(Morinaga, Japan)

Black fruit pulp(Poland)


Yogurt drinks with lactoferrin

With L.casei andLactoferrin (Kyodo Milk)

With lactoferrin(Morinaga)


Innovations in drinking yogurt

With protein,Vit. & minerals(Glanbia, Ireland)

With protein,Fibre, vit & minerals(General Mills, US)

Probiotics withcranberry juiceOcean Spray, US


Adult medical/complete nutritional beverages

• Meal replacement nutritional supplement

• Disease-specific beverages


Complete nutritional beverages –pharmaceuticals to consumers

www.ensure.com


Complete nutritional beverages

Power Bar PriaNestle

Novartis

Novartis Ross Abbott


Complete nutrition - liquid breakfast

Aussie Bodies, AU

Sanitarium, AU Meadow Fresh, NZ

Carnation Junior, Nestle


Sports and performance

• Sports beverages• Whey-based drinks


Sports/performance beverages


Opportunities and strategies

• Analyse market and meet consumer needs and demands• Growing affluence in developing world

• Increased affordability• Lifestyle diseases in developed world

• Target Obesity – opens up markets for CVD, diabetes, cancers etc.

• Aging population• Dairy from birth• Globalisation• Consumer awareness and self medication• Individualised nutrition

• Nutragenomics



• Dairy bioactives not yet fully exploited in beverages• Peptides, immune and growth factors,

lipids, etc.)• Looking beyond dairy for bioactives

• Forging partnerships with non-dairy bioactive ingredient companies

• Developing novel milk beverages• Clear milk beverages from skim milk or

proteins for wider acceptability



• Promoting dairy as a preferred carrier for bioactive ingredients• General acceptability• Flavour• Inherent nutrition• Convenience


Challenges

• Lack of knowledge/understanding• Food technologist/scientist has limited

understanding of human physiology• Nutritionist/health professional does not take into

consideration of intricacies of food formulations• Conflicting and biased nutritional studies• Challenges of market fads

• Communication gap• Among food technologist, health professional,

nutritionist, marketer• Regulatory hurdles

• Working along regulators or working around regulations?


Challenges

• Formulation challenges• Non-dairy ingredients incompatible in dairy

environment – stability issues• Ingredient interactions • Efficacy issues• Safety issues

• Innovation challenge• Low R&D investment (Australia – 0.3% of TO vs

0.8-1.2% worldwide)• Risk averse nature of food companies – not leading

from front?• Where is the IP?• Companies wanting to have immediate ROI


Thank you !

• OzScientific offers independent, cost-effective and innovative solutions for functional & bioactive ingredients• Business intelligence: Market intelligence,

Strategic analysis and Innovation management• Ingredient innovations: Concept to

commercialisation• Ingredient knowledge: Desktop scientific and

technical reviews•Industry intelligence on functional foods (free newsletter!)OzScientificTM Weekly Digest

• Australasian functional food resources (under development)

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Ranjan Sharma Functional Dairy Beverages Market Trends …users.telenet.be/bart3/Danone/Ranjan%20Sharma%20-%20Functional... · Lifestyle, consumer marketing beverages ... Malaysia