Functional and personal: NZMP highlights top trends shaping dairy food and beverage manufacturing 

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26 Mar 2018 --- NZMP, Fonterra’s global dairy ingredients B2B brand, has released its insights into business-shaping forces in the dairy industry, ranking naturally functional food ingredients and personalization as the top global consumer food and beverage trends. 

“NZMP teams in over 130 markets are seeing a renewed focus on foods that suit individual lifestyles, beliefs and desires for new experiences. As a result, there’s plenty of unmet need and exciting potential that manufacturers could capture with the right products and stories,” says Gillian Munnik, NZMP Marketing Director.

“At a macro level, we are continuing to see global shifts that shape the way we live as consumers and the way we do business as companies. Urbanization, demographic changes, developments in technology – all constantly influence consumer behaviors, including the way food and beverage products are being consumed year on year. NZMP monitors how these behaviors are evolving.”   

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Gillian Munnik, NZMP Marketing Director

“Five trends stand out for their ability to shape the future growth of the dairy industry,” says Munnik.

Naturally functional 
“New Nutrition Business calls this the king of all trends because of its broad influence and overlap with most of the other trends,” says Roshena De Leon, NZMP Global Insights Manager.    

“We will continue to see consumers preferring natural options to tap into the nutritional values of food. This comes to life either through consuming foods that are perceived to deliver therapeutic benefits, ‘food as medicine’ or looking for the intrinsic health benefits associated with certain food ingredients,” says De Leon.    

The popularity of naturally functional foods is a major drive for high-protein foods, according to NZMP. Research indicates that dairy protein stimulates muscle growth and in countries like China and Japan, it’s ranked number one in terms of importance for maintaining health and wellness versus other nutrients. 

Speaking to NutritionInsight during a press visit to the company's facilities in New Zealand in December, Munnik noted that the protein space is “without a doubt” set to continue to be one of the key drivers of innovation within the company.

Well over 40 percent of global food and drinks launches tracked by Innova Market Insights in 2016 were positioned on a health platform of some kind, with just 11 percent being positioned on an “active” or functional health platform. According to the market researchers, consumers are increasingly looking for inherent health benefits from natural ingredientswhich convey better-for-you appeal. 

Personalization and fragmentation
Personalization and customization have taken their place as key drivers in the nutritional space. 

James Dekker, NZMP Program Manager Nutrition and Health, says, “Increasingly consumers will choose a product based on the promise that it addresses their particular dietary requirements.  This will cause further fragmentation of categories and markets, meaning companies will have to find the best way to efficiently and effectively cater to various consumer segments, or identify the ones that provide most value.”

“The next progression of this trend sees consumers making decisions based on their uniqClick to Enlargeue genetic profile, metabolism or disease risks.”

“A small, but growing, group of consumers are increasingly open to a more science-based approach to personalization. These are the consumers wanting to make changes in their diet based on their individual needs, be it through DNA testing, microbiome profiling or other tests,” says Dekker. 

Innova Market Insights has echoed this sentiment in its Top Ten Trends report for 2018, stating that personalized nutrition, made possible through technologies like AI, is emerging a strong emerging market.

Full disclosure
Transparency and traceability have become key.

“There is a renewed consumer focus on a democratization of transparency and traceability,” says De Leon.

“The trend of full disclosure means manufacturers need to extend transparency and traceability to products for all consumers, not just those shopping at the premium end of the market,” says De Leon. 

The consumer demand for knowledge is clear from recent consumer studies. A 2017 Innova Market Insights consumer study found that one in two US, UK and German consumers read the ingredient label often and 7 in 10 Chinese consumers check claims & logos front-of-pack, while 7 in 10 US and UK consClick to Enlargeumers want to know and understand the ingredient list.  

The notion of “real ingredients” is key for concerned consumers and a clear opportunity to achieve differentiation. In fact, 23 percent of Chinese consumers find “made with real ingredients” to be the factor most influence their purchasing decisions when buying food & beverages (2017). In the US this figure was 21 percent and in the UK it was 17 percent. 

Snackification 
As traditional meal times and occasions become less prevalent and people seek quick, convenient, yet healthy solutions for busy lifestyles, we are seeing snacks that are not only healthier but are also more wholesome, satisfying, sustaining and nutritious. This is creating opportunities for snacks to increasingly fulfill the role of mini meals and play a more meaningful role contributing to nutritional needs across the day. Snacks are not only becoming healthier, they are also becoming more , sustaining and nutritious, blurring the boundaries between snacks and meals. 

“Hypermobile lifestyles favor food that can be consumed in non-traditional environments and situations,” says De Leon.

“Leading food and beverage manufacturers will be thinking about how their product portfolio can be consumed on the go. Within dairy we anticipate a rise in ambient-stable products, protein-rich snacks and packaging that suits on-the-go snacking,” She adds

New sensations 
According to a 2017 Innova Market Insights consumer study, novelty and variety is driving positive purchase behavior for 1 in 10 European (Germany, UK, France, Italy and Spain) and North American (US and Canada) consumers.

“The way we consume food has evolved significantly especially with the development of technology and social media. While taste remains at the forefront, being ‘instagram-able’ and share-worthy has become a big plus,” says De Leon.  

by Lucy Gunn

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