PB Leiner flags growth potential of collagen peptides beyond early growth stage

23 Apr 2021 --- Collagen peptides are currently in the early growth stage, but their potential is still “far from fully explored.”

This is according to PB Leiner product manager Yingying Wu, who shares how collagen peptides’ current market stage influences the company’s long-term business strategy with NutritionInsight.

Where to begin
The dynamic lifecycle of health ingredients takes years to develop. Wu explains the phase usually starts with the increased popularity of a given health ingredient within a niche. 

“This could be either based on a specific geography, as in the case of omega 3’s popularity in Nordic countries, or specific benefits, as with whey proteins in weightlifting and bodybuilding applications.”

In the case of collagen, its applications have been known for decades, says Wu, with an early market focus on beauty in the Asian market. 

PB Leiner aims to introduce peptides to F&B applications, but issues with taste and smell remain.In the initial stage of growth, an ingredient’s expansion is usually driven by scientific research. 

“A first major study supporting the health claims of collagen peptides was published in 2003. Since then, more than 300 scientific papers on the health benefits of collagen have been published,” Wu points out. 

A shift to early stage
More studies drive market growth and vice versa, leading to increased consumer awareness, new product and application developments, stimulating delivery format innovation.

When companies begin to explore technological advances in manufacturing, this spurs an ingredient from the initial phase to the early growth stage. 

“Processing efficiency is a key element, as producing the ingredient must be cost-efficient for the final product to be affordable for the general public. All types of collagen were successfully extracted in the early 1990s,” Wu details.

Market barriers to consider
However, the peptides sector also has some challenging facets. In the medium stage of growth, health ingredient manufacturers seek ways to incorporate an ingredient into common foods to expand the base of potential consumers. 

Here, the key challenge is to overcome organoleptic issues, such as taste and smell. “Despite the advances in technology, obtaining premium quality collagen products with excellent organoleptic and dissolution performance has been hard to master.” 

She notes “only a handful of players” in the market can achieve the highest quality in a consistent way. 

Collagen peptides tick the boxes in various healthy aging subtrends, but less so in the plant-based scene.In more practical obstacles, there are no European Food Safety Authority (EFSA) health claims for collagen yet. Despite increasing consumer awareness of collagen as a health ingredient, consumers’ understanding of its health benefits is “still rather limited.”

Reconciling with low market penetration?
PB Leiner points out that collagen peptides have low market penetration across Europe, North America and Asia-Pacific compared to probiotics, plant proteins, or soluble dietary fibers.

This is expected, however, considering that collagen still situates itself in the early growth phase. “It indicates huge untapped potential for growth,” Wu explains.

She sees North America as the region with the highest market penetration rate, with collagen growing into the mainstream category in the US. 

“For example, consumers can easily buy collagen powder in different supermarkets, while a few years ago this would not have been an easy task.” 

On top of industry trends
Different industry trends are projected to positively influence PB Leiner’s business growth. “Healthy aging, for example, includes different aspects to support the improvement of life quality in aging populations,” says Wu. 

She lists mobility, bone and joint health, muscle health, protein supplementation. Other trends include beauty-from-within, dietary trends such as keto and paleo, and sports nutrition going mainstream. 

The development of collagen peptides is “certainly on the right track” to exit the early growth stage.Further evidence of this trend, Innova Market Insights data observes a 32 percent average annual growth in F&B launches tracked with an aging well claim (2017-2020).

However, not all current industry trends align with PB Leiner’s business strategy. “Collagen being an animal-based ingredient goes against the popular plant-based trend,” Wu notes.

Indeed, Innova Market Insights has tracked plant-based’s growing popularity in its top F&B industry trends over the past few years. A “Plant Forward” mindset continues into 2021, ranking second in the market researcher’s Top Ten Trends this year.

Conscious of this trend, PB Leiner offers certified grass-fed collagen and will present upcoming marine collagen as “increasingly popular” alternatives. 

Predicting early growth stage exit 
While some regions might move out of the early growth phase faster than others, it is difficult to predict the exact timing, says Wu.

“When we look at the success stories of more well-known and established health ingredients, such as whey and omega 3, the timeline of their early growth phases varies from 10 to 25 years.”

Moreover, several factors can positively impact the growth curve, introducing new energy to facilitate further growth and extending the length of this phase. “We believe the development of collagen peptides is certainly on the right track,” Wu concludes.

By Anni Schleicher