Food & Beverage Market
A majority of Europeans understand the importance of positive nutrition. According to a 2014 Datamonitor Consumer Survey, presented by Vitafoods Europe’s Mark Whalley, 56% of Europeans are using food and drink to improve health, and women (60%) are bigger believers than men (51%). The survey also suggests that 19% of Europeans consume functional food and drink products a few times a week. The future of European’s functional foods and drink market appears to be heading into a more natural, protein, and nutritionally dense content direction.
Due to the maturity of the European market, predominately in Western Europe, growth expectations from 2014-2019 are not projected to gain much in size. It, therefore, will be beneficial for functional foods and drink marketers and companies to focus on specific trends within the region before entering into the market.
After general wellness, weight management is the largest platform for functional food and drink sales in both Eastern and Western Europe—with value sale amounting to US$57.1 billion in 2014, according to Euromonitor International statistics. The highest trends in weight management products involve protein and nutrient dense products. The high protein trend is likely going to have a pronounced impact in the European marketplace, as protein is believed to moderate cravings and maintain lean muscle tissue. The trend, which began in the US, is becoming extremely popular in Europe. Functional foods and drink products that include high levels of protein are projected to be a major hit in the forecast. Products that are carbohydrate based, or have an abundance of carbohydrates are not doing well. Instead, consumers are attracted to products with “supergrains,” such as quinoa, oats, flack seed, teff, and buckwheat in the ingredients. Snack foods, breakfast cereals, and bakery products that remain innovative, incorporating supergrains and protein, will likely remain popular to European consumers.
Other popular products in Europe are ones that focus on enhancing beauty from within. Although that can sound quite preposterous, these products will prove to be the most dynamic over the 2014-2019 forecast in both Eastern and Western Europe. In terms of value growth, products positioned as enhancing beauty from within are projected to grow 58% in Eastern Europe and 30% in Western Europe in the next five years. Functional foods and beverages that incorporate collagen, the body’s top structural protein, will likely exert significant more traction than it has in the previous years. Of course, the consumption of vegetables and fruits are linked to health and beauty, and consumers are attracted to functional foods and beverages that incorporate these ingredients.
Functional beverages are hot in the European market. According to Euromonitor International statistics, over half of the total vitamins and minerals in Europe in 2012 were consumed through functional beverages. Sparkling waters fortified with vitamins and minerals are one of the most popular beverages bought by consumers. Functional products that are “better for you” are also becoming increasingly popular all throughout Europe. Value-friendly products that are natural, yet gluten-free, sugar-free, lactose-free, or fat-free are represented heavily in the new, 2015 product launches.
Even though the functional foods and drink market is relatively mature in Europe, there is an absolute wealth of opportunity for new distributors and innovative products. Nearly three-quarters of European consumers state that they are not loyal to specific brands. In 2014, the top five players in the European functional foods and drink products market held only 15% of total value sales. Private label is increasing its share, and in 2014, it accounted for 20% of the total market sales (23% in functional foods and 17% in functional beverages). Distribution from supermarkets is losing share to the penetration of private label, predominately due to Internet retailing. A growing number of manufacturers are successfully developing their own Internet distribution channels, in addition to selling to third-party distributors.
