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Underlying forces will continue to drive functional food growth, analyst says

By Hank Schultz

09-Jun-2014

Supplement users seeking nutrition in food form drives sector, consultant says
Supplement users seeking nutrition in food form drives sector, consultant says

The hot market for functional foods shows no signs of cooling off, according to longtime industry consultant Jeff Hilton.  In his view a number of factors will combine to drive continued growth.

 

“I think functional foods and beverages are going to be the hot category for the next decade,” Hilton, co-founder and chief marketing officer of Salt Lake City-based consultancy BrandHive, told NutraIngredients-USA. “Functional foods as a category has global momentum.  The market in the United States is leading the way in terms of the breadth of offerings.  Consumers here are a little bit further down the road in terms of what ‘functionality’ means,” he said.

Vague term, but concrete benefits

'Functional food' is really a term born in the minds of consultants who work in the sector and analysts who write about it.  It’s not a term that a consumer would understand. But even if they couldn’t offer a definition of what a functional food is, they know it when they see it, and are not shy in acting on that knowledge.  In the US it started first perhaps with the vitamin loading of breakfast cereals.  Really, no cereal outside of the organic or 'natural' offerings can find space on the shelf now without some functional benefit, whether it’s a meal’s worth of vitamins (generally 25% or 30% of the RDA of given nutrients) or some other functional addition, such as added protein or fiber. 

And that functionality is now finding its way into other categories, such as sports nutriton or healthy aging.  The ramifications of these movements will be explored in an online forum on functional foods that will be put on by NutraIngredients-USA on June 30.  Hilton will be among the speakers for the event.

Hilton said the growth of dietary supplement usage is part of the push that buoys the growth of functional foods. Consumers understand the need for certain nutrients, and are looking to get them in different, perhaps more pleasant ways.

“For the traditional supplement user between pill fatigue and dosge innovations there are some real opportiunities for functional foods.  If consumers can get the nutrition they are looking for in the form of foods and beverages that’s really everybody’s preference,” Hilton said. 

Protein is king

In terms of ingredients in these foods, one stands head and shoulders above the rest, and that’s protein, Hilton said.

“Protein is just amazing in terms of how aggressively it is growing. One of the reasons why protein is so hot is that it sits on both ends of the age spectrum, and in between. You’ve got younger body builders who are interested in it, and middle-aged weekend warriors who are looking to protein to help maintain fitness.  And then you have older consumers who are looking at protein for its anti-wasting benefits.  So it really drives at all ages,” Hilton said.

“Among the grains, the protein-rich grains are really hot.  Chia, quinoa and hemp.  And as for superfruits, I don’t think we’ve seen the end of that story by any means,” Hilton said. “As far as the antioxidant benefits of superfruits are concernced, consumers can’t really tell you the free radical story, but they get that these ingredients are healthful.”

Beverages lead the way

One of the areas in which superfruits have figured most prominently is in beverages, and Hilton said beverages lead the way in functional foods overall for a variety of reasons.

“Beverages have always led the way in terms of functionality.  It’s accessible, and easy for consumers to wrap their heads around. And it’s an easy commitment to buy a single serving can. That’s why I think inherently functional products like coconut water are so popular.  And recently I’ve seen maple water, and artichoke water and a product based on aronia berries. 

“On the food side, healthy snacking is massive.  It ranges from the better-for-you products, basically better versions of things you might already eat, to hardcore things like seaweed snacks,” Hilton said.

In addition to Hilton, speakers for the June 30 online forum will include Jason Sapsin, an attorney with the firm Fox Rothschild, Eric Schnell, CEO of the functional food firm and brand development agency Metabrand, and industry consultants Risa Schulman, PhD and Kantha Shelke, PhD, who are principals in the consultancies TapRoot and Corvus Blue, respectively.

For more information on the forum, click here .

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