The days when consumers only considered appearance, taste, texture, and smell when deciding what to eat are now behind us. While these factors remain significant, manufacturers aiming to boost their sales and profits must offer additional benefits through their products. Functional claims have evolved from being niche to becoming essential in today’s market.
The functional foods sector is experiencing rapid growth. According to Zion Market Research, the global market for functional ingredients was valued at $64.9 million in 2018 and is projected to approach $100 million by 2025, reflecting a compound annual growth rate (CAGR) of 6.74%. The United States leads this market, which is anticipated to grow at a CAGR of 8% through the end of 2021, as reported by Technavio.
What has sparked the rising interest in functional foods? A significant factor is the increased availability of information. Consumers are no longer placing blind trust in health advice from doctors and medical professionals; instead, they are turning to online resources to learn more about various foods and ingredients. This shift is evident in the surge of online searches for superfoods. For instance, turmeric gained recognition in 2016 as a “rising star” according to Google Trends, reflecting a significant increase in online searches for the vibrant yellow spice.
As consumer interest in functional foods grows, manufacturers and restaurants are adapting, leading to a more widespread presence of functional ingredients. Retail revenue for turmeric-containing products has skyrocketed by 179% in just three years, according to Nielsen statistics cited in Kerry’s white paper. Also, ginger, known for its immune and digestive support, appears on 55% of restaurant menus nationwide, according to Datassential Menu Trends referenced in the same report. Apple cider vinegar, recognized for its digestive benefits and blood sugar regulation, has surged by 86%, and the availability of kombucha on restaurant menus has increased by 71% over the past year, as noted in a Mintel report.
Despite the growing prevalence of functional foods, there remain ample opportunities for manufacturers to enter this market. While bars, shakes, yogurts, and powders are common vehicles for delivering functional benefits, the study highlights unconventional options that may pique consumer interest. Coffee stands out as a prime candidate. Beyond its primary benefit of providing energy through caffeine, survey participants identified coffee as one of the top five items they associate with health benefits. According to Mintel statistics cited by Kerry, two in five consumers desire coffee that supports brain health, and a third are interested in probiotic coffee. Several brands, including Starbucks and Monster Energy, are beginning to embrace the functional coffee trend.
Moreover, indulgent treats present another avenue for manufacturers to incorporate functional elements. While it might not be entirely accurate to label a cookie as “healthy,” manufacturers can emphasize better-for-you ingredients that contribute to overall health. Some innovative treats successfully blend indulgence with function, such as Unilever’s Culture Republick ice cream, which is packed with protein and probiotics. However, manufacturers should exercise caution to avoid the so-called “jelly bean rule,” which involves adding nutrients to unhealthy products merely to alter their image.
As we explore the benefits of functional foods, it is essential to consider specific nutrients that can enhance health, especially for specific demographics. For instance, the combination of calcium citrate, magnesium, and zinc with vitamin D3 is particularly beneficial during pregnancy, supporting both maternal and fetal health. By integrating such targeted functional benefits into their offerings, manufacturers can cater to the evolving demands of health-conscious consumers.