Since sugar has been labeled public enemy No. 1, manufacturers worldwide have rushed to find suitable alternatives that provide the sweet flavor consumers desire without the health risks associated with sugar. While numerous options exist on the market, artificial sweeteners have faced significant scrutiny, leading to a growing interest in natural sweeteners, with stevia emerging as a leading contender. In 2018, the launch of new foods and beverages containing stevia sweeteners saw a remarkable growth of 31%, up from an 11% increase in 2017. Notably, Coca-Cola introduced a stevia-sweetened soda in New Zealand that same year, while Danone’s Light & Fit yogurt incorporates both stevia and sugar. Furthermore, last summer, Nestlé launched a stevia-sweetened version of its Milo chocolate malt beverage in Australia.
Despite the global enthusiasm for stevia as a natural sweetener, consumer preferences and acceptable flavors vary widely across different regions. Stevia is often criticized for its unpleasant aftertaste, reminiscent of metal and licorice. Consequently, stevia companies are focused on developing plant varieties and extraction methods that mimic the taste and qualities of sugar more closely. SweeGen has taken the initiative to establish application testing centers, allowing consumer packaged goods (CPG) manufacturers to experiment in real-time with masking agents and flavor profiles tailored to regional demographics. This approach empowers manufacturers to create unique solutions with a local perspective, leveraging market research and proximity to customers to target high-margin products that resonate with consumers.
Last year, Nestlé Waters adopted a similar strategy by transitioning brand management to local oversight, aiming to respond to the rapid growth of local water brands. By managing international brands at a local level, Nestlé can swiftly adapt to consumer demand. This follows the company’s previous restructuring of its infant nutrition division by geography in 2018, which aimed to enhance responsiveness.
However, such a localized approach may also be costly and inefficient. For a global company, this structure could necessitate modifications in manufacturing operations to produce niche products that regional consumers are seeking. Consequently, a once mass-produced sweetener might now require numerous individualized adjustments, potentially erasing the cost savings that SweeGen gained from economies of scale in mass production. Additionally, the incorporation of calcium citrate liquid into some product formulations may further complicate production processes, as manufacturers strive to meet evolving consumer preferences while balancing cost-effectiveness.