Over the last five years, Canada’s gluten-free market saw an impressive compound annual growth rate of 26.6%, fueled by growing awareness of celiac disease and gluten intolerance, increased availability of gluten-free products at mainstream retail outlets (Sobeys and Atlantic Superstore, to name a few), and improved product quality.
Indeed, almost half of Canadian consumers surveyed for the report believe the quality of gluten-free products available has improved considerably in recent years, though nearly 25% felt certain types of products still need improved quality, taste or variety.
Less likely to be a recurring diet fad in Canada
Unsurprisingly, the power of the celebrity cannot be ignored. The spate of celebrity endorsements—from Oprah to Miley Cyrus—of gluten-free diets as “healthier” has also contributed significantly to demand and will likely remain a key contributor to sales growth for 2013, according to the report.
Whether they heard it from Oprah or elsewhere, roughly one third of consumers surveyed said they consider gluten-free products to be generally healthier than their gluten-containing counterparts, while one quarter purchase gluten-free foods to help manage their weight.
The report’s authors attribute this perceived 'health halo' to several possible factors:
“Many GF specialty marketers operate according to principles associated with healthful food; consumers may have initially become aware of the category while shopping at health/natural food stores; and ‘free from’ suggests what the food does not contain is somehow undesirable.".
Compared to their U.S. counterparts, a higher percentage of gluten-free product users in Canada report purchasing gluten-free foods because someone in their household is gluten intolerant, or has celiac disease, or a gluten or wheat allergy. In addition, more respondents in Canada purchase gluten-free products to deal with celiac and treat other diseases, which suggests that “gluten-free is much less likely to be a cyclical diet fad in Canada as compared to the U.S.,” according to the report.
In line with these findings, the report cited that demand tied to consumer perception of healthiness of gluten-free products is expected to wane in late 2013 or early 2014. By 2016, gluten-free market growth is projected to slow to the single digits, centered on Canada’s base of celiac and gluten-intolerant consumers. Still, retail sales are on track to reach $549.8 million in 2013 and more than $811 million in 2017, with a projected CAGR of 10.2%.
Snack foods still king
Canada’s largest gluten-free products category for 2012 was snacks, which accounted for $127.1 million, or 27.7%. Not far behind were the breads/cereals/grains (24.8%) and frozen/refrigerated prepared foods (20.5%) categories.
A few large players continue to dominate sales in most gluten-free food categories. Boulder Brands (the firm behind gluten-free giants Udi’s and Glutino), Kinnikinnick, Food Directions, Nature’s Path, Bob’s Red Mill and Amy’s Kitchen are among the market leaders.
Interestingly, an analysis of gluten-free Google searches found the most common product categories searched were gluten-free bread, desserts and beer, which shows both that there’s room for improvement in these products as well as untapped potential in these categories.