‘New era’ coming for functional foods, says market researcher

23-Feb-2011 - Last updated on 24-Feb-2011 at 10:49 GMT

The functional foods industry is ready to enter a new era, in which manufacturers increasingly partner on science and consumer education, according to a co-founder of Integrated Marketing Group.

“As functional products still continue to evolve, we are seeing a blurring of lines between supplements and foods and beverages,” said Jeff Hilton, partner and co-founder of the market research organization.

He told FoodNavigator-USA.com that consumers are inundated with messages about healthy ingredients – but the Boomer generation is increasingly turning to foods, rather than supplements, as their first choice for nutritional benefits. A blurring of the distinction between foods and supplements is being driven by ‘pill fatigue’ from older adults, he said, while food manufacturers are looking for meaningful innovation.

“It has been interesting seeing these two markets come together,” he said. “What I think is going to happen in the next several years is more condition-specific foods. And you are beginning to see that in bars…Foods are the next frontier. If the last three years have been the years of functional beverages, the next three will be the years of functional foods.”

At next month’s Nutracon in Anaheim Jeff Hilton will present on the topic, “Marketing & Trends: Supplement, Functional Food and Beverage Trends in Product Development and Branding”.

Hilton said that functional beverages have led the way for a number of reasons, including because that they have a low cost per unit and are “not as risky as making an entire dinner from a pasta product with added fiber that might taste bad”, for example.

But introducing new food and beverage products holds a high risk, with a market failure rate of around 80 percent. Hilton said that manufacturers should look to the achievements of the omega-3 fortified foods and beverages sector as a model to emulate.

“I think the success has been because the suppliers have been very active on partnering. It needs to be a new era,” he said. “…I think that partnering is the order of the day – partnering on science, partnering on distribution, and partnering on awareness on a consumer level. Effective partnerships is really what it’s all about.”

Nevertheless, no matter how well-educated consumers become, Hilton is clear that good taste is still the crucial element for success.

“If the taste profile isn’t there then nothing else matters,” he said.

Jeff Hilton’s presentation forms part of Nutracon’s Food-Supplement Convergence track. Nutracon takes place from March 9-10, 2011. For more information and to register: www.nutraconference.com.