Description

“This inaugural report in Mintel’s Flavor and Ingredient Library is the first layer in the foundation of a Report series designed to guide brands in product development, quantifying how to fill their innovation pipelines based on actual consumer interest. Each Report in this series will take a “now, near, next” approach: identifying current and future product trends that are important to monitor based on consumer data. This Report specifically looks at food and drinks with functional claims, brands that are producing them and what consumers actually eat and where their interests lie. While functional claims are still relatively low, strong consumer interest points to significant untapped potential for both brands formulating for function and those with natural function offerings.”
– Mimi Bonnett, Director – Food & Drink, Foodservice

This report looks at the following areas:

  • Functional claims communicate health, but falter with value and taste
  • Consumers are quitters
  • Consumer skepticism a key issue for functional food/drink marketers

Table of Contents

  1. Overview

    • What you need to know
      • Definition
      • Executive Summary

        • Top takeaways
          • The issues
            • Functional claims communicate health, but falter with value and taste
              • Consumers are quitters
                • Figure 1: Functional ingredient usage and interest, October 2019
              • Consumer skepticism a key issue for functional food/drink marketers
                • Figure 2: Attitudes toward functional claims and ingredients, October 2019
              • The opportunities
                • Food brands can follow drinks lead
                  • If you got it flaunt it
                    • Figure 3: Attitudes toward functional claims and ingredients, October 2019
                  • Know your audience(s)
                    • Figure 4: Functional ingredient usage, by age, October 2019
                  • Align with specialty diets where possible
                    • Figure 5: Functional benefit usage, by select approaches to eating, October 2019
                • Market Landscape – What you need to Know

                  • Taste still trumps health
                    • Energy dominates functional innovation
                      • CPG foods should look to drinks
                        • Health and value could use a boost
                          • Efficacy needed to alleviate skepticism
                          • Consumer Approach to Eating

                            • Cooking from scratch remains the standard
                              • Taste more likely than health to drive food choices
                                • Figure 6: Approach to eating, October 2019
                              • Connect the dots between function and wellness to overcome older adults’ skepticism
                                • Functions need to align with younger adults’ more complex, intentional choices
                                  • Figure 7: Approach to eating, by gender and age, October 2019
                              • Food Types Consumed

                                • Opportunity to make prepared meals more functional
                                  • Figure 8: Food types consumed, by age, October 2019
                                • Consumers who enjoy new and trendy foods are primed for functional packaged foods
                                  • Figure 9: Food types consumed, by approach to eating, October 2019
                              • Functional Innovation in Food

                                • The why behind the functional food buy
                                  • Functional claims communicate health, but falter with value and taste
                                    • Figure 10: Perception of food launches with functional claims versus without functional claims, Jan 2017-Dec 6, 2019
                                  • Only 6% of food launches feature functional claims
                                    • Figure 11: Food launches, by claim category, 2014-19*
                                  • Snacks (largely bars) are most likely foods to feature functional claims
                                    • Figure 12: Functional food launches, by food category, 2014-19*
                                    • Figure 13: Functional food launches, by food sub-category, 2014-19*
                                  • Energy leads among functional food claims
                                    • Figure 14: Food launches, by functional claims, 2014-19*
                                • Drink Types Consumed

                                  • Young adults gravitate to beverage types that play in functional space
                                    • Figure 15: Drink types consumed, by age, October 2019
                                  • New-and-trendy and specialty diet groups use functional-friendly drinks
                                    • Figure 16: Drink types consumed, by approach to eating, October 2019
                                • Functional Innovation in Drink

                                  • Purchase intelligence finds functional drinks need to position for taste
                                    • Drink taste perceptions impacted by function
                                      • Figure 17: Perception of drink launches with functional claims versus without functional claims, Jan 2017-Dec 6, 2019
                                    • Drinks do a better job at function, points to the occasionality of function
                                      • Figure 18: Drink launches, by claim category, 2014-19*
                                    • Meal replacement drinks comprise the largest share of functional claims
                                      • Figure 19: Drink launches, by food sub-category, 2014-19*
                                    • Energy leads among functional drink claims
                                      • Figure 20: Drink launches, by functional claims, 2014-19*
                                    • Heart health, stress relief represent areas of opportunity
                                    • Market Perspective

                                      • Supplements are pivotal to driving VMS market growth…
                                        • Figure 21: Total Market size and forecast, Supplements, at current prices, 2014-24
                                      • …yet, a large set of consumers think functional foods are better
                                        • Figure 22: Functional foods are more nutritious than dietary supplements, by age, July 2019
                                      • Food and drink shoppers priorities may complicate functional offering
                                        • Figure 23: Food and drink choice factors, February 2019
                                    • Innovators and Disruptors – What You Need to Know

                                      • Functional trend is driven by wellbeing
                                        • Now: Pragmatic functions like protein, probiotics and energy
                                          • Next: Taking it to the masses
                                            • Pipeline: Mood foods
                                            • Innovators and Disruptors

                                              • Change can be sparked anywhere
                                                • Trend Drivers – what’s motivating change?
                                                  • Brands can become wellbeing partners through function
                                                  • Product Development: Now – Current Trends in Function

                                                    • Protein powers up
                                                      • Figure 24: Healthy food and drink attributes sought, by age, August 2018
                                                      • Figure 25: Food and drink protein claim growth, 2014 – 2019
                                                    • Brands in action
                                                      • Energy 2.0 moves away from drinks and bars…
                                                        • Figure 26: Food and drink claims, energy, 2014 – 2019
                                                      • Brands in action
                                                        • …yet also stays somewhat liquid
                                                          • Brands in action
                                                            • Legacy brands lean into heart health
                                                              • Figure 27: Food and drink claims, heart health, 2014 – 2019
                                                            • Brands in action
                                                              • Probiotics everywhere
                                                                • Figure 28: Food and drink claims – gut health, 2014 – 2019
                                                              • Brands in action
                                                              • Product Development: Near – What to watch for tomorrow

                                                                • Hitch the wagon to specialty diets
                                                                  • Brands in action
                                                                    • Multi-taskers
                                                                      • Brands in action
                                                                        • Advanced Hydration
                                                                          • Brands in action
                                                                            • Functional Indulgence
                                                                              • Brands in action
                                                                              • Product Development: Next – What’s in the Pipeline

                                                                                • Mood food: CBD, THC, and adaptogens
                                                                                  • Figure 29: Reasons for cannabis use, october 2019
                                                                                • Brands in action
                                                                                  • Brain power = the new gut health?
                                                                                    • Figure 30: Experience or interest with focus enhancing foods/drinks, October 2019
                                                                                  • Brands in action
                                                                                    • I feel pretty
                                                                                      • Figure 31: Experience and interest in beauty function in food/drinks, October 2019
                                                                                    • Sweet dreams
                                                                                      • Figure 32: Experience and interest in sleep aid food/drinks, October 2019
                                                                                  • The Consumer – What You Need to Know

                                                                                    • Meals could be next for functional treatment
                                                                                      • Younger adults drinking function
                                                                                        • Untapped potential is great
                                                                                          • Go natural if you can
                                                                                          • Functional Benefit Usage and Interest

                                                                                            • Untapped potential: interest level higher than current consumption
                                                                                              • Figure 33: Functional benefit usage and interest, October 2019
                                                                                            • Younger consumers seek a wider array of functional benefits
                                                                                              • Figure 34: Functional benefit usage, by age, October 2019
                                                                                            • Different eating approaches drawn to different functional benefits
                                                                                              • Figure 35: Functional benefit usage, by select approaches to eating, October 2019
                                                                                          • Functional Ingredient Usage and Interest

                                                                                            • Caffeine the oldest and still by far the most common functional ingredient
                                                                                              • High proportion of former users reflects fickle nature of category
                                                                                                • Figure 36: Functional ingredient usage and interest, October 2019
                                                                                              • Young adults a key market, but 35-54 could be a growth opportunity
                                                                                                • Figure 37: Functional ingredient usage, by age, October 2019
                                                                                              • Appeal to health/diet-focused consumers and trend seekers
                                                                                                • Specialty diets
                                                                                                  • Overall health
                                                                                                    • New and trendy
                                                                                                      • Figure 38: Functional ingredient usage, by select approaches to eating, October 2019
                                                                                                  • Attitudes toward Functional Claims and Ingredients

                                                                                                    • Focus on natural functionality could help to overcome skepticism
                                                                                                      • Figure 39: Attitudes toward functional claims and ingredients, October 2019
                                                                                                    • Young consumers less skeptical, look for immediate results
                                                                                                      • Figure 40: Attitudes toward functional claims and ingredients, by age, October 2019
                                                                                                  • Appendix – Data Sources and Abbreviations

                                                                                                    • Data sources
                                                                                                      • Consumer survey data
                                                                                                        • Abbreviations and terms
                                                                                                          • Abbreviations
                                                                                                            • Terms

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