Food Sales: Healthier

Consumers looking for health and convenience continued to fuel trends in global food and beverage growth, according to research released by AC Nielsen last week. Of the seven categories enjoying double-digit revenue growth between July 2003 and July 2004, five—soy-based drinks, drinkable yogurts, eggs, sports/energy drinks and sugar substitutes—promoted health or weight-loss benefits. The remaining two—cereal/muesli/fruit bars and refrigerated complete meals—traded off of portability and ease in preparation.

“With a significantly aging population, people are saying ‘I want to be healthy’ at the same time the media is pumping up coverage of obesity and diabetes,” explained the author of the report, Jane Perrin, Nielsen managing director of global services. “They want to extend their lives as long as possible.”

As further evidence, Perrin points to the fact that sales of sugar substitutes are outgrowing those of sugar; olive oil is driving oil sales; and the increasing demand for vegetables, fruits, nuts and bottled water. The most dramatic signs of change in dietary preferences can be seen in the sales of meat, fish and eggs, which increased 6 percent in aggregated sales. Reflecting the popularity of low-carb diets in North America and England, eggs, for instance, jumped 16 percent in revenue while none of the 10 ‘non-sweet carbohydrates’ categories climbed by more than 4 percent.

While Perrin acknowledged the Atkins diet craze may be waning, she emphasized its impact is far from over. “Carbohydrates will continue to be a factor just as fat is a factor in people’s diets. It’s made consumers more aware. The low-carbohydrate diet fad may be dying but the awareness is not.”

Nielsen looked at retail purchases in Asia-Pacific, Europe, Latin America, North America and emerging markets. Countries in the study account for over 93 percent of the world’s gross domestic product and over 77 percent of the planet’s population. The market research firm analyzed data spanning 89 food and beverage categories, comparing the year ended last July to the year-earlier period. Nielsen is a unit of VNU, which publishes Adweek.

Strongest total growth (10 percent) came from emerging markets. One indication there of a change toward more healthy and active lifestyles is apparent in the boom in the cereal/muesli/fruit bars category, which soared 47 percent, helped in part by new product launches in Eastern Europe.

Growth in private label products showed a 4 percent increase globally. That growth ranges from 48 percent in emerging markets, where hyper markets are replacing mom-and-pop stores, to no growth in North America, where consumers still see store labels as inferior to branded alternatives.