Market & Consumer Insights on Sports

2

Global Trends

wha

t is

on

cons

umer

s’ m

ind?

what benefits are consumers looking for?

how big is this market?what do consumers find important?

is this market growing?

what products are out there?

who/ what is influencing these trends?

3

Market & consumer insights

• The sports nutrition markets• Key drivers• Key trends• Consumer evolution

Market Insights

• Sports facts & figures• Consumers & sports nutrition• Motivational segmentation• Meet the consumer

Consumer Insights

4

Sports foods is more than just sports nutrition

Energy & Nutrition Bars

Address both daily and sports nutrition needs, which are high in protein and/or carbohydrates.

Sports Nutrition

Bars, gels, powdered- and RTD’s containing protein, creatine, amino acids for serious athletes and gym-goers. To build muscle mass, improve physical endurance and boost energy.

Sports Drinks

RTD mainstream sports beverages (isotonic, hypotonic and hypertonic) containing water, minerals and glucose to replace lost body fluids and boost energy.

5

A €3,6 billion category with good growth perspectives

2006 2007 2008 2009 2010 2011 2012 2013 2014 20150

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

4,500

5,000

Sports Drinks Sports Nutrition Energy & Nutrition Bars

Energy & Nutrition bars

CAGR 2005 – 2010 8,4%CAGR 2010 – 2015 6,8%

Sports Nutrition

CAGR 2005 – 2010 9,5%CAGR 2010 – 2015 6,9%

Sports Drinks

CAGR 2005 – 2010 5,5%CAGR 2005 – 2015 3,8%

€ 3,6bn

€ 4,7bn

Source: Datamonitor 2011, Western & Eastern Europe

RSP milllion €

6

Current offerings in sports nutrition – Maxinutrition (#1)

Competition and Retailing Trends

• Energy Drinks• Energy Gels• Supplements• Protein bars• Powdered protein drinks• RTDs clear beverages• RTD protein shakes

7

Sports drinks positioning; Gatorade from 1 fits all to pre-, during and after work-outs and mainstream

9

9

Trend: rising health awareness

TREND: OVERVIEW

Rising health awareness

Physical appearance and body weight and

shapeRising global obesity

Rising health awareness is being driven by both negative factors such as global obesity and rising consumer awareness of the positive advantages of

optimising physical appearance

Source: Datamonitor 2010: Exercise and Sports Nutrition: Consumer Trends and Opportunities

10

10

Trend: rising exercise participation

TREND: OVERVIEW

Increase in the amount of exercise

Lack of time is a barrier to do more

sports

Exercise rates are rising, though there remains a clear disconnect between its perceived importance and the attainment of health goals

Men do exercise more than women

Source: Datamonitor 2010: Exercise and Sports Nutrition: Consumer Trends and Opportunities

11

11

Trend: consumers’ sports nutrition buying habits driven by distinct consumer needs

TREND: OVERVIEW

Physical appearance and fitness goals

change buying habits

Sports nutrition broadening the use of

their products

The emergence and future evolution of unique sports nutrition consumer segments offers significant potential to the industry

New consumer groups lead to new

solutions

12

Segmentation broadening the sports nutrition market

Competition and Retailing Trends

Athletic lookLean muscles Sixpack Muscular look Strength

Fit & HealthyImprove fitness Stamina Endurance

Endurance Muscle mass Toned body Lean body Slim body Burn calories

Loose weightBurn calories

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Muscle mass rebuild

Energy and endurance

Health & fitness Women Young

athletesElderly athletes What’s next?

Consumer segmentation shapes innovation by shifting its target

Driving Forces of Sports Nutrition

• A wider consumer base • From adult men to other consumer types• Sports nutrition no longer exclusively for men wanting to develop and show off powerful muscles• Most people combine going to the gym with a healthy diet• Develop other applications or formulations for different segments with different consumer needs

14

European Consumer Insights

why

doe

s (s

)he

eat

that

?

how does (s)he assess the quality of a product?

when does (s)he eat that?

who is influencing her purchase decisions?

what does (s)he eat?

15

Market & consumer insights

• The sports nutrition segments• Key drivers• Key trends• Consumer evolution

Market Insights

• Sports facts & figures• Consumers & sports nutrition• Motivational segmentation• Meet the consumer

Consumer Insights

16

16

TREND: TOPLINE EVIDENCEHalf of the people ensure an adequate amount of weekly exercise

Generally, to what extent are you trying to do the following?

Ensure you get an adequate amount of exercise each week

(% - share of respondents)

All the time

Most of the time

Source: Datamonitor 2010: Exercise and Sports Nutrition: Consumer Trends and Opportunities

1419

917

10

22 1915 16

26

39

24

32

20

27 3230 31

Bra

zil

Chi

na

Fra

nce

Ger

man

y

Rus

sia

Spa

in

UA

E

UK

US

A

17

17

TREND: TOPLINE EVIDENCEConsumers are tailoring their buying habits in responseto physical appearance and fitness goal

How appealing are the following food and beverage concepts to you personally?

Food and beverage products that are formulated with your specific nutritional needs in mind?

Very appealing

Somewhat appealing

33

1568

2415

2318

43

53

4045

4149

5153

Bra

zil

Chi

na

Fra

nce

Ger

man

y

Rus

sia

Spa

in

UA

E

US

13

43

UK

(% - share of respondents)

18

26%

GOAL/RESULT DRIVEN

FOR FUN

INT

ER

NA

L/I

ND

IVID

UA

L D

RIV

EN E

XT

ER

NA

L/S

OC

IAL D

RIV

EN

Relevant consumer benefits in sport products depend on what consumers you’re talking to

13%

5%

5%

CHARACTERISTICS• Dedication• Discipline• Focus• No pain/ No gain• Perseverance• Self confidence• Feeling of power

DEMOGRAPHICS• 2-3% of population• 20-40 years old• Mainly male

SPORTS NUTRITION• Whey protein• Builds lean muscle mass• Low carb, no fat• Right amount Leucine

HEALTH INVOLVEMENT• Beyond health• Health is not an issue• Focus on body sculpturing

PRODUCT ASPIRATIONS• Easy to eat, everywhere, every day• Fast acting product• Triggers muscle build up and recover

The Body Builder wants to build the perfect body

CHARACTERISTICS• Competition & Winning • Discipline• Continuously improving• In and out hard core

DEMOGRAPHICS• 5% of population• All age groups• 44% has children• Slightly higher income• Excellent physical condition

SPORTS NUTRITION• That helps to perform better• Visible or can be noticed in any

kind of way, i.e. muscle build up vs. recovery of muscles.

HEALTH INVOLVEMENT• Beyond health• Health is not an issue• Focus on sports performance• Improvement is key

PRODUCT ASPIRATIONS• All you need in 1 serve• The protein you need to recover in 1 bottle• Triggers muscle build up thanks to easy take-up of protein into bloodstream and muscles

The Performer wants to improve performance

CHARACTERISTICS• Sports is a necessary evil• It’s not for fun, it’s to lose weight• Spends less time on sports than average (<1-2 per week)

DEMOGRAPHICS• 13% of population• Both male and female• Lower income• All are overweight

HEALTH INVOLVEMENT• Health equals weight; they don’t feel healthy• Worried about gaining weight• They’re on a diet• Focus on burning fat• Losing weight is key

SPORTS NUTRITION• Rehydrates• Gives energy without the

“baddies” that could make the workout redundant again, i.e. fat

PRODUCT ASPIRATIONS• No fat• Drinks like a water• Low calorie

The Weight Watcher wants to lose weight

CHARACTERISTICS• Sports to keep in shape• Enjoy doing sports • Spends more time on sports than average (2-3 per week)

HEALTH INVOLVEMENT• Stay healthy and fit• Keep in shape • Body tone is key• Not on a diet

SPORTS NUTRITION• Rehydrates• Brings back my body in balance• In to drinks like flavored milk

PRODUCT ASPIRATIONS• Drinks like a water• Not too much sugar, low in calorie • Low in fat

DEMOGRAPHICS• 26% of population• Both male and female• Average income

The Body Conscious wants a toned body

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Only in-between is the moment of the day where yoghurt and sports nutrition are the same today

After sports Before sports During sports0%

20%

40%

60%

80%

100% 87%

12%

52%

Sport nutrition related to sports activity

On the go At home At the gym0%

10%20%30%40%50%60%70%80% 75%

17%

52%

Sport nutrition by location

Breakfast Lunch In-between Dinner0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

3%7%

47%

18%

Sport nutrition occasions

Breakfast Lunch In-between Dinner After dinner0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

33%30%

39% 38%

31%

Yoghurt occasions

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Attitude towards sports specific food is similar as attitude towards food in general

Indulgence

Pro

-act

ive

Pre

vent

ion ReactiveF

ixing

Nutrition

“Eat what’s right, but enjoy it!”

“Less is more”

“Food is there to enjoy”

“I just eat what I always eat & don’t really think about it”

“Healthy is a way of living”

“I need to watch out what I eat, I’m

on a diet”

“I make sure I have a balance”

Source: Fonterra Consumer Deep Dive & Sports nutrition research 2011

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~50% of consumers are “active”

Less active

Intr

insi

cally

driv

en“I

wan

t to

stay

hea

lthy”

Externally driven

“My doctor told m

e to”

More active

Source: Fonterra Consumer Deep Dive & Sports nutrition research 2011

27

Attitude towards sports specific food is similar as attitude towards food in general

Indulgence

Pro

-act

ive

Pre

vent

ion ReactiveF

ixing

Nutrition

“Eat what’s right, but enjoy it!”

“Less is more”

“Food is there to enjoy”

“I just eat what I always eat & don’t really think about it”

“Healthy is a way of living”

“I need to watch out what I eat, I’m

on a diet”

“I make sure I have a balance”

Source: Fonterra Consumer Deep Dive & Sports nutrition research 2011

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Consumer needs regarding sports & food

PerformanceStrength

Efficient workouts

Rehydration

Less muscle soreness

Re-energize Re-energize

Body composition

Thirst quenching

Body tone

Endurance

Thirst quenching

In controlWinning diet

battle

Less muscle soreness

Less muscle soreness

Sports Nutrition needs General food needs

Naturalness

No additives

Low fat

Low sugar

Low calorie

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Protein delivers the RtB to consumer food & sports needs

PerformanceStrength

Efficient workouts

Rehydration

Less muscle soreness

Re-energize Re-energize

Body composition

Thirst quenching

Body tone

Endurance

Thirst quenching

In controlWinning diet

battle

Less muscle soreness

Less muscle soreness

Relevant consumer needs

Muscle building

Muscle maintenance

Muscle recovery

Faster energy replenishment

Improved re-hydration

Energy resource

Functional benefits

Naturalness No additives Low fat

Low sugar

Low calorie

PR

OT

EIN

Satiety

Natural source of energy

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Yoghurt was mentioned as one of the first

sources of protein

Protein benefits are latent knowledge

What makes protein important for human beings? % consumer mention

Essential for a healthy diet 98%

Provides energy 80%

Is an essential part of the body / to live 65%

Health 19%

I get enough protein if I

eat balanced

Protein is crucial for growth & development

Protein is good for muscles

Protein is healthy

How much protein should

I take?

Protein supplements is

for body builders

• To get extra protein for sports performance, consumer prefer beverages• ~20% is prepared to pay more for protein enhanced products• Knowledge about protein increases by age

31

Consumers recognize the health benefits of protein

Source: Protein Consumer Research: Brainjuicer, May 2011

You see a list of several health benefits of adding extra protein. How important are the following benefits to you? (Select all that apply) (n=166)

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How do active consumers benefit from protein?

Optimal nutrition following exercise

1. Stimulate muscle recovery 3. Stimulate energy replenishment

2. Encourage fast rehydration

Protein Protein

Carbohydrates

Electrolytes

Protein

Carbohydrates

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Status of Protein Claims in the EU

Postive Opinion Negative Opinion

Protein Maintenance of normal bone Increased satiety/reduction of energy intake

Helps growth and maintenance of muscle mass

Maintains normal body weight

Source of Protein High in protein Increased in Protein

Conditions to meet the claim

12% of the energy value of food is from protein

20% of the energy value of the food is from protein

The product meets the conditions for ‘source of protein’ claim if the increase in protein content is at least 30% cf to a similar product

• EFSA Article 13.1 Health Claim Opinions for Protein

• Protein Nutrient Content Claim Requirements

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Potential barriers & solution to keep in mind.....

Lack of knowledge

Cynicism Build & drive credibility

EFSA Ensure high protein level and link it to relevant

consumer needs

Use protein as a RtB of consumer relevant benefits regarding sports nutrition and food needs

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Using the right messages to communicate the protein benefit is key

Added proteins = “additives”

2x, 3x more protein doesn’t resonate

Natural source of protein is important

High quality source of protein

“Good source of protein”

Source: Protein Consumer Research: Brainjuicer, May 2011

X

36

Consumer benefits for the performer to further strengthen the positioning of a protein enhanced sports beverage

Most appealing claims:

1. 3-in-1: rehydration, refuel and recover

2. Get the nutrition your body needs after exercise in 1 single serve

3. The protein to recover, now in 1 bottle

4. Triggers muscle build up

37

Consumer benefits for body conscious and weight watcher to further strengthen a protein enhanced sports beverage

Consumer claims:

1. Direct thirst quenching

2. Refreshing

3. More than water

4. Only 10 kcal per 100 ml

5. Energy to recover without the sugar

38

3. Innovative concept/product ideas

39

Preferred applications are in the sports or in the general health area – no product type serves both currently

• How do consumers like to get the benefits – what applications? • Map of consumers’ benefit areas of interest and their product format preference

Gap

4040

Recommendations for protein positioning Products Protein benefits

The majority of yoghurt formats (spoonable, drink, flavoured, pure) resonate with general health and children growth. These benefits have the highest scores among all consumer groups. To strengthen the protein positioning we would recommend to stress general health and energy benefits for all consumer groups (adults, children and seniors).

High protein beverage and yoghurt shot resonates most with sport performance and muscle maintenance. These benefits score as the second important among consumers. The possible way to proceed is to do further research among athletes to determine market perspectives for a specialised sport yoghurt.

Yoghurt shots and protein bar also resonate with weight management and hunger suppression. These benefits have relatively low scores compared to general health, but they are important for younger females who are also more likely to pay more for yoghurt with added protein. We would recommend further research into specialised product for this group, which can be quite successful.

Three groups of product formats resonate with different benefits that protein can deliver upon

general health and children growing

sport performance and muscle maintenance

weight management and hunger suppression

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Dietary protein Muscle protein

Nutritional switch

Key amino acid (leucine) in the blood

Adequate intake

Time dependant

Maximal response

~2.5g leucine(~30g protein)

RtB Protein Synthesis – How does it work

42

Dairy Protein provides best results for speed and build

Rapidly digested

Promotes more muscle mass

CHO/Placebo

Soy Milk Whey0

0.5

1

1.5

2

2.5

3

3.5

4

Fol

d ch

ange

in le

an m

ass

gain

s(f

rom

CH

O/P

lace

bo)

Adapted from:

Tang et al, (2009)

Adapted from:

Phillips et al, (2009)0

0.5

1

1.5

2

2.5

0 30 60 90 120 150 180

Minutes following consumption of protein

Fo

ld c

han

ge

in p

lasm

a le

uci

ne

(fro

m b

asel

ine)

Whey

Soy

Casein

43

Success requires highly functional proteins that can deliver the health without compromising taste & texture

YOGHURT

Key insight:

The key to success in this

space is to provide the

desired benefits in mainstream good tasting

product offerings

44

Fonterra’s Protein delivers the Reason to Believe to these consumer needs...

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.. but can our protein deliver the taste as well though? We put our protein bars up to the test!

Meet the test panel…

Stephen

Mark

AndrewFloris

Allard

Agustin

46

There is an interest in functional food, but they are not perfect yet

What do they consume today & what benefits are they looking for?

47

Taste & Texture does matter & Fonterra has the solution!

Source: Euromonitor

Featuring here the results in our bars – Bar “F” is the bar with Fonterra’s protein in it.