identifying opportunities for health and wellness packaged ... · identifying opportunities for...
TRANSCRIPT
Identifying opportunities for health
and wellness packaged food and
beverages in APAC
Speaker: Reema Bhagwan Jagtiani, Analyst, Euromonitor, Singapore
IDENTIFYING OPPORTUNITIES FOR HEALTH AND WELLNESS PACKAGED FOOD AND BEVERAGES IN ASIA-PACIFIC
6 SEPTEMBER 2017
REEMA JAGTIANI ANALYST
2
© Euromonitor International
INTRODUCTION
INDUSTRY OVERVIEW
CURRENT TRENDS IN HEALTH AND WELLNESS
THE NATURALLY FUNCTIONAL MOVEMENT
TARGETED POSITIONING
FUTURE OUTLOOK
3IDENTIFYING OPPORTUNITIES FOR HEALTH AND WELLNESS PACKAGED FOOD AND BEVERAGES IN ASIA-PACIFIC
About Euromonitor International
© Euromonitor International
4
Alcoholic Drinks
Apparel
Automotive
Beauty and Personal Care
Consumer Appliances
Consumer Electronics
Health and Wellness
Home and Garden
Home Care
Consumer Health
Eyewear
Fresh Food
Nutrition
Packaged Food
Personal Accessories
Pet Care
Soft Drinks
Tobacco
Toys and Games
Tissue and Hygiene
IDENTIFYING OPPORTUNITIES FOR HEALTH AND WELLNESS PACKAGED FOOD AND BEVERAGES IN ASIA-PACIFIC
Research ExpertiseConsumer Products
Consumer Foodservice
Institutional Channels
Services
Consumer Finance
Retailing
Travel
Supply
Ingredients
Packaging
Economies
Business Dynamics
Cities
Economy, Finance and Trade
Industrial
Lifestyles
Income and Expenditure
Households
Population
Hot Drinks
Luxury Goods
Ethical Labels
Consumers
Digital Consumer
© Euromonitor International
5
© Euromonitor International
INTRODUCTION
INDUSTRY OVERVIEW
CURRENT TRENDS IN HEALTH AND WELLNESS
THE NATURALLY FUNCTIONAL MOVEMENT
TARGETED POSITIONING
FUTURE OUTLOOK
6IDENTIFYING OPPORTUNITIES FOR HEALTH AND WELLNESS PACKAGED FOOD AND BEVERAGES IN ASIA-PACIFIC
Scope12 Geographies
• China• Hong Kong
• Indonesia
• India• Japan
• Malaysia• Philippines
• Singapore
• South Korea• Taiwan• Thailand
• Vietnam
5 Health & Wellness
• Better For You (BFY)• Reduced Carbs
• Reduced Fat
• Reduced Salt• Reduced Sugar
• Functional/Fortified (FF)• Free From (packaged food only)
• Naturally Healthy (NH)
• Organic
© Euromonitor International
7IDENTIFYING OPPORTUNITIES FOR HEALTH AND WELLNESS PACKAGED FOOD AND BEVERAGES IN ASIA-PACIFIC
Fortified/functional products dominate value sales in APAC
46%
35%
39%
35%
7%
20%
0%
APAC
Global
Global vs Asia Pacific Health and Wellness by type: Retail value sales 2016 (Packaged Food & Beverages)
20%
Fortified/Functional
40%
Naturally Healthy
60%
Better For You
80%
Free From
100%
Organic
© Euromonitor International
8IDENTIFYING OPPORTUNITIES FOR HEALTH AND WELLNESS PACKAGED FOOD AND BEVERAGES IN ASIA-PACIFIC
And registered the strongest absolute value growth
0
15
30
45
60
75
FF Packaged Products
NH Packaged Products
BFY Packaged Products
Free From Products
Organic Products
Asia-Pacific Health and Wellness by type:Retail value sales 2016 (Packaged Food & Beverages)
2016 retail value sales 2011-2016 CAGR%
© Euromonitor International
USD billions %
22
20
18
16
14
12
10
8
6
4
2
0
9IDENTIFYING OPPORTUNITIES FOR HEALTH AND WELLNESS PACKAGED FOOD AND BEVERAGES IN ASIA-PACIFIC
Largest Fortified/functional (FF) product categories in APAC
Asia-Pacific Fortified/Functional Products by Categories: Retail value sales 2016
Food
Baby Food
Dairy
Confectionery
Sweet Biscuits, Snack Bars and Fruit Snacks
Others (Breakfast Cereals, Oils, Bread)
Beverages
FF Energy Drinks
FF Fruit/Vegetable Juice
FF Sports Drinks
FF Other Hot Drinks
FF BottledWater
Others (Carbonates, Concentrates, Instant Coffee, RTD Tea/Coffee)
Baby Food
Dairy
Energy Drinks
Fruit/ Veg JuiceSports
Drinks
Other HotDrinks
© Euromonitor International
10IDENTIFYING OPPORTUNITIES FOR HEALTH AND WELLNESS PACKAGED FOOD AND BEVERAGES IN ASIA-PACIFIC
Largest Naturally Healthy (NH) product categories in APAC
Food
NH Fruit Snacks
NH Honey
NH Olive Oil
NH Nuts, Seeds and Trail Mixes
NH High Fibre Food
NH Rice
Others (Dairy and Cereal Bars)
Beverages
NH RTD Tea
NH Tea
NH Other Hot Drinks
NH BottledWater
NH Fruit/Vegetable Juice
NH Asian Speciality Drinks
© Euromonitor International
RTD Tea
Asia-Pacific Naturally Healthy Products by Categories: Retail value sales 2016
Bottled Water
Nuts, seeds, trail mixes
Fruit Snacks
11
© Euromonitor International
INTRODUCTION
INDUSTRY OVERVIEW
CURRENT TRENDS IN HEALTH AND WELLNESS
THE NATURALLY FUNCTIONAL MOVEMENT
TARGETED POSITIONING
FUTURE OUTLOOK
12IDENTIFYING OPPORTUNITIES FOR HEALTH AND WELLNESS PACKAGED FOOD AND BEVERAGES IN ASIA-PACIFIC
Health and wellness industry driven by two key trends
Naturally Functional
• Unprocessed or minimally processed foods driven by functional health claims
• Use of natural or fortified ingredients with intrinsic benefits (e.g. botanicals)
• Traverse both Fortified/Functional andNaturally Healthy products
Targeted Positioning
• Standard fortifications in emerging & developed markets
• Health claims targeted at specific healthconditions
• Led by Fortified/Functional products© Euromonitor International
13
40
Is all natural
Does not contain artificial sweeteners
Has limited sugar or no added sugar
Does not contain trans fat or hydrogenated oils
Does not contain GMO ingredients
Has limited or no artificial ingredients
Contains added vitamins or fibre
Has limited fat or no added fat
Reduced or low calorie
Only contains ingredients I recogonise
Which of the following factors or ingredients do you look for on foodlabels and food ingredient labels?
0 10 20 30
2016
2015
IDENTIFYING OPPORTUNITIES FOR HEALTH AND WELLNESS PACKAGED FOOD AND BEVERAGES IN ASIA-PACIFIC
Less is more, consumers increasingly prefer all natural products
% respondents50
© Euromonitor International
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© Euromonitor International
INTRODUCTION
INDUSTRY OVERVIEW
CURRENT TRENDS IN HEALTH AND WELLNESS
THE NATURALLY FUNCTIONAL MOVEMENT
APAC PRODUCT FOCUS
SPOTLIGHT: OLIVE OIL
TARGETED POSITIONING
FUTURE OUTLOOK
15
Naturally Healthy
IDENTIFYING OPPORTUNITIES FOR HEALTH AND WELLNESS PACKAGED FOOD AND BEVERAGES IN ASIA-PACIFIC
Attributes of the naturally functional movement traverse FF & NH
Naturally Functional
Approved health
claims by regulator
No known approved
health claims by regulator
Fortified/Functional
Image sources: Aloegloe.com; 7-11 Philippines© Euromonitor International
16IDENTIFYING OPPORTUNITIES FOR HEALTH AND WELLNESS PACKAGED FOOD AND BEVERAGES IN ASIA-PACIFIC
APAC product focus: plant-based beverages
NaturallyFunctional
Zico Coconut Water
Matcha Love MatchaColada
0
10
50
0.0
0.2
200.4
0.6
1.040
0.8
30
1.2
1.4
Thailand South Korea
Indonesia Japan China UK Brazil US
Coconut and other plant water: Retail value sales %
60
2016 2021 2016-2021 CAGR%© Euromonitor International
USD billions
Image sources: RedMart.com; Itoen.com
17
F&N Magnolia Kids Cocio Energy, Arla Foods
Farm Fresh Kurma
Fresh Delight
Purple Rice Yoghurt
IDENTIFYING OPPORTUNITIES FOR HEALTH AND WELLNESS PACKAGED FOOD AND BEVERAGES IN ASIA-PACIFIC
APAC product focus: other botanicals and superfoods
NaturallyFunctional
© Euromonitor International
Image sources: Youtube.com; Cocio Philippines; Farmfresh.com
© Euromonitor International
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Regulation
• Legally approved healthy property
Market size
• Global retail value sales = USD13 billion in 2016
Emerging Markets
• “New world growers” such as India set to re-shape future world olive map
IDENTIFYING OPPORTUNITIES FOR HEALTH AND WELLNESS PACKAGED FOOD AND BEVERAGES IN ASIA-PACIFIC
Naturally healthy spotlight: olive oil
NaturallyFunctional
© Euromonitor International
19
0
2
4
6
8
10
12
14
16
18
0.0
0.2
0.4
0.6
0.8
1.0
1.2
1.4
1.6
1.8
2.0
India China Brazil US Italy Spain
value sales
Japan France
2011 2016 2021 2016-2021 CAGR%
IDENTIFYING OPPORTUNITIES FOR HEALTH AND WELLNESS PACKAGED FOOD AND BEVERAGES IN ASIA-PACIFIC
Olive oil gains traction in key APAC markets
Major & emerging NH olive oil markets: Retail
Raj Olive Oil, India
Leonardo, India
%
20
NaturallyFunctional
USD billions
Image sources: Rajolive.com; Leonardo Olive Oil
20
© Euromonitor International
INTRODUCTION
INDUSTRY OVERVIEW
CURRENT TRENDS IN HEALTH AND WELLNESS
THE NATURALLY FUNCTIONAL MOVEMENT
TARGETED POSITIONING
FUTURE OUTLOOK
© Euromonitor International
21
Japan, FFC, 2015
• New voluntary label, Foodwith Functional Claims
• Display specific health benefit
• Cheaper, faster and less stringent than FOSHU
• Promotes innovation
India, FSSAI, 2015/6
• New fortification standards for milk, rice, oil etc.
• Raises consumer confidence
• Benefits packaged food/beverage players
IDENTIFYING OPPORTUNITIES FOR HEALTH AND WELLNESS PACKAGED FOOD AND BEVERAGES IN ASIA-PACIFIC
Regulatory updates in APAC support targeted positioning
Targeted Positioning
22IDENTIFYING OPPORTUNITIES FOR HEALTH AND WELLNESS PACKAGED FOOD AND BEVERAGES IN ASIA-PACIFIC
FFC labelling stimulates successful use of innovative ingredients
Indigestible dextrin + dietary fibre
Suppress absorption of fat and sugar
Kirin Raw Tea Kirin Mets Plus Lemon Squash
Kirin Mets Plus Sparkling Water
Gaseri-Kin SP Reduce body fat,
especially visceral fat
Future opportunities for traditional Japanese
foods
Natto (Vitamin K2)
Amazake (Manganese, Vitamin B)
Oi Ocha Nihon No Kenko Genmai Cha
Monoglucosyl-Hespederin
Healthy blood flow
Megumi SP Kabu Sarasara Mugicha
Targeted Positioning
© Euromonitor International
Image sources: Amazon.com; Itoen.com; Megumi-yg.com
23
© Euromonitor International
INTRODUCTION
INDUSTRY OVERVIEW
CURRENT TRENDS IN HEALTH AND WELLNESS
THE NATURALLY FUNCTIONAL MOVEMENT
TARGETED POSITIONING
FUTURE OUTLOOK
24IDENTIFYING OPPORTUNITIES FOR HEALTH AND WELLNESS PACKAGED FOOD AND BEVERAGES IN ASIA-PACIFIC
Food and drink still the preferred way to stay healthy in future
0
1
2
4
5
-
20
40
80
3
60
100
120
140
Herbal/TraditionalProducts
Vitamins and DietarySupplements
Naturally Healthy (NH) Fortified/Functional (FF)
Asia-Pacific: Retail value sales
2011 2016 2021 2016-2021 CAGR%
© Euromonitor International
%
6
USD billions
25IDENTIFYING OPPORTUNITIES FOR HEALTH AND WELLNESS PACKAGED FOOD AND BEVERAGES IN ASIA-PACIFIC
Top APAC NH forecast growth markets
© Euromonitor International
26IDENTIFYING OPPORTUNITIES FOR HEALTH AND WELLNESS PACKAGED FOOD AND BEVERAGES IN ASIA-PACIFIC
Top APAC FF forecast growth markets
© Euromonitor International
27IDENTIFYING OPPORTUNITIES FOR HEALTH AND WELLNESS PACKAGED FOOD AND BEVERAGES IN ASIA-PACIFIC
Innovation and customisation key to product differentiation and growth
ON-THE-GO
Cadbury Bournvita Breakfast
Biscuit
TAILORED
Ceregrow, cereal for 2-5
year olds
TARGETED
Meiji Gold Advance for
Seniors
White Space!
Other Demand Drivers
© Euromonitor International
Image sources: Mondelez International; Amazon.in; UFC Velvet; Elovi.com.vn
© Euromonitor International
28IDENTIFYING OPPORTUNITIES FOR HEALTH AND WELLNESS PACKAGED FOOD AND BEVERAGES IN ASIA-PACIFIC
Key takeaways
Targeted Positioning
Diversified
Market Strategy
Naturally Functional
THANK YOU FOR LISTENINGReema Jagtiani
Analyst
+65 6429 0590 Ext 6762
CONNECT WITH US!
http://blog.euromonitor.com/
@Euromonitor
www.facebook.com/euromonitorinternational
Euromonitor International Market Research Group
Comparative consumer analysis
between ASEAN, Japan and India
Speaker: Rieko Shofu, President and CEO, Sensing Asia Ltd., Japan
@2017 Sensing Asia
6 September 2017
Rieko Shofu
President and CEO, Sensing Asia Ltd.
Comparative Consumer Analysis
between ASEAN, Japan and
India
@2017 Sensing Asia33
• Marketing consulting company supporting
business development in Asia region
• Affiliate partners in 13 countries in the region
1. Consulting and M&A advisory services
2. Efficient and cost-effective support (online &
offline services)
3. Hands-on approach
What is Sensing Asia Ltd.?
@2017 Sensing Asia34
We provide 4 types of services to supporteach step of your international business development.
Basic Services
• Covers regulatory information, investment environment, consumption, living and business cost information
Trend Sensing
• Provides future insights for business strategy planning and development of goods, services and technologies
• Analyzes signs of new trends and changes in market trends in the target market.
Advanced Services
• For detailed research for international business expansion
• Covers industry structure, regulations, market, customers, competitors and also searches the potential business partners
Service Overview
@2017 Sensing Asia35
Table of contents
1. Market overview and consumer trends
1.1 ASEAN
1.2 Japan
1.3 India
2. Marketing strategies case studies
2.1 ASEAN
2.2 Japan
2.3 India
@2017 Sensing Asia36
Table of contents
1. Market overview and consumer trends
1.1 ASEAN
1.2 Japan
1.3 India
2. Marketing strategies case studies
2.1 ASEAN
2.2 Japan
2.3 India
@2017 Sensing Asia37
17.0
18.5
33.0
37.5
42.5
47.0
51.7
57.0
58.5
59.1
64.0
76.1
83.0
81.5
67.0
62.5
57.5
53.0
48.3
43.0
41.5
40.9
36.0
23.9
0% 50% 100%
Metro Manila
Jakarta
Kuala Lumpur
Bangkok
Singapore
Hong Kong
Seoul
Delhi
Ho Chi Minh City
Beijing
Taipei
Tokyo
Want to staymentally youngforever
Want to becomewiser with age
Source: Hakuhodo, 2012
Comparative study on people in their 50s in Asian 12 cities
-- aspirations for being/looking young --
@2017 Sensing Asia38
28.0
28.0
30.0
37.5
40.0
46.7
48.0
53.3
59.0
61.5
62.6
74.4
72.0
72.0
70.0
62.5
60.0
53.3
52.0
46.7
41.0
38.5
37.4
25.6
0% 50% 100%
Metro Manila
Kuala Lumpur
Jakarta
Bangkok
Hong Kong
Singapore
Delhi
Seoul
Ho Chi Minh City
Taipei
Beijing
Tokyo
Want to stayphysicallyyoung forever
Want a matureapperance thatsuits my age
Source: Hakuhodo, 2012
Comparative study on people in their 50s in Asian 12 cities
-- aspirations for being/looking young --
@2017 Sensing Asia39
Source: Hakuhodo, 2012
Youth-orientation rising with age:
Tokyo and Taipei
Maturity-orientation rising with age:
Jakarta, Kuala Lumpur, Bangkok and
Singapore
Comparative study on people in their 50s in Asian 12 cities
-- aspirations for being/looking young --
@2017 Sensing Asia40
Comparative study on people in their 50s in Asian 12 cities
-- aspirations for being/looking young --
Source: Hakuhodo, 2012
All youth-oriented:
Beijing and Ho Chi Minh City
Different worlds:
Delhi and Hong Kong
@2017 Sensing Asia41
0.0 50.0 100.0
Mumbai
Delhi
Ho Chi Minh City
Jakarta
Metro Manila
Bangkok
Kuala Lumpur
Singapore
Guangzhou
Beijing
Shanghai
Seoul
Taipei
Hong Kong
Use of skin care and makeup products
Makeup product
Skin care product (excludingfacial wash)
Comparative study on Asian women in 14 cities
-- sense of beauty and beauty care --
Source: Hakuhodo, 2012 Question: What kind of beauty products do you usually use?(women from age 15 to 59)
East Asia :
skin care 94.6%
makeup 71.4%
South East Asia:
skin care 73.6%
makeup 87.4%
India:
skin care 60.4%
Makeup 97.4%
@2017 Sensing Asia42
Market overview: ASEAN
• Demands for functional foods and supplement are increasing across
the ASEAN region
• However, as consumers become more interested in functional foods
and supplement, they are becoming more wary about the
health/functional claims labeled on the products.
• There is an increasing need to establish consistent regulations,
approval procedure and guidelines for scientifically evidenced
health/functional claims across the region
@2017 Sensing Asia43
Consumer trends: ASEAN (Sugar tax debate)
Background
• In ASEAN, high sugar intake and increasing rate of obesity and diabetes
have been an issue.
• Asians are at higher risk of developing type 2 diabetes when compared with
people of other ancestry.
• Some ASEAN countries have been deliberating on the plan of imposing
sugar taxes on sugary beverages and food.
Source: Asian Diabetes Prevention Initiative, International Tax and Investment Center, WHO “Global Report of Diabetes 2016”
Region Prevalence (%) Number (millions)
1980 2014 1980 2014
South East Asia 4.1% 8.6% 17 96
Europe 5.3% 7.3% 33 64
Estimated Prevalence and Number of People with Diabetes (Adults 18+)
@2017 Sensing Asia44
Consumer trends: ASEAN (Sugar tax debate)
Legislations and debate
Under Discussion
Malaysia: Worst obesity rate in SE Asia
Philippines: Still under debate but
recently Ministry of Finance indicated it
may drop the sugar tax proposal.
Indonesia: Plan to implement a soda tax
in 2017 but yet to determine the tax rate.
Luxury tax on some drinks was once
imposed but scrapped in 2004 after it
badly affected beverage manufacturers.
Sugar Tax Introduced
Brunei: Sugar tax took effect on 1 April
2017. (A can of soft drink costs 13 cents
more.)
Thailand: From 16 Sept 2017, taxes on
sugary drinks will be increased over the
next 6 years. (Taxes on drinks containing
no sugar or using artificial sweeteners will
be decreased on the other hand.)
Dropped
Vietnam: Proposed to levy 10% tax on carbonated drinks in 2014, but was cancelled in
2015 due to commercial pressure
Source: International Tax and Investment Center, Borneo Bulletin Online, www.beveragedaily.com, Bangkok Post, the Philippines Star,
www.apfoodonline.com
@2017 Sensing Asia45
Consumer trends: ASEAN (Sugar tax debate)
Possible Effects
• Sugar tax debate needs to be followed, as it certainly affects the target
industry (certain kinds of beverages and food).
• Meanwhile, the effect of sugar tax is still argued:
– Some argue that:
• it would help reduce the average sugar intake in the same way the tax
on cigarette worked.
– Others argue that:
• Consumers will only take sugar from other untaxed products.
• Public awareness raising is more important to produce an overall effect.
@2017 Sensing Asia46
Consumer trends: ASEAN (Singapore’s “Healthier Choice”)
Background
1. Growing demand for local produce
• Seen as healthier, fresher, tastier and safer option
2. Dining out with healthier options
• Hot soup dishes - considered to be healthier, popular at hawkers
• More demand for vegetarian food
• e.g. salad bars, high-protein, low-carbohydrate and low-calorie bento,
high probiotic food, superfoods such as kale, quinoa, etc.
Yong Tau Foo Ban Mee Kale Quinoa
Source: Euromonitor, Photo credit: By Takeaway (Own work) [CC BY-SA 3.0 (http://creativecommons.org/licenses/by-sa/3.0)], via Wikimedia
Commons, By Goh Wei Zhong (Goh wz); produced with the assistance of Terence Ong and Calvin Teo. - Own work., CC BY 2.5,
https://commons.wikimedia.org/w/index.php?curid=1500495, By blairingmedia - Own work, CC BY-SA 3.0,
https://commons.wikimedia.org/w/index.php?curid=9486992,
@2017 Sensing Asia47
Healthier Choice Symbol (HCS) Programme
• Government initiative to put logos on healthy food/groceries (Generally
lower in total fat, saturated fat, sodium and sugar)
• 7 out of 10 ppl acknowledge the HCS logo
• 69% check HCS logo when purchasing groceries.
• Groceries at supermarkets, food at school cafeteria, hawkers
Source: Euromonitor, Health Promotion Board Singapore, http://www.tnc-trend.jp/singapore03/
Consumer trends: ASEAN (Singapore’s “Healthier Choice”)
@2017 Sensing Asia48
Consumer trends: ASEAN (Indonesia – drinks for cooling
down)
• Among the wide variety of Asian specialty drinks, in Indonesia, the
most popular product is “cooling water” (locally known as “larutan
penyegar”).
• “Cooling down” is seen as an added function to the beverage.
• In Indonesia, local companies are major players in this area; although
not much growth is anticipated in a foreseeable future.
Source: Euromonitor
@2017 Sensing Asia49
Consumer trends: ASEAN (Indonesia – drinks for cooling
down)
• PT. Sinde Budi Sentosa, a Indonesian pharmaceutical company, produces
“Larutan Penyegar Cap Badak” since 1981.
Source: www.sindebudi.com
• Larutan Penyegar is a health beverage to cure
body heat (the symptom of so-called “panas
dalam” or “hot inside” in Indonesian).
• The drink is a sort of “Jamu”, traditional
Indonesian herbal medicine, and contains
traditional herbal ingredients (Gypsum Fibrosum
etc.).
• Its tasteless, colorless and odorless formula was
widely accepted by all age group of Indonesia.
• Currently, aside from the original formula, 7 flavors
are available (orange, strawberry, melon, lychee,
guava, grape and apple).
@2017 Sensing Asia50
Consumer trends: ASEAN (Thailand – vegetable based
protein products)
Source: NNA, Bangkok Post, TIPCO Beat facebook
• High-protein health beverages have become increasingly popular in Thailand, big
players in this field being Meiji and Dutch Mill.
• Tipco Foods Plc, has entered into this market
by introducing “Tipco beat”, yellow pea
extract-based high-protein drink.
• Not only that it matches the growing
consumer needs for high-protein products, it
contains only 4.5% sugar, which is less than
the threshold that the government is going to
introduce in the new sugar tax regime.
• By introducing “beat”, Tipco aims at reducing
the risk that other Tipco products may face
as the government puts the new sugar tax
regime in place.
@2017 Sensing Asia51
Table of contents
1. Market overview and consumer trends
1.1 ASEAN
1.2 Japan
1.3 India
2. Marketing strategies case studies
2.1 ASEAN
2.2 Japan
2.3 India
@2017 Sensing Asia52
Market Overview: Japan (Regulatory System)
Pharmaceutical
Products
Food for Specified
Health Uses
Food with Function
Claims
Food with Nutrient
Function Claims
Food in General
Food
with
Health
Claims
• Government approval required.
• Permitted to bear claims such as
“Slows cholesterol absorption.”
• Under the business operator's own responsibility, can
bear function claims based on scientific evidence.
• No need of pre-approval by the government, but the
supporting evidence needs to be submitted.
• To supplement the nutrients (vitamins, minerals, etc.)
• No need to submit a notification to the government, as
long as the food contains certain amounts of nutrient
Source: I.Bヘルスケア, Consumer Affairs Agency
@2017 Sensing Asia53
Market overview: Japan (Market Size and Growth)
Source: Fuji Keizai
30.1104.2 131.7
111.4
111.7114.6
382
391.7396.3
0
100
200
300
400
500
600
700
2015 2016 2017 (Projection)
Market size (Food with Health Claims)
Food for Specified HealthUses
Food with Nutrient FunctionClaims
Food with Function Claims
Billion JPY
@2017 Sensing Asia54
Market overview: Japan (Market Size and Growth)
Source: Fuji Keizai, http://www.suntory.co.jp/softdrink/iyemon/tokucha/product/ http://www.asahiinryo.co.jp/products/tea/16cha_syokuji_w/
http://web.bifix.jp/ http://www.megumi-yg.com/kinou/
https://www.glico.com/jp/product/chocolate/gaba/14069/ https://www.glico.com/jp/product/chocolate/libera/10625/
• In 2016, probiotics yoghurt, certain chocolate and tomato juice product contributed to
the growth of Food with Function Claims. The food product such as sweets/snacks and
fruit/vegetable juices started to bear function claims, creating new demands in the
market.
• Food for Specified Health Uses has the largest market; however, it costs quite much
for the company to obtain the approval from the government.
• More than 60% of Food for Specified Health Uses are beverages, and among them,
non-sugar tea drinks have been sold particularly well.
Food with Functional ClaimsFood for Specified Health Uses
@2017 Sensing Asia55
Market overview: Japan
Source: Intage
• Market share of health food and supplement by health benefit (FY2016):
1st – Maintaining health and improving physical strength
2nd – Beautiful skin and skin care
3rd – Eye health
4th – Recovery from physical exhaustion
@2017 Sensing Asia56
Consumer trends: Japan “Chou-Katsu (腸活)”
• “Chou-Katsu”, or “intestine activity” if literally translated, has
become popular these days.
• “Chou-Katsu” is to have a lifestyle, exercises and diet that could
create a better intestine environment.
–e.g.) Starting a day with a glass of water or drinking a spoonful of
olive oil to activate the workings of intestines
• Keeping a good intestine environment treats constipation, makes
skin beautiful and makes people healthier.
@2017 Sensing Asia57
Consumer trends: Japan “Chou-Katsu (腸活)”
• To control the balance between good and bad bacteria in the intestine,
the following health foods are gaining much attention:
–Probiotics yoghurt (Japan is the largest probiotics market in Asia (45%
in 2016))
–Traditional fermented food (miso, natto, shio-koji or a mixture of malted
rice and salt, etc.)
–Fiber-rich food (mushrooms, fermented germinated brown rice, etc.)
• Various food products and supplements are promoted and sold around
this concept of “Chou-Katsu”.
Source: Mordor Intelligence
“Toraya Miso Soup” by snowpea&bokchoi is licensed under CC BY 2.0, “Natto” by snowpea&bokchoi is licensed under CC BY 2.0
http://web.bifix.jp/ http://www.megumi-yg.com/kinou/
Miso soup Natto Probiotics yoghurt
@2017 Sensing Asia58
Table of contents
1. Market overview and consumer trends
1.1 ASEAN
1.2 Japan
1.3 India
2. Marketing strategies case studies
2.1 ASEAN
2.2 Japan
2.3 India
@2017 Sensing Asia59
Market overview: India
• Huge vegetarian population base
• Younger generation are getting more and more concerned about their
weight and shape and inclined to choose healthier food.
• The Food Safety and Standards Authority of India (FSSAI) has issued
the long-awaited rules for functional foods and supplements, which
will be enforced from 1 Jan, 2018.
• The rules cover health supplements, nutraceuticals, food for special
dietary use, food for special medical purposes, functional foods and
novel foods.
• The Indian Direct Selling Association (IDSA) has welcomed new rules
saying that the rules will offer much needed clarity and fill a
regulatory vacuum.
@2017 Sensing Asia60
Consumer trends: India
• Health and wellness foods market is growing at a rate of about 10%.
–Male: tends to go for fortification and nutrients
–Female: seeks organic and natural foods, stresses more on making
dietary choicesSource: Nielsen
• Consumers are moving away from traditional breakfast like ‘parathas’ to
healthier options such as cereals, oats and fortified milk food drinks.
Source: BW Disrupt, Nielsen, the Economic Times, “#paratha #bananaleaf #milpitas” by Mighty Travels is licensed under CC BY 2.0,
“Jalebi” by Rishabh Mathur is licensed under CC BY 2.0 https://www.kelloggs.in/en_IN/brands/corn-flakes/products.html#num=500
http://www.bagrrys.com/product/crunchy-muesli/crunchy-muesli http://marico.com/india/brands/saffola/saffola-oats
Parathas, Indian traditional breakfast Corn Flakes, Muesli and Oats
@2017 Sensing Asia61
Consumer trends: India
• Growth rates are high
especially in the
following categories:
–Green tea
–Wheat and Oat Noodles
–Milk food drinks
–Breakfast cereals
Category Sales (Rs crore) Growth
(%)2015 2014
Healthy biscuits 1,155 1,103 5
Wheat/Oat noodles 187 164 14
Breakfast cereals 951 865 10
Multigrain atta 1,205 1,126 7
Milk food drinks 5,180 4,677 11
Green tea 165 109 52
Healthy oils 1,250 1,148 9
Sugar substitutes 258 248 4
Source: Nielsen, the Economic Times http://www.tetley.in/our-teas/products?id=34 https://www.organicindiashop.com/organic-tulsi-teas/tulsi-
green-tea-classic-25-tea-bags-14.html
Green Tea
@2017 Sensing Asia62
Consumer trends: India
• Oil
–Consumers are increasingly aware that there are good and bad fats
and starting to consciously choose good over bad fats.
–Consumers are increasingly choosing baked over fried food,
including sweets and snacks.
• Fiber
–Products with high and added fiber are increasing
(e.g. bread, cereals and snack products)
• Protein
–Due to the vegetarian population base, demands for plant-based
proteins remains strong.
Source: Nielsen, Mintel, the Economic Times
@2017 Sensing Asia63
Table of contents
1. Market overview and consumer trends
1.1 ASEAN
1.2 Japan
1.3 India
2. Marketing strategies case studies
2.1 ASEAN
2.2 Japan
2.3 India
@2017 Sensing Asia64
Marketing strategies case study (ASEAN): Carabao group
(Carabao Dang energy drink)
Background
• Launched the energy drink “Carabao Dang” in 2002 when M-150 (40%
share) and Red Bull (26% share) were dominant in the market.
• After 10-plus yrs Carabao grabbed 21.7% market share from M-150 and
Red Bull. Now No.2 in the energy drink market.
• Targeted consumer: working population in need of energy and refreshment
during work, low to moderate income bracket
Source: http://www.carabaogroup.com/en/investor/download/ENG_Annual%20Report_2558_ForWeb.pdf
https://globalalliancepartners.s3.amazonaws.com/propositions/59cf8f6bccd43fa6a6b5793eba25ded5.pdf
https://www.krungsri.com/bank/getmedia/84a126b3-2e87-438d-a930-dcd78fea5ae9/Company-Update-141058-01-EN.aspx
http://www.osk188.co.th/th/images/articles/research_center/download/fundamentals/pdf_en/2016/05/th_carabao%20group_initiating%20coverage_20160531_rhb.pdf
@2017 Sensing Asia65
@2017 Sensing Asia66
Strategies
• One of the firm’s founders is Aed Carabao, a leader of a famous music-for-
life band called “Carabao”
• Marketing through various media channels to reach wider consumer
coverage
• Marketing to reach target customers in specific areas (“Bao Dang Girls
Team” and “Cash Van model”)
Source: http://www.carabaogroup.com/en/investor/download/ENG_Annual%20Report_2558_ForWeb.pdf
https://globalalliancepartners.s3.amazonaws.com/propositions/59cf8f6bccd43fa6a6b5793eba25ded5.pdf
https://www.krungsri.com/bank/getmedia/84a126b3-2e87-438d-a930-dcd78fea5ae9/Company-Update-141058-01-EN.aspx
http://www.osk188.co.th/th/images/articles/research_center/download/fundamentals/pdf_en/2016/05/th_carabao%20group_initiating%20coverage_20160531_rhb.pdf
Marketing strategies case study (ASEAN): Carabao group
(Carabao Dang energy drink)
@2017 Sensing Asia67
Table of contents
1. Market overview and consumer trends
1.1 ASEAN
1.2 Japan
1.3 India
2. Marketing strategies case studies
2.1 ASEAN
2.2 Japan
2.3 India
@2017 Sensing Asia68
Marketing strategies case studies (Japan):
• Food for Specified Health Uses:
- Started in 1991
- Market size shrinking from its peak of 680 bn yen in
2007
- Very limited varieties of products: among those
currently in the market, 30% is tea, 12% is milk
beverage/yoghurt
- 1,271 products of 201 companies have been
approved so far, but only 366 products are
currently in the market
- Huge cost for product development
- Takes 3-4 years to obtain approval
Source: Tsuhan Shinbun http://www.suntory.co.jp/softdrink/iyemon/tokucha/product/
http://www.asahiinryo.co.jp/products/tea/16cha_syokuji_w/
Food with Nutrient Function Claims
@2017 Sensing Asia69
Marketing strategies case studies (Japan):
• Food with Functional Claims:
- Started in 2015
- Number of applications for over 900 products
- Changing marketing approach
Source: Tsuhan Shinbun http://www.fancl.co.jp/Items/Detail?category=02&item_code=5391a
e.g. Supplements
containing bilberry
extract and lutein
“To enjoy seeing
and reading”
Unclear/ambiguous
sales copies
Food with
Functional Claims
e.g. Fancl’s Enkin, eye
supplement
“To help the eye focus
on close objects”
Clearer message
targeting certain parts
of body
@2017 Sensing Asia70
Table of contents
1. Market overview and consumer trends
1.1 ASEAN
1.2 Japan
1.3 India
2. Marketing strategies case studies
2.1 ASEAN
2.2 Japan
2.3 India
@2017 Sensing Asia71
Marketing strategies case studies (India): Saffola oil
Source: http://marico.com/india/brands/saffola/saffola-oils
Background
• Launched by Marico Limited, much before Indian people became
health conscious (Marico produces healthcare/grooming brand
“Parachute” as well as health food brand “Saffola”.)
• Saffola’s portfolio includes edible oils, functional foods, and salt
• As Indians became more concerned about their health, variety of
healthy oils were launched and market competition increased
@2017 Sensing Asia72
Marketing strategies case studies (India): Saffola oil
Source: the Economic Times Brand Equity
BEFORE
• Typical customer: mid aged urban male who switched to Saffola from regular oil
due to recommendation from doctors
• Brand Idea: therapeutic, medical item
• Marketing strategy:
Called itself “life insurance”, bulwark against heart disease
Ambulance lights and sirens, panic-stricken faces in the ad
NOW
• Customer base: In addition to the old customer base, obtained new customers
who want to have an active and healthy life
• Brand Idea: Optimistic and positive, such as care and happiness
• Marketing strategy:
Leaving from scare-mongering ads, runs “Saffola FIT foodie”TM website,
introducing healthy recipes of traditional favorites supervised by nutritionists
and dieticians
Position on proactive and preventive heart health
@2017 Sensing Asia73
Marketing strategies case studies (India): Saffola oil
Source: https://www.instagram.com/maricocareers/ https://www.fitfoodie.in/
@2017 Sensing Asia74
Marketing strategies case studies (India): Saffola oil
Source: The Economic Times Brand Equity, Livemint.com
• Further challenge:
– Still seen as mama papa brand
– Whether the brand can obtain supports from younger consumers or not is the
question
• Saugata Gupta, managing director and CEO of Marico, in an interview:
– Going to focus on “in-between healthy foods” (healthy planned meals around
11am and 6pm) as part of its three-year growth strategy
– Super premium edible oils (Saffola Aura), male grooming (Set Wet, Beardo),
and food (Saffola) should drive the company’s growth in the next three years
– Seeing small local shops as the biggest sales channels for snacking and
impulse items (Marico has not reached at the moment)
@2017 Sensing Asia75
Sensing Asia Ltd.
Phone : +81-3-6205-3131
Fax : +81-3-6205-3100
Thank you!
The Asian food consumer: A
global citizen
Speaker: Natasha Telles D'Costa, Director, Visionary Science Practice: Chemicals, Materials,
and Foods- APAC, Frost & Sullivan, New Zealand
Agriculture
Nutrition
Presented by
Natasha Telles D’costa | Director, APAC
The Asian food consumer: A Glocal citizenMarrying Premiumisation & Value for Money to Ascertain
How Consumers Food Focus are Changing
2017
The Frost & Sullivan StoryOur Global Footprint 40+ Offices – Scanning the Globe for Opportunities and Innovation
78
1961 1990 Today
Pioneered Emerging Market
& Technology Research
• Global Footprint Begins
• Country Economic Research
• Market & Technical Research
• Best Practice Career Training
• MindXChange Events
Partnership Relationship
with Clients
• Growth Partnership Services
• GIL Global Events
• GIL University
• Growth Team Membership
• Growth Consulting
Visionary Innovation
• Mega Trends Research
• CEO 360 Visionary Perspective
• GIL Think Tanks
• GIL Global Community
• Communities of Practice
Emerging Research
1961-1990
Growth Partnership
1990-Today
Visionary Innovation
Today-Future
Key Focus Areas under Agriculture and Nutrition The Agriculture and Nutrition Practice Approaches the Industry from Five Major Segments
79
Aerospace & Defense
Automotive & Transportation
Visionary Sciences
Energy & Power Systems
Environmental & Building
Technologies
Healthcare
Industrial Automation & Process
Control
Information & Communication
Technologies
Our Industry Practices
Electronics and Security
Measurement and Instrumentation
Agriculture and Nutrition – Key Focus Areas
• Omega Fatty Acids
• Direct fed
microbials /
Prebiotics
• Protein Ingredients
• Soy based
ingredients
• Whey Protein &
Casienates
• Vitamin Premixes
• Botanicals
• Other Functional
Ingredients
Nutraceuticals Animal Feed Food
Ingredients
End Product
Research
• Vitamin Premix
• Growth Promoters
• Enzymes
• Amino Acids
• Probiotics
• Dietary Fibers
• Coccidiostats
• Preservatives
• Other Feed
additives
• Emulsifiers
• Colors
• Preservatives
• Flavors &
Fragrance
• Antimicrobials
• Enzymes
• Anticoagulants
• Sweeteners
• Starch
• Stabilizers
• Anti caking agents
• Acid Regulators
• Moisture retention
agents
• Processed Foods &
Snacks
• Fresh & Frozen
Foods
• Dietary
Supplements
• Functional Foods &
Beverages
• Animal Feed &
Nutrition
• Morning Goods /
RTE / RTF / RTC
• Cooking aids /
Prepared
Convenience &
staple foods/Instant
mix
• Oils & Fats
Agriculture
• Crop production
• Crop management
• Cash crops
• Food crops
• Plantation
management
• Sustainable
agricultural
practices
• Farm to Fork
efficiency support
The Evolving Food Consumer
WHAT KEEPS US UP AT NIGHT? The Developed World worries about Rising Healthcare Costs,
Driving Demand for Food as Nutrition If current trends hold - by 2050, healthcare spending will double, claiming 20-30% of GDP for some economies
81
Disease/Care
Management
Prevention/Wellness
Go
al: K
ee
p p
eo
ple
he
alt
hy l
on
ge
r
End of LifeChronically Ill Unmanaged
Chronically Ill Managed
Undiagnosed“At Risk”Healthy /”Worried
Well”
Go
al: M
an
ag
e o
r m
itig
ate
ris
k
Go
al: D
iag
no
se
an
d r
ed
uc
e
trea
tme
nt
de
lay
Go
al: M
ove
to
mo
re
inte
rac
tio
n a
nd
se
lf-
ma
na
ge
me
nt
Go
al: M
an
ag
e
Go
al: In
form
ed
de
cis
ion
s
Track, Predict,
Intervene, Manage
SIZ
E O
F IM
PA
CT
ED
PO
PU
LA
TIO
N
Non Communicable
Diseases have witnessed a
46%
Lifestyle Diseases have
emerged as the key global
cause of death
Heart Diseases cause
27%of global disease
mortality
growth in mortality
rates since 2000
Food Security and Food Safety as a Major Focus in The Developing World
82
of the worlds hungry
population lives in APAC
of fruit & vegetables
produced in APAC
are wasted
>5% of GDP is
spent on
healthcare in most
APAC economies
driving interest in
preventative
nutrition
HEALTHCARE COSTS
FOOD FRAUD
FOOD
WASTAG
E
FOOD
SECURITY66%
or 522 million
42%
is lost to food scams
every year in APAC
driving calls for traceability
>8 billion USD
However Changing Demographics will Result in Growing Sedentary Lifestyles and
Demand for Premium Health Products
83
*Middle Class is defined as the section
of society earning between 2500-4999
USD per month corrected to
purchasing price parity per country
of the world’s
billionaires and
over 30% of the
world’s High net
income
individuals live in
APAC!Source: World Wealth Report,2015
of the world’s
Millennials live in
APAC!Source: Frost & Sullivan
of global GDP
comes from
APAC!Source: IMF, 2015
Middle Class*
Individuals
with growing disposable
incomes!Source: Frost & Sullivan
Market Consumption TrendsThe Food Consumer is Changing in leaps and bounds led by a Focus On Nutrition and the Need To Make
Their Money Go Farther
84
Consumer
preferences towards
added nutritional
value and ‘free-from’
foods. Individuals
and organisations
aim to reduce
nutritional
deficiencies.
KEY TRENDS
HEALTH AWARENESS
Rising populations and affluence in the
large urban centres particularly in
APAC has increased uptake of
convenience and food service products
URBANISATION
Decreasing rates of sustainable
food production provides an
opportunity for premium
manufacturers
SUSTAINABILITY
Blurring borders and
changing demographics
drives demand for
convenient and
accessible food choices
as global palates change
GLOBALISATION
Traceability
Responsible Nutrition
Natural Trend
Lifestyle Nutrition
Preventative Healthcare
Urbanisation
Gen-Y
Globalisation
Megatrends to Microeffects – Consumers will Buy Concepts Not Products
85
Indulgence and Visual Eating
Social Media & Affluence
Glocalisation Changing Competition
Ethnic Food goes Global
Convenience
Bricks & Clicks
Fitness for Everybody
Condition Nutrition
Affordable Nutrition
Free from
Back to Basics: Ancient Foods
Eco is Consumer Friendly
Transparent Value Chains
Eating Local, supporting local
Ethical Trade
WHERE WE BEGAN WHERE WE ARE WHERE WE ARE GOING
Sustainability
& Food Safety
Health &
Wellness
Globalisatio
n &
Changing
Economies
Consumer Food Choices and Affordability will be Defined based on Emotional
Connections with Food Products- The Story has never been More Important
86
ASPIRATIONAL LIVING
A key consumer trigger
helping assess nutraceutical
messages:
• India
• China
• ASEAN-5
ETHNIC ASSOCIATIONS
Large traditional medicine
sectors moving into the
commercial space
• South Korea
• India
• China
• New Zealand
CONVENIENCE
Markets where urbanisation
is a key influencer
• South Korea
• India
• ASEAN-5
• Australia
• Japan
AGEING FOCUSSED
Markets where the rate of
ageing is accelerated
• Japan
• Australia
• New Zealand
TRACEABILITY
Growing concerns over
ethical and safe value chains
• Japan
• Australia
• New Zealand
• South Korea
• China
While demographics tend to
skew consumer ingredient
choices each country tends to
have similar overarching
drivers
Affordable Nutrition: Investments into Nutrition
Value for Money becoming a Priority The APAC Example – Dairy Today is an Investment into Healthy Living
88
The bulk of ANZ consumers today reside in markets where it takes over 30 minutes of work at minimum wage to afford a liter of UHT milk
The growing willingness of lower income consumers to invest in the nutrition that dairy provides is a factor driving dairy companies to invest
in growing their value added portfolio
The growing focus on austerity in APAC has not focused on dairy but has caused a growing crop of consumers willing to invest in premium
products- if a value added benefit is evident
0
0.5
1
1.5
2
2.5
0
0.2
0.4
0.6
0.8
1
1.2
1.4
1.6
1.8
Fre
sh
milk P
rice (
$U
SD
)
Ho
urs
at
min
imu
m w
ag
e t
o
bu
y 1
L m
ilk
Hours at Minimum Wage to buy 1L of Fresh/UHT milk, APAC, 2017
Hours at minimum wage to buy 1L milk Fresh Milk Price (1L) USD
Income
Health Value
Accessibility
Price
Affordable nutrition : The natural example
89
“nothing artificial
or synthetic
(including all color
additives
regardless of
source) has been
included in, or has
been added to, a
food”
Limited in market
natural
definitions-
natural is often
confused with
organic, free from
and clean label
Only defined in context of flavourings- “Source material must be vegetable, animal, or microbiological. Must be produced by a traditional food preparation process.”US-
FDA
EU
APAC
Consumer
Buzzwords
100%
Natural
Fresh/Clean
Free- From
Organic
Farm Fresh
Pure/Real
The demand for natural/clean labels is a key focus area for food manufacturers
90
With increasing concerns about chemical side effects and introduction of synthetic additives into foods consumer demand for natural alternatives has
increased dramatically.
The industry responded to such demand by focusing on customization of products to focus on natural alternatives for established variants.
Increasing Shifts to NaturalAPAC:
Increasing
focus on local raw
materials such as
Noni, green tea ,
Ayurveda etc.
USA:
Stevia a natural
sweetener takes on
aspartame the
established synthetic
variantEU:
Beta-carotene a primarily
synthetic variant facing
substitution with natural in
spite of being more
expensive
The natural label has emerged as a market
defining trend with synthetic products being
constantly replaced by natural ingredients due to
worries over synthetic variants safety.0
500
1000
1500
2000
2500
2009 2010 2011 2012 2013 2014 2015 2016
US Stevia Market, 2009-16
0%
2%
4%
6%
8%
10%
0
100
200
300
400
500
2009 2010 2011 2012 2013 2014 2015 2016Natural Synthetic Natural growth rate
Implications of natural labels The Food Consumer is Changing in leaps and bounds led by a Focus On Nutrition and the Need To Make
Their Money Go Farther
91
60% EU consumers would
choose a product
with natural on the
label over one
without KEY TRENDS
TRUST
30-40% consumers in
developed countries would focus on
ingredient compositions on labels
INGREDIENT AWARENESS
APAC consumers are 3Xmore likely to pay premium for an
organic tag on a product
SUSTAINABILITY
A back to basics focus
has resulted in
consumers spending
up to 15% more on products that
have cultural tags
such as Ayurveda/
Traditional Chinese
medicine claims
ETHNIC FOCUS
Consumer triggers: Investments into Nutrition
Conveying Value : Consumers look for different stories that they identify with to invest in
food
93
Fitting in- A focus on providing a
nutritional story that blends into daily life
Secure Supply Chains: Playing on
the willingness to invest in “fresh”
Peddling Dreams: Investing in
connected eating and traceable
nutrition
Tall Poppies: Food as the ultimate
status symbol
ACTIVE NUTRITION: “A form of nutrition that involves a lifestyle that
provides the body with optimal physical and mental stimuli via food”
CASE STUDY 1 : Fitting In - Conveying Value via a Lifestyle StoryFrom condition to demographic to active nutrition – a story of changing health and affordability propositions
94
Functional Foods
Functional
Beverages
Dietary …
Nutraceutical Market: Split by Product Type, (World),
2015
Active as a Lifestyle Choice
Maternal Health Geriatric Health Kids Health Sports nutrition
Growing
importance of
products focused
as an essential
nutritional aid for
new mothers
Focus on ageing nutrition products
to provide supplementation
againstosteoporosis and
improving metabolicfunctions
Addressingdevelopmental
concerns in bone &joint health
and focusing onthe Asian
micronutrientdeficiencychallenge
Addressing demands for supplemental
nutrition across an active lifestyle
focusing on providing healthy
energy sources for consumers
Condition Nutrition
De
mo
gra
ph
ic N
utr
itio
n
31% 33%
36%
Heart Health
Eye Health
Digestive health
Cognitive health etc.
Japanese are investing in
Children’s Health• Growing functional beverage market
aimed at children such as Calpis’ range
of fermented dairy products
The Japanese Story: A Heavy Burden on Young Shoulders
95
KEY FACTS
• 25% of the Japanese populations over 65
• Young Japanese will have to work longer
to support their dependent elders
• Children are thus a family’s main
investment in its future
Trend towards cute food• Japanese food manufacturers are
aiming to introduce aesthetically
pleasing local RTE foods to encourage
kids consumption
Food Education Programs• Ajinomoto Co, Mos Food Services Inc
and Q.P. Corp have launched
education programs to encourage
children to understand healthy food
choices
Trigger 1 : Products must convey a story of better nutrition
96
Naturally functional : A focus on
providing a naturally functional nutritional
story that blends into daily life
Ingredient Stars
Social media driven
• Ancient wisdom :Focus on superfoods such as ancient grains, superoxidants, teas etc
• Social media will drive natural ingredient awareness• Turmeric awareness as an anti-inflammatory has
skyrocketed since 2014• Social media is a key tool driving naturally functional
product launches especially within emerging ingredient segments
CASE STUDY 2: Secure Supply Chains - Playing on the willingness to invest in “fresh”Fresh symbolises quality in a processed food economy and is a concept most developing nations are
beginning to associate with premium- however perspective differs greatly
97
Manufacturer Messaging of Fresh
tends to be quite Consistent
Typical Words used by Consumers:
Freshness Innovation
Better, Goodness Assurance
Natural / Organic
Authenticity
New Process and Shorter Treatment
Higher Value Perception Indulgence
Chilled
However Consumer Perception varies significantly
on a Regional and Economic Basis
CHINA: A natural, fresher, longer shelf life
product
Buzzwords: “Premium imported product”
AUSTRALIA: Minimally processed
Buzzwords: “Closest thing to raw”
SAUDI ARABIA: Natural, no
preservatives, added nutrients
Buzzwords: “Fresh, fortified and
locally sourced/organic”
Trigger 2 : Deliver more than you promise
98
Secure Supply Chains: Playing on
the willingness to invest in “fresh”
• Fonterra has launched a food quality "seal" to all
its branded products - a stamp with the words
"Trusted Goodness"
• US products will bear a "non-GMO" claim, in China
it will be "grass-fed" and for other markets "cared-
for cows" will appeal to people with animal welfare
concerns.
• Arla’s campaign is focussed on the goodness of
milk with its full cream narrative
• The company aims to take consumers back to a
simpler time when milk was natural and a highly
nutritious food
CONVENIENCE
Consumers look to choose products that
are both natural and easy to integrate into
their diets and daily life
CONDITION NUTRITION
New product development will focus on
natural products that cater to specific
demographic and health conditions as part
of its overall concept
FOOD AS A STATUS SYMBOL
There will be a growing focus particualrly
in Asia of food choices becoming a means
of driving home a story of affluence
Dairy is a key focus of “fresh” based natural product messaging
CASE STUDY 3: Peddling Dreams: Investing in Connected Eating and Traceable NutritionConsumers require traceable connected eating food to prove quality and provide references of food safety
99
INTERNET OF THINGS (IOT)
Food providers will have to provide a strong accessible traceable story
AUGMENTED AND VIRTUAL REALITY
Brand interaction will define price tags of products and define its luxury status
BIG DATA
Predictive packaging based on consumer trends and ideal formats of delivery
Product Spotlight : Traceable, local and naturally processed are growing trends in the
natural product industry
Traceable stories will continue to drive natural product demand
Meat with vegetables is a growing natural food trend and seafood a key innovationarea in natural food products. Many US companies are now capitalising on thistrend for healthy, traceable, natural seafood options.
LoveTheWild, Boulder, offers traceable, sustainable frozen seafood mealkits in such varieties as barramundi with mango sriracha chutney, catfishwith Cajun creme and Pacific cod with roasted red pepper almond sauce.Locally grown and short farm to fork timelines will drive
consumer interest
Nudie Juices took the Australian market by storm when they launched locally grown 100% Australian based juices to a country that was facing growing worries over imports of juice concentrate.
Though priced significantly higher Nudies products have remained extremely successful due to their natural and local storyNaturally processed is a key consumer adoption factor
paritucalrly in the west
While organic, ethical trade and free from processing methods continue to dominate choices of natural foods there is a growing interest in newer processing techniques that distinguish food as safe and natural.
Sri Lanka has become to first country in the world to produce its tea without ozone depleting chemicals a fact that is resonating with developed world tea consumers.
Connected Eating will be driven by e-tailing of Food- What CEO’s think
The cognitive era is upon us, and it will have a significant transformational impact on the global food and beverage industry. Are you
ready?
Internet of Things
(IOT)
Augmented and Virtual
Reality
Big Data
Trigger 3 : Connected Eating in the Cognitive Era
Ingredients providers will have to
provide a strong accessible traceable story
Strong partnerships between B2B and
B2C to assess customer experience as
ingredients become a sought after
customer product
Predictive ingredient demand based
on consumer trends and formats of delivery
CASE STUDY 4: Tall poppies: Food as the ultimate status symbolSocial media will be a major driver for the growth of the indulgent category
103
Indulgence has taken on a major role in mental well-being globally. A growing crop of RTD drinks focussed on
indulgence such as Iced Mocha’s will begin to claw away market share within this category
Food
Home
Life…
Busi…
News
Other
40% of Singaporeans and
42% of South Koreans have too17% of Chinese and 8% of
South Koreans post once a day
of pins on Pinterest are related to
“FOOD AND DRINKS”
of people between 25 and 34 take their
phones or tablets with them to the kitchen
SensoryAppeal
HumanStory
Accessibility
Timeliness
IdentityShaping
Approximately 52%of topics covered in highly shared
(‘viral’) headlines are about FOOD
consumers in China (62%) have
shared their food experience on
social media in the past month
6 in 10
Case Study of Aspirational Food Gifts
104
Japanese consumers provide aspirational stories by providing contacts with premium local products and health
& wellness based international products
FUROSHIKI Gift OKAKI Set includes Sencha Superior, Genmaicha,
and OKAKI rice cracker which is one of the most popular and classic
snacks in Japan.
Green Tea box sets with premium loose leaf green tea are
growing in popularity in Japan especially those from Kyota and
Shizuoka famed for making the best green tea.
Japanese consumers often find international products overwhelming
and so food pairing is recommended in gift bags.
International food gifts in Japan tend to either have a strong
health & wellness of a luxury message with a clear local story
Trigger 4: : Protein is currently one of the most popular natural ingredients that is catering
to convenience, condition nutrition and aspiration via its product launches
Aspiration driven personalised protein shakes in Singapore
Catering to the need for personalisation USANA Health Sciences launched in2016 its First Personalised Shake, MySmartTMShake.
With backing from professional sportspersons the shakes offer two main consumerpulls- the ability to personalise the shake with the ability to choose separately thebase ( soy/whey), the flavour optimiser (various fruits) and the booster (fibreoptions)
Convenience driven demand for RTD options in Malaysia
While Singapore demands personalisation markets such as Malaysia are focussing on RTD options for protein drinks
Companies such as Fraser & Neaves are taking the concept of Protein into the barista space and providing protein enriched instant coffee options for the food service sector
Condition nutrtion focussed specific in protein in Thailand
The Thai consumer is probably the most developed protein consumer in SEA.
This is evidenced by protein in Bangkok being differentiated based on Whey (muscle building) and Carnitine (fat burning)
CP Meiji has thus launched in 2015 “double protein” milk- with whey protein concentrate in a chocolate flavour and carnitine in a natural flavour aimed at urban, exercise driven residents
Competitive Trends
Key Competitive Trends – Snackification
Alliances between alcoholic andnon-alcoholic FMCG players
As alcoholic beverage consumptiondips more and more players areentering health & wellnessfocussed beverages.
PepsiCo has partnered withSuntory to take on Coca Cola inAsian markets via a H&W beverageportfolio
Snack providers focus oninteractive marketing
Unilever Ventures has invested in anaugmented reality treasure hunt gameSnatch, a game dubbed “Pokémon Gofor brands
Snatch is an augmented reality mobilegaming experience where players findparcels and brands to win real prizes.Immersing people in an interactiveenvironment where they’re activelyseeking out products is being seen asa huge step in creating brand mindshare
Traditional food companies focus on the high value medical nutrition space
Nestle is doubling its interest in guthealth by investing in businessessuch as Seres Health (microbiometherapeutics) with an aim toultimately develop nutraceuticalsfor Gut and IBS products.
With an ageing consumerpopulation at risk of severaldigestive diseases Nestle isbeginning an aggressivetransformation into a H&Wcompany.
Pharmaceuticals & Consumer Health Future
Strategic Focus – Recent Examples
Douglas pharmaceuticals enters nutraceuticals with health supplements
• Douglas pharmaceuticals entered the preventative nutrition space in 2014 with
current products aimed at infant, maternal and geriatric care.
• The Puria range is growing in double digits and emerging as a key export venue for
the company.
Taisho pharmaceuticals a growing innovation source for functional beverages
in Japan
• Taisho pharmaceuticals forayed into the medicinal beverage market as eary as 2002
and has partnered with several leading pharmaceutical companeis such as Takeda
to develop products ranging from energy drinks ( Lipovitan D) to gastrointestinal
products such as Ichoyaku
DuPont investing in China via local pharmaceutical companies
• DuPont has tied up with Traditional Chinese herbal tea producer Guangzhou
Wanglaoji Pharmaceutical Co Ltd to introduce probiotic herbal drinks aimed at
children under 12 in China.
Ageing Nutrition : Biozoon moving into ageing nutrition via 3D
printing technology
Smoothfood is a growing requirement for elderly
consumers
Biozoon uses plant based texturizers and
fresh food, transforming it into smoothfood
using 3D printing to create visually appealing
meals which can be nutritionally tailored to any
individual., Smoothfood workshops are offered,
with chefs to inform users on how to prepare the
food.
Benefit to Consumer
Cater to very specific nutritional needs
Relevant to health & wellness trends such as Nutrigenomics
Increases quality of foodTurkey medallions with carrot by Biozoon©
Population over 60 by
2025
1.2 Bn
Are expected to be
undernourished
45%
Growth in elderly
homes in developed
markets
4X
Market for ageing
based foods
(nutrition and texture)
> 8 BN
Personalised nutrition : Nuritas using AI to create
functional foods
Scans every gene and protein in a food
sample, for peptides that offer human health
benefits
10 times faster than conventional research
methods, with 380 times more predictability, at
a thousandth the cost
Benefits: Targeted approach, high speed
prediction, 100% natural ingredients, cost
effective innovation, sustainable
Applications:
– Molecules found have antimicrobial
capabilities, can be used as a natural
food preservative to enhance food
safety and extend shelf life.
– Product differentiation, the peptides
discovered are novel, enabling the
creation of unique functional foods
Benefits across value chain
Customer: Increased value and quality of offering, potential cost
savings passed on through value chain
Manufacturer: Cost effective, reduce labour costs, reduce wastage,
product differentiation
$5bAI market by 2020
$101bGlobal natural
healthy food
market 2016
$69bGlobal functional
food market 2016
39%
increaseIn revenue
for early
adopters of
AI by 2020
Gamification as Education
Target market was primary school children
Indomilk wanted to invite parents to actively
support their children’s education and health
The game is centred around a very popular
cartoon character, Jagoan BoBoiBoy and a
collaborative board game was created
Game characters were obtained through
purchasing the milk drinks and cutting the
characters available on the packaging
Benefit to across value chain
Consumer: Children receive the health benefits of milk, whilst
developing key cognitive skills through playing the game
Customer: Parents feel like their children are benefiting with
respect to education, development and health
70%Of business
transformations fail due to
lack of engagement
$11bGamification market
by 2020
40%Of top organisations are using
it to transform business
operations
“75% psychology,
25% technology”
- Gabe Zichermann
Concluding Remarks
Conclusions – Lessons & Learning Competitive landscapes are changing rapidly for the food sector and providing emerging opportunities
113
Focus On What Makes Consumers Tick
• Identify consumer triggers and messaging in each market that will define the difference
between mind and market share
• Respect the local story and assess what makes consumers tick : where does the brand fit
in their daily life?
Understand That Competition Is Changing – STAY RELEVANT!!
• More and more pharmaceutical manufacturers will enter the food and beverage market
changing competition and rules of the road
• The key nutrition areas will drive scope for collaboration with non-traditional supplement
manufacturers
• Embrace the tall poppy! – Most developing consumers want a story of affluence attached to
a premium product – tailor the story to match this need
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