The War on Sugar – Food Companies And Retailers Strategies Reinvented

Consumers’ growing sugar intake is now undisputedly one of the prime causes of obesity. Contributing very little to no health benefits, and relatively high amounts of energy to our diet, sugar has become an easy nutrient to blame for the problem. One of the consequences for those who have a high sugar consumption can be diabetes and heart diseases. The global purchase of sugar is currently 140 million tonnes per year, and with a CAGR of 2.1%, it is expected to rise up to 156 million tonnes over the 2015-2020 forecast period.

In 2015, the top 10 sugar consumers in the world buy 11.7 million tonnes of sugar from carbonates and sugar and sweeteners alone. If current formulations remain, this figure will rise by another 77,000 tonnes by 2020.

sugar-map

With malnutrition, and diet-related diseases still on the rise, the world has been busy with public health appeals, calls for action and changes in nutrition regulations. Euromonitor expects the sugar tax to negatively impact the sales of soft drinks in the UK, even before its implementation in 2018, due to the stigma linked to sugar. Brands are now looking into new ways to appeal to consumers with still tasty, but healthy snack alternatives.

Top 10 sugar consumers globally

Country Sugar Consumption (grams per capita per day)
Chile 143.0
Netherlands 138.9
Belgium 135.4
Israel 133.4
Hungary 133.0
Germany 131.4
Slovakia 128.9
USA 128.3
Brazil 126.3
Australia 125.1

Source: Euromonitor International

 

Euromonitor’s packaged food data shows growth of healthy snacks rose by 7 percent in 2014-2015,  compared to ‘conventional’ snacks, which only increased by 5 percent. “The growth in healthy snacks was driven by Western Europe and North America, which combined, increased by US$10.8 billion from 2011 to 2016, an emerging trend that could transform the food industry.” said Jack Skelly, food analyst at Euromonitor International.

The ‘war on sugar’ has dented the potential demand of sweet snacks as consumers have greater awareness of ingredients used in food production and are more cautious on their consumption. According to a recent Euromonitor survey, 47 percent of global respondents look for foods with limited or no added sugar.  “The demonisation of sugar inevitably created a change in the type of ingredients used in snacks,” says John George, ingredients analyst at Euromonitor. In 2015, global sweeteners use in conventional snacks amounted to 15.5 million tonnes, while in comparison, new snacks included less than a fifth of this at 3 million tonnes.

This health trend doesn’t only foster ingredients shift but also new pack sizing strategies,  “We’ve seen an increasing polarisation of pack sizes in conventional snacks, as larger formats are  marketed for a shared consumption, and smaller sizes, more commonly launched as ‘calorie packs’. The aim of these new formats are to convey greater portion control and lower the guilt of buying a treat while still boosting impulse purchase.” adds Karine Dussimon, senior packaging analyst at Euromonitor.

“Consumers are also increasingly aware of the importance of healthy weight in prevention of diabetes and other diseases, so minimising sugar and calorie intake is high on consumers’ agenda.” mentions Ewa Hudson, head of health and wellness research at Euromonitor. New products are predicted to take a larger slice of the snacking market, resulting in further acquisitions.

These insights have been collected at the recent press briefing, hosted by Euromonitor International at their London headquarters in September 30, 2016. For more information, read the presentation extract available on Euromonitor’ Slideshare page: http://www.slideshare.net/Euromonitor/no-sugar-please-how-snacks-are-being-redefined