Joanna Cosgrove01.27.11
Certain health conditions, food allergies and intolerances continue to compel a growing number of global consumers to seek foods and beverages that are personalized to meet their unique nutritional needs. Technology is playing an increasingly important role in the proliferation of the trend, especially in the U.K.
Researchers at Datamonitor found that in the U.K., nearly half (47%) of U.K. consumers currently find the idea of using information about their genes to provide nutritional and diet-related advice appealing.
“Consumers have always wanted food and beverages which cater to their individual needs,” commented Mark Whalley, an analyst at Datamonitor. “However, it is only in the past few years that manufacturers have really woken up to this fact and begun to create grocery products that consumers really feel identify with their personal attitudes and requirements. They are constantly asking themselves ‘what does this product say about me and how does it specifically benefit me?’ It’s little surprise considering that our research shows two in every three U.K. citizens attach importance to the concept of individuality and being able to express themselves.”
Datamonitor said that this attitude will inevitably give more traction to nutritional technology—specifically gene-based nutrigenomic technology—enabling the consumer to use their own genetic information to determine how a food or beverage can most effectively benefit their specific makeup. A particularly appealing example of this concept in action, the firm said, would be food and drinks which can more effectively address a particular health condition, such as having a weak immune system. Genetic flavor preferences could also be established, they said, allowing for goods that taste better to the consumer.
“Currently [nutrigenomics] is a very niche concept with R&D proving to be expensive (and therefore restrictive as to who can and cannot explore this possibility),” Mr. Whalley said. “Consumers are probably also not ready for such a concept—functional foods need to gain more acceptance and current levels of trust in this particular concept built upon. However, in 10 years time it could be much more prominent. Certainly most of the big food and beverage players will be identifying this as something interesting to consider for the long term.”
Consumer Perspective
Mr. Whalley said that consumers are increasingly on the hunt for products that are tailored specifically for them. “In an age of so much choice, why settle for something generic? Consumers do not like to be treated as one homogenous group—they are individuals and therefore appreciate products which reflect this. Another consideration is that, for many, certain product choices are representative of personal attitudes and values. Consumers look at a product and think ‘what does this say about me?’”
Results from a global Datamonitor consumer survey of 20 markets reflected that 73% of consumers deemed whether the product features best address their needs as being highly influential in deciding what grocery products and brands offer good value for money. “To this end, 42% of consumers perceive that a 'customized/personalized' claim would lead to a more favorable evaluation of a grocery product,” said. Mr. Whalley.
But all of that choice is causing a phenomenon researchers have termed “choice paralysis,” whereby consumers become unresponsive to new product launches and simply seek out trusted brands. “Fifty-two percent of respondents to the survey agreed with the statement ‘There is too much product choice when doing grocery shopping,’ while only 17% disagreed,” Mr. Whalley explained. “This does highlight contradictory behavior from consumers—they like the freedom of having options but they also feel overwhelmed when they are confronted with many. If customization involves a lot of buy-in from consumers in terms of time or emotional engagement then there is a risk they will turn to something simpler.”
Market Potential
The concept of personalization is especially evident in the functional foods segment, where there are products targeted to health conditions, usage occasions, specific dietary requirements and demographic differences.
Mr. Whalley affirmed that the concept of personalized nutrition is lucrative if approached effectively, and despite the aforementioned choice paralysis, he doubted consumers would ever tire of products that have particular relevance to them.
Success, he said, depends upon the extent of the customization and the way in which it is achieved. “Creating unique products to exact consumer specifications is obviously more expensive than mass-producing something, as well as not necessarily being the most suitable way of manufacturing FMCGs en masse. This is not to say that it cannot work as a niche concept, but certainly it will only prove lucrative for some. However, having a portfolio of products which target various demographics (be it age, gender, specific health conditions or just about any other way of separating consumers) is generally a good way of ensuring that a company can appeal to a wide range of consumers.”
The most customizable products are beverages. Mr. Whalley pointed to the sheer size of the Vitaminwater range as an indicator of how beverages can be formulated to target the need of almost all consumers.
In the U.K., MANFLU Ltd. launched a new Soothing Hot Or Shot Drink. The product, which is geared toward men, is said to be the first anti-cough and cold product that is sold in a shot format and also can be consumed at room temperature, or can also be served hot.
In Japan, Nagatanien recently added a new Instant Shoga Tom Yam Goong Soup (Ginger Tom Yam Goong Soup) to the Nagatanien Hieshirazu-san No (“Chilly Miss’s”) brand. The product claims to contain ingredients which make it particularly suitable for young women in their 20s and 30s who can easily feel chilly, for example, when sitting for long periods in an air-conditioned office.
Custom Choice has afforded those with celiac disease the option of creating their own gluten free breakfast cereal. One of three base cereals can be customized with up to 11 ingredients to create the highly personalized breakfast meal. “It is arguably more important for consumers with specific dietary requirements to have customizable options because they are more restricted in what they can purchase,” Mr. Whalley noted.
In conclusion, Mr. Whalley felt that the current market’s personalized food and beverage offerings are likely only a small representation of what’s to come. “As interest amongst consumers increases, we expect to see a surge in the number of food and drink companies launching products with DNA/genetic influences over the next few years, probably originating from coming smaller niche companies looking to find gaps in the market,” he said. “The larger brands will likely wait to see what products are launched and also how these are received by consumers.”
Researchers at Datamonitor found that in the U.K., nearly half (47%) of U.K. consumers currently find the idea of using information about their genes to provide nutritional and diet-related advice appealing.
“Consumers have always wanted food and beverages which cater to their individual needs,” commented Mark Whalley, an analyst at Datamonitor. “However, it is only in the past few years that manufacturers have really woken up to this fact and begun to create grocery products that consumers really feel identify with their personal attitudes and requirements. They are constantly asking themselves ‘what does this product say about me and how does it specifically benefit me?’ It’s little surprise considering that our research shows two in every three U.K. citizens attach importance to the concept of individuality and being able to express themselves.”
Datamonitor said that this attitude will inevitably give more traction to nutritional technology—specifically gene-based nutrigenomic technology—enabling the consumer to use their own genetic information to determine how a food or beverage can most effectively benefit their specific makeup. A particularly appealing example of this concept in action, the firm said, would be food and drinks which can more effectively address a particular health condition, such as having a weak immune system. Genetic flavor preferences could also be established, they said, allowing for goods that taste better to the consumer.
“Currently [nutrigenomics] is a very niche concept with R&D proving to be expensive (and therefore restrictive as to who can and cannot explore this possibility),” Mr. Whalley said. “Consumers are probably also not ready for such a concept—functional foods need to gain more acceptance and current levels of trust in this particular concept built upon. However, in 10 years time it could be much more prominent. Certainly most of the big food and beverage players will be identifying this as something interesting to consider for the long term.”
Consumer Perspective
Mr. Whalley said that consumers are increasingly on the hunt for products that are tailored specifically for them. “In an age of so much choice, why settle for something generic? Consumers do not like to be treated as one homogenous group—they are individuals and therefore appreciate products which reflect this. Another consideration is that, for many, certain product choices are representative of personal attitudes and values. Consumers look at a product and think ‘what does this say about me?’”
Results from a global Datamonitor consumer survey of 20 markets reflected that 73% of consumers deemed whether the product features best address their needs as being highly influential in deciding what grocery products and brands offer good value for money. “To this end, 42% of consumers perceive that a 'customized/personalized' claim would lead to a more favorable evaluation of a grocery product,” said. Mr. Whalley.
But all of that choice is causing a phenomenon researchers have termed “choice paralysis,” whereby consumers become unresponsive to new product launches and simply seek out trusted brands. “Fifty-two percent of respondents to the survey agreed with the statement ‘There is too much product choice when doing grocery shopping,’ while only 17% disagreed,” Mr. Whalley explained. “This does highlight contradictory behavior from consumers—they like the freedom of having options but they also feel overwhelmed when they are confronted with many. If customization involves a lot of buy-in from consumers in terms of time or emotional engagement then there is a risk they will turn to something simpler.”
Market Potential
The concept of personalization is especially evident in the functional foods segment, where there are products targeted to health conditions, usage occasions, specific dietary requirements and demographic differences.
Mr. Whalley affirmed that the concept of personalized nutrition is lucrative if approached effectively, and despite the aforementioned choice paralysis, he doubted consumers would ever tire of products that have particular relevance to them.
Success, he said, depends upon the extent of the customization and the way in which it is achieved. “Creating unique products to exact consumer specifications is obviously more expensive than mass-producing something, as well as not necessarily being the most suitable way of manufacturing FMCGs en masse. This is not to say that it cannot work as a niche concept, but certainly it will only prove lucrative for some. However, having a portfolio of products which target various demographics (be it age, gender, specific health conditions or just about any other way of separating consumers) is generally a good way of ensuring that a company can appeal to a wide range of consumers.”
The most customizable products are beverages. Mr. Whalley pointed to the sheer size of the Vitaminwater range as an indicator of how beverages can be formulated to target the need of almost all consumers.
In the U.K., MANFLU Ltd. launched a new Soothing Hot Or Shot Drink. The product, which is geared toward men, is said to be the first anti-cough and cold product that is sold in a shot format and also can be consumed at room temperature, or can also be served hot.
In Japan, Nagatanien recently added a new Instant Shoga Tom Yam Goong Soup (Ginger Tom Yam Goong Soup) to the Nagatanien Hieshirazu-san No (“Chilly Miss’s”) brand. The product claims to contain ingredients which make it particularly suitable for young women in their 20s and 30s who can easily feel chilly, for example, when sitting for long periods in an air-conditioned office.
Custom Choice has afforded those with celiac disease the option of creating their own gluten free breakfast cereal. One of three base cereals can be customized with up to 11 ingredients to create the highly personalized breakfast meal. “It is arguably more important for consumers with specific dietary requirements to have customizable options because they are more restricted in what they can purchase,” Mr. Whalley noted.
In conclusion, Mr. Whalley felt that the current market’s personalized food and beverage offerings are likely only a small representation of what’s to come. “As interest amongst consumers increases, we expect to see a surge in the number of food and drink companies launching products with DNA/genetic influences over the next few years, probably originating from coming smaller niche companies looking to find gaps in the market,” he said. “The larger brands will likely wait to see what products are launched and also how these are received by consumers.”
