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Focus on Clean Label

Consumers are increasingly aware of the health and environmental consequences of products they buy. Consequently, they are paying close attention to information on labels, opting for foods, beverages, dietary supplements, and personal care products that offer clear, straightforward information about what’s in—and what’s not in—the products they evaluate.

According to insight from Nielsen: “As all marketers are well aware, today’s consumers are more educated than ever, largely because they have access to more information than ever—and that’s only going to continue. So when it comes time to shop, consumers are putting that knowledge to use, and they’re making their selections carefully and for specific purposes. They’re also willing to pay for products that meet their specific needs, and for many, those needs revolve around knowing exactly what’s in—and not in—the items they buy.”

Consumer survey results from product data company Label Insight indicated that 39% of U.S. consumers said they would switch from the brands they currently buy to others that provide clearer, more accurate product information. Additionally, 73% of consumers surveyed by Nielsen said they feel positively about brands that share the “why behind the buy” information about their products.

Interestingly, 68% said they’re willing to pay more for foods and beverages that don’t contain ingredients they perceive are bad for them. In some cases, consumers are more interested in knowing what’s not included than what is included in the products they buy. In fact, 53% of consumers said the exclusion of undesirable ingredients is more important than the inclusion of beneficial ingredients.

That list of “undesirable ingredients” includes artificial ingredients (flavors, colors, sweeteners, and preservatives), GMOs, antibiotics, and hard-to pronounce or unrecognizable ingredients. Essentially, consumers are looking for simplified formulas, and transparency from the brands they buy.

“Today, the ‘why’ and ‘how’ behind the products have become as important as the product itself, oftentimes becoming the primary decision-making criteria that drives a purchase. This has added an entirely new layer of complexity to the way fast-moving consumer goods (FMCG) companies develop and market their products to consumers,” Nielsen noted.

Transparency and label claims are significant sales drivers. According to Nielsen data, sales of products that make organic claims are up 10% from a year ago, sales of products that make ‘all-natural’ claims are up 7.8%, and sales of products that claim “no additives or artificial ingredients” are up 8.0%. “We can also see increased sales across the broader categories along the progressive scale that describes the attributes within the clean arena.”

From ingredient lists, claims, and descriptors, to the nutrition facts panel, about four in 10 (42%) consumers said they rely on the product label as a source for helpful and accurate information about health and wellness, according to the Hartman Group.

Consumers believe less processed products are self-evident; they are not necessarily looking for a “less processed” label, the firm noted.

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Organic By The Numbers — Infographic

In 2016, sales of U.S. organic food and beverages hit a record-breaking $43 billion, accounting for 5.3 percent of total food sales in United States. Sales of nonfood organic products increased by almost 9 percent to $3.9 billion, with organic fiber, supplements and personal care products accounting for most of those sales.

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Report Forecasts Supplement Market to Reach $278 Billion by 2024

The global dietary supplements market is expected to reach $278.02 billion by 2024, according to a new report by Grand View Research, Inc. Favorable outlook toward the medical nutrition market in light of increasing applications for the treatment of malnutrition and cardiovascular disorders is likely to spur the market, the report said.

Rising sales of sports nutrition products in the U.S. and China on account of increasing prevalence of fitness and sports at a domestic level along with new product launches is likely to have a significant impact on the industry over the projected period. The market is expected to generate revenues worth $37.16 billion by 2024, Grand View Research predicted.

Rising consumption of clinical nutrition products as a prevention medium for reducing malnutrition is expected to have a substantial impact. Furthermore, increasing prevalence of premature births on a global level is expected to promote the use of medicinal supplements over the forecast period. The market was worth $19.17 billion in 2015 and is projected to witness growth at a CAGR of 9.5% from 2016 to 2024.

Further key findings from the report include:

 

  • The market for dietary supplement capsules was valued at $26.42 billion in 2015. The increasing use of omega-3 fatty acids in the formulation of dietary supplement capsules is expected to have a positive impact over the forecast period.
  • Amino acid-based dietary supplements accounted for 14.3% of the market share in 2015 and is projected to witness significant growth on account of increasing protein intake by bodybuilders and sports athletes
  • Gel caps and soft gels together accounted for 13.2% of the overall market in 2015. These products are expected to witness growth on account of their increasing application in confectionaries including chocolates, candies, and desserts.
  • Asia-Pacific is projected to grow at a CAGR of 11.2% from 2016 to 2024. Rising sales of green juice, royal jelly, blueberries, chlorella, and black vinegar in Japan owing to increasing awareness toward natural products is expected to promote the use of nutritional supplements over the forecast period.
  • North America accounted for 28.5% of the total market in 2015 and is projected to witness growth on account of increasing consumption of products with reduced calorie level and high nutritional content.
  • Key participants include Amway Corporation, Pfizer Pharmaceuticals, Abbott Laboratories, Herbalife International, ADM, DuPont, and Carlyle Group. In April 2016, Amway Inc. launched a new sports nutrition energy drink under the brand name, XS Sports Nutrition line. This type of product innovation is expected to force manufacturers to develop new products over the next eight years.

 

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