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Consumer attitudes about sugar and sweeteners Presented by Lynn Dornblaser Director, Innovation & Insight Mintel Ltd.

Agenda

Consumer attitudes and preferences

What’s on the market that delivers on those preferences

A few final thoughts

Context: “Health & Wellness” focuses on “wellness” • • •

Brands are shifting mission statements and changing marketing strategies to emphasize wellness. Among consumers, the wellness conversation surged in 2017, reaching 21.7 million online mentions, a 32% increase in mentions of wellness over the past 10 years. Brands will need to stand out in a sea of “wellness” branding and marketing. UNIVERSE COUNT FOR MENTIONS OF “WELLNESS”, DECEMBER 2007-17

3

Methodology: Universe Count references the total estimated impact of your query. This is done by analyzing source distribution for content over time, then referencing internally computed metrics for percent of volume scaled across those source types against the web at large, and finally scaling the query results accordingly. Note: the universe number is scaled across blogs, forums, twitter, etc with specific weights given to each source. For example, we know that we collect a random 10% of everything that happens on Twitter. Therefore, Social Universe is used to scale to a more accurate volume count across the entire channel. Base: 85 million mentions of wellness SOURCE: INFEGY/MINTEL

Wellness is a journey and brands should join the ride

•

•

•

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Very few adults are not focused on their health, a positive sign for the health and wellness market. Wellness is a journey for many adults, another sign of growth potential for the health and wellness market. Brands that help consumers manage their wellbeing over time by partnering with them for the long run are likely to resonate with adults who see the bigger picture of wellness.

Base: 2,000 internet users aged 18+ Source: Lightspeed/Mintel

SELECT WELLBEING SELF-PERCEPTIONS, OCTOBER 2017

“Wellness” increasingly appears in on-pack statements in US

5

“Supports the body’s overall wellness”

“Supports digestive wellness”

Balanced nutrition from a value brand

Living Intentions Activated Blueberry Blast Superfood Cereal

Rebbl Turmeric Golden Milk Super Herb Powered Coconut Milk Elixir

Aldi’s Elevation by Millville Peppermint Stick Wellness Bar

The good and bad about eating healthy Consumer statements about eating healthy, US, % agree

A home-cooked meal is healthier than one from a restaurant

81

I pay attention to the ingredients on food labels

77

The fewer ingredients a food has, the healthier it is

55

Eating healthy is too expensive

Most healthy foods lack flavor

6

Source: Mintel

48

33

“Healthy” today is about naturalness and “no bad stuff” What consumers identify as healthy and unhealthy food, US, % agree 63

60 53 47

46 40

39

36

35 28

24

18 7

5

6

5

4

5

Healthy food

7

Source: Mintel

3

4

15 5

Unhealthy food

8

8

5

5

Therefore, accentuate the positive, eliminate the negative Popcorn with protein and MCTs

Square Organics Sea Salt Protein Popcorn Contains twice the protein as plain old popcorn providing 10g. Air popped, non-GMO, USgrown kernels with mixture of spices, brown rice protein, and coconut oil known for its MCTs. 8

Small indulgences

barkTHINS Dark Snacking Chocolate with Peanut and Sea Salt Thin slivers of snackable dark chocolate packed with amazingly simple and real ingredients. Uses Fair Trade certified ingredients and is free from GMOs.

Sugar an important consideration when choosing healthy food Important factors when choosing healthy food and beverage, US Fresh

67%

Low/no sugar

51%

all natural

45%

Low/no salt

41%

Low/no fat

39%

Protein content

39%

Hormone free

28%

Organic

28%

Non-GMO

28%

Plant-based Gluten free

9

Source: Mintel

15% 12%

And tops the list for those trying to lose weight—more than fat About half of consumers who are trying to lose weight say they look for low sugar or no added sugar claims on products, higher than any other claim, including fat.

Important ingredient claims among consumers trying to lose weight, US 53

49

44

42

41

41

38 30

10

Source: Mintel

40

Low/no/reduced sugar claims grow in all regions Global: penetration of low/no/reduced sugar claims in food and drink product launches, by region, 2013 to 2017 10 9

9 8

% penetration

8

6

6

6

6 6

2013 5 5

5

4

4

5 4 4 4 4

5 5 5

5

5 4 4

4 4

2014 2015 2016 2017

2

0 North America

11

Source: Mintel

APAC

Middle East and Africa

Latin America

Europe

Low/no/reduced sugar claim more prevalent than calories Claim incidence, low sugar and low calorie, North America, 2013-July 2018 6.83%

5.21% 4.39% 3.88%

5.51%

5.31%

4.62% 3.92% 3.41%

3.45%

3.44% 2.92%

2013

2014

2015

Low/No/Reduced Sugar

12

Source: Mintel GNPD

2016

2017

Low/No/Reduced Calorie

2018

No added sugar claims: Sweetness delivered in many ways

13

Sweetened with fruit juice

Dates and raisins provide sweetness

Oasis Zero Tropical Flavoured Fruit Drink with No Added Sugar, France

Nakd. Strawberries & Cream Fruit & Nut Nibbles, South Africa

No added sugar, sweetness from fruit juice

Nix and Kix Cucumber & Mint Lightly Sparkling Soft Drink with a Little Cayenne, Germany

Non-nutritive sweeteners flat, but growth in natural varieties Use of natural non-nutritive sweeteners has increased about 1% from 2013 to 2018, while use of artificial non-nutritive sweeteners has declined by almost 1.5%, indicating companies response to consumers’ desire for more “naturalness” in products.

Sweetener incidence on North American food & drink introductions, 2013-July 2018, by type 7.65% 7.03%

6.97%

6.80%

6.55%

6.20% 4.46% 3.74%

3.71%

3.63% 2.89%

1.85%

2013

1.80%

2014

Sweeteners (all)

14

Source: Mintel GNPD

2.20%

2.11%

2015

2016

Artificial Non-nutritive Sweeteners

2.38%

2017

3.07%

2.61%

2018

Natural Non-nutritive Sweeteners

Consumers consider natural sweeteners to be healthier Sweeteners considered healthiest Honey

64.4%

Raw cane sugar

33.0%

Stevia

28.5%

Agave

26.6%

Maple syrup

24.1%

Coconut sugar

22.7%

White granulated sugar

20.0%

Monk fruit Sucralose

18.5% 7.3%

Saccharin

6.7%

Aspartame

6.6%

High fructose corn syrup

6.1%

15

Source: Mintel

Various sweeteners appear across categories

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Maple syrup

Stevia

Maltitol

Bec Cola Organic Cola Flavoured Carbonated Drink with Maple Syrup, France

Mondelez’s Royal AntiOx Antioxidant Strawberry Flavoured Jelly with Stevia, Spain

Justine's Choc Chip Flavoured Protein Cookie, Spain

But how much does the sweetener influence purchase? The fast answer: It doesn’t have a big impact. A closer look at CSDs: Attributes that influence purchase are taste, value, brand. Health is secondary.

Purchase intent, CSDs of various types

30%

CSDs with "sugar" and honey as sweeteners

17

33%*

CSDs with ONLY sugars and carbohydrate sweeteners

28%*

31%

CSDs with ONLY CSDs with ONLY natural sweeteners artificial sweeteners

Source: Mintel Purchase Intelligence * Indicates statistical significance when compared ot the primary group

34%*

All CSDs

A closer look at those CSDs with highest purchase intent

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Sugar or honey: “Mexican” Fanta, made with only sugar

Any type of carbohydrate sweetener: HFCS as second ingredient

Coca-Cola’s Fanta Orange Soda Purchase intent: 58%

PepsiCo’s Mountain Dew Soda Purchase intent: 60%

Source: Mintel Purchase Intelligence

Natural sweeteners: Contains stevia and 1g sugar from fruit juice

Artificial sweeteners: Aspartame and AceK, plus natural flavors

DPSG’s Bai Bubbles Gimbi Pink Grapefruit Sparkling Antioxidant Infusion Purchase intent: 46%

DPSG’s Canada Dry Diet Ginger Ale Purchase intent: 50%

A few final thoughts

Consumer confusion

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There is a disconnect between what you know and what consumers believe. You have a responsibility to teach them.

Choice for all

There’s room for products formulated with many types of sweetener ingredients. There should not be any “bad guys” here.

Taste rules

Health, naturalness, convenience and even price take a backseat to taste. Promote sugar’s contribution to DELICIOUSNESS.

Thank you

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© 2018 Mintel Group Ltd. All Rights Reserved. Confidential to Mintel.

Lynn Dornblaser Director, Innovation & Insight 312 450 6117 [email protected] @LynnMintel...