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Functional food and beverages persist during coronavirus

In the past, supplements were the primary way consumers would try to achieve an immune system boost or improved gut health. Today, consumers can turn to functional food and beverages to address those same health and wellness concerns. Recent snacking and beverage trends have included better-for-you products, and consumers are continuing to turn to these offerings, even during the coronavirus pandemic.

“While a few years ago, interest in products with health benefits was limited to snack bars, that’s not the case today,” said Pam Stauffer, Global Marketing Programs Manager at Cargill. “We found consumers wanted nutritional benefits in salty snacks and increasingly, baked goods too.”

Functional ingredients appearing in other food and beverage categories reflect consumer trends, especially from buyers who want to improve health through a balanced diet as an alternative to taking supplements. For example, snack company GoodBelly is branching out from traditional probiotic categories -- such as yogurt or kefir -- and instead are introducing innovative options such as cereal products.

“Where consumers once viewed snacks as indulgences, today’s shoppers increasingly look for snacks that can help them achieve their health and wellness goals,” Stauffer said about Cargill’s Snack Foods Opportunity Research. “It’s not so much that consumers are turning away from supplements. Rather, they are also expecting more from the foods and beverages they consume.”

Trending functional ingredients

What are some of the key ingredients that producers are likely to incorporate into functional food in the future?

“[T]he next generation of products with superfoods and botanical ingredients are just around the corner,”  said Stauffer. “We see opportunities for snacks that feature ingredients like turmeric, pumpkin seeds, matcha and probiotics.”

But, simply adding these ingredients with the intention to improve health is not enough to win over consumers. Supplements can provide health benefits, but consumers are seeking out health benefits from products they are already buying and consuming: snacks and drinks.

“Product developers can create health-oriented snacks made with minimally processed, label-friendly ingredients -- but if they don’t taste great or are priced too high, they won’t sell,” Stauffer advised.

The explosion of kombucha

The food and beverage industry has seen a surge in consumers addressing digestive health in recent years, and one of the primary categories targeted for this health need is kombucha. The market for the fermented tea beverage in the US was valued at $492 million in 2019, a huge jump from a valuation of $152 million four years previously, per Nielsen data. Kombucha has B vitamins and minerals, and potentially provides probiotics and kills bacteria, which are health claims that consumers are clearly attracted to.

Major beverage companies certainly capitalized on the trend to meet consumer desires for the new “it” drink. In 2016, PepsiCo purchased kombucha and probiotic brand KeVita to “expand its health and wellness offerings in the premium chilled beverage space,” and Coca-Cola’s venturing and emerging brands division invested $20 million in kombucha brand Health-Ade last year.

How will coronavirus affect consumer trends?

While the coronavirus pandemic has halted several trends, the use of functional ingredients in food and beverage products is not likely to slow down even while more consumers are at home during the public health issue.

A Tastewise report found consumers have been increasingly looking for food and beverage options that offer functional benefits during the past year, but interest has risen even more during the pandemic.

“In this time of global pandemic, consumers are increasingly aware of their health and practices necessary to defend it,” the report noted.

The study -- which was based on social media interactions, internet searches, online recipes and menu databases from February 2019 to March 2020 -- found 45% more consumers year-over-year were focused on functional food with the intention of treating health concerns. Tastewise also reported that internet searches for kombucha for health reasons grew 73% month-over-month. These consumer insights show that coronavirus has not ended the functional food trend, but rather more consumers have health at top-of-mind during the pandemic and are craving food and beverage products that offer beneficial health claims.

“Our industry is resilient, successfully having navigated through crises brought on by nature/the environment, the financial market, tariffs/trade and many other external factors in the past,” said Mike Wagner, Cargill’s managing director, North America.

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