Market divergence calls for tailor-made solutions
The world market for sports and fitness nutrition products (including foods & drinks) is currently undergoing a transformation, emerging from a niche segment to a mainstream market that is projected to reach US$60.8 billion by 2020. The main reason for the transformation is the expansion of the customer base from high endurance athletes and body builders to general customers ranging from women and teenagers to college students and even older individuals displaying strong interest in maintaining a healthy lifestyle. This divergence in customer profile and how the different customers use nutritional food and drink highlights the need for marketers to adopt tailor-made strategies for targeting such varied groups of consumers in order to gain greater penetration in the market.
These days, when it comes to sports nutrition food and drinks, there is more emphasis on general health and wellbeing rather than on performance. Customers today are more interested in doing exercise which has meant that the products within the world of sports and fitness nutrition have also had to shift. Younger generation, health conscious consumers, and weekend fitness warriors are now all a part of the core consumer cluster.
Focus in this segment is still, to a significant extent (although diminishing), on traditional customer group such as athletes as these customers have greater awareness and understanding of the products. These customers constitute the early adopters and are also loyal customers, using the products to gain targeted benefits such as muscle enhancement or for post-workout recovery.
Alternatively the newer groups of customers consisting of non-professional sportspersons, recreational users, casual athletes, gym-goers, women seeking fitness control, young adults, or weekend fitness enthusiasts and others, use such products to receive a boost in stamina and enhance overall physical and mental performance or as a preventive measure against illness.
The U.S. enters new era of sports nutrition
The United States makes up the largest market worldwide. Favourable demographics, ageing baby boomers and a sedentary lifestyle are the major growth promoters of the fitness industry in the country. The sports nutrition market has witnessed exponential growth over the years due to new innovations, novel packaging and marked changes in consumer preferences. Sports supplements and sports nutrition functional foods are among the leading categories exhibiting strong growth. Latin America represents the fastest growing regional market displaying a CAGR of about 8.5% over the analysis period. Despite accounting for a small portion of the world’s food and beverage market, Latin America is expected to emerge as the hotspot in the coming years. The market for sports and energy drinks in Latin America is expected to surge in the near future primarily due to rising income levels, increased focus on health and wellness and willingness of consumers to spend on the category.
As the nation struggles to shed extra pounds and keep them off, more consumers are recognising the importance of engaging in regular physical activity to promote overall good health. Adults of all ages are seeking out foods and beverages to help them maintain enough energy to support fast paced lives that less and less frequently involve food preparation and healthful, sit-down meals with family or friends. This is all helping to drive a robust functional foods market in 2015.
Among the most popular functional foods are sports drinks and nutrition bars. According to a recent report, 36% of all U.S. adults consume sports drinks. Meanwhile, sales in the nutrition bar segment grew an impressive 8% last year to reach $2 billion. Despite the popularity of both segments, several factors—including a shift away from sugary sports drinks to more natural formulations, as well as increased consumer demand for nutrition bars featuring savoury rather than sweet ingredients—are ushering in a new era of sports nutrition.
Growing consumer interest in recent years for more natural food and beverage products as well as those made without pesticides, artificial colors, flavors and other additives extends to sports drinks and points to a gap in the market that several small start-ups and, increasingly, not-so-small acquirers and new entrants, are actively attempting to fill.
Many of these new products highlight the use of natural and organic ingredients, including greater use of natural sweeteners, both caloric, such as cane sugar and agave, and zero-calorie, stevia, monk fruit and erythritol. Focus on added sugars is also resulting in more use of other zero-calorie sweeteners to help keep caloric content down, notably sucralose and acesulfame potassium. Mention of vegan, Fair Trade and sustainability are just beginning to emerge as benefits associated with sports drinks. Packaged Facts expects focus on sugar to dominate in the year ahead with continued attention to these other important differentiators as this dynamic market evolves.
Meanwhile, the future of energy and recovery foods designed for athletes and others who are physically active appears destined to be dominated by savoury flavours and ingredients, including meat. Many athletes have long requested energy products that are less sweet than standard nutrition bars and drinks, and now that national attention has turned to reducing added sugar in the diet, a new wave of savoury products, including bars, gels and meat jerky, are being introduced.
Driven primarily by small entrepreneurs and regional companies, the U.S. is currently experiencing a major wave of new nutrition bar and related product introductions based on savoury flavours and ingredients. Sweet potatoes, seeds, meat and fruits are frequently used ingredients. Most notable is the creation of these products with natural and organic, non-GMO, gluten-free whole foods including grass-fed, humanely treated animals while addressing sustainability concerns along with taste, performance and nutrition.
Nutrition bars in flavours such as Roasted Jalapeno, Honey Smoked BBQ and Pizza Marinara are becoming increasingly commonplace as are those based on meat and other non-sweet proteins that rival jerky, in the footprint of a bar. More professional athletes can be found backing meat snack brands. Behind this growing trend is greater awareness among casual sports participants of the importance of consuming protein following exercise to help rebuild muscle.
Expansion is preferred strategy in protein ingredients
The protein ingredients market is predicted to be worth $39.08 Billion by 2020 driven both by consumer demand for health focused products as well as other growing demand for protein ingredients in other industries such as animal feed, cosmetics & personal care, and pharmaceutical. Expansions formed the most preferred strategy among the key players, to expand their geographical reach, retain existing client base, and attract new customers, globally. Industry players have focused on expanding their business and establishing new business units in the emerging markets in order to enhance their global reach and sustain the competition prevailing in the market. Acquisition also helped key players in strengthening their product portfolio.
A key factor in the sports nutrition market moving forwards is for producers to take into account the varying dietary needs of the wider market. The growing free-from market has entered a point of intersection with sports nutrition and a group of consumers looking for products beyond dairy or soy based proteins. Amongst ingredients suppliers exploring new solutions in this area is Glanbia Nutritionals, who have announced the European launch of its HarvestPro line of vegan plant proteins. Derived from ancient grains, flax and chia, the HarvestPro range of plant-based ingredients includes protein crisps and protein powders, which can be incorporated into a wide range of applications, including beverages, bars, baked goods and gluten-free foods.
Offering a high source of protein with levels ranging between 50 and 60 percent, HarvestPro crisps constitute a great-tasting, gluten-free alternative to soy equivalents and a unique offering in the marketplace. Comprised of pea, tapioca, amaranth and chia, HarvestPro CA Crisp 60 can enhance the flavour, texture and nutritional profile of bars, clusters and cereals. Plus, the vegan product enables on-pack labelling of ancient grains, tapping into the increasingly popular trend.
HarvestPro Protein, a clean flavoured, 85% vegetable protein isolate, will be the first of the range to be launched in Europe. Extracted from non-GMO yellow peas, HarvestPro Protein is suitable for a wide range of applications such as sports and weight management products.
Carla Clissmann, EMEA Regional Director, Glanbia Nutritionals Ingredient Technologies, says:
“With new product introductions incorporating ancient grains on an upward trajectory, it is clear that consumers are seeking these ingredients and their inherent benefits in their diet. Following the launch of HarvestPro in North America earlier this year, we’re excited to be leading the way in the development and diversification of plant protein sources with ancient grains, flax and chia in the European market.”
 Global Industry Analysts, Inc. – “Sports and Fitness Nutrition Foods and Drinks: A Global Strategic Business Report”
 Packaged Facts – “Functional Foods: Key Trends by Product Categories and Benefits”
 MarketsandMarkets – “Protein Ingredients Market by Source”