Better For You Packaged Food in Australia

PROSPECTS

Negative growth in BFY packaged food due to changing lifestyle habits

BFY packaged food sales are expected to decline at constant 2017 prices over the forecast period as the category will continue to be negatively affected by the shift in consumer demand towards products that are considered to be more obviously part of a healthier lifestyle. This is expected to result in demand shifting away from BFY products towards free from products, mainly gluten free products and dairy free, as well as NH packaged food and fresh food, which are perceived as more natural and healthier due to their minimal processing.

BFY products need careful positioning

Australian consumers are increasingly avoiding products that are explicitly marketed as BFY food in favour of products that complement their general efforts to lead healthier lifestyles, such as NH packaged food. One major factor behind the decline of BFY food is that consumers are becoming more aware that fad diets and restrictive eating habits are not sustainable over the long term.

Could consumers’ added sugar concerns encourage the use of stevia?

The consumer backlash against products that are perceived to be high in sugar is likely to remain a major feature of the Australian packaged food industry over the forecast period, with snack bars and breakfast cereals particularly likely to be influenced by consumers’ desire to avoid products with added sugar. This is expected to result in an increase in the use of the natural sweetener stevia as a substitute for sugar.

COMPETITIVE LANDSCAPE

Lion Pty Ltd maintains the leading position through its Dairy Farmers brand

Lion Pty Ltd remains the leading player in BFY packaged food due its very strong position in reduced fat dairy, led by its Dairy Farmers brand. Dairy Farmers is present in the majority of reduced fat dairy categories, including cheese, cream and milk.

Private label remains strong in BFY packaged food

Private label continues to have a strong presence in BFY packaged food. Australia’s two dominant grocery retailers Wesfarmers and Woolworths are the leading private label players through their respective Coles and Woolworths ranges, followed by the country’s only major discounters chain Aldi with its Farmdale range.

Simplot Australia’s repositions its Lean Cuisine brand

Lean Cuisine was the leading brand in the important BFY category of reduced fat ready meals and fourth overall in BFY packaged food in 2017. Owner Simplot Australia recently made changes to its marketing approach for Lean Cuisine, repositioning the brand as a healthier alternative to regular ready meals rather than promoting it explicitly as a product for people on calorie-control diets that can assist with weight loss.

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