Fortified/Functional Packaged Food in Germany

PROSPECTS

Regulations will continue to hamper the category’s growth

Early in the review period, the European Union introduced considerably stricter rules and regulations regarding the usage of health claims, with these proving to be a serious blow to certain products which had previously claimed specific health benefits, for example probiotic yoghurts. The manufacturers of these products reacted by giving their products a different unique selling proposition.

FF products with recognised health benefits will continue to do well

Nevertheless, in some areas the use of health claims is permitted under certain circumstances, with these expected to record above average growth over the forecast period. Incidentally, many of these are in some way connected to the ageing German population.

Change in the economic climate could further damage the category’s prospects

The outlook for FF packaged food in Germany is not particularly bright. Another factor which could adversely impact this category more than others (with benefits being harder to convey than for example with organic or naturally healthy products) is the economic situation.

COMPETITIVE LANDSCAPE

Many different players competing for share

As FF packaged food comprises many different products, including baby food, bread, breakfast cereals, confectionery and dairy, a large number of manufacturers, ranging from multinationals and domestic manufacturers to private label players, will continue to be active in the category. Competition remains strong but the category is also characterised by a high level of fragmentation as in many cases manufacturers not only offer FF products but also those from other health and wellness categories as well as standard products without any health benefits per se.

Danone seeking to overcome legal restrictions regarding probiotics

The leading player in the category, Danone Deutschland, has been able to defend its position despite the blow the company received following the EU’s introduction of stricter rules and regulations regarding health claims. The company has successfully repositioned its products, focusing on indulgence, taste and convenience.

Mars Wrigley Confectionery to profit from a unified presence

Wrigley remained in second place in FF packaged food in 2018 thanks to its strength in FF gum. It is expected that the creation of Mars Wrigley Confectionery will further strengthen the company’s position in the wider confectionery category, as well as in FF confectionery.

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