Fortified/Functional Packaged Food in Germany

PROSPECTS

FF packaged food is stagnating as competition comes from natural products

The FF packaged food performance in 2019 was very much in line with the review period CAGR – with both figures reflecting stagnating sales in current value terms. FF packaged food is being undermined by the lack of products available in many categories and a shift away from products containing added functional ingredients towards those naturally containing functional properties, notably in dairy, the second largest FF packaged food category.

Confectionery the main product area in FF packaged food

In 2019, FF confectionery continued to be the biggest product area in FF packaged food. It continued to benefit from the robust performance of medicated confectionery, with the positioning of these products suffering less from their high sugar content than other sugar confectionery.

FF products with recognised health benefits will continue to do well

While EU legislation introduced considerably stricter rules and regulations regarding the usage of health claims in the early part of the review period, the use of health claims is still permitted for some products under certain circumstances, with these expected to record above-average growth over the forecast period. Many of these are in some way connected to the ageing German population.

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.

Danone’s Milumil/Milupa brand suffering in FF milk formula from its lack of presence in discounters

In breakfast cereals, leading players continue to drive FF sales with major brands, especially in children’s breakfast cereals, for example Nestlé with Cini Minis and Kellogg with Frosties. Nestlé gained share thanks to new recipes for Cini Minis and Lion with filled cereals.

Wrigley likely to build on dental care/teeth whitening position in FF gum

In sugar confectionery, Ricola is one of the key FF brands. Ricola is a major player in FF packaged food as a result of its number one ranking in medicated confectionery, followed by Fisherman’s Friend, with both brands benefiting from their positioning centred strongly around functional properties.

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