Fortified/Functional Packaged Food in Spain

PROSPECTS

Sales decline as consumers move to naturally healthy and free from options

The decline in the demand for fortified/functional packaged food is driven by consumers moving to naturally healthy and free from products, as they do not contain added ingredients. For example, FF yoghurt sales are falling as sales of naturally healthy options like kefir increase.

Growing interest in digestive health and nutrition offers growth opportunities

Although Spain was a pioneer in fortified/functional products (the first enriched omega-3 milk was launched in the country), category development has lagged behind Western European counterparts like the UK and Germany. As the link between a healthy diet and natural and fresh food grows, there is likely to be a further shift away from perceived artificial options like fortified/functional to more natural and organic packaged food.

Innovation adds dynamism to FF bread and protein/energy bars

Despite the general decline in retail volume sales of fortified/functional packaged food, some categories posted healthy growth in 2019. While the demand for bread is very mature in Spain, players are investing in innovation, including new FF varieties, to stimulate sales growth.

COMPETITIVE LANDSCAPE

Trend for natural products increases pressure on players to revitalise FF offer

Fortified/functional packaged food is impacted negatively by the trend for more natural components and less fortification. This focus is visible among processed meat companies.

Skyr gains traction as players cater to consumers’ digestive health concerns

As their work and home lives become increasingly hectic and stressful, consumers are increasingly seeking products that contribute positively to digestive health. The focus is on increasing protein intake without triggering the consumption of unwanted ingredients, such as fats.

Growth potential sees flurry of new product development in FF bread

Healthy retail volume and value sales growth has intensified the competition in FF bread in Spain. As this category is expected to offer further growth potential, it constitutes an opportunity to add dynamism to bread, as the demand for standard bread stagnates.

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