Opportunities in Gut Health: Dairy and Beyond

July 2019

Gut health is an emerging trend in the healthy living space. Functional dairy snacks with gut-friendly live cultures meet the demand of health-driven consumers. However, probiotics also expand from traditional dairy categories into snacking where consumers see indulgence merge with health benefits. Pioneering markets such as the US and Japan are ahead of the competition in terms of gut health. Prebiotics that feed good bacteria in the gut will lead the way in the future.

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Key findings

Gut health increasingly arouses interest

Gut health receives more and more interest from the food and drinks industry as well as consumers. The main focus is on digestive health, but it goes beyond and impacts not only consumers’ physical health, but also mental wellbeing due to the gut-brain axis.

Functional food leaves supplements behind

With health issues rising as a result of an ageing society, consumers increasingly opt for a preventative approach to remain healthy. The trend shifts towards functional food rather than supplements which ties in with consumers’ demand for naturally better-for-you products.

Remarkable success of certain fermented products from a low base

Many consumers now discover the health benefits of fermented products such as kefir and kombucha. Sales of such products have exploded in markets such as the US, Australia and the UK and are expected to debut in other markets.

Probiotics provide growth opportunities within dairy as well as snacking categories

Probiotics are now increasingly found in non-dairy snacking categories with new products being launched in traditional snacking categories such as snack bars, ice cream and savoury snacks. In the eyes of consumers, these products allow them to indulge while having healthy properties.


Key findings

Growth Limitations in Dairy

Market saturation in dairy leaving companies in search of growth
Asia Pacific and fermented dairy products see fastest growth

The Rise of Gut Health and Its Potential

What is ‘gut health’?
The impact of gut health on the human body is manifold
Probiotics, prebiotics and fibre are key ingredients that benefit gut health
Get more of the good bacteria with fermented products
Use of medication creating need to restore balance in gut
Digestive diseases and diabetes as cause of death
Cure versus prevention to tackle digestive health issues
Yoghurt builds on functional benefits, Sour Milk products on tradition
From probiotic to prebiotic to synbiotic
Kefir sparks interest in countries with no such tradition
Digestive health in dairy will gain in importance over forecast period

Gut Health New Product Developments in Dairy and Beyond

Gut health creates room for new product developments
Kefir opens up growth opportunities in niche categories
Focus on fibre reaches dairy products
Combining gut health with the on-the-go trend
Going dairy-free with live cultures
Beyond dairy - foods: Probiotics conquer traditional snacking categories
Prebiotics gain in importance
Prebiotic fibre for health activists
Beyond dairy - drinks: Fermentation and gut health gain popularity
Case study Japan: Probiotics provide an opportunity for category extension

Taking a Strategic Look at Gut Health

Opportunities for functional snacks in the natural, preventative space
Data paints a picture of ‘Artificial Asia’ versus ‘Natural Europe’
In Europe the focus is on natural preventative options
Natural gaining importance in some developing countries
China’s thirst for functional drinking yoghurt drives future growth
Need to educate consumers to increase awareness about gut health
Microbiome testing as a future tool for personalised nutrition
Key takeaways

Packaged Food

In packaged food we consider two aspects of food sales: 1) Retail sales. 2) Foodservice. Retail sales is defined as sales through establishments primarily engaged in the sale of fresh, packaged and prepared foods for home preparation and consumption. This excludes hotels, restaurant, cafés, duty free sales and institutional sales (canteens, prisons/jails, hospitals, army, etc). Our retail definition EXCLUDES the purchase of food products from foodservice outlets for consumption off-premises, eg impulse confectionery bought from counters of cafés/bars. This falls under foodservice sales. For foodservice, we capture all sales to foodservice outlets, regardless of whether the products are eventually consumed on-premise or off-premise. Foodservice sales is defined as sales to consumer foodservice outlets that serve the general public in a non-captive environment. Outlets include cafés/bars, FSR (full-service restaurants), fast food, 100% home delivery/takeaway, self-service cafeterias and street stalls/kiosks. Sales to semicaptive foodservice outlets are also included. This describes outlets located in leisure, travel and retail environments. 1) Retail refers to units located in retail outlets such as department stores, shopping malls, shopping centres, super/hypermarkets etc. 2) Leisure refers to units located in leisure establishments such as museums, health clubs, cinemas, theatres, theme parks and sports stadiums. 3) Travel refers to units located in based in airports, rail stations, coach stations, motorway service stations offering gas facilities etc. Beyond the scope of the foodservice research are captive foodservice units that serve captive populations around institutions such as hospitals, schools, and prisons. This is also known as institutional sales.

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