Innovation in the foods industry: functional foods.

ABSTRACT

For many consumers, health is a key factor in determining their food choices. As well as simply providing nutrition, it is now being recognised that the consumption of certain foods can promote improved health and well-being. The market for these functional food products is estimated to be worth US$60 billion per annum, and is growing rapidly. This overview discusses the drivers behind the growth of the functional foods industry and describes the current marketplace, as well as offering a perspective on where the industry is heading in the future and some of the issues it will face.

Keywords: functional foods; diet; health; trends

FUNCTIONAL FOODS: WHAT ARE THEY?

It used to be that the healthfulness of foods was seen as a function of their amount of nutrients such as proteins and vitamins. It is now recognised, however, that foods contain nutrients and other components that may have direct positive impacts on physiological processes and thus health. Foods that contain these beneficial components are commonly referred to as 'functional foods', but while most people will have heard this term, many do not understand what it really means. Diplock et al (1999) published a definition which has been widely accepted by those working within this area. It states:

For a food to be considered functional it must contribute some benefit through a meaningful physiological effect on the body that is over and above simple nutrition. However, it is also essential that the functional food be used in the same manner as conventional foods--dietary supplements such as vitamin pills or fish oil capsules are nutraceuticals but not functional foods.

Foods can be deemed 'functional' through a variety of mechanisms. There are natural, whole foods which meet Diplock's (1999) definition of a functional food in their native state. Examples of these include fruits, which may be rich in fibre and antioxidants, and oily fish which contain high levels of omega-3 fatty acids. Functional ingredients may be added to minimally-processed foods, such as the fortification of orange juice with soluble fibre, or to more highly formulated food products, including margarines containing plant stanols. It is also possible to alter the com position of whole foods to enhance the level of beneficial components. This can be achieved through breeding techniques (selection of tomato plants which produce fruit containing higher levels of lycopene or cows that produce milk higher in a certain protein), through customising an animal's diet (cows fed a diet high in selenium produce organo-selenium enriched milk) or through genetic engineering.

Despite the recent increase in publicity, the idea of food providing more than just nutrition is not new. In 400BC, Hippocrates is reported to have said 'Let food be your medicine and medicine be your food.' The modern concept of functional foods has been attributed to the Japanese recognition in the 1980's of the importance of dietary fibre. This built on the traditional Asian philosophy linking the food an individual consumed with their overall health. Japan continues to lead the world both in the development of technologies and trends and in consumer acceptance, with over 400 functional food products released in the Japanese market in both 2004 and in 2005 (Anon 2006d). However, functional food products are now available throughout the world, and the market is currently worth an estimated US$60 billion per annum (Anon 2007a).

WHY SUCH AN EMPHASIS?

Health is one of the most frequently mentioned reasons behind food choices in EU countries (Lappalainen et al 1998). The epidemiological evidence of the link between diet and health has been growing since the 1950s. Statistical investigation of the consumption patterns and overall health status of populations identified a number of foods or food components which appeared to influence the prevalence of certain disease states. These trends were then investigated using controlled clinical studies to determine whether there really was a significant cause-effect relationship between the food intake and health outcome. Proof from these studies of the links between foods and health has provided the scientific basis upon which the modern functional food industry has been built, but a number of other key factors has also fed the industry growth.

There are two primary drivers behind the consumption of functional foods. The first is the general promotion of health and wellness, while the second is the prevention or minimisation of disease.

The obesity epidemic, the prevalence of serious health concerns (heart disease, cancer and diabetes) and the increasing average age of the population have resulted in a global escalation in the costs of health care (Foster & Lunn 2006). This has in turn resulted in a shifting governmental emphasis towards prevention, and opened up a wealth of opportunities for foods targeting specific health problems. This has corresponded with an increased acceptance and utilisation by consumers and health professionals of non-drug solutions that may have previously been seen as 'alternative' treatments. Health and disease are also being more strongly perceived as consequences of the individual's own behaviour, rather than as a result of their external environment (Ogden 1998) or as an unalterable consequence of their genotype. With the current global median age of 26 years projected to increase to 44 years by 2057 (Kern 2006), the number of individuals suffering from metabolic syndrome and other diseases increasing, and the percentage of individuals who are obese still rising (Foster & Lunn 2006; Kovacs & Mela 2006), it seems likely that even more emphasis will be placed on preventative dietary interventions in the future (Shahidi 2004).

As well as preventing or alleviating specific illnesses, there is an overall increased interest in general health. In an ideal situation, people would eat a balanced diet with lots of fresh whole foods that provide all the necessary food components for optimal health. However, a combination of factors seems to be conspiring against this for many people, ranging from lack of time to the lack of availability of particular foods, cost through to health and dietary factors (ie coeliac disease, vegetarianism). Moreover, some people simply make their food choices based on likes and dislikes. Many people want to be able to have the 'right' nutrition without compromising their dietary and lifestyle choices. This is particularly important given evidence that individuals find it very difficult to adhere long-term to dietary changes unless they are diagnosed at high risk of disease (British Nutrition Foundation 2004). In addition, 'healthy' people who have a satisfactory diet and are generally well may still wish to have enhanced health or performance (more energy, better concentration, stronger immune system), despite having no evidence of any underlying health issues.

Consumer expectations also play a critical role. Different generations have been identified as having different attitudes and behaviours which result in specific patterns of functional food consumption (Duff 2006). Overall, older consumers generally show a greater interest in health (Roininen et al 1999) and in functional foods with associated health claims (Poulsen 1999; Bogue & Ryan 2000). 'Baby Boomers' (40-60 years of age) are well-educated, well-informed, have a relatively large disposable income, and they want to remain fit and vital for as long as possible. They are willing to pay more for the right foods to prevent disease, and are particularly concerned about cardiovascular disease, high blood pressure and cholesterol, gut health and the general signs of aging. While they may be sceptical about the functional food industry, they are willing to try products that they feel will address their concerns. In contrast, 'Echo Boomers' (10-27 years of age) are just as concerned about wellness as their predecessors, but are less worried about chronic illness or specific diets and instead have a stronger focus on natural and organic products. They have grown up with enhanced beverages (such as Red Bull, high calcium milk and orange juice) and are thus highly receptive to foods with functional attributes.

From the perspective of the manufacturers of functional foods, this industry offers a wealth of opportunities. The number of ingredients that have been identified as providing potential health benefits is growing all the time, with the level of scientific evidence and consumer acceptance increasing rapidly. The addition of functional ingredients enables a product to be distanced from other products within the same category, increasing the profit margins and reducing the impact of price wars with competing commodity products. Demographic fragmentation of the sector creates opportunities for niche marketing, suiting smaller players who may not be able to compete across an entire market sector, but also offering larger players the chance to differentiate their product. At present, the market is dominated by large multinationals that are able to afford to pay for the clinical trials and marketing efforts required for success in this area (such as Danone, Unilever, Quaker, PepsiCo, Coca Cola, Yakult and Honsha), however there are an increasing number of small companies focusing on a specific product or health need (Datamonitor 2004; Anon 2006b).

WHERE IS THE INDUSTRY CURRENTLY AT?

Consumers are becoming more aware of the effect that certain foods or food components may have on their risk of developing specific diseases. Of particular note, research shows that 93% of Americans recognise that calcium promotes bone health, 83% believe that dietary fibre may reduce the risk of cancer, 78% link the consumption of omega-3 fatty acids with reduced risk of heart disease and 50% recognise that pre- and probiotics may aid digestive health (Berry 2006). This increasing awareness of the health benefits of food products containing particular ingredients is translating into a large and rapidly growing market. As an example, sales of probiotic daily-dose drinks in Europe exceed US$4 billion, and continue to grow at 20% per annum after 10 years of solid growth (Mellentin 2006).

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