‘One size fits all’ approach ineffective for health market

27th August 2008, 12:51pm

Obesity issues, changing lifestyles and rising levels of disposable income have helped drive the health and well-being food market worldwide, but manufacturers are being warned not to adopt a ‘one size fits all’ approach to the category if they want export success.

The latest findings from the International Health, Wellbeing and Organic Report, produced by market development consultancy Food from Britain, indicate that while there are extensive opportunities for exporters of healthy and organic produce, the global market is very fragmented, and different countries are fuelling the growth of the category in very different ways.

According to Chris Brockman, Research and Consultancy Manager at Food from Britain, there are still significant export opportunities in the health and wellbeing category, but manufacturers need to carefully choose their export markets.

He said: "The report has revealed that health and wellbeing are very dynamic sectors of the food and drink industry and, with the current economic climate creating a challenging market for these products in the UK, manufacturers should be looking overseas.

"Manufacturers can tap into the global health and well-being trend but products need to be tailored for each market and different countries demand different benefits from their healthy foods. Spain, for example, demands functional foods, while in Germany the organic market is experiencing massive growth," continued Chris. "Not armed with the right information or advice, exporters could easily make costly mistakes. The growth of organic across Europe for example could encourage organic producers to try a one-size fits all approach, but in a market like Spain where the average consumer has very limited experience or understanding of organic food, this may not work

The report shows that Germany is the largest consumer of organic food across Europe, with a value of more than £5bn and per capita expenditure of £54. In contract, the Spanish, who spend only £6 per head annually on organic food, are leading the functional food boom across Europe. An increasingly ageing population and an innovation driven market have been and will continue to be key factors in Spain's rapidly growing health and wellbeing industry. The country currently leads the EU in terms of per capita expenditure on functional food and drink.

Chris added: "The increasing importance placed on health and wellbeing in the Spanish market has led to the launch of a number of private label ranges dedicated exclusively to this category in retailers such as El Corte Ingles and Carrefour. As lifestyles and work patterns throughout Europe evolve, opportunities will continue to grow for UK manufacturers to take advantage of and profit from this rapidly developing trend."

Overall, the US and European organic food market is worth a combined £21bn, more than double the value in 2000. The US is particularly dynamic organic market, but smaller countries, such as Sweden, are also growing. Market penetration of organic products has risen significantly across a number of broad industry categories since 2000, and now holds significant shares of the European and US markets for bakery, dairy, meat and fish products.

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