Module 1 : INNOVATING NEW HEALTHY FOODS FOR THE OBESITY CRISIS

1. Module 1 : INNOVATING NEW HEALTHY FOODS FOR THE OBESITY CRISIS

2. OVERVIEW This module will look at the challenge of obesity in the EU and the opportunities that they represent for a new commercial response. Learners will expand their knowledge and gain new tactical skills to understand the market opportunity arising and develop an innovation plan for their business to guide their development of new products with a healthy focus. Disclaimer Please note – this module is based on innovation themes (in the main driven through consumer demands and global best practice). We strongly advise that you check with your local Food Authority to ensure that any new products that you develop are in full compliance with national and EU laws and regulations.

3. OBESITY Obesity rates have more than doubled over the past 20 years in most EU countries, with obesity related illnesses estimated to account for as much as 7% of total healthcare costs in the EU. SLEEP APNA QUALITY OF LIFE INFERTILITY ARTHRITIS GOUT OBESITY GALL STONES HIGH BLOOD PRESSURE CANCER CORONARY HEART DISEASE DIABETES Over 2.1 billion people or almost one third of the population worldwide are estimated to be overweight or obese and this figure is on course to rise to almost half the world’s adult population by 2030.

4. THE CHALLENGE OF OBESITY IN THE EU Obesity is a major public health problem in Europe, and is described by the World Health Organisation as an ‘epidemic’. In the WHO/European Region over 50% 1 in 3 of people are overweight or obese 11 year olds is overweight over 20% obese or of people are obese www.euro.who.int/obesity

5. Britain is spending £47bn a year tackling the implications of an overweight population Obesity is a bigger cost for Britain than war and terror as Britain spends £47bn a year dealing with the healthcare and social costs of an increasingly overweight population. What are potential obesity interventions and how many lives can they save ? (source McKinsey Global Institute) ... .

6. Opportunity for food producers

7. LET’S LOOK AT KEY CAUSES ..... The key causes of obesity are ... Increased consumption of energy-dense foods high in saturated fats and sugars, and reduced physical activity. Our food environment is also a key determinant The Harvard School of Public Health Food Environment has conducted fascinating research into understanding how the food environment influences our weight. Download their Research by Setting Summary – which looks at risk factors in Families, Workplaces, Schools, Neighbourhoods, Lack of Access to Supermarkets, Greater Access to Convenience Stores and Fast Food. View The Forum at Harvard School of Public Health’s webcast, “Why We Overeat: The Toxic Food Environment and Obesity.”

8. GOVERNMENTS ARE LOOKING AT A LEGLISLATIVE RESPONSE ..... Fat tax is a controversial topic .... It is an additional tax imposed on high-fat food products. While taxes on alcohol and cigarettes have been commonplace for many years, taxes on specific unhealthy foods and drinks aimed at combating obesity have only recently been introduced by some EU countries. Many nutrition experts say that taxation is a powerful tool that has been effective in campaigns to reduce smoking and alcohol consumption. But many questions remain about how to make it work.

9. In Finland, soft drinks have been taxed since 1940, while the tax on the production of candy was introduced in 2011 and extended to ice cream. However, the candy tax is due to be scrapped at the end of 2017 as the European Commission has found that the tax is unfairly advantageous to Finnish producers as imported sweets also have to pay the tax on top of import duties.

10. In France, a tax on all beverages with added sugar or with artificial sweeteners had already been introduced in 2012. In October 2013, French parliamentarians also voted for a new tax on energy drinks, such as Red Bull. The new tax aims at promoting health by limiting the consumption of such drinks, but does not affect ordinary coffee.

11. In Hungary, since 2011 food considered to be unhealthy, including crisps, soft drinks and chocolate bars, have been subject to tax that is aimed at "improving the health of the nation". Initially called 'the hamburger tax', the measure was dubbed 'crisps tax' or 'fat tax' after the Hungarian government decided that it would not affect fast food restaurants.

12. Health and Wellbeing – Top Trends

13. Health and Wellbeing, THE TOP TRENDS Healthy living is as much about stripping away the artificial and unnecessary as it is about adding more ‘good stuff’. Pure and natural products are the order of the day. Achieving balacne is increasingly top of consumers’ agendas; boundaries between emotional and physical wellbeing blur as people aspire to a holistic ideal of healhty mind and body. Consumers are making use of technologies that manage and measure many aspects of their lifestyle, from water intake, to sleeping, to sugar levels. Knowledge is power when it comes to ensuring you are living the healthiest way you can be SOURCE BORD BIA IRELAND

14. Health and Wellbeing, THE TOP TRENDS How can you interpret same to innovate your food business ? Leverage technology to help consumers make the most of your product, and understand it’s health and energy benefits for adults and children alike? Make your product customisable, and suitable for a variety of diets and lifestyles? How can it contribute to a holistically balanced lifestyle? Pare back ingredients, processes or packaging to emphasise the naturalness of your product? SOURCE BORD BIA IRELAND

15. KNOW WHAT MOTIVATES YOUR TARGET MARGET FOCUS ON 4 TYPES OF HEALTHY EATERS Calorie Counter: • Counts points/calories • Watches sat. fat/checks labels religiously. May have banned certain food groups from diet. • Loves seeing calorie content on food and labels such as “healthy option”, “low fat”, “low calories”.. • Would love to see detailed menus, it equates to • Gets anxious when they don’t know what is in food or how many points. • Will purchase low calorie/healthy options from all venues • More likely to frequent restaurants/sandwich bar than convenience store for lunch Moderates: • Healthy but not in an obsessive way, likes to keep weight in check • Avoids fried/greasy foods, likes unprocessed, fresh quality • Not driven to seek our healthy restaurants, will find something on menu. Would not like to see calorific content or too much to detail on the menu. • Likely to “break out” at weekends. • More likely than other groups to frequent deli counters in convenience store, sandwich bar, bar chains or have pub lunch Reformed: • Used to be overweight, watches diet very closely • Adamant not to touch junk food, sweet drinks • Plain, simple healthy food, fresh important • Watching carbs, fat and calories • Eating the right food in the right proportions • Studies labels and nutritional content • Actively seeks out restaurants with healthy • Determined not to “break out” ever! • Most likely 50+ • Will purchase healthy options from all venues. More likey to frequent restaurant/sandwich bar than convenience store for lunch Moderate Naturalist: • Everything eaten natural as possible within reason • Likes fresh, good quality food, no fast food, no frozen or microwaveable food, no MSG • Concerned with lunch giving them energy • Not about weight, more of a holistic view on life • Good carbs ok – wholemeal bread, brown rice • Very educated about food, will eat in both good restaurants and purchase from a convenience store • Most likely to find vegetarians in this group • Most likely to be in youngest age category 24-34 • Likely to purchase from deli counter/convenience store & other venues

16. MAKING IT HEALTHY – Where to start? • According to World Health Organisations – factors key to a healthy diet are: • Limiting intake of free sugars to less than 10% of total energy intake is part of a healthy diet. A further reduction to less than 5% of total energy intake is suggested for additional health benefits. • Keeping salt intake to less than 5 g per day helps prevent hypertension and reduces the risk of heart disease and stroke in the adult population. • WHO Member States have agreed to reduce the global population’s intake of salt by 30% and halt the rise in diabetes and obesity in adults and adolescents as well as in childhood overweight by 2025.

17. MAKING IT HEALTHY – Where to start? • Reduce free sugars in your products • “Free” sugar is any sugar that is added to foods by the manufacturer, plus that naturally present in honey, syrups, and fruit juices. It does not include sugar naturally present in milk or whole fruit and vegetables • 2. Reduce salt levels • According to W.H.O. 5 million global deaths could be prevented each year if people’s salt consumption were reduced to the recommended level of less than 5 g per day

18. MAKING IT HEALTHY – Where to start? 3. Think about going Gluten Free With recent increases in people being diagnosed with celiac disease and gluten sensitivity, the idea of a gluten-free diet has been researched by physicians across all sides of the nutritional spectrum, including weight loss specialists, bariatric physicians, and dieticians. It has been found that a gluten-free diet can have a variety of health benefits, such as improving cholesterol levels, promoting digestive health, and increasing energy levels.

19. CONSIDER A ‘FREE FROM’ APPROACH Bord Bia – Irish esearch on “Free From” Foods 2010 Attitudes to Free-From Foods Base: Ever bought Free-From products - 208 See more on slide 44 I have to eat certain “free from” foods as I suffer from a condition such as coeliac disease, dairy intolerance etc. 16% One or more family members must eat certain “free from” foods as they suffer from a condition such as coeliac disease, are dairy intolerant 12% I like these products because I prefer to remove certain ingredients from my diet 19% I like these products because they are generally healthier form me 31% One or more family members like these products as they prefer to remove certain ingredients from their diet 9% One or more family members like these products because they are generally healthier. 15%

20. Products purchased most often in ‘FREE FROM’ Category Purchase Most Often Base: Ever bought Free-From products - 208 59% Sugar Free Products 18% Gluten Free Products 12% Dairy Free Products 7% Wheat Free Products 4% Don’t Know

21. MAKING IT HEALTHY? According to Nielsen: The world is facing a global health crisis—nearly 30% of the global population was considered overweight or obese in 2013—and consumers are attempting to take charge of their health. Nearly half (49%) of global respondents in Nielsen’s recent Global Health & Wellness Survey consider themselves overweight, and a similar percentage (50%) is actively trying to lose weight. And they’re looking for help from food and beverage manufacturers to make healthier choices

22. MAKING IT HEALTHY? According to Nielsen: On the list of new products consumers can’t find in stores but wish they could, healthy options are second behind affordability in all regions but one (North America) .

23. The Opportunity MAKING IT HEALTHY poses According to Nielsen: Nielsen’s Breakthrough Innovation research findings provides examples of how manufacturers can win by catering to consumers’ need for quick, healthy options. Sodebo identified an unmet need for active consumers who want a healthy lunch without compromising on quality and pleasure. It filled this gap with Salade & Compagnie, a range of healthy, gourmet salads that are both convenient and tasty. The launch generated sales that doubled Sodebo’s original estimates and played a key role in the packaged-salad market’s 60% growth https://www.sodebo.com/fr/produits-frais/salades/salade-compagnie/1

24. The Opportunity MAKING IT HEALTHY poses According to Nielsen: In the U.S., Mondelēz capitalized on a widely recognized need for nutritious, convenient breakfast options by offering something unique: a sustained energy benefit. The company’s Nabisco belVita Breakfast Biscuits, which were adapted for the U.S. market following success in Europe, generated year-one sales in excess of $70 million and achieved more than 50% growth in year two. www.belvitabreakfast.com

25. The Opportunity MAKING IT HEALTHY poses According to Nielsen: Healthy eating isn’t just an opportunity for new products. Existing products and brands can also capture market share and sales growth by reinventing themselves as healthy, especially in crowded, undifferentiated spaces. For example, when Oberto, a family-owned beef jerky company with a 95-year history, repositioned their brand as all-natural and healthy, they were able to attract consumers with an active lifestyle who were concerned about their health. The resulting repositioning helped Oberto increase sales by double digits and gain share on larger competitors with much larger advertising budgets. www.oberto.com www.oberto.com 

26. A FOCUS ON SPECIFIC SEGEMENTS OF ‘HEALTHY’ EATING – FUNCTIONAL FOODS

27. “If you understand your own life - you are half way to successful consumer marketing taking into account health concerns and problems, packaging, motivation individuality, brand communications and consumer segmentation.” - Peter Wennström Find out more and follow his blog > http://www.thehmt.com/peter-wennstrom Peter Wennström, has earned his reputation as an international brand management consultant in over 25 years working for clients in functional foods, pharma & dietary supplements. He is the founder and President of The Healthy Marketing Team and is regarded as one of the world’s leading experts in functional foods marketing.

28. FUNCTIONAL FOODS “A functional food may be described as a food which provides a specific health or performance benefit over and above that expected from its normal nutritional value” Used to describe any food or food ingredient that has a positive impact on an individual’s health, physical performance or state of mind in addition to its basic nutritive value.

29. FUNCTIONAL FOODS Rapid advances in science and technology, increasing healthcare costs, changes in food laws affecting label and product claims, an aging population, and rising interest in attaining wellness through diet are among the factors fuelling consumer interest in functional foods. However ....

30. FUNCTIONAL FOODS Internationally, the functional food market has experienced remarkable growth and is one of the most dynamic sectors in the food industry in terms of product development and international expansion. While large food companies can aggressively harness larger market shares, SMEs are also successfully identifying untapped opportunities and building up a market niche.

31. Consumers look at Food as ‘Medicine’ • And as a way of increasing performance • EXAMPLE • egg producers developing foods with resulting health benefits • (e.g. Enhancing nutritional properties eggs, Omega 3)

32. Consumers look at Food as Medicine

33. SELLING BENEFITS CLAIMS (but tread carefully, claims MUST be substantiated ) • A Natural Product • With a high GI rating • Cholesterol reducing • Low fat • Low salt • No added sugar • Help concentration levels

34. SELLING BENEFITS Even applies to primary products ....

35. SPOTLIGHT ON ‘THE FOOD DOCTOR’ Case study http://www.thefooddoctor.com/COUSCOUS-and-LENTIL-POT-with-tomatoes-red-peppers-and-cumin-PPOTCNL/

36. HUNGARIAN CASE STUDY - Fullgrass http://fullgrass.hu/ Benefits of Wheatgrass Juice : Wheatgrass juice is an effective healer because it contains all minerals known to man, and vitamins A, B-complex, C, E, l and K. It is extremely rich in protein, and contains 17 amino acids, the building blocks of protein. It is also one of the best sources of living chlorophyll  and contains up to 70%. Chlorophyll is an important blood builder containing enzymes and super- oxide dismutase, a copper-containing protein found in mature red blood cells. This enzyme decomposes superoxide radicals in the body into a more manageable form, thereby helping to slow down the aging process.

37. EXERCISE....  1) Consider what functional foods innovations are prevalent in your sector which meet consumer wants and needs 2) Understand EU regulations relating to functional foods, and understand what can and can not be said on the food label

38. BE CAREFUL WITH MARKETING CLAIMS Terms used in marketing terms by food companies to enhance the consumers view of the nature of the food product – but in many cases the use of such term is ‘misleading’ ‘natural’ defined following Supreme Court case & legislation & court cases for the use of terms such as ‘fresh’, traditional’ & ‘mountain’ Food Standards Agency Guidelines establishing criteria for the use of the terms ‘fresh’, ‘natural’, ‘pure’, ‘traditional’, ‘original’authentic',' home made’, ‘farmhouse’ No specific legislation or guidelines as so many Italian products have PDO/PGI status or national or regional denomination of origin

39. CLAIMS - USE OF TERMS ‘artisan’, ‘farmhouse’, ‘natural’ etc Artisan’ – it is a term that is popping-up on all sorts of products everything from Starbucks, Mc Donalds, to Domino’s Artisan Pizza. Datamonitor (UK) found that in the past 5 years an amazing 800 new food products had emerged on the market bearing artisan’ labels

40. CLAIMS – Ireland FSAI in conjunction with Taste Council and other stakeholders have drafted a Code of Practice on the Use of Food Marketing Terms • Artisan/Artisanal • Farmhouse • Traditional • Natural Ireland is working to be the first country in the EU to define the term ‘artisan/artisanal’ For more visit www.fsai.ie

41. A FOCUS ON SPECIFIC SEGMENTS OF ‘HEALTHY’ EATING Reformulate existing products for lower sodium, sugar and/or fat content

42. Case Study (Ireland) Conor Murphy is the founder of Gym Chef,a ready meal brand based in Co. Meath, Ireland. The business was born out of the intense frustration experienced by Conor when he tried to improve his own health and fitness. He found a ‘scary’ amount of misinformation about ‘healthy-food’ and the ready meal sector had little to offer in terms of healthy and convenient food.

43. Case Study (Ireland) Gym Chef was set up with a simple aim, to make healthy eating easy. The business places great emphasis on providing information about nutrition to consumers. The key messages are – Clean Food and All Natural Clean Ingredients. Conor launched the Gym Chef range in 2014 as a pilot and built up a strong sales base through Supervalu outlets and independent retailers. He subcontracted the manufacture to his recipes and strict protocol. In early 2015, Conor reassessed the business and is assessing a new business model of taking over production himself or looking for a new manufacturing partner.

44. Case Study (Ireland)

46. FOCUS ON SPECIFIC SEGEMENTS OF ‘HEALTHY’ EATING - have you heard about Clean Labels and Nutraceuticals?

47. WHAT IS A CLEAN LABEL ? Basically, the term clean labels refers to the wholesomeness of a food product, the “naturalness” of its ingredients, and the absence of unrecognizable chemical names or processes. In other words, consumers want transparent descriptions of what goes into the food they are buying, and they want to make sure it’s all healthy. Brands are now keen to offer recognizable, authentic, unprocessed ingredients which appeal to a mainstream audience. While shoppers are now actively seeking authenticity from products in grocery and health food stores.

48. HealthFocus Internationaltell us that 74% of people say they wish they could eat healthy foods more often but are just too busy. Their studies show shoppers consider words like natural, organic, non-GMO, artisan, grass-fed and locally-sourced as quick indicators of better nutrition choices. Natural Drivers“Clear Clues” are used as shortcuts by consumers to make choices. They include like the lack of chemical ingredients on the label, where they bought it, who manufactured and a host of other brand attributes. 37% of shoppers think natural is an extremely or very important brand attribute, compared to a similar 27% for organic.

49. FREE FROM – An example ... When it comes to ‘Free From’ Brands, Kelkin is the principal Irish brand. This is their EGG FREE Mayonnaise

50. CASE STUDY - BFree Foods BFree Foods has been offering its range of award-winning gluten and wheat-free bakery products since its launch in 2011 and has now successfully developed the world’s first allergen-free fajita kit which has seen the company make a significant breakthrough in the UK market. https://bfreefoods.com/