Low-Fat and Low-Sugar Foods

Low-Fat and Low-Sugar Foods

The low-fat and reduced-sugar foods market increased by 6.7% in value in 2007, up from a 4.7% rise in 2006. This is likely to be linked to continuing government messages regarding healthier eating and a healthier lifestyle, necessitated by the clear increase in numbers of overweight and obese persons, with further predicted increases posing challenges for the already overstretched NHS.

Dairy products comprise a major part of the total low-fat and reduced-sugar foods market, accounting for more than 70% in 2007. Other important sectors are ready meals, bakery products, sauces and soups, and cereal products. The proportions of their respective total markets taken by low-fat or reduced-sugar variants differ significantly — milk, chocolate and malted hot beverages, salad accompaniments, crackers and crispbreads, and ambient desserts and custards all hold value shares of 35% or more, but in other sectors these shares are much smaller.

Main media advertising expenditure on low-fat and reduced-sugar foods remains substantial, and the Government is putting pressure on food manufacturers and retailers to cut back on their promotion of foods with high-fat, -salt or -sugar contents. The Government has also been pushing through its `traffic-light' labelling scheme to show fat, salt and sugar levels, against the wishes of some manufacturers and retailers, which have devised an alternative scheme.

All the major food manufacturers and retailers are involved in offering low-fat or reduced-sugar variants of their brands, and there are strong own-label sub-brand ranges from the grocery multiples.

Key Note predicts that the growth rate for the low-fat and reduced-sugar foods market will fall in the immediate future. This is in large part due to the current trend of consumers being less interested in products sold on a slimming or diet platform and opting for those with wider health benefits. Food manufacturers and retailers have responded by developing lower-fat, -salt and -sugar levels across their ranges, with these not necessarily being classified as low-fat or reduced-sugar products. They have also repositioned many low-fat and reduced-sugar products in a `healthier for you' category, although there is still significant support being given to established brands with a low-fat heritage.

In addition, growth in the sector in the longer term is likely to be affected by the advent of foods that have been developed with appetite-suppressant qualities.  
 

1. Introduction

BACKGROUND

DEFINITION

RESEARCH

2. Strategic Overview

THE BODY'S ENERGY REQUIREMENTS

The `Balance of Good Health'

Table 1: Balance of Good Health Guide

The Body's Need for Energy

Table 2: Average Actual Energy Intakes from all Foods and Drinks, Excluding Alcohol (grams per person per day), 2003/2004-2005/2006 and 2006

Guideline and Actual Energy Intakes

Table 3: Estimated Average Requirements for Energy Intake by Age and Sex (kcal per day)

Table 4: Recommended Percentages of Fats, Protein and Carbohydrate for Energy Needs (% of total energy)

Table 5: Actual Energy Intakes — Percentages of Total Food and Drink Energy, Excluding Alcohol, 2003/2004-2005/2006 and 2006

Sources of Energy in the UK Diet

Table 6: Sources of Energy (% contribution to average daily intake)

Fat

Table 7: Major Food Sources of Saturated and Unsaturated Fatty Acids

Protein

Table 8: Protein Content of Selected Foods (grams per 100 grams of food)

Carbohydrate

Table 9: Carbohydrate Content of Selected Foods (grams per 100 grams of food)

Nutritional Requirements by Age Group

Table 10: Total Estimated Average Energy Intake by Food Type (kcal per person per day), 2006

TRENDS IN THE CONSUMPTION OF SELECTED FOODS

Table 11: The Consumption of Dairy and Cereal Products, Fats and Other Foods (grams or millilitres per person per week), 1974, 2004/2005, 2005/2006 and 2006

INCREASING NUMBERS OF OVERWEIGHT AND OBESE PERSONS

Table 12: Trends in Body Mass Index in England by Sex (% of adults), 1994-2006

Table 13: Body Mass Index in England by Sex and Age (% of adults), 2004

MARKET DYNAMICS AND SEGMENTATION

Table 14: The UK Low-Fat and Reduced-Sugar Foods Market by Value at Current Prices (£m), 2004-2007

ADVERTISING

DISTRIBUTION

COMPETITIVE STRUCTURE

THE CONSUMER

Visits to Leisure Centres, Health Clubs and Gyms

Table 15: Frequency of Visits to Leisure Centres, Health Clubs and Gyms (% of adults), Year Ending March 2007

MARKET FORECASTS

Table 16: The Forecast UK Low-Fat and Reduced-Sugar Foods Market by Value at Current Prices (£m), 2008-2012

3. The Market in Detail

THE TOTAL MARKET

Table 17: The UK Low-Fat and Reduced-Sugar Foods Market by Sector by Value at Current Prices (£m), 2004-2007

Figure 1: The UK Low-Fat and Reduced-Sugar Foods Market by Sector by Value at Current Prices (%), 2007

MARKET SECTORS

Dairy Products

Milk

Table 18: The UK Low-Fat Milk Sector by Value at Current Prices (£m and %), 2004-2007

Cheese

Table 19: The UK Low-Fat Cheese Sector by Value at Current Prices (£m and %), 2004-2007

Butters and Dairy Spreads

Table 20: The UK Low-Fat Butters and Dairy Spreads Sector by Value at Current Prices (£m and %), 2004-2007

Yoghurts, Chilled Desserts and Fromage Frais

Table 21: The UK Low-Fat and Fat-Free Yoghurts and Chilled Desserts Sector by Value at Current Prices (£m and %), 2004-2007

Ice Cream

Table 22: The UK Low-Fat Ice Cream Sector by Value at Current Prices (£m and %), 2004-2007

Ambient Desserts and Custards

Table 23: The UK Low-Fat Ambient Desserts and Custards Sector by Value at Current Prices (£m and %), 2004-2007

Soya Milk

Table 24: The UK Soya Milk Sector by Value at Current Prices (£m), 2004-2007

Bakery Items

Sweet Biscuits

Table 25: The UK Low-Fat Sweet Biscuits Sector by Value at Current Prices (£m and %), 2004-2007

Crackers and Crispbreads

Table 26: The UK Low-Fat Crackers and Crispbreads Sector by Value at Current Prices (£m and %), 2004-2007

Cakes and Cake Bars

Table 27: The UK Cakes and Cake Bars Sector by Value at Current Prices (£m and %), 2004-2007

Bread

Table 28: The UK Low-Fat Bread Sector by Value at Current Prices (£m and %), 2004-2007

Crisps and Other Bagged Savoury Snacks

Table 29: The UK Low-Fat Crisps and Other Bagged Savoury Snacks Sector by Value at Current Prices (£m and %), 2004-2007

Ready Meals

Chilled Ready Meals

Table 30: The UK Low-Fat Chilled Ready Meals Sector by Value at Current Prices (£m and %), 2004-2007

Frozen Ready Meals

Table 31: The UK Low-Fat Frozen Ready Meals Sector by Value at Current Prices (£m and %), 2004-2007

Soups and Sauces

Salad Accompaniments

Table 32: The UK Low-Fat Salad Accompaniments Sector by Value at Current Prices (£m and %), 2004-2007

Canned and Chilled Soups

Table 33: The UK Low-Fat Soups Sector by Value at Current Prices (£m and %), 2004-2007

Canned Beans and Pasta Products

Table 34: The UK Reduced-Sugar Canned Beans and Pasta Products Sector by Value at Current Prices (£m and %), 2004-2007

Cereal Products

Breakfast Cereals

Table 35: The UK Low-Sugar and -Fat Breakfast Cereals Sector by Value at Current Prices (£m and %), 2004-2007

Cereal Bars

Table 36: The UK Low-Fat Cereal Bars Sector by Value at Current Prices (£m and %), 2004-2007

Jams and Marmalades

Table 37: The UK Reduced-Sugar Jams and Marmalades Sector by Value at Current Prices (£m and %), 2004-2007

Chocolate and Malted Hot Beverages

Table 38: The UK Light Low-Calorie Chocolate and Malted Hot Beverages Sector by Value at Current Prices (£m and %), 2004-2007

Other Foods

Table 39: Other Low-Fat Foods by Value at Current Prices (£m), 2004-2007

4. Advertising and Labelling

MAIN MEDIA ADVERTISING EXPENDITURE

Table 40: Main Media Advertising Expenditure on Selected Low-Fat and Reduced-Sugar Foods (£000), Years Ending March 2006-2008

Advertising to Children

LABELLING

5. Distribution

RETAIL DISTRIBUTION

Table 41: The Distribution of Foods with Low-Fat Variants by Retail Outlet by Value (%), 2006/2007

6. An International Perspective

EUROPE

7. PEST Analysis

POLITICAL FACTORS

ECONOMIC FACTORS

SOCIAL FACTORS

TECHNOLOGICAL FACTORS

8. Consumer Dynamics

OVERALL FINDINGS

Table 42: Summary of Findings (% of respondents), 2008

THE FINDINGS IN DETAIL

``I Nearly Always Buy or Eat the Low-Fat or Reduced-Sugar Versions of Foods and Drinks Rather than the Traditional Ones``

``I Sometimes Buy or Eat the Low-Fat or Reduced-Sugar Versions``

Table 43: Those Who Nearly Always and Sometimes Purchase Low-Fat or Reduced-Sugar Versions of Foods and Drinks (% of respondents), 2008

``I Seldom, if Ever, Buy or Eat the Low-Fat or Reduced-Sugar Versions``

Table 44: Those Who Seldom or Never Buy Low-Fat or Reduced-Sugar Versions (% of respondents), 2008

``I Find the Low-Fat or Reduced-Sugar Versions have Much Less Taste than the Traditional Ones``

``I Would Buy or Eat More Low-Fat or Reduced-Sugar Versions if They Tasted Better``

Table 45: Attitudes Towards the Taste of Low-Fat or Reduced-Sugar Versions (% of respondents), 2008

``I Try to Have a Balanced Healthy Diet Including Fruit and Vegetables Rather Than Eating Low-Fat or Reduced-Sugar Versions of Foods and Drinks``

Table 46: Those Trying to Have a Balanced, Healthy Diet (% of respondents), 2008

``I Generally Read the Labels on Foods and Drinks to Find the Fat, Salt or Sugar Contents``

``I Believe that Labelling Should be Clearer to Identify the Fat, Salt or Sugar Contents``

Table 47: Attitudes Towards Labels on Foods and Drinks (% of respondents), 2008

``I Think that Labelling has Improved in Recent Years with `Traffic Light' and Other Schemes``

Table 48: Agreement Over Improvements to the Labelling of Foods and Drinks (% of respondents), 2008

``I am Taking More Exercise than I Did 12 Months Ago``

``I Am a Member of a Health Club or Gym``

Table 49: Taking More Exercise than 12 Months Ago, and Membership of a Health Club or Gym (% of respondents), 2008

``I am Concerned About the High and Rising Number of Overweight and Obese Persons``

Table 50: Concern About Overweight and Obese Persons (% of respondents), 2008

``I Think Food and Drink Manufacturers Should do More to Cut the Levels of Fat, Salt and Sugar in their Products``

``I Think Manufacturers Should Promote their Low-Fat and Reduced-Sugar Products More, and Cut Back on Advertising those with High Fat, Salt or Sugar Content``

Table 51: Attitudes Towards Food and Drink Manufacturers (% of respondents), 2008

9. Manufacturer Profiles

ALPRO (UK) LTD

Company Structure

Brands

Profitability

Table 52: Financial Results for Alpro (UK) Ltd (£000), Years Ending 31st December 2005-2007

ARLA FOODS LTD

Company Structure

Brands

Profitability

Table 53: Financial Results for Arla Foods Ltd (£000), Years Ending 30th September 2005 and 2006 and 65 Weeks Ending 31st December 2007

ASSOCIATED BRITISH FOODS PLC

Company Structure

Brands

Profitability

Table 54: Financial Results for Associated British Foods PLC (£000), Years Ending 17th September 2005, 16th September 2006 and 15th September 2007

BAXTERS FOOD GROUP LTD

Company Structure

Brands

Profitability

Table 55: Financial Results for Baxters Food Group Ltd (£000), Year Ending 15th May 2005, 54 Weeks Ending 27th May 2006 and 53 Weeks Ending 2nd June 2007

BEL UK LTD

Company Structure

Brands

Profitability

Table 56: Financial Results for Bel UK Ltd (£000), Years Ending 31st December 2004-2006

CADBURY TREBOR BASSETT

Company Structure

Brands

Profitability

Table 57: Financial Results for Cadbury Holdings Ltd (£000), Years Ending 1st January 2006 and 31st December 2006 and 2007

DAIRY CREST GROUP PLC

Company Structure

Brands

Profitability

Table 58: Financial Results for Dairy Crest Group PLC (£000), Years Ending 31st March 2006-2008

DANONE LTD

Company Structure

Brands

Profitability

Table 59: Financial Results for Danone Ltd (£000), Years Ending 31st December 2004-2006

GREENCORE GROUP PLC

Company Structure

Profitability

Table 60: Financial Results for Greencore Group PLC (e000), 53 Weeks Ending 30th September 2005 and Years Ending 29th September 2006 and 28th September 2007

HJ HEINZ COMPANY LTD

Company Structure

Brands

Profitability

Table 61: Financial Results for HJ Heinz Company Ltd (£000), Years Ending 30th April 2004 and 27th April 2005 and 53 Weeks Ending 3rd May 2006

KAVLI LTD

Company Structure

Brands

Profitability

Table 62: Financial Results for Kavli Ltd (£000), Years Ending 31st December 2005-2007

KELLOGG MARKETING & SALES COMPANY (UK) LTD

Company Structure

Brands

Profitability

Table 63: Financial Results for Kellogg Marketing & Sales Company (UK) Ltd (£000), 53 Weeks Ending 1st January 2005 and Years Ending 31st December 2005 and 30th December 2006

KRAFT FOODS UK LTD

Company Structure

Brands

Profitability

Table 64: Financial Results for Kraft Foods UK Ltd (£000), Year Ending 14th December 2004, 53 Weeks Ending 17th December 2005 and Year Ending 16th December 2006

MÜLLER DAIRY (UK) LTD

Company Structure

Brands

Profitability

Table 65: Financial Results for Müller Dairy (UK) Ltd (£000), Years Ending 31st December 2004-2006

NESTLÉ UK LTD

Company Structure

Brands

Profitability

Table 66: Financial Results for Nestlé UK Ltd (£000), Years Ending 31st December 2004-2006

PREMIER FOODS PLC

Company Structure

Brands

Profitability

Table 67: Financial Results for Premier Foods PLC (£000), Years Ending 31st December 2005-2007

QUAKER OATS LTD

Company Structure

Brands

Profitability

Table 68: Financial Results for Quaker Oats Ltd (£000), Years Ending 31st December 2004-2006

R&R ICE CREAM UK LTD

Company Structure

Brands

Profitability

Table 69: Financial Results for R&R Ice Cream UK Ltd (£000), Year Ending 26th September 2004, 53 Weeks Ending 2nd October 2005 and 65 Weeks Ending 31st December 2006

STREAMLINE FOODS LTD

Company Structure

Brands

Profitability

Table 70: Streamline Foods Ltd (£000), Years Ending 31st December 2005-2007

UNILEVER PLC

Company Structure

Brands

Profitability

Table 71: Financial Results for Unilever PLC (e000), Years Ending 31st December 2005-2007

UNITED BISCUITS (UK) LTD

Company Structure

Brands

Profitability

Table 72: Financial Results for United Biscuits (UK) Ltd (£000), Years Ending 1st January 2005, 31st December 2005 and 30th December 2006

WALKERS SNACK FOODS LTD

Company Structure

Brands

Profitability

Table 73: Financial Results for Walkers Snack Foods Ltd (£000), Year Ending 25th December 2004, 53 Weeks Ending 31st December 2005 and Year Ending 30th December 2006

WARBURTONS LTD

Company Structure

Brands

Profitability

Table 74: Financial Results for Warburtons Ltd (£000), Year Ending 24th September 2005, 53 Weeks Ending 30th September 2006 and Year Ending 29th September 2007

WEETABIX LTD

Company Structure

Brands

Profitability

Table 75: Financial Results for Weetabix Ltd (£000), 73 Weeks Ending 25th December 2004, 53 Weeks Ending 31st December 2005 and Year Ending 30th December 2006

WEIGHTWATCHERS (UK) LTD

Company Structure

Profitability

Table 76: Financial Results for WeightWatchers (UK) Ltd (£000), Years Ending 31st December 2004-2006

RETAILER OWN LABEL

10. The Future

MARKET FORECASTS 2008 TO 2012

Table 77: The Forecast UK Low-Fat and Reduced-Sugar Foods Market by Sector by

Value at Current Prices (£m), 2008-2012

Figure 2: The Forecast UK Low-Fat and Reduced-Sugar Foods Market by Value at Current Prices (£m), 2004-2012

11. Further Sources

Associations

General Sources

Government Sources

Bisnode Sources