Welcome to the latest edition of our F&B Digest, this time focused on functional foods and wellness products. We’ve digested data from 1,000 UK consumers to discover trends and opportunities in this growing sector.
Consumers are still confused about what’s healthy, especially when it comes to food and drink products marketed as containing wellness ingredients.
Nutrition labelling is a divisive topic, but while food and drink manufacturers disagree over the best system to implement, UK consumers are still struggling to identify healthy products.
According to Action on Salt and Sugar, around one in four food products does not display either traffic light or Nutri-Score labels. The colour-coding that both systems employ make it easy for shoppers to see if a product is a healthy or unhealthy choice. Without them, consumers must rely on other visual clues on the packaging – but how reliable are they?
To put this to the test, we showed six varieties of cereal bars to 1,000 UK consumers and asked them to tell us which was the healthiest choice (see the data here). We then asked them why they made that choice. These answers were particularly illuminating in showing how F&B brands mislead consumers – whether it’s intentional or not.
We used the Nutri-Score system to gauge the healthiness of the cereal bars, inputting the nutritional information available on pack into this Nutri-Score calculator. It’s worth noting that nearly all of the cereal bars we tested got a score D or above (amber colour), denoting that it’s a less healthy option. Only one cereal bar had a Nutri-Score of C (yellow colour).
Clear consumer confusion
Only 16% of our respondents were able to identify the cereal bar with a Nutri-Score of C. Thanks to their low sugar and calorie content, and high protein content, Fibre One Cookies and Cream are the healthiest choice.
The bulk of respondents (78%) chose cereal bars with a Nutri-Score of D. It’s easy to see why; many included health-related messaging, such as “natural”, “protein packed”, “plant based”, “source of fibre”, “contains fruit,” and “no artificial colours or flavours”. Respondents cited these messages as central to the choices they made. However, when you look a little closer, high sugar content drags these products into the red-zone.
Only 16% of Brits could identify the healthiest cereal bar.
For example, the Deliciously Ella Oat and Raisin Bars, which were rated healthiest by 27% of people, have a hefty 29 grams of sugar per 100 grams. Meanwhile, another of the cereal bars, Trek White Choc & Raspberry Protein Flapjacks, crept into the very worst letter E category. But with the protein claim, they were able to convince 6% of consumers they were the healthiest choice.
Brands can’t keep burying their heads
Our data shows that consumers look to brands and retailers to provide information about the health benefits of particular foods and ingredients. 53% and 45% trust them respectively, which puts them on a par with government organisations (who 47% of people trust for information). It means brands and retailers have a considerable duty of care, which should extend to clear nutritional labelling.
The beauty of colour-coded nutrition labels is their simplicity, but it’s this that can also deter brands from wanting to use them. They may argue that the nutritional benefits of nuts, for example, outweigh the negatives of their high fat content. Yet the arbitrary nature of the algorithms may result in a nut-based product receiving a poor score.
53% of consumers trust brands for information about the health benefits of foods.
It’s a valid argument, but the fact is that the UK is facing an obesity crisis. Brands need to play their part in fighting it, even if that means reduced sales for products they can’t, or don’t want to, reformulate. As we see from the Nutri-Scores of this small sample of cereal bars, there are too many products on supermarket shelves that appear healthy but might actually contribute to weight gain. And it’s something that is of real concern to consumers.
Nearly half of our respondents (48%) stated that their top concern when shopping for food and drink products marketed as healthy is that they actually have high sugar, salt or fat content. But encouragingly for brands confident in the nutritional value of their products, clearly displaying it can help them win more sales; 47% of shoppers say this is the number one factor that would increase their trust.
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UK consumers show strong demand for functional foods that promise to improve their health.
F&B brands that include wellness ingredients in their products can achieve higher RRPs, with UK shoppers increasingly attracted to these ingredients – and willing to pay more for them.
Our latest F&B consumer data unpicks what ingredients enjoy the biggest health halos, the benefits shoppers believe those ingredients offer, and how much of a premium they’re prepared to pay.
Brits rank eating so-called ‘functional foods’ as the third most likely factor to impact on their health (behind eating less sugar, salt and fat, and eating more fruits and vegetables). And more than half of UK consumers (55%) say they are consciously looking out for food and drink products to support their overall health when they shop.
Creating products for this market will be a growth opportunity in 2022 and beyond, but where should brands start when it comes to NPD?
Ingredients with the most pulling power
We showed a list of wellness ingredients to 1,000 nationally representative UK consumers and asked them to tell us the top three they were most attracted to. The clear winner was protein, chosen by 58% of respondents. It’s especially popular with Gen Z (aged 18-25), 68% of whom say they’re attracted to food and drink products containing it.
When we asked what health benefits respondents associate with protein, they were most likely to say ‘better overall wellbeing and energy’ (58%). It was also recognised for the role it can play in weight loss (27%).
Behind protein, the most desirable ingredient is Omega-3; 48.5% of people selected it, but it’s the older demographic groups who desire it most (57% of Boomers versus 40% of Gen Z). Brits associate Omega-3 with brain health (47%) and heart health (34%).
The third-most attractive wellness ingredient is pre/probiotics (32%), with Millennials showing the most interest overall (38%). People believe pre/probiotics support digestive health (53%) and immune health 33%.
68% of Gen Z are attracted to food and drink containing added protein.
The data also suggests opportunities for targeting different demographics with certain wellness ingredients. Boomers, for example, over-index for interest in ginger (30%), and turmeric/curcumin (25%). They associate these ingredients with immune and digestive health.
Meanwhile, Gen Z show the most interest in green tea/matcha (27%), which is associated with digestive health and weight loss. This demographic is also most likely to be attracted to food and drink products containing CBD/hemp (17%). CBD is ascribed a wide variety of health benefits by respondents, including relief from pain, stress, anxiety and depression.
Categories with the most potential
Now we know what wellness ingredients people are most attracted to, let’s find out which products they most want to see them in. We asked respondents to choose the top three food and drink products they would like fortified with functional ingredients.
First choice, chosen by 39% of respondents, was cereals & cereal bars – Boomers especially want wellness ingredients in this category. Soups & smoothies are also popular choices for fortification; 31% want health-boosting ingredients added. The third-most popular category is dairy products (29%), with Gen X (aged 41-55) over-indexing for this selection. They also show a higher preference for fortified bread & bakery products.
Millennials are attracted to wellness ingredients in savoury snacks and prepared meals more so than the other demographics, while the soft drinks category shows the most potential among Gen Z.
17% of people will pay a significant premium for wellness ingredients.
How much do brands stand to benefit from expanding or reformulating their range to incorporate these in-demand ingredients? Our data shows that people are prepared to pay a premium for wellness ingredients; 53% will pay a ‘little’ bit more than for a standard product, while 14% will pay a ‘moderate’ amount more and 3% a ‘lot’.
But Gen Z are the most willing to fork out for functional foods, with 23% claiming they’d pay a moderate amount/a lot more. This is a trend brands should watch, hinting that the next generation of consumers will be even more focused on the benefits of the food they consume.
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The pandemic has changed what we want from our diets, with shoppers looking to foods and supplements to protect them from illness.
Brits are aiming to eat their way to better physical and mental health in 2022, with a particular spike in interest around immunity and gut health.
As we face a future of ‘learning to live with coronavirus’, it’s clear that UK consumers want to take steps to boost their natural immunity. Our data from 1,000 working age consumers shows that ‘better immune health’ is the health benefit respondents would most like to get from food and drink products.
Just over 44% of people would like it if food and drink products supported their immune system, while a further 39% want products to offer better digestive health (with gut health also being closely linked to immunity).
People aged 56-65 (Boomers) over-index for desiring immune-supporting products, yet it’s Gen Z (aged 18-25) who are most likely to say they are actively looking for them when out shopping (28%). Pro and prebiotics are the ingredients consumers most associate with both immune health (33%) and digestive health (53%). They also believe in the power of ginger to support both functions.
Mental health is front of mind for Gen Z
The pandemic hasn’t just taken a toll on our health physically, repeated lockdowns have affected us mentally too. We see the impact of this in the number of people who say they’re consciously on the look out for food and drink to support their mental health; 18% of Brits in general, rising to 28% of Gen Z.
Nearly a quarter of young people say they would like F&B products to provide relief from anxiety and depression, rising to 27% of people aged 41-55 (Gen X). Boomers are less interested in obtaining mental health benefits from food (16%).
35.5% of consumers associate CDB with relief from anxiety and depression.
CBD/hemp is seen as a hero ingredient when it comes to mental wellbeing; 35.5% of consumers associate it with relief from anxiety and depression, 31% think it provides relief from stress, and 23% believe it aids sleep.
Another ingredient believed to offer mental health benefits is green tea/matcha, with 25.5% of people thinking it helps with stress, and 17% thinking it can help with anxiety and depression.
Supplements play a vital role in Brits’ diets
The debate around supplements and whether they’re necessary has been going on for years but it looks like the pandemic could have reinforced Brits’ belief in bottled vitamins. We see that nearly half of UK consumers now take dietary supplements – and there are clear benefits people are trying to obtain.
The most popular supplement in the UK is vitamin D (something we don’t always get enough of naturally from the sun), followed by vitamin C. Both of these vitamins play important roles in defending the body against infection, with their popularity feeding into the larger immune health trend. Multivitamins are also popular, coming in as the third-most consumed type of supplement.
46% of consumers want ingredient combinations that support overall health.
When it comes to supplements and wellness foods, respondents say they’re most attracted to ingredient combinations that support better general health (46%), while 20% prefer ingredient combinations for specific health benefits, such as heart health or brain health. A further 19% prefer single-ingredient products.
Only 14% of respondents say it’s their preference to have combinations personalised to their individual needs, suggesting that the current trend towards personalisation seen in other sectors will require more time to mature here.
Data reveals what factors help UK shoppers to have trust in new wellness products and brands.
Overcoming consumer mistrust is vital for F&B brands looking to take a bite out of the lucrative wellness foods sector.
Pricing is most pivotal of all, with 54% of people worried that food and drink products containing special ingredients are overpriced. Although 70% of consumers say they’re prepared to pay a premium for wellness foods, it’s important the product delivers value for money. This means that brands must not only work hard to achieve a competitive price but also on messaging around value.
Money off coupons are also a valuable tool for persuading shoppers to try a wellness product for the first time. For 20% of consumers, being able to try a product at a discounted price is one of the top three things that would increase their trust. Of all the demographics, Gen Z (aged 18-25), in particular, can be convinced with coupons.
Letting people sample the goods
In-store sampling could be potentially more important in the wellness foods space than in others, because another big consumer concern is that they might not like the taste. Over a third of respondents worry the flavour will not be to their liking, rising to 42% of Gen Z.
Giving shoppers a chance to try products before they buy is something that a quarter of consumers would greatly appreciate, especially those in the younger demographics. However, it’s not just about taste; 48% of Brits worry that products marketed as good for their health are actually high in sugar, salt and saturated fat. It’s something that worries Boomers especially (56%).
34% of Brits worry they won’t like the taste of wellness foods and drinks.
Other concerns that marketers need to tackle centre around the effectiveness of the wellness ingredients themselves. Four in ten people say they’re concerned that the health benefits of the ingredients haven’t been scientifically-proven, while 36% worry that the amount of active ingredients included isn’t actually enough to make a difference. Interestingly, the older you become, the more likely you are to have these concerns.
Labelling central to building trust
The packaging of wellness products is one area brands should focus on if they want to increase consumers’ likeness to purchase. Information provided on-pack for these types of products is under more scrutiny, so transparency is key for building trust.
According to our respondents, putting clear nutrition labelling on-pack is the number one thing that brands can do to increase trust in their products (47%). The desire for this is universal across the age groups, showing there needs to be a nutrition labelling system that’s easy for all consumers to understand.
Brits rank a nutrition label that indicates a product is good for their health as the factor most likely to influence them to select a food or drink product. This is ahead of details about wellness ingredients included in the product or on-pack health claims.
47% of consumers would have more trust in wellness foods with clear nutrition labelling.
Other information consumers want to see on the front of wellness foods packaging is the amount of active ingredients; this would significantly increase trust for 25% of people. Using and promoting natural ingredients in products would have an even more persuasive effect, with 42% of respondents calling for this.
Endorsements and certifications are also extremely valuable for the successful marketing of wellness foods. Nearly 4 in 10 people would be convinced by an endorsement from a health professional or organisation (they represent the most trusted source of information about health-boosting foods). Meanwhile, 30% of consumers say seeing certification logos on-pack would significantly boost their trust.
How OTO discovered CBD’s most valuable consumers
Consumer profiling revealed that it’s menopausal women who are prepared to pay a premium for luxury CBD products.
Think you know who your target audience is? You might want to think again, because your most valuable customers are not always the most obvious ones – as OTO, a direct-to-consumer CBD brand, found out.
According to Marketing Director Holly Rix, OTO had built their marketing strategy around young people. This was the demographic most open to products containing CBD, and most aware of the benefits CBD can offer. But OTO had begun to question if they were the consumers actually most in need of the products.
To find out, they worked with Attest to explore consumers’ awareness of CBD in the UK, as well as their attitudes to the category.
“We wanted to find out who knew about CBD, whether they were using it, whether they were interested in it or not,” explains Rix. “And if they weren’t, what the barriers were to them understanding it and wanting to buy into the category. Then, if they were open to it, what was important to them when they were looking for products.
“We also wanted to understand the awareness of our brand and the purchase behaviour. For example, the purchase intent and claimed usage of our brand versus competitors.”
The results confirmed the niggling feeling Rix and her team had been having – they weren’t going after the right people. Younger people might be more open to CBD but they simply don’t have as many ailments as their older counterparts – or as much disposable income.
“We’re a luxury brand in the category, so we’ve been targeting too young basically. This audience are lovely and open, but really don’t care about or need CBD and can’t afford our products, so we weren’t seeing any conversions,” she says.
We’re a luxury brand in the category, so we’ve been targeting too young basically.
Holly Rix, Marketing Director, OTO
Zoning in on menopausal women
OTO identified that middle-aged consumers represented the sweet spot between openness to (and need for) CDB, and ability to afford their products. They shifted their target audience accordingly.
“Our primary target now is about 40 years old. They’re at a point in their lives where they are stressed and/or struggling to sleep. An important and engaged sub segment for us are menopausal women because they are hyper engaged with finding solutions to their symptoms, which CBD can help with. For example, not being able to sleep, low mood, brain fog and hormonal skin.”
Rix says OTO’s work with Attest also highlighted the primary reasons that people buy CBD, with help sleeping being the number one reason. This knowledge has empowered them to confidently focus on sleep as the main way to recruit consumers.
“We’ve stopped doing all of the stuff we were doing around skincare, which just wasn’t working and was targeted too young,” she says. “And we are focusing primarily on associating our brand with helping people sleep.”
The change in strategy has led to OTO working with different influencers and curating new product selections.
“We’re now using influencers with a much older following. We worked with Lisa Snowden who is famous for talking about HRT and the menopause, and she talked about not being able to sleep. That’s worked really well.”
Rix adds: “We have also made a menopause collection, which is a collection of existing products that we put together. And then we did a survey through Attest where we sent products out to 100 menopausal women that signed up and they then rated the impact of those products on their symptoms.”
We were using beauty influencers to talk about skincare and it just wasn’t having any impact.
Capturing the C-suite in Japan
Following the impactful results of the UK survey, OTO wanted to dig into customer profiles in other markets. The brand currently has a presence in Japan and Hong Kong.
“We rolled out effectively the same survey in Japan, which has got different results in line with that market,” says Rix. “It’s more conservative, the number of people that aren’t aware of CBD is higher and the openness to trying it is lower. But we’re still seeing that age is a factor, not in terms of old age but in terms of career seniority and education level. So at C-suite and director level all of a sudden you see the awareness and the engagement completely change and also, obviously, income level.”
Rix says OTO’s enhanced knowledge of their target customers has not only improved their marketing but also their media planning. It has enabled them to build out a tighter audience profile, making sure their ads are targeted at people over a certain age and income threshold whilst maintaining their attitudinal segmentation that still very much holds true.
And the new direction of OTO’s marketing is already translating into better financial performance for the brand.
“Our run rate after doing some work with Pandora Sykes, for example, in December is much higher. It was about how our Sleep Drops have enabled her to sleep better (she’s pretty vocal about being an insomniac), whereas before we’ve been using beauty influencers to talk about skincare and it just wasn’t cutting through that cluttered market.”
OTO are now preparing to run a major PR campaign and, afterwards, they plan to repeat the brand awareness survey to see if they’ve been successful in shifting their awareness.
Attest’s CEO and resident scientist Jeremy King investigates… CBD products
Words by Jeremy King
There’s been a noticeable increase of CBD products on the shelves in recent years. I’m curious to learn why people do or don’t buy CBD products.
To find out, we’ve run identical surveys in the US and the UK to get to the core of what consumers think about these products, and about what might compel them to purchase in the future. Each market is at a different stage of CBD evolution and maturity, and it’s always fascinating to understand what matters most in the minds of real consumers.
I’ll summarise my findings below, but make sure to check out our public dashboards where you can see the data in full, drill down into demographics and run statistical significance tests to interrogate the numbers.
In a first surprise, we’ve found that there’s only a small difference in awareness between the US and UK markets. In the US, 83% of respondents know a little or a lot about CBD products, compared to 79% in the UK. Personally, I’m surprised to see awareness so high in the UK, as subjectively I thought that the US was even further ahead on CBD market development… but awareness is still just the top of the funnel.
Another surprise emerged, this time between the genders in the UK. For whatever reason, I’d expected males to be more aware of CBD products, but we actually find that it’s females who are more in the know, and by quite a margin – 87% of females say they know a little or a lot, compared to just 70% of males.
Disparity in usage across the pond
Where we start to see some juicy differences between the US and UK markets is when we drill into CBD product usage. Overall, 57% of Americans have tried the products, while just 31% of Brits said the same.
There also appear to be some significant transatlantic generational differences. When we filter to see how under 30s responded, we see that there’s a negligible difference in usage for this group in the US, when you compare with the overall results. But in the UK the split between the have-trieds and the haven’t-trieds narrows significantly for under 30s:
Under 30s in the UK: 49% have tried CBD products
30 and overs in the UK: 24.5% have tried CBD products
I find this generational difference fascinating, particularly when you see that there’s no such difference in the US.
We asked those who haven’t tried CBD products why that was, and we find no explanation as to why there’s such a stark British generational divide that’s absent in the US. Among all UK age groups, the standout reason is that they don’t know enough about CBD products and their effects.
Here’s the full breakdown of the reasons Brits haven’t tried CBD products (we asked people to select all reasons that apply to them):
I don’t know enough about CBD products and their effects – 60.6%
I don’t like the idea of CBD products – 31%
I’ve heard negative stories about CBD products – 7.7%
Products are too expensive – 5.6%
I haven’t been able to find CBD products available to buy – 4.9%
And here are the reasons Americans gave:
I don’t know enough about CBD products and their effects – 55.3%
I don’t like the idea of CBD products – 28.2%
Products are too expensive – 13.6%
I’ve heard negative stories about CBD products – 8.7%
I haven’t been able to find CBD products available to buy – 5.8%
As we can see, awareness and lack of understanding is the most powerful force in both markets among consumers who are new to CBD products. It’s clear there’s work for brands to do to raise the profile of products and let potential customers know about their safety and benefits.
Among all UK age groups, they don’t know enough about CBD products and their effects.
Price seems to be a deterrent
Another nugget from above to emphasise is that 13.6% of people in the US think CBD products are too expensive – this is more than twice the amount of Brits who think the same. This shows some price sensitivity that brands should absolutely be aware of when launching in the US.
We see this price sensitivity even more emphatically expressed among those who’ve tried CBD products but don’t plan to again. In the US, 30.6% said price was a reason they don’t want to buy again, while 27.3% in the UK said the same.
There are interesting analogues and potential solutions to draw from other industries here: beauty products finding ways to justify a premium price point for a specific core ingredient, and laddering of brands to offer a wider range of pricing choices to consumers. CBD can repeat all of the tried-and-tested formulas, and while the CBD market is still maturing, there is all to play for!
Top 3 takeaways from the research
1.CBD products see fundamentally no difference in consumer behaviour vs. many products and sectors: awareness and education are essential for tapping into new markets – this emerged as the top reason consumers gave for not having tried CBD products at all.
2. Young Brits appear to be a much more receptive audience to CBD products than Millennials and older groups (not a trend we see replicated in the US, where receptiveness comes from all age groups), so definitely an exciting UK growth opportunity for brands there.
3. Ignore price sensitivity at your peril – it’s one of the main reasons people choose not to buy CBD products. Most consumers have no idea how to think about CBD product pricing, and that’s both a big opportunity, and a significant barrier to overcome.