Attitudes towards Sugar & Sweeteners - UK - January 2017

OVERVIEW
What you need to know
Products covered in this Report
EXECUTIVE SUMMARY
The market
Decline in sugar brings down entire market over 2011-16
Inflation to affect the market over 2016-21
Sugar decline to slow, sweeteners to remain static
Figure 1: UK retail value sales of sugar, sweeteners and honey, 2011-21
Government pressure on industry to cut sugar
Multiple health organisations advise sugar cutbacks
New advertising rules ban promotion of sugary products to children
Companies and brands
Silver Spoon regains position as sugar market leader
Figure 2: Leading brands’ share of the UK retail sugar market, by value, 2015/16*
Own-label grows sales in weak sweeteners market
Modest growth in low/no/reduced sugar launches
Stronger activity in drinks
Artificial sweeteners remain the principal sugar substitute, but use of stevia and honey is growing
Nestlé announces chocolate breakthrough
Brands look to associate no-sugar products with enjoyment
The consumer
Renewed focus on sugar heightens people’s health concerns
Concerns about artificial sweeteners also rise
Figure 3: Concern about selected ingredients in food and non-alcoholic drink, October 2016
Ageing population has implications for all sugar-containing products
Majority of people check product nutritional details in some way
Figure 4: Sugar-related behaviours, October 2016
Reduced sugar soft drinks widely accepted, and opportunities for NPD in breakfast cereals and yogurt
Portion control focus could be best approach for sweet treat makers
Figure 5: Likelihood to buy reduced sugar food and drink products, October 2016
Consumers are open to a wide range of sugar alternatives
Figure 6: Preferred alternatives to refined white sugar, October 2016
Suspicions over sweeteners could be a barrier to reformulation
Figure 7: Attitudes towards sugar and sweeteners in food and drink, October 2016
Amenability to less sweet tastes offers an opportunity
What we think
ISSUES AND INSIGHTS
Consumers’ amenability to less sweet tastes allows manufacturers options to cut sugar without replacing
The facts
The implications
Explaining sweeteners could help to overcome concerns over reformulations
The facts
The implications
Consumer openness to a range of sugar alternatives gives companies scope to experiment
The facts
The implications
THE MARKET – WHAT YOU NEED TO KNOW
Decline in sugar brings down entire market over 2011-16
Inflation to affect the market over 2016-21
Sugar volume decline to slow, sweeteners to remain static
Government pressure on industry to cut sugar
Multiple health organisations advise sugar cutbacks
New advertising rules ban promotion of sugary products to children
MARKET SIZE, SEGMENTATION AND FORECAST
Decline in sugar brings down entire market over 2011-16
Inflation to push up prices over 2016-21
Figure 8: UK retail value sales of sugar, sweeteners and honey, 2011-21
Figure 9: UK retail value sales of sugar, sweeteners and honey, 2011-21
Table-top sugar
Health concerns push down sugar volume sales over 2011-16
White sugar feels the principal impact of consumer cutbacks
Figure 10: UK retail value and volume sales of sugar, by segment, 2015 and 2016
Sugar decline to slow over 2016-21
Multiple factors determine sugar prices
Figure 11: UK retail value sales of sugar, 2011-21
Figure 12: UK retail value sales of sugar, 2011-21
Sweeteners
Deflation negates effects of modest sweetener volume growth in 2016
Rising production costs to make sweetener values edge up over 2016-21
Figure 13: UK retail value sales of sweeteners, 2011-21
Figure 14: UK retail value sales of sweeteners, 2011-21
Honey
Honey’s health halo sees it gain strength as a sugar alternative over 2011-16
Honey volume sales growth to run out of steam over 2016-21
Figure 15: UK retail value sales of honey, 2011-21
Figure 16: UK retail value sales of honey, 2011-21
Forecast methodology
MARKET DRIVERS
Government sets industry targets to cut sugar by 20% by 2020
Soft Drinks Levy to hit the soft drinks industry
Potential for the tax to have wider implications
EFSA rules make it difficult to make low-sugar claims
Multiple health organisations advise sugar cutbacks
WHO advises restricting certain naturally occurring sugars as well as added sugars
British Dental Association advises parents to reduce sugar in their children’s diets
National Diet and Nutrition Survey says average sugar consumption remains too high
New rules ban companies from advertising sugary products to children
Sugar-scanning app proves popular with consumers
New Change4Life app targets parents’ health concerns
Ageing population likely to limit sales of all products with sugar
COMPANIES AND BRANDS – WHAT YOU NEED TO KNOW
Silver Spoon regains position as sugar market leader
Own-label grows sales in weak sweeteners market
Modest growth in L/N/R sugar launches
Stronger activity in drinks
Artificial sweeteners remain the principal sugar substitute, but use of stevia and honey is growing
Nestlé announces chocolate breakthrough
Brands look to associate no-sugar products with enjoyment
MARKET SHARE
Sugar
Silver Spoon returns as market leader
Figure 17: UK retail sales of sugar, by leading brands, 2013/14-2015/16
Figure 18: UK retail sales of sugar, by leading manufacturers, 2013/14-2015/16
Billington’s buoys up sales through emphasis on its unrefined nature
Tate & Lyle loses out to Silver Spoon and own-label
Sweeteners
Own-label strengthens position in weak sweeteners market
Silver Spoon bucks negative trend for brands
Figure 19: UK retail sales of sweeteners, by leading brands, 2013/14-2015/16
Figure 20: UK retail sales of sweeteners, by leading manufacturers, 2013/14-2015/16
LAUNCH ACTIVITY AND INNOVATION
Modest growth in L/N/R sugar claims in 2016
Stronger activity in drinks
Figure 21: Share of food and non-alcoholic drink product category launches carrying an L/N/R sugar claim, by category (sorted by 2015)^, 2011-16
Soft drinks brands take differing approaches to reducing sugar
Major brands reformulate and withdraw sugary variants
Tesco reformulates own-label soft drinks and delists brands
Brands’ increased emphasis on lack of sugar helps drive growth in L/N/R sugar CSD launches
CCE extends into other drinks categories
AG Barr creates zero-sugar Irn-Bru variant
Fruit juices put stronger emphasis on lack of added sugars
Nestlé announces chocolate breakthrough
Friesland Campina launches no-added-sugar Yazoo
Waitrose moves to cut sugar in its breakfast cereals
Yogurt brands vary in their approach to cutting sugar
Müller reformulates and Yoplait expands its low-sugar offering
Arla turns to fruit/vegetable blends
Artificial sweeteners remain the primary sugar substitute
Figure 22: L/N/R sugar food and non-alcoholic drink launches, by ingredients^, 2011-16
Strong growth in use of stevia
Continued growth in soft drinks
Napolina substitutes sugar with stevia in pasta sauces
Honey’s natural health halo drives rise in launches
Sweet food brands look to offer reassurance on sweeteners
ADVERTISING AND MARKETING ACTIVITY
Brands look to associate no-sugar drinks and food with pleasure
CSD brands focus on taste
Robinsons links sugar avoidance with childhood adventures
Promoting abstention with No Added Sugar Days
Friesland Campina gives parents permission with No Sugar Yazoo
Danone Light & Free promotes care-free image
THE CONSUMER – WHAT YOU NEED TO KNOW
Renewed focus on sugar heightens people’s health concerns
Concerns about artificial sweeteners also rise
Ageing population has implications for all sugar-containing products
Majority of people check product nutritional details in some way
Reduced sugar soft drinks widely accepted, and opportunities for NPD in breakfast cereals and yogurt
Portion control focus could be best approach for sweet treat makers
Consumers are open to a wide range of sugar alternatives
Suspicions over sweeteners could be a barrier to reformulation
Amenability to less sweet tastes offers an opportunity
CONCERNS ABOUT INGREDIENTS IN FOOD AND NON-ALCOHOLIC DRINK
Renewed government and media focus heightens consumers’ sugar concerns
Concerns over artificial sweeteners linger despite EFSA assurances
Figure 23: Concern about selected ingredients in food and non-alcoholic drink, October 2016
Ageing population has implications for all sugar-containing products
SUGAR-RELATED BEHAVIOURS
Majority of people check nutritional details in some way
L/N/R sugar labels can appeal even to those who do not check labels
Figure 24: Sugar-related behaviours, October 2016
Media coverage of sugar in savoury foods affects consumer behaviour
Opportunities for expansion in reduced sugar table and cooking sauces
Changed buying behaviour especially likely among parents of young children
Appeal of no-added-sugar label drives change in snacking habits
LIKELIHOOD TO BUY REDUCED SUGAR FOOD AND DRINK PRODUCTS
Soft drinks levy and familiarity enhance appeal of reduced sugar soft drinks
Figure 25: Likelihood to buy reduced sugar food and drink products, October 2016
Reduced sugar breakfast cereals have strong chance to appeal
Also strong opportunities for reduced sugar yogurts
Focus on portion control could be best approach for sweet treat makers
PREFERRED ALTERNATIVES TO REFINED WHITE SUGAR
Consumer openness gives companies scope to explore a range of substitutes
Honey’s natural health halo boosts its appeal
Figure 26: Preferred alternatives to refined white sugar, October 2016
Plant-derived sweeteners benefit from their associations with nature
ATTITUDES TOWARDS SUGAR AND SWEETENERS IN FOOD AND DRINK
No-added-sugar label appeals more than low/reduced sugar
Figure 27: Attitudes towards sugar and sweeteners in food and drink, October 2016
Consumers’ suspicion of sweeteners a potential barrier to reformulation
Consumer openness to less sweet tastes gives options to cut sugar without replacing
APPENDIX – DATA SOURCES, ABBREVIATIONS AND SUPPORTING INFORMATION
Abbreviations
Consumer research methodology
APPENDIX – MARKET SIZE AND FORECAST
Figure 28: Best- and worst-case forecasts for retail value sales of sugar, sweeteners and honey, 2016-21
Figure 29: Best- and worst-case forecasts for retail value sales of sugar, 2016-21
Figure 30: Best- and worst-case forecasts for retail value sales of sweeteners, 2016-21
Figure 31: Best- and worst-case forecasts for retail value sales of honey, 2016-21
Forecast Methodology
APPENDIX – LAUNCH ACTIVITY AND INNOVATION
Figure 32: Share of product category launches carrying an L/N/R sugar claim, by category (sorted by 2015), 2011-16