The beat goes on. It has been common during the first half of 2015 for food and beverage companies to announce reformulation efforts designed to improve the perception of their products as natural or clean, and the trend has continued during the past month as such companies as Nestle, McCormick and Subway have announced such efforts. The challenge facing many firms is such trends are not static, and it’s useful to ask how the clean label trend may evolve.
“I think many large companies are feeling the pain and working to give the consumers the transparency they want,” said Angelina de Castro, senior marketing manager for wholesome for Ingredion, Inc., Westchester, Ill. “But part of this goes beyond reformulations; it’s also about gaining the consumer’s trust.”
Part of that trust is making sure products are clean and making sure consumers understand companies have nothing to hide, Ms. de Castro said.
“There is a blurring of the lines between a clean label and a clean brand,” she said. “I think that will be a macro trend for consumers in the near future. We are going to go beyond the ingredients used and also look at a brand’s background.”
One of the most significant challenges facing packaged food companies today may be consumer demand for simple ingredients, said Irwin Simon, chairman, president and chief executive officer of the Hain Celestial Group, Inc., Lake Success, N.Y. And leading the charge, he said, are the 93 million millennials whom “no consumer packaged goods companies should overlook.”
“I think one of the big things the big food companies are facing today: ‘I’m not getting any growth; if I’m not getting any growth, do I want to go clean up my product line and have margin dilution because of it, and make a bet that I’m going to get the sales increase?’” Mr. Simon said during a May 27 presentation at the Citi Global Consumer Conference in New York. “‘Or am I just going to hang in there, maybe I will take my trade promotions down, not promote enough; because how far can I fall? But I want to keep my margins.’
“Listen, at the end of the day today, there’s 93 million millennials out there that are focused on ingredients (and) read packaging today.”
Mr. Simon’s company and its stable of natural and organic brands generally are well-positioned to deliver on consumer trends. Ninety-nine per cent of its products are free of bioengineered or genetically modified ingredients.
“We don’t have artificial flavors, we don’t have artificial coloring, we don’t have high-fructose corn sweeteners, we don’t have hydrogenated oils,” Mr. Simon said. “Our protein comes from antibiotic-free or organic protein.”
He said he expects to see continued demand for clean labels and wholesome ingredients.
In addition to clean label products, consumers are expressing a greater interest in fresh products. Reformulating such products may be a challenge, because safety and shelf life may not be sacrificed for a cleaner formulation. Corbion, which has a U.S. office in Lenexa, Kas., has developed solutions for the ready-to-eat and fresh meat and poultry sectors, Corbion’s new multifunctional ingredient solutions are blends of natural ingredients, and will help manufacturers achieve food safety standards without sacrificing process yield or consumer appeal in a range of ready-to-eat and fresh meat and poultry products while meeting demands for natural and clean labels.
“Recently, there has been a real growth in the market for clean label and natural solutions,” said David Charest, industry director, meat North America. “At Corbion we anticipated these developments early on and have been formulating natural, specialty ingredients. As a result, we are now well-placed to serve our customers with a complete portfolio of biobased solutions, Opti.Form lactate/acetate blends and Verdad clean label blends, to help combat harmful microbes and extend shelf life without affecting color, flavor or texture.”