"Overweight Consumers and the Future of Food and Drinks," a new report from independent market analyst Datamonitor, reveals that the American waistline is getting bigger even though consumer spending on diet products is forecast to grow by 20%, to US$54 billion in 2009. The U.S. has the dubious distinction of having more overweight and obese consumers (in terms of both percentage of the population and absolute numbers) than any European country. By 2009, almost 70% of the population is expected to be overweight or obese.
A global epidemic
American consumers will spend more per head over the next five years than European consumers, with respective per head expenditures of US$154 and US$125 in 2004. By 2009, these figures will have grown to US$177 and US$147, with European growth outstripping U.S. growth at 3.3% a year compared to 2.7%.
The transatlantic weight gap is narrowing, comments John Band, Consumer Markets Analyst at Datamonitor and author of the report. The U.S. has by far the highest proportion of overweight and severely overweight consumers, but European consumers are not far behind: the figure for Europe is currently 48% and will have crossed the 50% barrier by 2009. Within a few years, having a normal BMI** of 20-25 will in fact no longer be normal in Europe. In the UK, and Spain this is already the case; with 40% and 39% of the population classified as overweight (BMI of 25-30) respectively, overweight consumers already outnumber normal consumers.
Weight concerns boost spending on diet food and drinks
In 2004, the overall U.S. diet food and drink market had a value of US$45 billion, and this is predicted to grow to US$54 billion by 2009, representing a growth of almost 20%. Low-fat dairy products accounted for almost 40% of US consumers expenditure on diet food and drink in 2004. This product market accounts for a higher proportion of consumers expenditure on diet products than any other, and is also enjoying some of the fastest growing expenditure at 4.7% per year.
High-fat ice cream, milk, cheese and cream products are often considered unacceptable when dieting, and many consumers following a healthy lifestyle will also avoid these foods which are considered to be high in fat and cholesterol, says Band. As such, diet dairy products will remain very popular.
Low-sugar and low-calorie confectionery is forecast to grow at the same yearly rate (+4.7%) between 2004 and 2009. The strong growth of the diet confectionery category can be explained by the fact that many consumers, not just dieters, feel the need to indulge on sweets and desserts, says Band. Many consumers regard sweets as a comfort as well as an indulgence and choosing a diet alternative to chocolate or sugar confectionery allows consumers to feel less guilt about their indulgence.
Low-carb is dead; long live low-fat
Within the diet foods sector, low- and no-fat products account for more new product launches than those making any other lesser evil claims. In 2001, 7.4% of new food products launched worldwide claimed to contain reduced levels of fat, rising to 10.4% in 2005. Although growth in the proportion of products claiming to be low-fat is comparatively low at only 7.0% a year between 2001 and 2005, it remains in a dominant position: the benefits of a reduced fat intake are easily comprehensible and instinctively accepted by all consumers.
At the height of the Atkins craze in 2004, 14.1% of new food products claimed to be low-carb, making this the only claim ever to be more widespread than being low-fat. However this popularity was short-lived: launches of low-carb products fell to only 5.1%. This is a powerful illustration of the faddish nature of the diet market, says Band. The high level of low-carb NPD was intimately linked to the temporary high popularity of a particular diet, but the ongoing dominant position of low-fat products reflects a long-term consumer health trend.
**BMI The Body Mass Index (BMI) is used to segment the population by weight, in a meaningful manner. A persons BMI is calculated as the ratio of their weight in kilograms and the square of their height in meters according to the formula BMI = Weight/Height2. The BMI categories used throughout this report follow the following classification:
- Severely underweight: BMI < 18
- Underweight: 18 < BMI < 20
- Normal: 20 < BMI < 25
- Overweight: 25 < BMI < 30
- Obese (severely overweight): 30 < BMI
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