Navigating Health Claim Regulation in Food and Drinks: Making substantiated claims in a changing regulatory environment

Navigating Health Claim Regulation in Food and Drinks: Making substantiated claims in a changing regulatory environment published by Business Insights in May, 2009. This report consists of 124 pages and the price starts from US $ 2875.

Introduction

Abstract

In 2007 new legislation (Regulation 1924/2006) came into effect in the European Union (EU) and its effects will dramatically change the marketing landscape for health claims in foods and drinks. In general there is broad support for the regulation within the industry, with consumers and manufacturers recognizing the benefits it will bring in terms of greater consumer protection and an improved regulatory framework. However, major criticisms of the process for putting the legislation into effect have emerged. The new legislation is changing the “rules of the game” for marketing products featuring nutrition and health claims in Europe and adapting to these changes will be crucial. Food and drinks companies need to ensure they are in a position to update their marketing messages not only to account for the additional science required to pass regulatory requirements, but critically to start to re-engage consumers whose trust in these products is low. ‘Navigating Health Claim Regulation in Food and Drinks: Making substantiated claims in a changing regulatory environment' is a new report published by Business Insights that examines the many challenges facing companies due to regulations. From corporate and marketing strategy down to tactics for marketing individual products, this report analyzes and gives advice on how marketers should be responding to threats and identify the opportunities associated with the new regulations.

Table of Contents

Executive Summary

• Consumer attitudes
• Claims & corporate strategy
• Marketing strategy
• Product claims strategy

Chapter 1 - The impact of new legislation

• Summary
• Introduction
  • The new legislation will have a dramatic effect on the marketing landscape

• Overview of regulation # 1924/2006
• Introduction
  • The creation of stronger, clearer regulation
  • A “gold standard” approach is proving controversial
• Definitions and scope of the regulation
  • Definition of “food”
  • Definition of nutritional and health claims
  • Medicinal claims are beyond the scope of this regulation
• Articles 13, 13.5 and 14 - the heart of the regulation
  • Article 13
  • Article 13.5
  • Article 14
• Problems with the implementation of the regulation
  • Communication breakdown? Dossier insufficiencies and related problems
  • Interpretation of Article 13 and the “Gold Standard” approach
  • A need within a defined population must also be shown for a health claim
  • The costs of dossier compilation are harming innovation budgets
  • Direct challenges to EFSA' s opinions are risky and ignore the wider context
• Challenges the food and drinks industry must meet
• The future impact of the regulation

• Conclusions
  • The rationalization, and not the death, of nutrition and health claims
  • A narrow focus on the regulation will miss a vital piece of the marketing puzzle

Chapter 2 - Consumer attitudes

• Summary
• Introduction
  • A need to address the latest consumer trends affecting the market
  • Addressing consumer issues can lead to major rewards
  • A note on the following sections

• A major trust issue needs addressing
• Mistrust is the number 1 inhibitor of continued growth
  • The majority of consumers still need convincing before they will buy products
  • An independent expert approving claims is crucial
• Functional foods are favored over other food technologies
  • Clear benefits and low risk make functional foods more acceptable to consumers
  • The media and governments play a fundamental role in shaping consumers' views
• Regulation and corporate practices need to build trust
  • A lack of consumer control creates a clear need for regulation

• Consumer understanding needs to be improved
• Areas of misunderstanding
  • Claims should be concise and clear to avoid confusion

• Deep-seated food attitudes affect the marketing landscape
  • Introduction
• The process of food attitude formation
  • Steps to determining attitudes and behaviors in a category
• “Natural” products must also fit in with these attitudes
  • As a result, some ingredients are seen as more natural than others
• The carrier food for any ingredient is crucial
  • A logical connection between the carrier and ingredient is required
  • Staples, and products already seen as “healthy”, make the best carriers

• Risk-Benefit assessments
  • The prominence of “risk” in consumers' minds
• What are the risks on which consumers need assurances?
  • Education about regulation can help provide reassurances

• Differences by consumer groups
• Attitude towards the product is the key
• Demographic factors to augment attitudinal segmentation

• Attitude-Behavior discrepancies
  • Research needs taking into context - consumer research can be misleading

• Price and taste remain more important than claims
  • Claims are important, but the “golden rules” cannot be ignored

• Conclusions
  • A tough recipe for success

Chapter 3 - Claims & corporate strategy

• Summary
• A need to update current strategies
• Health-orientated businesses should re-examine strategies
  • Companies which simply wait upon EFSA' s decisions will fall behind
  • It' s not just a case of “carrying on as usual” once a claim has been approved
• Areas that should be strategically reassessed
  • Decisions to challenge EFSA will harm companies and industry in the long run
  • Research & development needs to focus on clinical excellence and “marketability”
  • Product pipelines and portfolios should be reassessed

• Next steps in corporate strategy
• Avoid distractions associated with the new regulation
• Adopting a pharmaceutical-style model for health brands
• Developing a corporate health brand
  • Case study: Danone, developing a corporate health brand
• New approaches in portfolio management
  • All health brands in the market need to offer highly credible health claims
• Research and development pipelines should be segmented by risk
• Where possible, make use of “stalking horses” when launching new ingredients

• Conclusions

Chapter 4 - Marketing strategy

• Summary
• Introduction
  • The advantage will go to those who are quick to update their marketing

• A framework for marketing strategy
• Strategies can, and should, be based on consumer insight
• A tool for assessing products' consumer appeal
  • Assessments of product appear should be based upon consumer insights
  • Market analysis can also be layered on top of consumer appeal assessments

• Marketing strategy and tactics
• Make claims clear, specific and benefit-focused
  • The temptation to continually add claims should be avoided
  • Wellness positionings should also be avoided for specific products
• Market benefits first and provide the science as back up
  • Naming specific ingredients is a powerful tool in marketing communications
• Safety of products is a tricky issue
  • Marketing should reassure consumers about safety

• Improving communications
• Commercializing science and educating consumers are key
• A flexible blueprint for global marketing is crucial
• Companies must take the lead in responsible communications

• The Natural Perspective
• Natural positioning should be used where possible
  • Determining just what is “natural” is not an easy task
  • Natural positionings must meet consumers' expectations as well as regulation
  • New “natural” sweeteners highlight the power of a natural positioning
  • Marketers will need to decide how overt to make any natural positioning

• Conclusions

Chapter 5 - Product claims strategy

• Summary
• Introduction
• Scope of the chapter
  • Analyzing the last year of new launches provides insight into latest strategies
  • Scope of the data

• Claims analysis
• Claims by type and by industry
  • An average of 2.6 claims is made by a product making any claim
  • Beverages focus on “positive” nutrition, but food focuses on avoiding the “bads”
  • Innovation is greater in North America and is more focused on positive nutrition
  • Why should positive nutrition be more popular in the US?
• Most popular claims by industry
  • “High”, “low” and “no” positioning still dominate
• The natural angle
  • Natural positionings are of fundamental importance
  • American products heavily focus on natural benefits
• Most popular functional claims by industry
  • Most functional claims are not specific
  • Functional claims are much more prevalent among North American launches
• Leading countries for new claims
• Leading manufacturers for new claims
  • Private Labels are providing competition to brands

• Conclusions

Chapter 6 - Appendix

• Bibliography
• Index

List of Figures

• Figure 2.1: The top-down process of food attitude formation: a hypothetical example from the yogurt category
• Figure 3.2: An initial framework for segmenting product development portfolios by risk
• Figure 4.3: Framework for assessing product strengths and weaknesses
• Figure 4.4: Fewer, clearer claims make a product more, not less, compelling
• Figure 4.5: Pistachi Oats: The Heart Healthy Cookie. A credible product proposition for European consumers?
• Figure 4.6: Actimel uses a consistent set of key messages to clearly and succinctly explain product benefits

List of Tables

• Table 2.1: Percentage of European and US consumers who find health and nutritional claims on food and drinks “trustworthy”, 2008
• Table 5.2: % share of different claims being used, by type, in North America and Western Europe, in new product launches between April 2008 and April 2009
• Table 5.3: % share of different claims being used, by type, in North America and Western Europe, in new product launches between April 2008 and April 2009
• Table 5.4: Most popular claims made by new product launches that feature health or nutrition claims (% of products with any claim), by industry, in North America and Western Europe, April 2008 to April 2009
• Table 5.5: Ranking of the most popular claims, overall and by industry, for new product launches, in North America and Western Europe, April 2008 to April 2009
• Table 5.6: Most popular claims made by new product launches that feature health or nutrition claims (% of products with any claim), by industry, in North America and Western Europe, April 2008 to April 2009
• Table 5.7: Percentage of new product launches that feature health or nutrition claims which make a specific functional claim (% of products with any claim), in North America and Western Europe, April 2008 to April 2009
• Table 5.8: Percentage of new product launches that feature health or nutrition claims which make a specific functional claim (% of products with any claim), by region, April 2008 to April 2009
• Table 5.9: Leading North American and Western European countries by the number of new product launches featuring health and nutrition claims launched between April 2008 April 2009
• Table 5.10: Leading manufacturers in North America and Western Europe, based on new product launches that feature health and nutrition claims, April 2008 to April 2009

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