Redefining functionality

The term ‘functional’ is changing. It is not a new concept; first coined in the 1980s, it simply came to represent quality. Functional ingredients were used to improve the physical properties of food and drink products – making sauces thicker, extending shelf life and binding other ingredients together, among others.

However, the term ‘functional’ later shifted again, in line with rising numbers of health conscious consumers. Food and beverages were expected to be formulated with nutrients that improve health, while providing the same physical properties. Recent proposals to implement sugar taxes across Europe have since fuelled this drive for healthy functional ingredients, particularly following the backing of the World Health Organisation (WHO) last year. This hasn’t damaged the global functional food and drink market at all; it is seeing huge growth and is predicted to rise at a CAGR of nearly eight per cent from 2017-2021.

Now there’s a new dimension to ‘functional’ food and drinks. Quality and healthiness have become so ingrained into everyday consumer lifestyles that they are increasingly being taken for granted. Ingredients need to deliver more than ever; they are expected to help deliver brand promises, values and principles, and it is changing the industry landscape.

Keeping sustainability promises

It is a trend that started with industry heavyweights, like Nestlé and Kellogg’s, and is filtering down to smaller food and drink companies, too. Suppliers of ingredients, as well as production methods and marketing collateral, now need to help their customers deliver on more than just quality and healthiness – they also need to tie-in, reflect and support their brand promises. From quality assurance to sustainability and innovation, functional ingredients offer an opportunity to align values.

Unsurprisingly, the sustainability message is huge. Brands, such as Kellogg’s and Starbucks, are investing greatly in ensuring a transparent supply chain, with minimal environmental impact. It has been at the top of many businesses’ agendas in recent years, with industry leaders like Pret à Manger implementing new sustainability strategies with tangible targets. Sustainable farming, animal welfare and the highest practical level of environmental stewardship are all part of the company’s strategy, due to finish this year.

Many ingredient suppliers already have values that are deep rooted in sustainability. Fruit and vegetable ingredient supplier SVZ has built its entire operation on the premise of a transparent supply chain. “Our agronomists have excellent control over every step of the supply chain by working closely with our network of growers, ensuring complete transparency,” explains SVZ’s sales director Johan Cerstiaens. “We share a lot of the same values with companies like Kellogg’s and Nestlé. By harvesting and processing our ingredients at source, we reduce our dependency on transportation and decrease our energy use.”

This increased desire for transparency has also manifested itself in the drive for clean label, which is rapidly becoming a global standard for food and beverage companies. Now consumers want to see the complete supply chain on their labels. This is reflected in recent formulations from big brands, such as Mars, which recently committed to removing all artificial colouring from its human food products over the next five years. It is a reoccurring theme across the food and drink industry, with brands like Danone making clean label promises as part of its corporate messaging. According to Innova Market Insights, 25 per cent of new products in the US had clean label positioning in 2015, up from 17 per cent in 2014.

Functional ingredient suppliers have also noticed a surge in demand for clean label. Gelatin is one ingredient that is increasingly being formulated for having no e-numbers and ability to comply with clean label standards. “Once a consumer trend, the clean label development has now become a standard for many manufacturers, who see clean and even clear label as an essential, unavoidable part of their product offering,” says Sandor Noordermeer, VP global marketing and sales for Rousselot Gelatin and Peptan Collagen. “Over the past couple of years, we’ve seen our customers sourcing an increasing number of natural multifunctional ingredients, to avoid e-numbers in their ingredient lists.”

A question of quality

Even the term ‘quality’ in the functional ingredients context has changed. Big brands and food service operators are keen to reassert their commitment to providing only the very best products. Arla Foods lists quality as one of its defining features, working to an additional 16 set of standards, over and above the revolutionary Red Tractor Scheme. Warburtons goes one step further, and describes quality as more than a value, but an “obsession” on its corporate website page.

This change can be seen in the way in which ingredient suppliers are sharing their quality processes – highlighting the same values as part of a more transparent approach. It’s nothing new for global nutrition company, Glanbia Nutritionals. From its roots in innovating whey technologies in Ireland, Glanbia has long held the belief that quality underpins everything. “We understand that quality transparency is extremely important to our customers, and we work very closely with them to fulfil specific certification requirements, as well as audits and quality assurance,” comments Dr Dagmar Ortlepp, marketing manager at Glanbia Nutritionals.

“Adhering to strict quality standards not only upholds our internal promises, but appeals to our broad customer base. Customers are increasingly looking to us to provide the evidence that our production processes go beyond the standard criteria and we are happy to provide this. For example, we have one of the highest quality standard premix facilities in Europe,” adds Dr Ortlepp.

Pioneering ingredients

It’s not just at a corporate level that suppliers are meeting the changing needs of big brands. Consumers’ appetite for exciting food and drink products is shaping functional ingredient new product development. Industry giants, such as Unilever, have long since championed innovation in food technology, encouraging suppliers to emphasise their R&D offering.

Corbion has been watching this trend with interest, having a strong track record in innovation. Its range of lactic acids, emulsification technologies and functional blends help to formulate fresh and stable products. “Our business has always been based on using natural resources as much as possible to create safe and relatively simple ingredients that reflect our customers’ needs,” explains Peter van Paridon, global industry director, food and beverage, Corbion.

The company recently opened a new R&D lab in Gorinchem, the Netherlands, to cater for growing customer requirements. Van Paridon continues, “We understand that it’s important for our customers to stay ahead of their competitors and anticipate and comply with industry requirements. Our approach of constant creativity and improvement helps us, and customers, innovate faster and meet that rising demand.”

Given consumers’ varied and rising demands, suppliers are also innovating with ingredients that meet multiple purchasing considerations at one time. Clean label continues to be a key focus for the industry; it is increasingly important that there are fewer, recognisable ingredients in formulation. For ADM, reformulation has become a crucial element of the business. Bastian Hoermann, product manager, food, ADM Wild Flavors and Specialty Ingredients, says that it is changing the customer landscape: “Product development challenges are becoming more complex and multifaceted; they are now seeking out complete ingredient systems from ADM to deliver on their formulation needs and help them get to market faster.”

Hoermann adds, “Not only can functionality help to boost a product’s value proposition, ADM’s range of ingredient solutions can also address specific market challenges on taste and texture. Our ability to provide tailored, turnkey solutions has proven particularly popular with developers looking for ingredients to deliver functionality, such as additional protein and fibre, or offering sweetness or natural flavourings.”

The future for functionality

Functional ingredients have already fully established themselves as a must-have addition, and are certainly not new to the industry. The way in which the ingredients must be ‘everything to everyone’ is gaining ground, however.

SVZ’s Cerstiaens agrees the market is still evolving: “Consumers are more educated than ever before. As they increasingly interrogate the labels on their food, further questions are being raised, leading to more demands. The functional ingredients market is flourishing, and will continue to do so, with an increased focus on products that are both natural, but also contribute to a healthy lifestyle.”

Some of the current key trends in the industry don’t show any signs of stopping either. “The clean label trend will continue to evolve in the functional ingredients market, with more emphasis on sustainable components and initiatives,” adds Noordermeer of Rousselot.

Investing in the right ingredients to tie in with brand concepts could help to set apart manufacturers’ food and drink products on the shelves and increase consumers’ emotional buy-in as awareness grows. It is also important to consider functional ingredients as an extension of a brand’s values, along with other aspects of the supply chain.

What’s next for functional ingredients? ADM’s Hoermann believes they are the answer to a growing population, with innovative, robust properties that improve health, too. “With growing consumer demand for vegetarian, vegan and flexitarian products, product developers are incorporating more plant based ingredients, such as edible beans, soy and wheat proteins, to provide functional, health and nutrition focused products.” Cricket flour, anyone?

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