[On-demand webinar] Healthy snacking market moves from free-from claims to holistic nutrition

“What we have noticed in the past year is a real shift in tone from a focus on what is not in snacks to what is in the snacks,” Melissa Dolan, director at venture capital firm Emil Capital said during FoodNavigator-USA's webinar Elevating healthy snacking: Meeting demand for function, flavor, format​​, ​which is available to watch for free on-demand.

“A lot of brands in the past were focused on the absence of artificial colors, the absence of artificial sweeteners, the absence of certain ingredients, and we are really seeing the shift towards a really positive focus on the goodness inside of these products,” she elaborated.

Gen-Z is ‘indexing really high today for probiotics, microbiome, brain health [and] mood health’

In recent years, the health foods market has focused on functional claims over specific ingredient claims, as consumers take a more holistic view of what they are eating, said Dolan. Emil Capital has invested​ in better-for-you snack brands like ALOHA, Bare Snacks and SNAX-Sational Brands.

Additionally, younger consumers are driving broader trends around functional claims in the snack category, growing the better-for-you category, said Sherry Frey, VP of total wellness at NIQ.

“Gen-Z consumers, who are just moving into their earning years, are indexing really high today for probiotics, microbiome, brain health [and] mood health. And so, when we think about what is the future going to look like ... this is not what they are saying, [but] it is actually what they are already buying today. We anticipate that will continue to grow, and that the snacking space is a space that is really poised well to deliver that to them,” Frey added.

‘Ozempic curious:’ Consumers want GLP-1 benefits, without a prescription

The emergence of GLP-1 drugs like Ozempic and WeGovy as a potential solution to the obesity epidemic has elevated the discussion around healthy eating and led to a surge in demand for products that can promote satiety and weight management, the panel shared.

Supergut provides a range of snack bars and powders​, formulated with unripe green bananas, oat beta glucan, resistant potato starch and soluble vegetable fiber, to promote gut health but also mimic the body’s ability to create GLP-1 effects naturally, company CEO and Founder Marc Washington said.

Supergut is serving consumers who need an on and off ramp for these drugs, who might be experiencing gastrointestinal symptoms, while also tapping into a broader market of consumers who might want similar benefits to GLP-1 drugs but do not want to go on the drug, he added.

“As many people who are ... using these drugs, there will always be more people who are not for one reason or another, and I do think that there is a significant impact on the rest of us — that I have come to phrase the ‘Ozempic curious’ — [who] are interested but do not want to necessarily spend $1,000 a month or do not want to use injection or pharmaceutical but are interested in appetite control, healthier weight management, etc. That is the biggest group of all, and I think that is fundamentally impacting health and nutrition,” Washington said.  

Similarly, plant-based snack brand Rivalz is capitalizing on GLP-1-related trends​ around nutrient density and satiety while promoting healthy blood sugar by leveraging innovative extrusion technology to create its products, said company CEO Peter Barrick.  

“We went out to disrupt the salty snack category first, and what you see in the salty snack category [is] carbohydrates are pervasive. They lead to a blood sugar spike, insulin resistance [and] diabetes. We wanted to tackle that carbohydrate problem in salty snacks, and so what we did is we figured out how to extrude ingredients [to provide] high protein, high fiber [and] low carbohydrates, creating a low glycemic snack,” Barrick shared.  

Sugar, sodium reduction is still a concern for many consumers

While consumers are focusing less on free-from claims, they still are demanding products with lower sugar and sodium content, as health experts and researchers warn about how the overconsumption of foods high in sugar and sodium can be detrimental to health, the panel shared.  

Over the years, the food and beverage industry has responded to sugar reduction with innovation in non-caloric natural and artificial sweeteners, which can deliver on sugar's taste, explained Samil Ozavar, SVP of strategy and innovation at Cibo Vita​.  

“Having a combination — maybe combining a fiber with allulose and some monk fruits — could be a winning combination to replace sugar without any additional calories still keeping the taste and functionality. So, we have options, but what we choose is really key, and I believe many consumer brands should be more concerned about it,” Ozavar said.

Consumers are focusing on ways to reduce their sodium intake more than sugar, since many shoppers turn to sweet treats for a moment of indulgence, noted Frey.

“We see in our household panel, about 30% of the households that are self-reporting that they have high blood pressure. You can even see here in terms of searches, we track not just what the sales data is or who the consumer is, but we are also tracking when they are going to a retailer's website, what they're typing in, and we are finding that they are typing more searches around blood pressure, low sodium, even very low sodium. So again, this is one of those elements that we are starting to see some shifts, specifically in salty snacks,” she added.

Better-for-you product under-index in the market, Gen Z seeks out functional products

Despite many better-for-you categories under-indexing in the broader market, they represent 14.9% of total grocery, according to NIQ data shared in the webinar for the 52 weeks ending, June 15. Additionally, 62% of better-for-you growth is driven by smaller brands.

Consumers are turning to the snack category, but "the most important element is that we are looking for the pleasure and the enjoyment from our snacking," said Frey.

“We also did find about 40% of consumers are saying​, ‘Hey, I am looking for snacks that are made with nutritious ingredients, and they are going help me be healthier.’ And we also found about 35% of consumers that said, ‘I am really actually looking to find more premium high-quality ingredients. I get that they might be a little bit more expensive, but it is worth it to me,’” Frey said.