“Don’t mention the S word”A fresh perspective on:

SUGARFrom The Value Engineers

What’s all this fuss about sugar?

2

Some recent headlines…

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A 2014-5 report from the

World Health Organization

warned that too much sugar

in our diets increases the risk

of heart disease, diabetes,

tooth decay and obesity.

The report recommends

cutting free sugars in our diet

to 10% of daily energy intake

– equivalent to 25g which is

approximately 12 tea spoons.

W.H.O. report: the tipping point for how we think about sugar?

The UK’s Scientific Advisory

Committee on Nutrition

(SACN) endorsed the findings

of the W.H.O. report with a

firmer recommendation for

cutting free sugars to just 5%

of daily energy intake – that’s

25g or just 6 tea spoons.

UK S.A.C.N. report recommends huge reduction in sugar intake

Fuelling the public’s concern

about the current headlines

on sugar, key opinion formers

have added their voice to the

debate: from Australian

documentary That Sugar Film

to celebrity chef Jamie Oliver

calling for a tax on sugar.

Sugar has become “public

enemy number one” and even

been talked about as the new

tobacco in light of the wave

of health concerns.

Key opinion formers have been quick to join the debate

How is this all affecting FMCG?

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British supermarkets have

already started taking action

to reassure consumers that

they are cutting sugar levels

in-store and adopting a

healthier choice architecture:

from de-listing drinks with

high sugar content including

Ribena, Capri-Sun and

Rubicon to introducing

sweet-free checkouts.

Supermarkets react by taking steps to cut sugar levels in-store

With a longstanding battle

between maintaining value

and increasing sales volumes

(often through constant

promotion), confectionary

and sweet snacking brands

have been innovating with

new flavours, taste profiles

and occasions for some time

now, and the debate on sugar

reinforces the need for bold

innovation in the category.

Confectionary and sweet snacking brands are busy innovating

In light of growing consumer

concerns, and a shifting

marketplace and mind-set

other categories being

affected by concerns over

sugar levels include:

• Soft Drinks (both Sodas

and Fruit Juices/Smoothies)

• “Low Fat” Products

• Breakfast Items

• “Healthy” Snacking

Other categories are being hit by concerns over sugar levels

Whilst a tax on sugar has

been ruled out in the UK, as

long as obesity, diabetes and

tooth decay continue to be

costly public health issues it is

likely governments will take

steps to curb sugar reduction.

As changing consumer habits

lead to a fall in volumes,

regulation is likely to include

clearer guidelines and the

labelling of “free sugars”.

Further action on labelling and regulation should be expected

So how can FMCG brands move forward?

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Starter-for-ten: questions to think about

For every decade there is a “public enemy number one” – from e-

numbers to horse meat. Is sugar the new tobacco, or a more transient

health “fad” ?

1.

Does your brand have a unique perspective on health & wellness? Both

consumers and the industry use this time widely, but what does it mean

for your brands and category?

5.

Where will the debate on sugar be in 5, 10 or 15 years time? Is your

brand portfolio future-proofed with products to deploy against new

opportunities for growth?

2.

Supermarkets are reacting with a new, more conscientious “choice

architecture” approach. What level of responsibility do modern brands

have in helping customers moderate their diets?

4.

Through the 1970s & 1980s manufacturers focussed on “low fat”

products. Are we beginning to see something similar with low-sugar,

natural sugar, or no added sugar ranges?

3.

Starter-for-ten: questions to think about

What segmentations of consumers and their attitudes and/or behaviours

towards sugar can provide new opportunities for growth? Is it flexible to

cope with rapid shifts in attitudes?

6.

What new taste profiles can we explore? How are consumer’s palettes

evolving and what opportunities might this present?10.

In the battle between artificial and natural sweeteners, are there any

which pass both consumer taste tests and satisfy health beliefs?7.

Does the future for sweet products lie in “permissible treats”, “the

ultimate indulgence” or a different positioning altogether?9.

Is reducing portion sizes and cutting sugar levels sufficient, or do we need

totally new claims to reassure the most conscientious consumers?8.

Food & Drinks brands are pumping

billions into R&D with a view to re-

formulating products whilst

continuing to maintain overall

sweeter taste profiles.

Renovate: smaller packs, re-formulation

This strategy is centred on

preserving the “bliss point” of

sweetness which keeps consumers

coming back. It is expensive and

vulnerable to shifting taste profiles.

Brands attempting to renovate their

portfolio will need to find

convincing claims and propositions

to assure often sceptical consumers

that they are truly healthier.

Why is sugar so closely linked to

love, reward and happiness? The

deeply ingrained cultural

perceptions and positioning of sugar

are powerful motivators.

Re-Position: the ultimate indulgence?

Exploring attitudes towards sugar

could provide interesting new

opportunities – from identifying

alternate needs to positioning sweet

products as an acceptable vice.

Re-positioning sweet products is no

small challenge, and to succeed in

this brands need to go beyond

current attitudes and anticipate

where consumers may be heading…

The boldest response to the debate

on sugar is to recognise it as an

opportunity not just a threat.

Opportunities abound for those

who dare to zig whilst others zag…

Innovate: exploring new taste profiles

Consumer taste profiles are shifting,

and for those who don’t believe re-

formulation has all the answers, it is

an exciting time to explore new

flavours to overtake sweetness.

Brands wishing to lead and evolve

the market need to form a vision

for their category, and have the

innovation strategy and pipeline to

blaze the trails and get there.

Who can help me tackle these questions?

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Insightful Customer Understanding

Market research can deliver interesting

snapshots of consumer’s lives, but our approach

is to put the brand and wider business

objectives at the heart of insight, combining

qualitative creativity with quantitative rigour.

About The Value Engineers

Purposeful Brand Philosophy

Today brands need to cross boundaries of

category, country and audience. We have been

helping clients tell more compelling stories using

purpose and philosophy, simplifying things as

much as possible but no more.

Inspirational Sustainable Change

Brands are either dealing with seismic changes

in their market, or looking to drive significant

change in their own business performance. We

work with clients to navigate change and

engineer the future of their brands.

A fascination with discovering unlikely yet intriguing

connections between ideas has lead Sean from a degree in

Philosophy to strategic brand consultancy The Value

Engineers.

Having worked with a number of retailers, start-ups and

blue chip brands on their brand strategy, innovation

pipeline and customer journey planning Sean has a number

of thoughts on framing the current debate on sugar as an

opportunity and not just a risk.

To find out more get in touch:

Sean.Davey@thevalueengineers.com

About The Author: Sean Davey

The Value Engineers

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