A study published in the March 2009 issue of the Journal of Nutrition found that 78% of Canadian children ranging from four to eight years old were not receiving adequate amounts of Omega-3 EPA and DHA in their diets. That estimate is based on the suggested daily intake of 90 mg of Omega-3 EPA/DHA, as recommended by the Institute of Medicine. The suggested daily intake from the American Dietician Association and the Dieticians of Canada is 351 mg. By that standard, 90% of children who participated in the study were deficient. The U.S. Department of Health and Human Services has estimated that the average consumption of Omega-3 EPA/DHA for children four to eight years of age in the U.S. is only 50 mg per day. Thus, American children are typically DHA-deficient as well.
The Guelph University researchers who conducted the study concluded that additional education is needed to help consumers understand the benefits of DHA. “There is an apparent need to create greater awareness of the importance of the long-chain omega-3 polyunsaturated fatty acids among both health professionals and the general public, as well as the existing gap between actual and recommended intakes from various sources,” researchers stated in their findings.
NBJ recently spoke with Ethan Leonard, VP of Pediatric Nutrition for Martek Biosciences, who underscored the need for children to start getting the necessary dosage of DHA early in their lives. “DHA and ARA are proven to improve developmental outcomes in infants through breast milk, or substitutes. Martek recommends breast feeding first. If they cannot, or choose not to breast feed, then we want to participate in that and provide the best nutrition process possible.”
Martek Biosciences has established itself as the leading supplier of DHA and ARA to the infant nutrition market in the U.S. The company estimates that its life’sDHA and life’sARA products are used in more than 95% of infant formulas in the U.S. and are found in over 75 global markets. The company generated more than $352 million in global revenues in 2008, but still feels that there is untapped potential in the market for DHA. “American kids and North American kids don’t eat a ton of fish, whether it’s due to economic factors, or increasing problems with allergens and containments. We’re seeing in our own work that these products [fortified with ARA and DHA] are coming to market and will continue to come to market to fill in gaps,” said Martek’s Senior Public Relations Manager Cassie France-Kelly. Still, there are challenges in trying to educate consumers on the benefits of a product that does not have the name-recognition that other fortification ingredients like calcium or fiber do. “This idea that you eat to improve your intelligence or long term brain health is a sort of a new idea. When I was a kid we always heard you drink your milk for strong bones, but you didn’t hear a lot of, ‘If you eat this, you’re going to do better on your test or you’re going to have better concentration.’ The science has continued to develop and parents like the idea that you can eat something to contribute to cognitive and brain,” France-Kelly told NBJ.
So how does a company like Martek, which is predominately a supply company as opposed to a finished goods manufacturer, go about educating consumers? “We follow loosely the Intel Inside model. Although we are a business-to-business brand, we think that because our source is superior and because it’s such a complicated topic, it’s important to create a brand for consumers. That’s why we did life’sDHA a few years ago,” Martek’s Executive Director of Sales Jeff Bernfeld told NBJ. The company also has invested in print and television marketing, and has recently partnered with the March of Dimes to promote the importance of DHA.
While studies like the one conducted by Guelph University illustrate that a need for education still exists, Martek is seeing positive indicators that awareness is increasing. Based on an annual thousand-person survey conducted by the company, 78% of parents with kids less than 2 are aware of DHA, 68% of parents with kids two to six are aware of DHA and 82% of pregnant women have heard of DHA.
Read more about the Guelph University study here.
Related Links:
Martek Strengthens its Hold on Baby Formula Supply Market
Have Omega-3 Functional Foods Run out of Steam? GOED Says ‘No’
New Omega-3 Tests Highlight Industry, GOED Success
Lifeway Foods posted 24% sales growth for the first quarter as total sales increased from $11.1 million for the period ending March 31, 2008, to $13.7 million for the same period in 2009. Fresh Made Dairy contributed slightly less than $1.4 million in sales since being acquired on February 9 and is on track to exceed 2008 sales, according to a company release. Lifeway’s existing product lines grew 11% for the quarter.
Julie Smolyansky, chief executive officer of Lifeway Foods, recently told NBJ that the company was able to bounce back well from a particularly difficult fourth quarter in 2008. “In my years of working in this company–my father started the business when I was 9 years old–I’ve never seen a quarter like that. That’s not just us, it’s the whole world. Considering that, I’m very pleased with the business. We had a bounce back pretty much immediately in January.”
Edward Smolyansky, chief financial officer, talked about the company’s improved performance in a prepared statement. “We are extremely pleased with our first quarter 2009 revenue results. Given these tough economic times, the strong growth we experienced in the first quarter is a direct result of the marketing and educational initiatives we have invested in during the second half of 2008, and will serve as a strong foundation for future growth.”
Lifeway has also benefited from being in a product category that is on the rise. Natural & organic dairy sales in the U.S. increased 11% to $4.2 billion in 2008, according to NBJ estimates. Organic yogurt and kefir sales increased 9% to $937 million. Julie Smolyanksky thinks that the food industry has been able to bounce back from the recession more quickly than many others, due in part to more consumers shopping for groceries and preparing their meals as opposed to eating out. “I think food is somewhat recession proof. So maybe the recession isn’t over, maybe it’s just because we’re in a great industry. If there was any effect, I think it’s probably over for our company at least.” Lifeway Foods reported total sales of $44.5 million in 2008.
NBJ’s Healthy Kids issue will feature additional coverage of Lifeway Foods’ Pro Bugs children’s beverage, as well as complete analysis of the U.S. kids’ supplement, personal care and food markets in 2008. To order a copy of the issue, subscribe to NBJ or download a free 32-page sample issue, please click here.
Related Links:
Lifeway Foods Drinks Up Probiotic Kefir Competitor Fresh Made Dairy
Lifeway Foods Produces Probiotic Profits
Dean Foods Reports Strong 2008 Sales, Despite Q4 Softening
As we wrap up our research for Nutrition Business Journals’ inaugural Healthy Kids issue, it’s clear to us at NBJ that there are plenty of opportunities for innovators and entrepreneurs to enter and make a splash in the U.S. children’s nutrition market. In fact, Mark Trotter, CEO of Yo-Naturals, a California-based healthy vending company, thinks that the kid’s food market has booming potential right now. “Opportunities are endless for savvy product developers and marketers,” Trotter told NBJ. “Kids are very interested in healthy options. People think that because kids are kids they want to eat Hershey’s bars, but they don’t.”
Still, breaking into and succeeding in the children’s nutrition market remains challenging, particularly for small companies. “For a startup, it’s really expensive,” cautioned Julie Smolyansky, CEO of Lifeway Foods, which manufactures a popular children’s kefir beverage under the brand ProBugs. “The food business is really brutal, very expensive and it’s very hard to get capital. So be extremely aware of what you are getting into.”
Certainly companies are becoming more sophisticated in the way that they formulate and market children’s products, but there still appears to be a substantial gap between what manufacturers are producing and what parent’s desire. As Denise Devine sees it, much of this is due to a lack of true innovation in the children’s nutrition category. “Sometimes bigger companies confuse iteration with innovation,” said Devine, president and CEO of Froose, which makes a new kids drink that is packed with organic whole grains and fruit. “They might add a nutrient or two, but I don’t see a lot of turning product development on its head. If you look at what is happening in the food business, all the innovation comes from small companies. The companies that have the resources, I don’t see them taking the risk to do something very innovative. We are moving along a continuum and anything that’s better is great, but I don’t see that we are moving all that quickly in that direction.”
Financial hurdles will always be present for companies trying to break into the market with a better-for-you food or beverage product, but a down economy may be the best time for smaller, entrepreneurial companies to develop the new products that the larger CPG companies will one day want to buy, Devine said. “Research and development is the first thing that goes with big companies [during a recession]. They ignore new products and focus on their core brands. So when the economy returns, they are looking for new products.” Devine told NBJ that she hopes to turn her startup company into a nationally recognized brand in the next five years.
NBJ’s Healthy Kids issue will feature interviews with Trotter, Devine, Smolyansky and numerous other nutrition industry executives, as well as a complete analysis of the U.S. healthy kids’ food market in 2008. To order a copy of the issue, subscribe to NBJ or download a free 32-page sample issue, go to www.nutritionbusinessjournal.com.
Related links:
CRN: Multis Can Safely, Affordably Address Nutrient Gaps Present in Many U.S. Kids
Lifeway Foods Produces Probiotic Profits
Ian’s Swallows Healthy Handfuls
Researchers in Europe have pinpointed another benefit of drinking water: When children consume more H2O at school, they are less likely to become overweight. That’s the finding of a new study published in the April 2009 issue of the journal Pediatrics. In the study, researchers found that adding drinking fountains and classroom lessons that promote the benefits of water consumption to 32 elementary schools in the socially deprived areas of two German cities reduced the risk of children becoming overweight by 31%.
The study leaves many questions unanswered—such as how water intervention affected a child’s weight risk and whether increased water consumption prompted kids to consume fewer calories during the day. But it also showed that simple changes can help reduce the risk of obesity for our children, particularly when there is an education component involved. This alone makes me appreciate the fact that my son’s kindergarten teacher is adamant about parents sending their kids to school every day with a filled water bottle.
Nutrition Business Journal will be addressing the issue of childhood obesity in our upcoming Healthy Kids issue, which publishes later this month. The issue will include stories about school vending machine policies and healthier vending options and a Q&A with Ann Cooper, also known as the Renegade Lunch Lady and author of Lunch Lessons: Changing the Way We Feed Our Children. Also featured is a discussion with Vitamin Angels Founder and President Howard Schiffer about how the nutrition industry is helping his organization bring needed vitamins to more than 10 million children globally. To order a copy of the issue, subscribe to NBJ or download a free 32-page sample issue of the journal, go to www.nutritionbusinessjournal.com.
Related links:
Thirsty Market for Kids’ Beverages
Coca-Cola Company in Hot Water
National Vending Machine Company Launches Healthy Snack Program
‘How bad can the economy be if people are buying acai?’
That was the question posed by Washington Post columnist Jennifer Huget in a March 31, 2009, article about the growing popularity of the Brazilian wonder berry. The article noted that sales of acai have been skyrocketing—Americans spent more than $108 million on acai products in the 52 weeks ending Feb. 21, 2009, up from a little over $62 million during the same period in 2007, according to SPINS research. But the piece also questioned—as it should—the the validity of many of the health claims that are coming out about the acai super fruit. As Huget writes: “Who’d have believed that this modest product of Brazil’s Amazon rain forest could do everything from speed weight loss to correct sexual dysfunction—while bolstering your immune system, too?”
Huget also warns consumers against enrolling in the “free” trials of acai products that are showing up with increasing frequency on the Internet and in people’s e-mail in-boxes. “After sharing credit-card information to cover shipping and handling, consumers are being hit by surprise monthly charges, often before they even receive their trial shipment,” Huget writes.
What is happening right now with acai is another example of how a few bad berries can contaminate an entire industry. Stepping up against nutrition-related Internet scams (which acai product maker Sambazon is doing) and backing products with serious research that can stand up to scientific scrutiny (such as Proprietary Nutritionals Inc. has done for its cranberry Cran-Max ingredient) is becoming increasingly important and will be essential in helping individual companies—as well as the entire industry—weather the negative press that is being fueled by fraudulent acai and other nutrition-related companies.
Related links:
2008 Scientific Achievement Award: Cran-Max
XanGo, MonaVie, TNI Keep Squeezing Sales Out of Super Fruits
