The Need for Innovation in the Healthy Food & Drink Sector

Recent research conducted by Impact on Urban Health and Mission Ventures has revealed that lower-income households are spending a shocking £250m more annually on unhealthy food and drink than those on higher incomes. 10 categories were identified as lacking affordable and healthy options for the lower-income consumer, including sugar confectionery, frozen meals, bottled and canned soft drinks, frozen processed poultry, everyday biscuits, frozen savoury bakery, instant hot snacks, chilled flavoured milk, and children’s biscuits. This is an issue that retailers and manufacturers need to address with both reformulation projects and NPD - or risk being outpaced and outflanked by healthier challenger brands.

The Problematic 10 Categories

Unhealthy food options are often cheaper than their healthy equivalents due to their ingredients being bulk-bought at wholesale prices; this lower price point makes them more attractive and accessible to those who have a limited budget. However, this means that lower-income households are unable to purchase healthier alternatives without spending significantly more money.The current cost-of-living crisis is driving further inequalities in health and nutrition. Our recent cost-of-living crisis survey uncovered that 42% of participants feel it is too expensive to eat a healthy diet, and 35% feel health is less important in their food choices due to financial pressures. A worrying 39% had also skipped meals​. The time has never been more pressing or relevant to deliver solutions in this area.

Reformulation Projects Can Help Bridge the Gap

Reformulation to improve the nutritional content of existing products is one mechanism through which retailers and manufacturers can help lower-income consumers access healthy, affordable products. For example, replacing white flour with whole-wheat flour in cakes can provide consumers with a healthier option without compromising on price, taste, or quality.This approach has already been tested in practice by the soft drinks industry levy. Introduced in 2018, the levy led to a 35% reduction in the sugar content of soft drinks, and at the same time, sales increased by 15%. The initiative demonstrates how reformulation can drive meaningful health improvements without either increasing cost to the consumer or compromising on taste or profit.

NPD Can Help Meet Consumer Demands

Consumers are becoming increasingly aware of what they’re consuming - they want to know where their food has come from and how it was made. To ensure that retailers and brands remain competitive against challenger brands who offer healthy alternatives with transparent ingredient lists, they should consider introducing NPD into their ranges which meet consumer demands for transparency while remaining affordable for lower-income households.Introducing new products that use natural sweeteners such as honey or grape juice instead of refined sugar can encourage shoppers to make healthier decisions without having to buy higher-priced foods from alternative providers.

The Need for Innovation in the Healthy Food & Drink Sector

Lower-income households are currently unable to access affordable yet nutritious foods due to the higher prices often attached to healthy options. Retailers and brands can help bridge this gap through reformulation projects which replace unnecessary refined sugars with natural sweeteners like honey, giving customers access to a healthier version of existing products at an equal price point, without sacrificing taste or texture.Additionally, introducing NPD into its own label ranges and branded offerings which include transparent ingredient lists will give shoppers more confidence about what they’re buying while providing them with an affordable option that meets their needs nutritionally as well as financially.Addressing this issue now will help ensure retailers and brands stay ahead of healthier challenger brands who can quickly innovate to launch solutions that meet increasing consumer demand for healthier products, whilst simultaneously supporting a healthier food industry.If you're looking for support with reformulation or NPD, FIS Group can help through every step of the journey, from benchmarking and product testing, to product concept ideation and development. Get in touch, and let's get talking!