MARKETI NG GLUTEN-FREE FOR SUCCESS Canadian Spice Association Annual Meeting Convention May 9, 2014 - Toronto, CANADA Gluten-Free Certification Program
Allergen Control Group Inc. Allergen Control Group I nc . ( ACG) represents a team of food industry experts, who understand how to manage manufacturing risks, while maximizing procurement and specialty product marketing opportunities. ACG manages, administers, and markets the Gluten-Free Certification Program in partnership with North America’s leading celiac organizations, the Canadian Celiac Association and the National Foundation for Celiac Awareness. Gluten-Free Certification Program www.GlutenFreeCertification.ca
The CCA Endorsement in Canada The Canadian Celiac Association (CCA) is the only national voice for people who are adversely affected by gluten, and is dedicated to improving diagnosis and quality of life. The Gluten-Free Certification Program ( GFCP) was developed by the CCA and launched in May 2011 with the goal to: • Help Canadians make clear and informed safe, gluten- free food choices • Increase ease of access to safe, gluten-free products • Broaden the scope of available & affordable gluten-free products • Be trusted by medical doctors and other medical practitioners Gluten-Free Certification Program www.GlutenFreeCertification.ca
The NFCA Endorsement in the US • Promoting an internationally recognized robust, management system based program • Enabling easier flow of both finished product and source ingredients across the US/ Canadian border • Building confidence and brand loyalty via providing transparency and education to consumers • Offers a channel for NFCA to engage with consumers at point-of- sale • Supports August 2013 FDA regulation defining ‘Gluten-Free” claims Gluten-Free Certification Program
Setting the Stage There are an estim ated 2 .3 m illion Canadians requiring gluten-free products for m edical reasons • Celiac disease is on the rise - It is 4 x m ore com m on today than is was in the 1950s. It is expected to double every 15 years • 7 1 % of consum ers buy at least some gluten-free food/ beverage products & 51% will continue to purchase • Gluten-Free Consumer inquires are the second most requested ingredient question for retailers & food service establishments • The “Halo” Group: Family members of those suffering as well as those seeking a gluten-free diet for its health benefits adds approxim ately 7 m illion to the total number of Canadians looking to buy gluten-free products. Gluten-Free Certification Program www.GlutenFreeCertification.ca
The Facts Approximately 9.0 Million Canadians are eating gluten-free 22% Gluten “avoiders” 6 % Gluten-sensitivity (2,000,000) 1% Celiac Disease (300,000)
Who is Our Consumer? • What they didn’t realize was that Andrew wasn’t the only one who would have to get over feeling different. “I felt like one of those people who think that nothing you do is good enough for my kid,” Nettie says. From fam ily m eals at the holidays to play dates w ith friends, food is the heart of their social interactions, and w hen the food changed, so did everything else. • They replaced all the pots, pans, colanders and utensils, w hich w ere too contam inated to use . Next came a new toaster and mixer and rolling pin and a once-in-a-lifetime cleaning of the oven. “I couldn’t get rid of my grandmother’s cast iron skillet, though,” Nettie says. • They endured their first holiday season of saying no to Christmas cookies, and the first visit to relatives in Louisiana where Martinez had to explain that Andrew and Danny couldn’t eat the gum bo, no m atter how little flour the cook put in the roux. Gluten-Free Certification Program www.GlutenFreeCertification.ca
Who is Our Consumer? • The cost of buying certified gluten- free foods is astronomical, especially to such a savvy, budget conscious shopper: • $3.50 for a baguette (“They are good, but not that good,” she reports), $5 for six flour tortillas (“that’s why we always have corn tortillas”) • $6 for oatmeal that used to cost $2 (“we don’t eat as much oatmeal anymore”), • the tiniest loaves of bread you’ve ever seen for $6. That’s enough bread for one round of the homemade lunches she makes for the kids every day . Gluten-Free Certification Program www.GlutenFreeCertification.ca
Who is Our Consumer? Martinez says that gluten-free icons and labeling help trem endously, but som etim es you still can’t be sure . Last year, she purchased what she thought was gluten-free rice mix from Zatarain’s. When she discovered it contained orzo pasta made with wheat, she contacted the company and got coupons for three free boxes . Gluten-Free Certification Program www.GlutenFreeCertification.ca
Symptoms The Facts Reasons for Gluten free Consumption Gluten-Free Certification Program www.GlutenFreeCertification.ca
The Facts The Facts Reasons for Gluten free Consumption Reasons for Gluten-Free Consumption 39% Digestive Health 31% 5% 100% Nutritional Celiac Disease Valu e 25% Lose Weight Source: Wellness Trends, The Great Transformation, 2010 report, The Hartman Group Inc . Gluten-Free Certification Program www.GlutenFreeCertification.ca
More Trend Than Fad Source: Wellness Trends, The Great Transformation, 2010 report, The Hartman Group Inc. Gluten-Free Certification Program www.GlutenFreeCertification.ca
Market Growth – Version #1 • The 2013 market for Gluten-Free products in Canada is currently estimated to be $ 9 0 m illion. • Reports show a 1 0 % ( CAGR) grow th of gluten-free sales until 2018 with a value of $ 1 4 5 .2 m illion in Canada • According to the researchers, the growth is fueled by an increase in celiac disease and food allergy awareness & diagnosis. • The gluten-free avoider consumer segments perceive gluten-free foods as healthier i.e. no GMO, no preservatives, heath food store heritage *Source: MarketsandMarkets Gluten-Free Certification Program www.GlutenFreeCertification.ca
Market Growth – Version #2 • The 2013 market for Gluten-Free products in Canada is currently estimated to be $ 4 5 0 m illion. • Reports show a 2 6 % ( CAGR) grow th of gluten-free sales 2008-2012 and projected doubling of the market in Canada. NOTE: Reflects an average spend of $50.00 per year per consumer ) *Source: Packaged Facts includes frozen & refrigerated/beer Gluten-Free Certification Program www.GlutenFreeCertification.ca
Key Market Research Findings “Gluten” trending on gluten 2004-Present *Source: Google Trends 2013 Gluten-Free Certification Program www.GlutenFreeCertification.ca
Key Market Research Findings Gluten-Free Certification Program www.GlutenFreeCertification.ca
Key Market Research Findings • Major drivers for gluten-free products are health benefits & general interest in healthy eating • The winning imperative for the gluten-free products industry is new product development • High price of gluten-free products have restricted the growth of the market • However, consumers have to serve this GF diet as there is no alternative • Private label brands will cause a significant growth of the GF market revenue • The global gluten-free food products market is dominated by US companies Gluten-Free Certification Program www.GlutenFreeCertification.ca
Market Numbers The US market is the fastest and largest growing gluten-free market in the world. Canada represents about 4% of world dollar volume, but is growing at parallel rates to the US. CAGR% Region 2011 2012 2013 e 2018 p 2013-2018 U.S. 1,768.9 1,942.3 2,141.1 3,548.7 10.6 $ Millions Canada 74.5 82.2 90.0 145.2 9.8 $ Millions Gluten-Free Certification Program www.GlutenFreeCertification.ca
Market Numbers Canada Gluten Free Food Market By Revenue 2013 e 2018 p CAGR % Type $ million $ million (2013-2018) Bakery & 40.1 64.9 10.1 Confectionary Breakfast 5.4 8.0 8.3 Cereals Snacks 16.4 27.0 10.4 Baking Mixes & 12.8 20.5 9.9 Flours Meat & Poultry 9.1 14.4 9.5 Other 7.1 10.5 8.0 Total 90.9 145.2 9.8 Gluten-Free Certification Program www.GlutenFreeCertification.ca
Market Numbers Gluten-Free Market Revenue by Retail Format 2013 2013 2013 2013 Retail Format Canada Canada US US $ Million % $ Million % Stand Alone Natural 10.8 11.9 237.0 11.1 Natural Chains 16.3 17.9 358.2 16.7 Grocery 48.5 53.4 1,030.9 48.2 Mass 7.7 8.5 236.3 11.0 Club 4.5 4.9 76.8 3.6 Drug 0.1 0.1 21.4 1.0 Other 3.0 3.3 180.5 8.4 Total 90.9 100.0 2,141.1 100.0 Gluten-Free Certification Program www.GlutenFreeCertification.ca
Competitive Landscape 75% New products New product launches have been 12% the most widely used strategy in Agreements this market. Partnerships and collaboration of 6% Mergers the business entities is the second 7% & most sought after growth strategy Expansion Acquisitions Gluten-Free Certification Program www.GlutenFreeCertification.ca
Key Brands Boulder Brands 58% Bob’s Red Dominos Pizza 8% Mill 8% Dr. Schar Jovial Kellogg 5% 6% Foods 5% Gluten-Free Certification Program www.GlutenFreeCertification.ca
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