Home >Opinion >Columns >Opinion | Consumer demand helps low sugar goods take off

Sugar is the new tobacco, as they say. However, it is now that the companies are seriously waking up to the challenges of a more educated consumer who is looking for low-calorie products in view of the rising incidence of obesity and diabetes. Recently, Cavin’s, the dairy arm of FMCG firm CavinKare, announced the launch of Cavin’s Milkshake Lite, which has no added sugar. While Cavin’s milkshake is said to have 23% less sugar, last month chocolate maker Mondelez launched a new variant of its popular Dairy Milk chocolate with 30% less sugar for the health-seekers. This is the company’s first such effort to reduce sugar content in its products in India. Mondelez’s director-marketing (chocolates), Anil Viswanathan, said they tried it with their biggest brand in India, which commands 40% share of the category. “Rather than trying it with a smaller niche brand, we thought we need to drive this conversation with the biggest brand."

The chocolate took two years to develop and comes at a premium, as the research and development to keep its taste intact despite low sugar, involved costs. There are other recent examples, too. A Bloomberg report said that Nestle has invented a new way to make chocolate with no added sugar, relying on leftover material from cocoa plants for sweetening. This will have 40% less sugar than most equivalent bars with added sugar.

It’s not difficult to see why the food and beverage industry is under pressure from the regulator and the consumer to offer healthier products. A Reuters report, a few days ago, quoted a study that said sugary drinks may be linked to cancer. People who have a lot of sugary drinks have a higher risk of developing cancer, though the evidence cannot establish a direct causal link, the report said. The study conducted in France suggested that limiting the intake of sugar-sweetened drinks may help cut the number of cancer cases in a population.

Explaining why Cavin launched a low-sugar variant, B.P. Ravindran, business head, dairy and beverages, CavinKare, said that the company’s milkshakes are its headline product liked for their thickness and taste. However, the company spotted an opportunity during a consumer studies group where people above 25 years said they wanted the same taste, but with lower calories and sugar. “Globally, consumer awareness for low-sugar product offering is increasing," Ravindran added.

To be sure, a Reuters report on Tuesday said that The Coca-Cola Co. had beat second quarter earnings expectations and raised its revenue for the full year as a result of higher sales of its zero-sugar sodas.

“Our performance was largely driven by consumer demand for no sugar versions of some of our best-known sparkling soft drinks brands, as well as for smaller packages for less sugar," said Coca-Cola chief executive officer James Quincey,

“Both Coke and Pepsi have announced their commitment to reduce sugar in their products further. The latest set of FSSAI (Food Safety and Standards Authority of India) regulation also wants products with high sugar to be marked red. So, low-sugar and diet variants are definitely the right direction to go," Ravindran said. Claims like “low-sugar" and “organic" have become important influencers at the point of purchase. “There is also a gradual shift in terms of willingness to pay a premium for healthier alternatives," he added.

Consequently, even a startup brand like Epigamia, which is into yoghurt, has launched a no-sugar Greek yoghurt and plans to launch smoothies in the category. However, its co-founder Rohan Mirchandani is quick to add that though sugar seems to be the new enemy, “we don’t have a stand on it as we are not scientists. But yes, we listen to the consumer and our decision to launch no-sugar variants is consumer-led".

V.S. Kannan Sitaram, venture partner, Fireside Ventures, which has invested in several brick-and-mortar food startups, believes that consumers are actively managing their sugar consumption. Many still want sweet tasting food and drinks so the focus is also to replace them with healthier alternatives like jaggery, palm sugar, coconut sugar, and natural ones such as stevia, besides substitutes such as sucralose. “This is an embedded trend and the big companies have been long working on the response to this. It is difficult as their brands have large consumer franchises and they need to be sure that they can carry the entire consumer franchise with them when they change their product. They have also been changing their portfolios with a bias for “better-for-you" products," Sitaram added.

Shuchi Bansal is Mint’s media, marketing and advertising editor. Ordinary Post will look at pressing issues related to all three. Or just fun stuff.

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