(05-02-06) Diet products fattening revenues, but not trimming waistlines

By FBR Staff Writer

Despite the fact that UK consumers will increase their spending on diet products to reach GBP86 per person per year by 2009, the British waistline is getting bigger, according to a new report from independent market analyst Datamonitor. Consumer market analyst and author of the study John Band explains...
The UK, along with Germany, has the dubious distinction of having the highest proportion of seriously overweight consumers in Europe. In both countries, 21% of consumers have a body mass index (BMI) higher than 30. Yet while consumer spending on diet goods is increasing apace, the fact remains that Britons are not getting any slimmer.
Transatlantic weight gap is narrowing
The US has by far the highest proportion of overweight and severely overweight consumers, with 65% of the adult population (people aged 18 or over) estimated to be in these two categories in 2004. However, European consumers are not far behind: the figure for Europe is currently 48% and will have crossed the 50% barrier by 2009.
Within a few years, having a "normal" BMI of 20-25 will in fact no longer be normal in Europe. In the UK, the US and Spain this is already the case with 40%, 41% and 39% of the population classified as "overweight" (BMI of 25-30) respectively. That is to say, in these countries overweight consumers already outnumber normal consumers.
At the other end of the weight scale, with BMIs of less than 20, are the underweight. Only in France and Italy do underweight consumers represent an important section of the population. With 15% and 11% of the French and Italian populations being underweight, they outnumber seriously overweight consumers. Elsewhere in Europe, however, the severely overweight are far more numerous.
Weight concerns boosting spending on diet food and drinks
In 2004, the overall UK diet food and drink market had a value of GBP4.6 billion, and this is predicted to grow to GBP5.3 billion by 2009, representing a growth of 15%. The French and Spanish markets are set to show the fastest growth in Western Europe, with annual growth of 4.6% and 4.0% respectively. With an average per head expenditure of GBP110 and GBP99 in 2004, Swedish and Dutch consumers spend the most on diet food and drinks.
Low-fat dairy products accounted for almost 40% of UK consumers' expenditure on diet food and drink in 2004. This product market accounts for a higher proportion of consumers' expenditure on diet products than any other, and is also enjoying some of the fastest growing expenditure at 3.1% per year.
High-fat ice cream, milk, cheese and cream products are often considered unacceptable when dieting, and many consumers following a healthy lifestyle will also avoid these foods which are considered to be high in fat and cholesterol. As such, diet dairy products will remain very popular.
However, low-sugar and low-calorie confectionery will have the fastest growth in terms of consumers' expenditure on diet products over the next five years. In the UK, it will grow by 3.7% a year between 2004 and 2009. This is due to the fact that many consumers, not just dieters, feel the need to indulge on sweets and desserts.
Many consumers regard sweets as a comfort as well as an indulgence. Choosing a diet alternative to chocolate or sugar confectionery allows consumers to feel less guilt about their indulgence.

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