Several factors contribute to the surge in popularity of mushroom supplements:

Functional foods are foods that provide medical or health benefits, in addition to nutritional benefits. Examples of such include fermented foods such as yoghurts and kefir, foods with omega-3 such as wild-caught fish, nuts and seeds, teas, herbs and spices and fresh fruits and vegetables.

There are multiple factors suggested for the increasing awareness and consumption of functional foods, including the COVID-19 pandemic, rising interest and awareness in utilising diet to promote wellness, and rapid advances in science and technology.

In 2024, we expect this rising trend to continue with people continuing to consume functional foods to support their health and wellness. In fact, we think this trend is here to stay for a while, as according to industry research by Grand View Research, the global functional foods market is estimated

This trend doesn’t just cover foods, we project to continue to see a huge rise in functional beverages too. Kombucha has been a dominant player in functional beverages for many years for its probiotic gut-boosting properties. This year we anticipate a surge in functional beverages fortified with immune-boosting properties. These beverages, ranging from shots to dissolvable powders, are brimming with a blend of vitamins, antioxidants, probiotics, and plant-based elements. Designed to amplify our daily intake of essential nutrients and strengthen our body’s natural defences, expect to see these multi-ingredient wellness drinks a lot. We expect to see them in shot form and packaged in miniature bottles.

With the increasing popularity of functional foods and drinks, regulatory agencies are subsequently monitoring health claims made by the companies selling these products. Not only this, but consumers are also expressing a desire for these products to be able to evidence their claims. This is likely why it was found that there has been a recent increase in customers reporting that a product that is backed by medical professionals would promote authenticity and consequently increase their trust in the product.

This was found to be more important to them than foods that were labelled as “clean”. As a result, companies have responded by investing in scientific research to substantiate the effectiveness of their products, with a real push on consumer education to ensure transparency and trust.

This leads to our next point…

In last year’s blog, we mentioned clean labels and we believe it still continues to be a trend continuing into 2024. There is no legal definition for “clean label” and subsequently, there are varying definitions of what a clean label is. It was first coined in the 1990s by the International Food Information Council (IFIC), which defined it as “a product that has a simple, clear, and understandable ingredient list”. However, over time there has been varying interpretations and deviations from this original definition of clean label. Dr Kantha Shelke describes how “clean is in the eye of the beholder” and what may be “clean label” in one sector may not be in another food sector.

Considering what we have covered already in this blog around consumers placing high importance on clinical evidence to backs up health claims, it’s never been so important to get a clean label right. Not only do customers want simple and clear ingredient lists, they want evidence the ingredients work how they’re being told they work. This tells us that strategic labelling and packaging should be prioritised by brands to strike the balance between providing simple and clear information, but in a way that promotes the efficacy of the claims behind their ingredients.

If you’re interested in learning more about clean labelling, and the brands that are being awarded for their commitment in this area, check out the Clean Label Project.

The rise of flexitarians is a significant trend we expect to continue to shape the food and wellness market landscape in 2024. We are seeing less of consumers committing to a stricter diet, with preferences shifting to a more relaxed approach to diets and eating in a more flexible way that meet their health needs.

BENEO’s 2023 consumer survey revealed that while only 10% of polled individuals in the U.S. identify as vegans, vegetarians, or pescatarians, a much larger portion—21%—consider themselves flexitarians. Among flexitarians, nearly half already purchase plant-based dairy alternatives. This demographic represents a substantial 42% of the market, overshadowing the numbers of vegans and vegetarians, who respectively account for only 4% and 6% globally. This shift towards flexitarianism is driving growth in the plant-based food market, which is expected to reach USD $74.2 billion by 2027, with a compound annual growth rate of 11.9% from 2020. By catering to flexitarians rather than solely targeting vegans or vegetarians, companies can double their market reach.

As our understanding of the environmental effects of meat consumption and the health advantages of reducing meat intake has grown, the decision to adopt a flexitarian diet is driven by a variety of motivations beyond the traditional ethical considerations associated with strict vegetarian or vegan diets. In research conducted by IFIC, 34% of Americans said environmental sustainability is highly impactful on their food and beverage consumption decisions. Similarly, 35% said the climate friendliness of a product has an impact on their purchasing decisions.

With this in mind, it’s no surprise that we are also seeing an increase in the introduction of hybrid products as companies are tailoring to flexitarians who make up such a large portion of the market. A systematic review completed by Grasso and Goksen found results from recent consumer studies show a positive attitude towards the concept of hybrid meat products and high attitude towards and high intention to buy hybrid products (and this was true also for consumers that are highly attached to meat).

However, it is important to understand the motives behind hybrid meat product interest and use them appropriately in the marketing of these products (for example with messages on health or environment).

We have seen consumers becoming increasingly aware of the calorie content of food and drink in recent years, particularly since April 2022 when calorie labelling legislation came into place in the UK. However, we are seeing a shift where customers are becoming increasingly aware of “empty calories” and therefore are less interested in just the calorie content and more about the specific ingredients and nutrients in foods they’re consuming. This is likely to tie in to the first trend we mentioned about functional foods and how consumers are viewing their food and drink choices as a tool to support their health and wellbeing.

This trend can be attributed to changing consumer perceptions of what constitutes “healthy” foods. According to a study conducted by the International Food Information Council last year, there has been an increase in individuals selecting “a good source of whole grains” when asked to define healthy foods. Among the various options provided, a good sources of protein, natural foods, good source of nutrients, good source of fibre, and those containing fruits and vegetables ranked higher than low-calorie options in terms of what people consider to be the best indicators of healthy food.

References

[1] https://www.mintel.com/global-food-and-drink-trends-2030

[1] https://www.launchjuice.io/top-5-wellness-trends-for-2023-and-how-to-capitalize-on-them/

[1] https://foodinstitute.com/focus/ai-predicts-3-food-trends-for-2023/

[1] https://www.mintel.com/global-food-and-drink-trends-2030

[1] https://www.mintel.com/global-food-and-drink-trends-2030

[1] https://en.wikipedia.org/wiki/Regenerative_agriculture

[1] https://www.danone.com/impact/planet/regenerative-agriculture.html

[1] https://foodinstitute.com/focus/ai-predicts-3-food-trends-for-2023/

[1] https://www.foodbusinessnews.net/articles/21805-three-trend-predictions-for-2023-revealed-at-ift-first

[1] https://www.nutritioninsight.com/news/trending-in-gut-health-branded-probiotics-build-consumer-trust-says-kerry-expert.html

[1] https://www.lactalisingredients.com/news/blog/on-the-horizon-for-2023-at-the-heart-of-nutrition-trends/

Welcome to our Dubai Retail Safari, a service where we provide a thrilling journey through the heart of Dubai’s dynamic grocery and/or pharmacy retail landscape. This  is one of the ways in which at Bolst Global we can help you  to understand first-hand  the  opportunities that the United Arab Emirates has to offer your  Health & Wellness business looking to enter or further develop business opportunities in this market.

In September 2023 we had the pleasure of supporting a delegation of 20+ South African female producers who were visiting the UAE market for the first time. Here is a rundown of how our day visiting the market went:

At Spinneys, we had the privilege of visiting the head office, where Commercial General Manager Tom Harvey, shared invaluable insights on what makes brands successful in their supermarket. The delegation discovered the strategies and tactics that have propelled brands to supermarket stardom as well as an insider’s view of Spinney’s inner workings

For several years, our relationship with Spinneys has developed into a trusted partnership. We’ve had the privilege of collaborating with this esteemed retailer, assisting in product sourcing and helping numerous brands in successfully introducing their health and wellness products to the UAE marketplace when a direct to retailer go to market strategy is the right one.

Organic Foods and Café is a family run company that runs organic supermarkets and cafés selling fresh organic and biodynamic food, supplements, skincare, cosmetics, baby items and household cleaning products. They opened their first store in 2004 and now have several shops in Dubai.

Our visit to the Organic Foods and Café was an essential stop on our safari for our delegation, providing valuable insights into consumer habits and the surging demand for organic and responsibly sourced products in the region.

We met with both the head of operations as well as the purchasing team to understand how this retailer operates. The delegation members interested in working with Organic Foods and Café also had the opportunity to speak directly with those responsible for buying and present their product ranges for consideration.

Géant is a chain of supermarkets and hypermarkets with a turnover in excess of over 30 billion euros and are owned in the UAE by the GMG group. There are currently ten Géant Express convenient stores across Dubai and a recently launched Géant Hypermarket at Dubai Hills Mall & Al Khawaneej Walk.

During our visit to Géant Supermarket, we met with the Senior Merchandise Manager and  a Category Manager. They shared invaluable insights about the store’s consumer base and how they work with imported goods, shedding light on the specific products that customers are seeking and the top-performing categories for them.

Next, we made our way to Dubai Mall.  A tourist haven and a place that allowed the delegation togain in-depth insights into what it takes to thrive in the health and wellness retail sector, with a closer look at retail outlets such as  Waitrose, Holland & Barrett,  Dr. Nutrition and Grandiose to name a few. Plus here there was also the opportunity to visit some of the renowned pharmacy players in this market too who have a presence in this mall.  These industry leaders have set exceptional standards and carved their own niches within the health and wellness market. Our visit provided an up-close view of the intricacies of product selection, customer engagement, and the overall shopping experience that distinguishes these brands. We delved into the nuances of consumer preferences, exploring the types of products that resonate most with health-conscious shoppers in these various outlets.

Throughout the day, we engaged in lively discussions both with those we met and between us about key market insights, knowledge and strategies that empower brands to successfully export their products to the Middle East. Understanding these complexities and opportunities as well as being able to navigate the business culture are key cornerstones to success in the region.

We wrapped up the day at ‘The Goods Collective Company,’ where we had the privilege of listening to Davina, a highly successful female entrepreneur in the Middle East. Her journey and insights on building an impressive healthy food and beverage distribution company shed light on the remarkable possibilities and potential ways of operating in this market that aren’t always via the traditional retail channels. And yet nevertheless can equally bring significant opportunities for women in business in this region.

Saudi Arabia is home to approximately 36 million citizens, with a medium age of 31.8 years old^[1]. GDP per capita reached 25,215 USD in 2021 which is considerably higher than the average across the rest of the MEA region (4,045 USD). Between 2022-2040 Saudi Arabia’s economy is expected to grow at a CAGR of 2.3%.

All of these factors contribute to the food and grocery retail market in the country, which is forecast to reach 59,816.9 million USD in 2023, an increase of 17.3% since 2018^[2].

Food is the largest segment in the category accounting for 70.5%, whilst drinks make up a further 19%.

Historically, the grocery retail market has been historically split into what those in the region call Traditional and Modern Trade.

The former refers to the large baazars that for many years made up the cornerstone of trading in the country, but in recent years the Modern Trade channel has come to the fore and comprises of many retail chains.

Within the Modern Trade channel, convenience stores and petrol stations account for a 31% share of the Saudi Arabian food and grocery retail market value. Hypermarkets, supermarkets and hard discounters account for 19.3%.

Let’s take a closer look at the retail landscape in more detail.

Given the vast geography of the Kingdom of Saudi Arabia it is fair to say that some chains dominate with their number of outlets and/or market share in specific regions and others in other regions, however, there are definitely some key players in the market.

The tables below illustrate the top five supermarket and hypermarket brands in Saudi Arabia, according to Euromonitor, based on number of outlets.

These leading players are well-entrenched in the market thanks to customer loyalty and brand recognition. But where they truly overtake the smaller retailers and traditional trade routes, is through their ability to exploit economies of scale.

Supermarkets and hypermarkets have the advantage here by being able to implement aggressive pricing models which price out the smaller retailers.

Price will continue to be a core deciding factor for consumers when choosing where to shop, meaning larger retailers are more likely to succeed in the market moving forward.

For food and beverage brands looking to enter Saudi Arabia, matching your product proposition and positioning to the retailer, and their shopper profiles who are likely to be more receptive to your products, is key. Like your domestic market not every retail chain may be suitable to approach so do apply the same logic when exporting.

Pharmacies: an alternative route to market

In addition to supermarkets, hypermarkets and convenience stores, pharmacies in Saudi Arabia are another fantastic route to market for health and wellness brands looking to export to the region.

Find out more now

The Covid-19 pandemic has undoubtedly accelerated the online capabilities and shopping habits of consumers across the world, including Saudi Arabia

Consumers wanting a more convenient, less crowded and safer shopping experience looked for low-contact alternatives during the pandemic, and despite there not being that many options at the time, the demand continues to be felt across the region.

As local consumers become more comfortable shopping online, retailers will continue to develop their websites, and potentially mobile applications, to enable their customers to conveniently shop online should they wish.

Omnichannel retail models will become more popular in Saudi Arabia too, with some significant steps being taken across the region already.

There have been significant investments in infrastructure, logistics, payment methods, digital marketing, and expanding product offerings.

E-commerce should not be seen as a threat for existing retailers across Saudi Arabia. In fact, many of them are already benefitting from partnerships with third-party delivery apps like Quick Market by Hungerstation which promises delivery in just 20-minutes. During the pandemic, many convenience stores and smaller retailers took advantage of the quick commerce (q-commerce) infrastructure, which continues today.

Another emerging retail model in Saudi Arabia is the introduction of “Dark Stores”, which act as retail distribution centres specifically for online customers. Popular enterprises include Noon Daily, Quick Market, Daily by Talabat, Nana, and Carrefour. As well as fulfilling orders placed online, these dark stores also offer click-and-collect for consumers wanting to place their order online, but collect in person. This is another shopping habit which is increasing in popularity across the region.

In 2021, despite emerging as a significant retail channel, e-commerce sales remained small, marginal or negligible depending on the source. But this is expected to grow considerably over the coming years in line with population growth, rising urbanisation, and the government’s implementation of its Vision 2030 initiative.

Like in many countries across the MEA region, there has been a post-pandemic health and wellness boom.

Consumers are becoming increasingly aware of the benefits of healthy eating, quality ingredients, nutrition, home-cooking, and allergens. This is also spurred on by changing buying behaviours in the country thanks to female empowerment meaning that women are making more informed decisions when it comes to shopping.

Food and beverage categories which are currently experiencing growth include, organic, reduced sugar and salt, better-for-you, naturally healthy, and free-from.

Retailers and brands in Saudi Arabia are expected to develop product lines that reflect changing consumers needs and demands. Whether this be through private labelling, in-house product development, or bringing in health and wellness brands from overseas.

There are plenty of opportunities for brands looking to get their products on shelves in Saudi Arabian retailers, as long as you go about it the right way.

Saudi Arabia Market Trends & Culture Changes 2022

During a trip to The Gulf earlier this year, Bolst Global Founder, Victoria, penned her thoughts and experiences surrounding current market trends in Saudi Arabia. It’s a really interesting read if you’re considering expanding your reach into the region.

Find out more now

Need support in exporting to Saudi Arabia?

This is where Bolst Global comes in. Our team has been working closely with brands, retailers, and distributors in the Middle East for many years.

Our experts can guide you through this sometimes complex landscape, and devise the best export strategy for your brand and product offering.

Get in touch with us today!

References

• Industry Profile: Food & Grocery Retail in Saudi Arabia, MarketLine (February 2020)
• Economy, Finance and Trade: Saudi Arabia, Euromonitor International (February 2022)
• Health and Wellness in Saudi Arabia, Euromonitor International (March 2022)
• Supermarkets in Saudi Arabia, Euromonitor International (March 2022)
• Hypermarkets in Saudi Arabia, Euromonitor International (March 2022)
• Convenience Stores in Saudi Arabia, Euromonitor International (March 2022)