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The Low-Carb Diet Craze
Low-carb now ranks fifth among product attributes consumers say will definitely/probably get them to try a new food product, right behind ready-to eat, heat-and-eat, packaged for on-the-go consumption, and no utensils required, according to Information Resources, Inc. (IRI). Low-carb (42%) is fast approaching low-fat (49%) as the cuisine consumers plan to eat more of in 2004, way above high protein (25%), Chinese (23%), Italian (21%), and Mexican (20%), according to Supermarketguru.com. And sugar now rivals fat as America’s top nutrition concern.
Low-carbohydrate diets have cost the industry more than $10 billion in traditional food sales, reports New Nutrition Business. French fry sales have dropped by 5% since 2001, according to the Potato Board. Sales of beef were up 22%, meat-based snacks 17%, and bacon 5% this year, according to IRI. Flour consumption dropped from 147 lb in 1997 to 137 lb in 2002, according to the North American Millers’ Association. The National Bread Summit said that 40% of Americans ate less bread than last year; 63% were trying to limit their daily carbohydrate intake, 31% chose other foods when eating carbs, and 20% didn’t think bread was healthy. Kraft/Nabisco concedes some of its third-quarter 2002 losses to Atkins and other healthy cookies. Because of its natural sugar content, sales of orange juice fell 1.2%, frozen concentrates 18.5%.
Today, 37–42 million Americans are on a low-carb regimen, 25 million on the Atkins plan. HealthFocus reports that nearly as many shoppers are on a high-protein, low-carbohydrate plan as on a low-calorie diet. According to the Natural Marketing Institute, 68% of consumers use high-protein foods (up 10% over 2002), 66% low-carb foods (up 7.5%), and 75% low-calorie foods (down 1.2%). Gallup/Wheat Foods Council found that 56% of grocery shoppers believe that high-protein, low-carb diets help them lose weight and 61% think they are safe. Those who feel bread is fattening rose from 45% in 1998 to 56% in 2002, pasta from 40% to 54%. Although Gallup found that 70% of shoppers believe their body needs carbohydrates, 58% feel that they must be eliminated by the body to lose weight, and 48% think starches should be avoided.
New Nutrition Business estimates the low-carb segment at $2.5 billion in 2003. Among low-carb-only marketers, leader Atkins’ Nutritionals (estimated at $100 million in 2002), and second major player Carbolite Foods are expected to double in sales in 2003. Within its first year, Anheuser-Busch’s Michelob-Ultra soared to become the seventh-best-selling premium beer, despite its comparatively high price.
Low-carb preferences are credited with an upheaval in the traditional diet industry. Unilever blames Atkins for Slim-Fast’s 21% drop in liquid and powder sales for the previous year, while similar Atkins products jumped 147%, according to IRI. Weight Watchers’ U.S. enrollment declined 6% in 2002, while computer-based eDiets—which has online rights to the Atkins, Zone, and South Beach diets—saw enrollment jump 17%.
PepsiCo is planning to enter the low-carb segment in 2004. Heinz launched One Carb ketchup, Celestial launched CarbFit snacks and pasta, and Russell Stover and Hershey introduced sugar-free and lowcarb candies, now 15% of candy sales. More than 800 new low-carb products have been introduced since 2001, among them Fantastic Foods’ Fast Natural Ready Meals, including Carb ‘Tastic Soup, La Tortilla Factory’s low-carb tortillas, S. B. Thomas Co.’s Carb Counting Bagels, and sandwich giant Blimpie’s low-carb bread. Pepperidge Farm’s bread is advertised as having “30% fewer carbs.” And with chefs taking the carbs off the plate and foodservice leaders like McDonald’s, Ruby Tuesday, Baja Fresh, Smoothie King, and Hardee’s promoting new low-carb menus and meals, low-carb will stay top of mind.
While the long-term sustainability of the low-carb segment is unsure, a number of pending actions will help ensure long-term growth. While there is no Food and Drug Administration definition of no-carb, low-carb, net carbs, or even carbs, the Grocery Manufacturers of America plans to submit a “citizen’s petition” for low-carb guidelines in 2004. A Low-carb Manufacturers Association has been formed. The Food and Nutrition Board has set the first-ever daily requirements for carbohydrates, calling for reduction of added sugar and total carbs, while setting no Upper Limit on protein. The U.S. Dept. of Agriculture’s Food Pyramid is being reconfigured.
Media coverage of low-carb diets has gone from 47% positive to 89% in the past year, according to SloanTrends. Reputable medical studies are indicating that low-carb diets are more heart and child friendly and more successful for weight loss than previously anticipated. Most important, low-carb diets have matured into the mainstream via a grass roots word-of-mouth campaign touting 20 years of successful weight loss, and they give permission to eat once-forbidden foods—a very tough combination to beat!
by A. ELIZABETH SLOAN
President, Sloan Trends & Solutions, Inc.