A growing health consciousness is emerging in the Asia-Pacific (APAC) region, people are becoming more health conscious, with 62% of consumers prioritizing health in food purchases, according to Global Data’s 2023 Q4 survey.
Despite economic challenges, the APAC food market with health attributes has thrived, growing at a CAGR of 7-9% from 2017 to 2022. Manufacturers are innovating to overcome cost barriers, reflecting a promising future for functional foods as consumers increasingly prioritize well-being.
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The APAC region is witnessing a health revolution, marked by a surge in demand for natural, organic, and functional food products. Global Data’s 2023 Q4 survey reveals a significant shift, with 62% of APAC consumers prioritizing health in food purchases. Despite economic challenges and inflation concerns, the APAC food market with health attributes has thrived, growing at a CAGR of 7-9% from 2017 to 2022. Manufacturers are innovating to overcome cost barriers, and the future of functional foods in the APAC region looks promising as consumers prioritize well-being.
Rising demand for wellness foods in APAC
The shifting consumer preferences towards healthy food products in APAC has awakened the awareness of lifestyle-related diseases and the importance of preventive healthcare grows. Even as COVID-19 concerns wane, the demand for foods perceived to contribute to overall well-being is on the rise.
A significant 62% of APAC consumers make food purchases based on how well the product/service impacts their health and well-being. This reflects a substantial paradigm shift in the mindset of consumers who are increasingly making informed choices to support a healthier lifestyle.
The health trend is not only influencing general food choices but is also spurring demand for specific categories such as probiotic and nut-based snacks. As a result, the APAC food market with health and wellness attributes has seen impressive growth, expanding at a value compound annual growth rate (CAGR) of approximately 7–9% between 2017 and 2022.
Challenges and opportunities in the market
While consumers are eager to embrace healthier options, premium prices have been identified as a key barrier to the wider penetration of health and wellness foods in the cost-conscious retail market. The economic challenges brought about by inflation and geopolitical conflicts, such as the prolonged Russia–Ukraine crisis, have intensified pressure on food manufacturers to pass on high input costs to consumers.
49% of APAC consumers express concerns about the impact of inflation on their household budgets. In response, some consumers are turning to cheaper brands or stores to navigate the cost-of-living crisis. Limited awareness of health-focused products is also identified as a factor hindering the segment’s growth.
Manufacturers in the region are now faced with the challenge of striking a delicate balance between offering affordable products and delivering the promised health benefits. In this environment, it becomes crucial for companies to create awareness about their functional food products through effective marketing initiatives.
Innovations in functional foods & ways to wellness
To meet the evolving demands of consumers, manufacturers are exploring alternative ingredients and production techniques to develop healthier alternatives. An Indian company ProV Foods has introduced a range of pre-soaked nuts, including almond, pecan, and walnut, under the ProV Lite Activated Nuts brand. As macroeconomic conditions improve, consumers can be encouraged to trade up to premium food products more frequently.
Functional and fortified food products have long been considered niche in the APAC region due to their higher-than-average prices compared to regular variants. However, to expand their consumer base, manufacturers must proactively highlight the myriad benefits associated with product consumption. Leading companies are also incorporating alternative ingredients and production techniques to develop healthier alternatives with personalized claims, such as ‘promotes gut health and blood circulation’ and energy-boosting.
To sum up
As the APAC region navigates the intersection of health consciousness, economic challenges, and consumer preferences, the functional food market is poised for substantial growth. The journey towards a healthier tomorrow involves not only addressing cost concerns but also emphasizing the long-term health benefits associated with these innovative and purpose-driven food choices. As consumers continue to prioritize their well-being, the future of functional foods in the Asia-Pacific region looks promising.
