Marketing soy as more than medicine

by Jeff Gelski
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Studies show soy beverages remain star performers in the soy category, which overall may be nearing maturity. Promoting the health benefits of soy milk has increased sales without question, but a warning to beverage companies comes from Brian Wansink, professor of applied economics of marketing and nutritional science at Cornell University, Ithaca, N.Y.

Marketing solely to people who view soy beverages as medicine, or something they have to take for health reasons, is a tough way to grow a market, he said.

"The day they don’t have to take it, or the day another alternative comes up, they’re gone," said Mr. Wansink, the author of the new book "Marketing Nutrition: Soy, Functional Foods, Biotechnology and Obesity." Mr. Wansink also worked in soybean research for eight years while at the University of Illinois.

Beverage companies, along with food companies, should think about developing soy products for mainstream consumers and not just "fringe" products for certain markets, he said. Taste and variety would play important roles in that strategy. Fortunately, newer varieties of soybeans are said to have better taste profiles. Soy fruit drinks are padding sales growth in soy beverages, too.

U.S. sales of food and beverages with soy claims on the packaging reached $1,818,268,557 for the 52 weeks ended Aug. 13, 2005, according to ACNielsen. The sales were about 0.3% higher than $1,812,159,258 for the previous 52 weeks. Unit volume declined to 620,985,529 from 653,510,167. The figures covered U.S. food, drug and mass merchandiser stores excluding Wal-Mart Stores, Inc.

A 2005 report called "Soy-Based Food and Drink in the United States" from Mintel showed some lost consumer enthusiasm for the overall soy market.

"Although the interest in soy may be slowing, we do not expect the market to suffer a major decline," the Mintel report said. "Rather, it is likely the soy market will move into a more stable, mature phase, with specific segments continuing to show notable growth. For example, soy milk, a product constantly being improved in both taste and presentation, grew 63% in the years covered by this report.

"This growth will take place at the same time as a decline in other soy product segments such as cheese, in which the transition from animal to vegetable protein is not as successful."

Soy beverage volume has grown from fewer than 10 million gallons in 1990 to nearly 170 million gallons in 2004, according to the July 2005 edition of "The Future of Soy Beverages in the U.S." report from the Beverage Marketing Corp., New York.

Lactose-intolerant consumers will continue to choose soy milk as an alternative, especially if soy milk continues to taste better than other grain-based milk alternatives, Mr. Wansink said.

It’s estimated 70% of Hispanics, 80% of African-Americans and 90% of Asians are lactose-intolerant, according to the Beverage Marketing Corp. Retail U.S. sales of dairy beverage alternatives jumped to $676 million in 2002 from $545 million the year before. In 2003, retail sales reached $879 million.

In the soy milk category, 8th Continent remains a top-selling and growing brand. A joint venture between General Mills, Inc., Minneapolis, and DuPont, 8th Continent turned in double-digit sales growth in the first quarter of fiscal 2006 ended Aug. 28 and increased its share of refrigerated soymilk category sales to 17%, according to General Mills.

Dean Foods Co., Dallas, offers Silk brand soy milk, soy creamers and soy yogurt. Gregg Engles, chief executive officer of Dean, said he expects Silk growth percentage of mid to high double-digits in 2006.

Besides the lactose-intolerant market, many consumers may view soy as a medicine, Mr. Wansink said. When their doctors advise them about a health problem, such as high cholesterol, consumers may drink soybased beverages to improve their health.

"That’s a terribly cyclical market," Mr. Wansink said. "They see (soy beverages) as something they have to drink, sort of a medicine. As soon as they get out of anymore. They’re gone like the wind."

Soy beverages already may be more than just medicine to some consumers. Soy remains a likely addition to sports drinks because of its protein content, Mr. Wansink said. Adding 5 grams of soy to a beverage may qualify it for a "good source of protein" claim and adding 10 grams qualifies it for an "excellent source of protein" claim, said Terry Gieseke, business development, Kerry Ingredients — Nutriant Soy Ingredients, Cedar Falls, Iowa.

Some beverage companies are adding fruit to soy-based beverages in attempts to offer products that mimic milkshakes, Mr. Wansink added.

"Smoothies and weight-loss products are common uses of soy in beverages," Ms. Gieseke said. "Soy also has strong potential in juice-based and juice-flavored drinks, coffees and teas, and in a range of liquid systems such as soups."

Finding the correct pH ranges takes priority in fruit beverages that include soy, she said. Nutriant has a technology that delivers acid stable soy protein enhancement without the use of gums or stabilizing systems.

Both Ms. Gieseke and Mr. Wansink stressed the importance of preserving the identity of newer soybean varieties, ones that often come with claims of a better taste profile. The current trade issues concerning bioengineered products have made processors more open to using identity preservation systems, Mr. Wansink said.

"In the past, there have not been tremendous incentives to come up with beans that have a less ‘beany’ taste," he said.

Now, however, there’s more of an incentive to develop a reduced after-taste. Processors still need to realize the economic benefit of preserving identity to reduce the after-taste, he said.

Besides ingredients made from identity-preserved soybean varieties, Nutriant has a proprietary process through which soy protein ingredients are processed without the use of hexane, another technique that may improve taste.

Monsanto and The Solae Co., both based in St. Louis, had flavor in mind when they recently agreed to market a new line of soy proteins with improved flavor and solubility. Monsanto is developing a new soybean with higher levels of beta-conglycinin, which is designed to improve soy protein flavor and functionality.

"This new product is expected to support — and help drive — growing consumer demand for healthier foods," said Jerry Steiner, executive vice-president of Monsanto.

Paul Graham, vice-president of new business development at The Solae Co., said, "We anticipate test marketing in the second half of 2006, but it is too soon to accurately estimate when the product will be available to customers."

The Solae Co. will examine how the soy proteins function in a variety of beverage systems, including, but not limited to, soy milk.

"We are early in the testing process and are at this time unable to share specific findings," Mr. Graham said. "The Solae Co. recognizes taste is the primary obstacle for consumers in making healthy choices, and we plan to focus our efforts heavily on creating products consumers like."

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