As a soda alternative that delivers probiotics and the health benefits of tea, kombucha is poised to gain favor among health-conscious consumers. While the fermented, tangy taste of kombucha is distinct, brands offer flavor profiles and formulation methods that encourage consumers to become loyal fans of specific offerings.

While studies have shown that kombucha has in vitro antimicrobial activity, and enhances sleep and pain thresholds in rats,¹ and that it its polyphenolic content provides potent antibacterial activity against pathogenic bacterial infections,² scientific research in humans is sparse. A 2019 review reviewed 310 articles, of which only one study reported the empirical results of kombucha in human subjects.³ But consumers don’t seem to mind the lack of scientific evidence in humans, so it makes sense that kombucha brands invest in their operation rather than funding studies.

“Consumers see kombucha as a natural, ‘better for you’ beverage that is a more healthful alternative to carbonated soft drinks and traditional ready-to-drink tea,” said Tom Vierhile, vice president, Strategic Insights, North America, Innova Market Insights. “Digestive, gut health and probiotic claims tend to be quite common for kombucha, and as consumer awareness of these benefits grows, it is helping kombucha gain traction with consumers.”

Kombucha market rebound

Kombucha market growth since 2014 has been impressive, according to Vierhile. “Kombucha launches in the U.S. grew at a compound annual growth rate (CAGR) of 9.4% for the period from 2014 to 2018,” he said. “As impressive as that is, kombucha launches are growing much faster globally, expanding at a CAGR of 37.5% for the period from 2014 to 2018.”

SPINS data showed kombucha’s dollar value is growing, but the growth is slowing. Growth in 2016 to 2017 for kombucha hit an impressive 197%, but slowed to 29% growth from 2017 to 2018, and hit only 4% growth from 2018 to 2019. SPINS data includes the natural and specialty gourmet channels, and conventional multi-outlet channel.

With US$600.6 million in sales, kombucha represented 85.8% of sales for the fermented beverage segment (52 weeks ending April 21, 2019), according to SPINS. “While the kombucha trend started in the natural channel, it has since gone mainstream with 26.4% growth in the conventional multi-outlet channel, becoming a mainstay with broad distribution,” according to the April 2019 SPINS report “Functional and Enhanced Beverages.”

Hannah Crum, president and founder of Kombucha Brewers International, a trade organization that promotes commercial kombucha around the globe, said she has seen an intense market growth of kombucha since her organization launched in 2014, even with the 2010 dip in sales when kombucha was removed from Whole Foods Market. “The market has grown from $1 million to $1.8 billion today,” she said, explaining that those numbers are an agglomeration of SPINS data, Whole Foods Market and Costco sales, as well as kombucha sold on tap in restaurants and at festivals.

Alcohol kombucha concerns

The big hit to kombucha sales stemmed from an abundance of unwanted alcohol. In June 2010, unpasteurized kombucha was taken off the Whole Foods Market store shelves after samples of different brands showed alcohol levels were over 0.5% alcohol by volume (ABV), some hitting as high as 2.5% ABV. The U.S. Alcohol and Tobacco Tax and Trade Bureau’s (TTB) regulation required that labeled non-alcoholic beverages must contain less than 0.5% ABV.

Numerous kombucha manufacturers voluntarily recalled their lines after conducting their own testing. Shelves stayed kombucha free while brands reformulated. Category leaders like GT’s Living Foods were out of the market for months, smaller brands took up to a year to return, and others never recovered.

“There was no complaint, safety issue or federal recall,” Crum remembered. “This was a withdrawal by Whole Foods Market where they had all the kombucha brands buy back their product, which was devastating and expensive. It was an intense blow to our industry, and it could have destroyed the industry, but as they say, ‘no bad press.’ It led to an increase in sales in the category because people are passionate about this product.”

The market rebound was only possible because brands are taking alcohol limits seriously. Producers can use a variety of techniques to keep the alcohol levels low including cone distillation, microbial manipulation, filtration and other ethanol-control techniques. To demonstrate legal compliance, the Kombucha Brewers International Board of Directors recommends headspace gas chromatography combined with flame ionization detection (GC-FID) or mass spectrometry (GC-MS) from a lab that employs methods specific for kombucha.

The nature of fermented products means they will contain small amounts of ethanol. “As part of our commitment to radical transparency, we advocate that all our kombucha brands that produce a living product include language on their labels that it includes trace amounts of ethanol, so consumers can make an informed choice about consuming the product,” Crum said.

Alcohol levels of commercial kombucha still affect the industry. Health-Ade and Whole Foods Market lost approximately $4 million in a class action settlement in March 2019 filed by customers who alleged the product contained more alcohol and sugar than stated on the label. GT’s, also with Whole Foods Market, settled a similar class action suit in 2017 for $8.25 million.

Kombucha Brewers International is working on updating regulations to accommodate for the living beverage that may experience alcohol level creep. “We are trying to create a buffer zone for our producers,” Crum said. “They are producing compliant kombucha that’s leaving the facility at 0.4% or lower, but kombucha is living; it’s still fermenting and continues to change in the bottle.” The Kombucha Act (Keeping Our Manufacturers from Being Unfairly taxed while Championing Health Act) would update the Internal Revenue Code so taxes from kombucha would not start until it reaches 1.25% ABV. Crum said the 0.5% ABV limit was arbitrarily decided on after Prohibition. “It doesn’t tie to any scientific study of where intoxication or inebriation occurs,” she said.

The Kombucha Act was first introduced in 2016, and it got reintroduced in the 2019 Congress. Both attempts to pass were unsuccessful, but Crum said Kombucha Brewers International is waiting for the right tax law to reintroduce the amendment.

References

1. Greenwalt C1, Steinkraus K, Ledford R. “Kombucha, the fermented tea: microbiology, composition, and claimed health effects.” J Food Prot. 2000;63(7):976-81.

2. Bhattacharya D et al. “Antibacterial Activity of Polyphenolic Fraction of Kombucha Against Enteric Bacterial Pathogens.” Curr Microbiol. 2016;73(6):885-896.

3. Kapp J, Sumner W. “Kombucha: a systematic review of the empirical evidence of human health benefit.” Ann Epidemiol. 2019;30:66-70.

You’ve heard the saying, “You are what you eat.” Now we have certifiable proof.

A new decade is underway, and consumers have never been more vigilant about understanding what’s in their food, and the impact of food production on the environment, animals and people. As a result, third-party certifications surrounding food production and sourcing are growing and changing the game. Certifications can be a valuable tool to provide increased transparency to business practices and standards, but they come with an investment of time and resources, leading to the question: Do certifications resonate with consumers and at what capacity?

Americans are widely aware of food certifications and are increasingly making purchasing decisions based on those certifications. According to proprietary gathered in November 2019 from Linkage Research's Free From Forum Market Monitor—a tracking study of key natural, free-from, and better-for-you attributes—a whopping 95% of Americans reported they are aware of one or more food certifications, and 59% reported they purchase one or more foods with certifications. Data indicate consumers aren’t just picking up these certifications because they are on the package already. Three-fourths of consumers noted that one or more food certifications are important when it comes to choosing which products to buy, and 78% of consumers said they are willing to pay a premium for a product with a certification. To better understand which certifications resonate most with consumers, it helps to examine the macro factors driving consumers to re-evaluate food.  

The first and arguably most important factor changing consumer eating habits is their desire for wellness. Seventy percent of Americans reported they are proactively trying to support their health through exercise and diet. And this focus on their own wellness has fueled changes in how they think about food. Today’s consumer wants food that is naturally sourced and produced, not fueled by artificial or man-made ingredients and chemicals that they have deemed unhealthy. In their quest to find natural food to support their wellness, consumers want transparency about how their food has been grown, sourced and produced.

This consumer desire for transparency and distrust in “big food" (the name given by the media to an industry in which a few huge companies dominate food production) has fueled the demand for certifying bodies to assure consumers that their food is natural, clean and good for them. Because of this prominent focus on wellness, the certifications most in demand among Americans are those related to natural farming and sourcing of ingredients, including USDA Organic, Non-GMO Project Verified and Certified Naturally Grown. Of U.S. households, 63% reported these certifications are important when choosing which food products to purchase, and they seek out these certifications because of the third-party reassurance that the products are natural. Americans are also voting with their wallets for products that contain these certifications—of those familiar with the certifications, 54% reported buying products with the USDA Organic certification, 50% with the Non-GMO Project Verification and 46% with the Certified Naturally Grown designation. When these certifications come with a premium price, 6 in 10 consumers who are aware of these certifications are willing to pay more for them.

A certification creating recent buzz around food safety and health is the Glyphosate Residue Free Certification from the Detox Project. This certification verifies that products do not contain the world’s most used herbicide—glyphosate—which has recently been connected to health concerns like cancer (Carcinogenesis. 2018 Oct 8;39(10):1207-1215). Consumer awareness of this certification is still relatively low (32%), but those familiar with the certification are willing to pay a premium to ensure their food is free from the chemical. 

The second factor influencing how consumers shop for food is a desire to support companies focused on “doing good,” as demonstrated by making ethical choices and using profits to do what’s right for people, animals and the ecosystem. According to the 2018 Edelman Earned Brand study, 57% of Americans agree it is easier to get brands to address social problems than the government, and 64% of consumers reported they choose, switch or avoid brands based on where they stand on societal issues. 

This desire to back brands that are doing good has driven a second group of food certifications that center around the ethical treatment of humans and animals, including Fair Trade Certified, Certified Humane Raised and Handled, Certified Sustainable Seafood and Rainforest Alliance Certified. Nearly 40% of U.S. households familiar with these certifications reported one or more are important when choosing which food products to purchase.   

Among these ethically oriented certifications, the ones with the most awareness are those related to the treatment and living conditions of animals and the humans involved in the food production, including Fair Trade Certified (59%), and Certified Humane Raised and Handled (52%).

Consumers want to know that the dollars they are spending on products are going toward good deeds, and as one consumer shared in our research, “I like to know that the product I am buying is not being made by poorly treating humans.” Products with the Fair Trade Certified and Certified Humane Raised and Handled certifications aren’t yet as widely purchased as ones like USDA Organic, but they are making their way into more than one-third of consumers’ baskets today.

Another certification growing in popularity is the Certified B Corp., which is a movement started in 2006 to ensure that certified companies are using their business and profits as a force for good, including the impact on workers, customers, community and environment. This certification is less familiar to consumers, perhaps because of its broad scope, but company adoption of this certification is growing. Ben & Jerry’s, Patagonia and Allbirds are a few of the companies carrying it. These companies all have a mission to do better and align profit with purpose, and their investment in the B Corp. certification backs this commitment.

The idea of “responsible consumerism” is growing as Americans are turning their dollars toward companies and brands that are backed by a commitment to bettering the planet for generations to come.  As the debate over the welfare of the planet—specifically climate change—goes on, Americans are broadly concerned about the impact of their habits on the future. Nearly 60% of Americans agreed that farming and food production practices impact climate change, and this is even higher among younger generations, at 63%. And Americans’ ecological concerns are not all related to climate change, as another 62% of Americans agreed if food production methods don’t change, it will be impossible to produce enough food for everyone on earth in the future.

With these growing concerns about the impact of consumerism on the planet, a number of certifications have been in the spotlight over the past few years that support farming principles and practices that go beyond organic to benefit the environment even more. The Regenerative Organic Certification was launched by the Rodale Institute in 2018 and supports farmers who use growing and grazing practices that regenerate topsoil, improve water retention and help to sequester carbon in the soil. The Demeter Certified Biodynamic seal is another model that supports farming practices that ensure self-sustainability of the soil, integrating plants and animals, and encouraging biodiversity. Although this certification program was established in the 1920s, it is now gaining traction due to growing ecological concerns.

Consumer awareness of these certifications is still relatively low among the general public; however, major companies such as Danone and General Mills have invested in farms that practice farming methods including regeneration and are promoting this certification on their food packaging. Large, well-known brands like these have a major impact on food sourcing and production; plus, their commitment to these certifications and practices delivers a strong message about their commitment to improving the future of food production and its impact on the planet. As more companies adopt these practices, these certifications are primed to grow in both awareness and purchase.

Looking to the future, consumers familiar with factors like organic, sustainable and cruelty-free reported they believe these qualities will grow in importance, which is a good indication that the certifications associated with these attributes will gain traction. But not all companies can or should invest in certifications. Choosing which of these certifications, if any, is right for one’s brand can be done through an understanding of the brand’s positioning—what the company stands for and the intended consumer target. When considering these factors, it should become clear where a certification can deliver a powerful reason-to-believe in a company’s brand or product promise.

Carrie Schaefer is the vice president of strategy and marketing at Linkage Research & Consulting. The firm provides brands with the latest understanding of the better-for-you marketplace, trends and consumer needs via access to a robust data monitor, syndicated reports and custom research.

Within the last 20 years, research has been presented suggesting too much sugar consumption is dangerous. Not only is sugar suggested to increase risk of cardiovascular disease,¹ cancer,² obesity³ and diabetes,⁴ it may also be linked to a slew of other health issues, including liver disease⁵ and cognitive decline.⁶ To make matters even more complicated, research has suggested artificial sweeteners may be linked to the same diseases^{7, 8, 9} and also may cause digestive disorders.¹⁰

Aware of the effects of sugar and artificial sweeteners, consumers are demanding brands reduce sugar and replace artificial sweeteners while still offering products that are sweet and taste great. According to Mintel, more than 84% of consumers are limiting the amount of sugar in their diet, and Nielsen reports more than half of consumers are avoiding artificial sweeteners.

A beverage developer has several tools to reduce or replace sugar, but no sweetener or technology is a 1:1 match. Consumers have grown accustomed to sugar’s very distinct sweetness profile. Sugar hits the palate quickly and with high intensity up front, with a slight, pleasant lingering effect absent any negative off-notes. No alternative ingredient exactly matches sugar, and many substitutes have off-notes, especially at higher usage levels. Beverage manufacturers are tasked with matching the sugar sweetness profile using combinations of different components to try to mimic the sugar-like experience consumers love.

Food and beverage makers have made many strides toward reducing sugar in products, but there is still a lot of work to do. Ready-to-drink coffee, tea, juice and kids’ beverages have experienced significant success, and many brands in these categories are touting 25% to 70% less sugar than leading products. The soda industry continues to struggle with finding a cost-effective and clean-label solution for sugar-reduced products that also taste great. Legacy brands are responding by launching more options such as reduced-sugar and zero-sugar versions of flagship products, and only time will tell what will stick.

Sugar reduction will continue to be an important issue for years to come, and as technologies improve, so will sugar reduction solutions. Product developers must continue to test new technologies so that brands can provide consumers with great-tasting, healthier food and beverage options.

To read this article in its entirety, check out the "Sugar and sodium reduction strategies" digital magazine.

Holly McHugh is the marketing associate at Imbibe, a Chicago-based beverage development company. She focuses on the company's external communications and brand awareness. She also monitors and analyzes beverage trends to guide clients in making strategic decisions about product development. She has a bachelor's degree from Columbia College Chicago and a master's degree from the University of Denver.

References:

1. Quanhe Y. “Added Sugar Intake and Cardiovascular Diseases Mortality Among US Adults.” JAMA Intern Med. 2014;174(4):516-24.

2. Tasevska N et al. “Sugars in diet and risk of cancer in the NIH-AARP Diet and Health Study.” Int J Cancer. 2012;130(1):159-69.

3. Delli Bovi AP et al. “Obesity and Obesity Related Diseases, Sugar Consumption and Bad Oral Health: A Fatal Epidemic Mixtures” Transl Med UniSa. 2017;16:11-16.

4. Rippe JM, Angelopoulos TJ. “Relationship between Added Sugars Consumption and Chronic Disease Risk Factors: Current Understanding.” Nutrients. 2016;8(11):697.

5. Jensen T et al. “Fructose and sugar: A major mediator of non-alcoholic fatty liver disease.” J Hepatol. 2018;68(5):1063-75.

6. Barnes JN, Joyner MJ. “Sugar highs and lows: the impact of diet on cognitive function.” J Physiol. 2012;590(Pt 12):2831.

7. Mossavar-Rahmani Y, Kamensky V, Manson JE. “Artificially Sweetened Beverages and Stroke, Coronary Heart Disease, and All-Cause Mortality in the Women’s Health Initiative.” Stroke. 2019;50:555-62.

8. Fowler SP et al. “Fueling the obesity epidemic? Artificially sweetened beverage use and long-term weight gain.” Obesity. 2008;16(8):1894-900.

9. Pase MP et al. “Sugar- and artificially-sweetened beverages and the risks of incident stroke and dementia: A prospective cohort study.” Stroke. 2017;48(5):1139-146.

10. Abou-Donia MB et al. “Splenda alters gut microflora and increases intestinal p-glycoprotein and cytochrome p-450 in male rats.” J Toxicol Environ Health A. 2208;71(21)1415-29.

In defending itself against a 2018 lawsuit that alleged the ingredients of LaCroix Sparkling Waters were “synthetic” and not “natural,” National Beverage Corp. notched two victories.

First, the putative class action suit in the U.S. District Court for the Northern District of Illinois was dismissed with prejudice, meaning it can’t be brought again. Second, the named plaintiff, Lenora Rice, and her counsel, expressly recanted the allegations.

The suit claimed LaCroix’s water contained four synthetic substances, two of which were listed in the code of federal regulations, court documents show. Rice further alleged independent lab testing commissioned by her counsel, Beaumont Costales LLC, disclosed the presence of ingredients in LaCroix that were not “natural,” according to a letter from Rice and her counsel retracting their claims.

National Beverage released the letter in conjunction with a Feb. 19 press release, announcing the dismissal of the suit.

“That laboratory has since confirmed in writing and separately under oath that its testing could not, and did not, determine whether the ingredients were ‘synthetic’ and made no finding as to the source of the ingredients it identified,” Rice and her counsel stated. “We do not dispute that those same ingredients can be derived naturally.”

Independent testing performed by another accredited lab, the letter added, verified “LaCroix’s flavor ingredients are 100% natural and free of any ‘synthetic’ sources.”

While Rice and Beaumont Costales wrote “they did not intend any harm to National Beverage Corp., its shareholders, retailers, and most importantly, its following of loyal consumers,” they acknowledged “harm was done.”

LaCroix is the flagship brand of National Beverage (NASDAQ: FIZZ), a manufacturer of sparling waters, energy drinks and carbonated soft drinks with FY19 sales of $1.01 billion.

Commenting on the dismissal of the case, a National Beverage spokesperson said in the press release, “This dismissal confirms our promise to demonstrate that these allegations had absolutely no merit and reaffirms that the company delivers a pure and innocent product.”

National Beverage previously accused Rice of a “public smear campaign” that was “malicious” and akin to “financial terrorism,” U.S. District Judge Joan Gottschall stated in a  2019 order, denying a motion to sanction Rice and her counsel for filing a “frivolous lawsuit.”

At least one other similar complaint was filed in January 2019 against National Beverage in the U.S. District Court for the Southern District of New York. The complaint alleged the company “has knowingly and intentionally misrepresented to consumers … the true nature and quality of the LaCroix product by claiming that the product is ‘all natural’ and ‘100% natural’ when in fact it is not.”

Citing a report from the Center for Applied Isotope Studies at the University of Georgia, the plaintiffs alleged “various flavors of the LaCroix product were found to be comprised of between 36% and 98% synthetic ingredients.” 

Neither National Beverage nor a New York-based attorney for the plaintiffs, Mitchell Breit, responded to an emailed request for an update on the complaint. However, the beverage maker denied the claims in a statement shortly after the lawsuit in New York was filed.

In its annual report, National Beverage also addressed allegations in lawsuits that LaCroix’s products contain synthetic ingredients in violation of state consumer protection statutes.

“The company believes the litigation is without merit and will not have a material adverse effect on the company’s financial position, cash flows or results of operations,” National Beverage stated.

The deal further cements DSM as a leading global solutions supplier to the Early Life Nutrition industry with its unique portfolio of nutritional lipids, vitamins and nutrient premixes. The addition of Glycom’s HMO products creates additional growth potential in other markets including toddlers, children and adults, as well as in the medical nutrition and the pet food segments. It also creates leverage with DSM’s strong R&D platform and clinical competencies to support development of Glycom’s next generation HMOs.

HMOs are a collection of carbohydrate structures found in human breast milk. Essential for both immune and cognitive development, HMOs act as prebiotics in infants, which help to develop the desired microbial flora by serving as feed for the good bacteria in the intestine.

According to a press release, Glycom’s 2019 sales reached €74 million in sales, predominantly generated from Nestlé. The company operates a manufacturing plant in Esbjerg, Denmark, and is the only fully-integrated HMO provider in the world with its own product development, preclinical and clinical development, regulatory and large-scale production with an exciting innovation roadmap for next-generation HMOs.

“We are looking forward to welcoming Glycom to DSM,” said Geraldine Matchett and Dimitri de Vreeze Co-CEOs of Royal DSM. “Our companies have a great fit together, with a shared passion for purpose-led and science-based solutions in Nutrition & Health. This acquisition is an attractive and logical next step for DSM enabling us to provide our customers with innovative Early Life Nutrition solutions in our Human Nutrition business.”

This latest acquisition is part of DSM’s global food and beverage play. In 2019, the company the international agro-industrial group Avril announced a collaboration produce a unique plant-based protein based on non-GMO canola that has functional properties, a high nutritional value, and a balanced taste profile, making it ideal for a range of applications including meat and dairy alternatives, beverages, baked products, bars and ready-to-mix. The partners’ are developing a state-of-the-art industrial production facility fully dedicated to canola proteins at Avril’s Saipol facility in Dieppe, France. Commercial availability from first production could be as early as end 2021.

Americans consume too much salt (and sodium by default), putting them at an increased risk for high blood pressure and heart disease. These risk factors have prompted medical professionals and regulatory entities to lobby the food and beverage industry to reduce sodium across the food supply to decrease the negative health effects of high-sodium diets.

The American Heart Association (AHA) estimates the average U.S. adult consumes approximately 3,400 mg of sodium per day, far more than the 2015-2020 Dietary Guidelines for Americans (DGAs) recommendation of 2,300 mg of sodium per day as part of a healthy eating pattern.

While sodium is found naturally in a variety of foods such as milk, meat and shellfish, most dietary sodium is found in processed foods and foods prepared in restaurants. According to CDC, estimated more than 40% of sodium intake comes from 10 types of foods—breads and rolls, pizza, sandwiches, cold cuts and cured meat, soups, burritos and tacos, savory snacks, chicken, cheese, and eggs and omelets.

Many food and beverage companies have stepped up to the challenge to reduce sodium levels in their products. According to 2019 data from The Consumer Goods Forum (CGF), more than 320,000 consumer goods products have been reformulated since 2015. Moreover, 98% of companies reported reformulating at least some part of their product portfolio to align with health and wellness policies, and 70% of companies reported reformulating salt and sugar in their products. The data is part of the 5th annual CGF Health & Wellness Progress Report, developed in conjunction with Deloitte, which details how its members are working together to empower consumers and employees around the world to live healthier lives.

To read this article in full, check out the "Sugar and sodium reduction strategies" digital magazine.