Mintel Predicts Huge Upside for Stevia

September 29, 2009
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All-natural and calorie-free stevia is poised to become a challenge to some of the leaders in the sweeteners market, according a new report from Mintel.

That said, a survey by the Chicago-based research firm also notes that stevia has a public relations issue with most consumers who haven’t hard of the sweetener or have no interest in trying it.

Since December 2008, when the Food & Drug Administration first approved use of rebaudioside A for the U.S. food and beverage market, the stevia market has erupted, Mintel reports. By mid-July 2009, stevia sales topped $95 million, a substantial increase over the $21 million achieved in all of 2008. Mintel predicts the stevia market could exceed $2 billion by the end of 2011.

"The FDA's approval of stevia in food and drink opened the door for this market's explosion," states David Browne, senior analyst at Mintel. "New product activity has accelerated in recent years, and since most categories with stevia applications remain untapped, we expect many more stevia-infused product introductions in the next few years."

During the first eight months of 2009, Mintel's Global New Products Database monitored the launch of more than 110 U.S. food, drink and healthcare products made with stevia. Annual new product activity for stevia more than doubled between 2007and 2008.

The portrait for stevia's success isn't completely rosy, Mintel cautions. According to a consumer survey by the firm, nearly 70% of Americans have never even heard of stevia. More than six in 10 (62%) say they have no interest in trying stevia, and 11% say they think stevia is unsafe and they plan to avoid it.

"Step one is for manufacturers to get the word out,” Browne says. “At this stage, heavy demo-ing of stevia products in stores, along with copious distribution of free samples, are just as important as promoting stevia's all-natural, zero-calorie positioning.”

Flavor remains another obstacle to stevia's growth. Companies are aggressively perfecting formulations and seeking better source material globally, but this means one stevia-based product won't taste the same as the next.

"If someone tries a stevia-sweetened drink with an off-putting aftertaste, it's logical to assume that person will be a tough sell for stevia products in the future," Browne says.

Mintel reports that 25% of people say they might be interested in stevia, but they haven't tried it yet. Just over one in 10 (11%) say they have tried stevia and plan to continue purchasing it.

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