Market Trends – Clean Label

Introduction

In the food and beverage industry, labeling claims like natural, fair trade, and even organic can be vague and at times, confusing. The understanding and expectations behind these labels can differ between producers and consumers. One claim that has gotten traction in recent times is “clean label.” Unlike natural and organic, clean label does not yet have any official regulatory parameters, so the notions of what is “clean label” run a gamut of definitions. In this blog, and in our newsletter, we explore the clean label trend to clarify what has been going on, and where the trend could head in the future.

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What is Clean Label?

Clean label is better thought of as a movement, rather than a regulatory labelling claim. The term clean label is consumer-led and is broadly accepted by the food and beverage industry.

Initially, clean label implied that a product had as few ingredients as possible, and each of those ingredients was recognizable and wholesome. The movement sought out easy-to-recognize ingredients, and was weary of artificial ingredients or synthetic chemicals. Clean eating often aligns with what US consumers consider healthy: natural, freshly made, organic, and preservative-free. “Clean” is now appearing as a claim on-pack and is being regarded as the new “healthy.”

Today, clean label has entered a new phase that some experts refer to as Clean Label 2.0. Clean label is no longer restricted to just the ingredients of a product. Now clean label extends to how a product is packaged, sourced, and sold.


The answer to the question of “what is clean label” is constantly evolving to meet consumer demand. A safe approach is to think of clean label as a movement that prioritizes perceived health, transparency, environmental, and cultural issues over price, eye-catching colors, and shelf-life.

Quick Market Facts

  • 91% of U.S. consumers believe that food and beverage options with recognizable ingredients are healthier.
  • 72% of U.S. consumers agree that they want more transparency in food product ingredients.
  • Brands producing products like bread, tortillas, crackers, and dairy have been the quickest to adopt clean label alternatives. In 2017, clean label milk and dairy alternatives accounted for 90% of sales in the category. The “Indulgent Treat” category which is often driven by impulse is lagging behind in terms of clean label alternatives.
  • As of 2018, the clean label ingredients market was valued at $38.8 billion, and is projected to reach $64.1 billion by 2026.
  • 24% of U.S. consumers aged 18-34 associate foods with sustainable claims as healthy.

What is Driving the Trend?

Consumers are looking to consume with a “clean conscience.” This means that the products they buy should be good for their bodies, minds, the environment, animals, and geopolitics. Transparent labels have become associated with trust with manufacturers of food. Anything that sounds “science-y” on the ingredients list, has a negative connotation.


One reason for the growing emphasis on clean label is that today’s consumer is better equipped to track and report issues than ever before. A wealth of information both online and off has allowed the modern consumer to make more informed and thought-out purchasing decisions. Access to a seemingly endless stream of this kind of information only adds to consumers’ fears about the products that they purchase for themselves and loved ones. This is especially true in the Asia Pacific region as there have been a wide range of food safety scares in recent history. As concerns about pollution and food-related illnesses increase worldwide, consumers are seeking products that are free of seemingly negative components.

Examples of Clean Label Claims (Company Names Withheld)

  • “Grown without pesticides, with natural fertilizer and with careful attention for the preservation of the ecosystem.”
  • “… committed to protecting and conserving water, soil resources, and wildlife habitats.”
  • “… handpicked from bee friendly farms.”
  • “… avoids routine use of artificial pesticides.”
  • “We use Erythitol, which though it has a rather scientific-sounding name, is actually another all-natural sweetener found in fruits like pears and grapes.”

Conclusion

The clean label trend is ever-evolving based on consumer sentiment and demand, but brands also need to be careful about how and the extent to which they advertise clean label claims. Brands should only use claims that actually mean something for the brand and product. There is such thing as too much information. Oversaturated claims, especially those that are unnecessary or unclear can confuse and lose the trust of the consumer. Consumers are seeking trust from brands when they buy clean label, so throwing off the delicate information balance could be confusing to the customer. If a consumer feels overloaded with information, a phenomenon also called “claim fatigue”, a brand’s authenticity, provenance, and transparency could be questioned. Information that clarifies, rather than confuses, should be prioritized.


Into the future, as technology involves, consumers could gain more access to information about the products they buy which could further the clean label trend. Block-chain for example, could be used to gather and sort information on where exactly an ingredient could come from. In the case of beef, a consumer could one day be able to, in the grocery store aisle, read about the exact cow that the steak they are considering came from. A quick look-up that reveals a diet of hormones and corn could deter even the most loyal of customers when an alternative on the same shelf is advertised as “grass-fed, grass-finished.” This sort of information is an exception today, but could one day be the expectation as skepticism around science and food grows.

Sources

Lightspeed/Mintel Food and Drink Platform

Devenyns, Jessi. “Onward and Upward: Clean Label Trend Shows No Signs of Slowing.” Food Dive, 14 Jan. 2019, www.fooddive.com/news/onward-and-upward-clean-label-trend-shows-no-signs-of-slowing/545738/.

Velissariou, Maria. “What Is Clean Label?” Brain Food – The Official Blog of IFT, blog.ift.org/what-is-clean-label.

https://www.globenewswire.com/news-release/2020/02/06/1981377/0/en/The-clean-label-ingredients-market-was-valued-at-38-8-billion-in-2018-and-is-projected-to-reach-64-1-billion-by-2026-growing-at-a-CAGR-of-6-8-from-2019-to-2026.html



Emily Oursler

Emily is a Marketing and Business Development Associate at Trilogy where she works on marketing and China-related projects. Prior to joining Trilogy in 2019, Emily worked in management consulting in Shanghai, China for three years. Her interest in the food and beverage industry began after developing a North America market-entry plan for a large Chinese hot pot chain. Emily graduated from the University of Maryland in 2016 with a degree in Chinese and a concentration in Economics. She is fluent in Chinese and speaks basic Vietnamese and French. In her free time, Emily enjoys playing the electric guitar, scuba diving, skiing, and sailing.

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