04 17FIJ Sweeteners

Food Insider Journal
Clean Label Strategy & Formulation

Brought to you by: Natural Products INSIDER
Sweeteners
Balancing Label, Taste Concerns
Vol.1 No.2 April 2017 US$20

foodinsiderjournal.com
CONTENTS foodinsiderjournal.com
April 2017
3 5 19
Viewpoint: Sweeteners: Clean Label
Sweet Success Balancing Label, Sweeteners Raise
Taste Concerns the Bar in Beverages
Innovation in Action
28 32
Reeds Inc.: Lotus Botanical Elixirs:
Dosing the World Naturally Crafted
with Ginger to Drink Life In

Brought to you by: Natural Products INSIDER
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2 Food Insider Journal Sweeteners: Balancing Labels, Taste Concerns April 2017
VIEWPOINT
Sweet Success
N
early two-thirds of Americans are limiting or avoiding added sugars, and
a quarter point to sugar as the most likely calorie source responsible for
weight gain, according to the newest data from the International Food If you are
Information Council (IFIC).This heightened attention to sugar intake
one of those
coupled with consumer demand for ingredients that are natural, sustainable and
healthfulis forcing food and beverage companies to their rethink ingredient manufacturers
selection and marketing messages, especially in key categories considered looking to clean
indulgent or inherently caloric. up labels and
If you are one of those manufacturers looking to clean up labels and reduce reduce calories
calories and sugars, its critical to work with your ingredient supplier to identify and sugars,
the appropriate natural sweeteners to help balance label and taste concerns.
its critical to
This issue takes a deep dive into the carbonated soft drink (CSD) sector,
which has seen sales fizzle in recent years due to consumer concern over added work with your
calories. To combat this, many companies are rolling out CSDs with natural ingredient
sweetener alternatives including stevia, monk fruit, stevia blends and cane supplier to
sugar. In particular, the craft and natural soda space is seeing an uptick in sales identify the
thanks to the clean label movement. Whats more, craft and natural soft drinks appropriate
also provide new flavor experiences, including blends of fruits, spices and herbs,
while hitting naturally sweetened and premium ingredient trends.
natural
The Innovation in Action case study on page 28 examines how craft soda sweeteners to
market leader Reeds Inc. seized on the growing popularity of the Moscow Mule help balance
cocktail to bring a low-calorie version of its best-selling ginger brew to market. label and taste
By replacing raw sugar cane with stevia rebaudiana leaf extract, Reeds Light concerns.
55 Calories Extra Ginger Brew achieved a 60 percent reduction in calories per
serving without compromising taste.
Visit foodinsiderjournal.com for more infographics, columns, videos and
presentations that complement this issue. As always, please feel free to drop me
a line with any suggestions on future topics.
Cheers,
Judie Bizzozero
Editor
judie.bizzozero@informa.com
@judiebizz
Enough
sweet
talk.
Taste the advantage of

ViaTech stevia sweetener.

Lets cut to the chase: ViaTech goes further

in reducing sugar while controlling off-notes.
The ViaTech portfolio uses proprietary
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a great-tasting stevia-sweetened food or
beverage, allowing you to get to market
sooner. Enough said.
Call 1-866-456-8872 for a sample.

Because the proof is in the taste.
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2016 Cargill, Incorporated
Sweeteners:
Balancing Label, Taste Concerns
by Judie Bizzozero
S
hifting consumer demands across the globe In fact, obesity was a key focal point when
drafting the 2015 Dietary Guidelines for
have led to immense innovation in the food and Americans, which recommends consumers
beverage space. The current trends are focused consume less than 10 percent of daily calories
on health and wellness, and a desire for products from added sugarsa much smaller amount
compared to similar guidelines released in 2010.
formulated with ingredients consumers can pronounce, The American Heart Association recommends
as well as products with shortened ingredient lists. limiting intake of added sugar to six teaspoons
for women and nine teaspoons for men; however,
According to the 2016 Food & Health Survey most Americans consume between 22 and 30
Consumption teaspoons of added sugar each day.
and opinions from the International Food Information Council
(IFIC) Foundation, most Americans think about the Major sources of added sugars include
regarding sugars
have changed healthfulness of the foods and beverages they regular soft drinks; juices; confectionery; dairy
over the past consume. Consumption and opinions regarding products such as milk-based drinks, yogurts and
year, with sugars also have changed over the past year, ice creams; baked goods; desserts; breakfast
with 61 percent of Americans limiting or avoiding cereals; and bars. While products with label
added sugars and 25 percent pointing claims such as no sugar added or 100 percent
to sugar as the most likely calorie fruit seem like healthier choices in a consumers
source responsible for weight gain. mind, thats not always the case.
Sugar content in foods and beverages has Innova Market Insights called out sweetener
been a politicized issue because of its association balance as a top trend in 2017, noting interest in
61% with several chronic illnesses, chief of which

include obesity, diabetes, cancer and heart
sugar reduction has combined with the ongoing
emphasis on clean label. In terms of new product
disease. Due to the global obesity epidemic, development, industry faces the challenge of
of Americans nearly all forms of sweeteners are coming under balancing public demand to reduce added sugars
limiting or avoiding intense scrutiny from healthcare professionals, and create indulgent experiences, while at the
added sugars.
lawmakers and consumer advocacy groups. same time delivering clean label products.
The good news is the food and beverage industry is meeting this challenge head-on. Over the
past few years, efforts have been stepped up to remove sucrose and high fructose corn syrup
(HFCS) from products and replace them with alternative sweetener ingredients that consumers
consider natural or healthy. While some have a lower glycemic index compared to sucrose, the
number of calories the substitute provides is usually similar, meaning consumers perceived
health benefit and reality do not always align, per a December 2016 Passport report from
Euromonitor International.
This disconnect between consumer perception and nutritional benefit was a critical factor
behind FDAs 2016 sweeping overhaul of the Nutrition Facts panel on packaged foods that
included modifying the list of required nutrients that must be declared on the label, and an
updated design to highlight calories and servings to help consumers make informed
food choices.
Sweeteners are a critical ingredient that consumers want to better understand, said Shawn
Kohlmeier, product line manager - Food Ingredients, Briess Malt & Ingredients Co. This is one
of the driving forces behind the AddedSugars component of the upcoming FDA label changes.
Consumers will want to know what sugars come from natural, nutritious whole foods and what
sugars are added solely for flavor and/or sweetness.
Most food manufacturers will be required to use the new label by July 26, 2018; however,
manufacturers with less than $10 million in annual food sales will have an additional year to
comply with the new rules. Foods imported to the United States also will need to meet the final
requirements. The attention to added sugar intake on packaging, and consumers shift away
from sugar or artificial sweeteners, provides food and beverage manufacturers the opportunity to
reformulate products and increase use of natural sweeteners.
Consumers Sweet on Clean Label

Todays consumers are demanding more food and beverage options made with recognizable
ingredients. Whats more, they want those products to taste good and provide a healthy dose of
nutrition. Subsequently, manufacturers must adjust to meet these needs.
2016 sweeping overhaul of the

Nutrition Facts panel on packaged
foods included modifying the list
of required nutrients that must
be declared on the label and
an updated design to highlight
calories and servings to
help consumers make informed
food choices.
The American
According to Euromonitor International, the number of Heart Association
companies committing to sugar reduction is growing at an
unprecedented rate, leading consumer packaged goods recommends
(CPG) companies to work with ingredient suppliers to find limiting intake of
new alternatives to sweeten products while maintaining
specific attributes such as taste, texture and mouthfeel. added sugar to
Consumer perception of what is natural is one of the
main drivers causing traditional sweeteners to struggle in the
marketplace. Data from Euromonitor found global sucrose
consumption recorded a compound annual growth rate
(CAGR) of 2 percent over 2010-2015, but in Western Europe
consumption posted a -0.3 percent CAGR, which is expected
to be replicated over 2015-2020. HFCS had a global
CAGR of zero percent over the historic period, likely due to
concerns over effects on health and links to obesity.
6
If consumer perception and consumption patterns
continue in this manner, there will be significant growth
opportunities for natural sweeteners that fit the better-for-
you mold.
teaspoons
Need proof? Honey and fructose posted global CAGRs
of 4 percent and 3 percent, respectively, between 2010
for women
and 2015, from strong bases, noted Euromonitor. Sales of
high-intensity sweeteners also reflect the rise of natural,
as stevias rise over 2010-2015 came at the same time
as the artificial sweeteners aspartame and cyclamate
declined, posting global CAGRs of -0.1 percent and
-0.4 percent, respectively.
Food manufacturers such as Campbells, General
Mills, Kelloggs, Kraft Heinz, Goya Foods, Mars, Mondelez
International, Nestl and Unilever have been working
to change consumer perception of packaged foods by
9
delivering innovative products made with healthy, functional
and clean label ingredients. In fact, data from Innova Market
Insights found 25 percent of new products in the United teaspoons
States had clean label positioning in 2015, up from 17
percent in 2014. Non-GMO (genetically modified organism), for men
gluten-free, organic and whole food nutrition labeling
along with the absence of natural colors, sweeteners and
preservativesare leading the clean label movement. however, most Americans
According to data from Mintel and Leatherhead Research,
the global market for high-intensity sweeteners for use in consume between
22 and 30
food and beverage manufacturing will reach $1.4 billion in
2017. However, high-intensity sweeteners have long had
a problem with consumer perception as being artificial,
so its no surprise to see clean label plant-based high-
intensity sweeteners such as stevia and monk fruit gaining teaspoons of added sugar
momentum in the market. In fact, Mintel predicts the market
for stevia-based sweeteners for use in food and beverages
will reach $275 million by 2017.
each day.
A Taxing Situation
The move to tax sugary foods and beverages
has been in the spotlight for years in the United
States as health professionals and advocacy
groups contend it would help reduce rates of non-
communicable diseases (NCDs) such as obesity
and diabetes and their associated healthcare
costs. However, manufacturers and trade groups
such as the American Beverage Association and
the Grocery Manufacturers Association argue the
opposite, calling into question studies that suggest
sugar-sweetened foods and beverages increase
Excess Sugar the likelihood of chronic diseases. Furthermore,
they dispel studies and surveys that suggest
Associated taxing such products will change consumers
purchasing behaviors.
With Chronic In July 2010, the state of Washington enacted

a retail sales tax on nearly 3,000 candy and gum
Disease Risk items made with sugar, honey, or other natural

or artificial sweeteners combined with chocolate,
fruits, nuts, or other ingredients or flavorings
and formed into bars, drops or pieces. The tax,
however, was repealed just four months later by
voters. The National Confectioners Association
(NCA) said the repeal sent a clear message
HYPERTENSION against arbitrary food and beverage taxes to state
governments throughout the country.
One of the most contentiously debated
regulations began in 2012 when the New York City
Board of Health passed a controversial measure
CANCER banning the sale of soft drinks and sweetened
drinks containing more than 25 calories per
8-ounce serving sold in areas regulated by the
health department. While the ban did not include
OBESITY packaged drinks sold at retail, CPG manufacturers
took it as a sign of things to come from an
overreaching government. A lawsuit filed by the
beverage and restaurant industries argued the
HEART DISEASE rulethe brainchild of former mayor Michael
Bloombergwould have imposed undue burdens
and was arbitrary and capricious because it
excluded several businesses. After numerous
INSULIN appeals, the New York State Court of Appeals in
RESISTANCE July 2014 killed the Portion Cap rule, effectively
ending the issue.
However, the governments role in promoting
nutrition through legislation didnt abate.
In November 2014, voters in Berkeley,
TYPE 2 California, approved a 1-cent-per-ounce tax on
DIABETES the distribution of most sugary drinks, becoming
the first U.S. city to do so. In 2016, Boulder,
Colorado, added a 2-cent-per-ounce excise tax
on distributors of sweetened drinks such as
carbonated soft drinks (CSDs), sports drinks and sweetened evidence suggesting pricing policies can influence purchasing
iced tea. San Francisco, Oakland and Albany, California, also patterns and have an impact on dietary behavior. A study
adopted a 1-cent-per-ounce excise tax. published in January 2016 in BMJ found sales of the taxed
On Jan. 1, 2017, Philadelphia began a 1.5-cent-per-ounce beverages in Mexico fell by an average of 6 percent in 2014,
tax to the cost of most sugary beverages except for infant and declined by as much as 12 percent in December 2014.
baby formula; drinks containing more than 50 percent milk, In addition, purchases of water and non-taxed beverages
fresh fruit or vegetables; and unsweetened drinks. Beginning increased by about 4 percent on average.
in July 2017, Cook County residents in Illinois will pay a Our study shows that taxing sugar-sweetened beverages
1-cent-per-ounce tax on sugary and artificially sweetened has a legitimate place as part of a toolkit for the prevention
beverages. In May 2017, voters in Santa Fe, New Mexico, of obesity. Taxation alone will not solve the problem, but can
will decide the fate of a proposed 2-cent-per-ouncetaxon contribute to its prevention and control, said Juan Rivera,
sugar-sweetened beverages. Ph.D., co-author of the study and director of the Mexican
Globally, the picture is similar. According to the World Health Research Center in Nutrition at the National Institute of
Organization (WHO), Finland has taxed sweets and drinks on Public Health.
and off since 1926. In 2011, Hungary introduced a 24-cent- The soft drinks manufacturers association of Mexico
per-liter tax on a range of foods and beverages with more than questioned the researchers conclusions, arguing that the
0.5 percent sugar content, while France adopted a tax in 2012 measure was regressive in that it hit poor households hardest,
on sugar- and artificially-sweetened drinks, including fruit but failed to make a significant reduction in Mexicans average
beverages and flavored waters. caloric intake.
In January 2014, Mexico implemented a 6-cent-per-ounce Unfortunately, the soda industry in Mexico is winning the
tax on sugar-sweetened beverages to help curb rising rates battle for public opinion, saying that the tax doesnt work
of obesity and diabetes. The 2015 WHO report Using Price and that it is regressive, argued Rivera, noting the impact
Policies to Promote Healthier Diets noted a growing body of on the poor has to be measured in terms of improving their
Global Obesity Rates

Worldwide obesity has more than doubled since 1980.
In 2014, more than

1.9 billion adults,
18 years and older, were overweight.
Of these, over 600 million
were obese.
39% of adults aged 18

years and over were overweight
in 2014, and 13% were obese.
41 million
Most of the worlds population live in children under the
countries where overweight and obesity age of 5 were overweight
kills more people than underweight. or obese in 2014.
Source: World Health Organization
health. Our study found that the reduction in
soda purchases was greater among the poor
(an average 9 percent reduction), so we expect
greater health gains among poor people,
Rivera said. The money raised by Mexicos soda
tax is being reinvested in obesity prevention
such as installing drinking water fountains in
low-income schools.
A national survey to gauge whether the soda
tax is helping to reduce obesity or type 2 diabetes
is planned between 2016 and 2018. However,
Rivera said the effects on weight are probably
going to show in five years or more. We estimate
that about 400,000 cases of diabetes could be
averted by 2050 if Mexico keeps the soda tax.
In 2015, other countries in the region followed
Mexicos lead. Barbados levied a 10 percent
tax on sugar-sweetened beverages, while the
Dominican Republic slapped a 10 percent tax on
sugary drinks and chewing gum. Chile tacked
on an 18 percent value added tax (VAT) on
beverages containing more than 6.25 g of sugar
per 100 ml.
In the United Kingdom, a two-tiered tax on
sugary soft drinks is set to take effect April
2018. Sugar-sweetened beverages with more
than 5 g of sugar per 100 ml will be taxed at
one rate and beverages with more than 8 g per
100 ml will pay a higher tax. Pure fruit juices and
milk-based drinks will be exempt due to concerns
that children, particularly girls, are not getting
adequate intakes of calcium. The Office for
Budget Responsibility anticipates the tax will raise
approximately US$313 million in the first year. In
Ireland, a similar tax will take effect around the
same time.
Industry Taking Action

In May 2010, with then first lady Michelle
Obama, the Healthy Weight Commitment
Foundations food and beverage members
pledged to reduce calories sold by 1.5 trillion
by the end of 2015. As an interim goal, the
companies were to reduce calories by 1 trillion
by the end of 2012; however, they exceeded that
goal and slashed 6.4 trillion calories from the U.S.
food supply that year. The reduction came three
years ahead of schedule and by more than 400
percent over the original pledge.
Companies participating in the calorie-
reduction pledge included Bumble Bee Foods
LLC, Campbell Soup Co., ConAgra Foods
(included Ralston Foods), General Mills Inc.,
Hillshire Brands (previously Sara Lee Corp.),
Consumers will want to know what sugars come from natural,
nutritious whole foods and what sugars are added solely for flavor
and/or sweetness.
Shawn Kohlmeier, product line manager - Food Ingredients, Briess Malt & Ingredients Co.
Kellogg Co., Kraft Foods Group/Mondelez, Mars Inc.,

McCormick & Co. Inc., Nestl USA, PepsiCo Inc., Post Foods,
The Coca-Cola Co., The Hershey Co., The J.M. Smucker Co.
and Unilever.
Today, more than ever, companies small and large across
the globe are committed to creating healthier products and
promoting improved lifestyles.
New data from The Consumer Goods Forum (CGF) found
more than 180,000 CPGs were reformulated in 2016, while
more than 30,000 communities worldwide have been involved
in industry-led programs that promote healthier diets and
lifestyles. The data is part of the 4th 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.
Results from the survey found food and beverage companies
targeted the removal of sodium and sugar in their reformulation In September 2014,
efforts, while working to add whole grains and vitamins. The
number of companies reporting in 2016 on how they are Americas Big 3 soda
implementing the CGFs Health & Wellness Resolutions and
Commitments increased more than 30 percent compared to makersThe Coca-
2015. The Resolutions and Commitments, approved by the
CGFs board of directors in 2011 and 2014, respectively, look
Cola Co., Dr Pepper
at specific areas where retailers and manufacturers can work
together to drive positive change and empower people to make
Snapple Group and
informed choices for healthy diets and lifestyles. While results PepsiCopledged a
20 %
overall show positive progress, the speed of implementation of
these specific targets has proven a challenge.
We recognize that CGF members are making visible efforts
to improve the health and wellness of people around the
world, said Paul Bulcke, member of the board and chairman
designate, Nestl S.A., and Dick Boer, Ahold Delhaize president
and CEO, and board co-sponsors for the CGFs Health & reduction in
Wellness Pillar. That said, this is an ongoing journey and we
strongly encourage all companies to join the collective effort. beverage calories
In September 2014, Americas Big 3 soda makersThe
Coca-Cola Co., Dr Pepper Snapple Group and PepsiCo
consumed per person
pledged a 20-percent reduction in beverage calories consumed
per person nationally by 2025 by increasing consumer
nationally by 2025.
education and aggressive marketing of smaller portion sizes,
water, and other no- or lower-calorie beverages.
stevia
monk fruit
agave
erythritol
According to SPINS data, stevia and stevia blends in the

alternative sweetened soft drink sector accounted for a
16 % growth in sales since 2015 across all retail

channels; some successful combinations include
stevia plus agave, erythritol or monk fruit.
Recently, organic yogurt maker Stonyfield announced a benefits of yogurt like calcium, protein and added vitamin D.
comprehensive plan to reduce added sugar across its portfolio. Were accomplishing reductions across the portfolio through
The company spent two years utilizing its proprietary library of a committed team whos finding a better way to deliver all of
culture strains to achieve a formula that reduces tartness and the nutrition and taste benefits of Stonyfield yogurts with less
balances the sweetness of yogurt, allowing for sugar reduction sugar, said Linda Lee, chief marketing officer.
without sacrificing taste. The company is working to reduce Food giant Nestl has been leading the charge to create
sugar in all its yogurt offerings this year and already offers healthier products across its entire portfolio. By the end of
plain, unsweetened options in its Stonyfield YoBaby, Stonyfield 2015, the company had reduced its added sugar content
Greek and Stonyfield core lines. by 18,000 tons, or 4.1 percent, toward its objective of a 10
The commitment to reducing sugar across the product percent reduction. The challenge for us lies in consistently
portfolio was born from Stonyfields mission to continually providing tastier and healthier solutions that meet consumer
provide healthier food both for our consumers and the planet, preferences, the company said in a statement.
said Nichole Cirillo, mission director, Stonyfield. We are In 2015, together with Cereal Partners Worldwide (its joint
achieving a lower amount of added sugar in all Stonyfield venture with General Mills), Nestl continued to reformulate
yogurt without compromising taste or organic standards recipes to achieve its objective to reduce the sugar
and are working toward purchasing 25 percent content in breakfast cereals to 9 g per serving.
less sugar as a company this year. In February 2017, Nestl announced plans
By the end of this year, Stonyfield for a 10 percent reduction in the amount
Smooth & Creamy varieties and of sugar in its confectionery products
lowfat Smoothies will have at least sold in Ireland by 4Q18a move
25 percent less sugar than previous that would slash 400 tons of sugar
recipes. Consumers want to limit the across numerous brands by replacing
amount of added sugar in their diets, it with higher quantities of existing or
without sacrificing taste and the great natural ingredients.
Finding the Sweet Spot
Brands looking to stake a new claim to consumers purchases are turning to natural
alternative sweeteners that carry consumer associations of health benefits, such as fewer
calories, lower glycemic impact and clean label attributes. Examples of natural sweeteners
increasingly being used include stevia and stevia blends, monk fruit, sugar alcohols, syrups,
prebiotic fibers and honey.
According to SPINS data, stevia and stevia blends in the
alternative sweetened soft drink sector accounted for a 16
percent growth in sales since 2015 across all retail channels;
some successful combinations include stevia plus agave,
erythritol or monk fruit. Even stevia blends with cane sugar
are emerging in the soft drink segment. Stevia is now being
used by some leading players and brands, most notably Coca-
Cola for Coca-Cola Life and Pepsi with Pepsi True.
Monk fruit is generally recognized as safe (GRAS) by FDA
for use as a flavor enhancer, sweetener ingredient in food,
and as a tabletop sweetener. In the natural channel,
monk fruit saw 50 percent growth in the sweeteners
category and its presence expanded into alternatively
sweetened sodas and a wide range of food and
beverage categoriesappearing in more than 20 food,
beverage and dietary supplement categories tracked by
SPINS. Examples include Chobani Simply 100, Bolthouse
Farms Protein PLUS, Skinny Cow Creamy Iced Coffees
Sheila Fitzgerald / Shutterstock.com
and Zevia Zero Calorie Soda.
Honey and syrups also are being used to add
sweetness and functional attributes in a wide variety of foods and beverages,
including bars, soft drinks, baked goods, cereals and granola, confections, dairy and
more. Examples include syrups being derived from coconut, palm, maple, sorghum,
agave, rice and tapioca. Other clean label ingredients used for sugar replacement
and functionality include sugar alcohols such as xylitol and erythritol that have been
clinically proven to promote dental health, and fiber ingredients such inulin and
oligofructose that offer digestive health benefits. LunaseeStudios / Shutterstock.com
Honey and syrups also are being used to add sweetness

and functional attributes in a wide variety of foods and
beverages, including bars, soft drinks, baked goods, cereals
and granola, confections, dairy and more. Examples include
syrups being derived from:
COCONUT PALM MAPLE SORGHUM AGAVE RICE TAPIOCA
Interestingly, recent Nielsen and Label Insight data found
products containing low-glycemic clean label alternatives are
growing across the store, as sales of these sweeteners grew
19 percent in 2016 over 2015, and 200 percent compared
to four years ago. In fact, 56 percent of U.S. respondents
strongly or somewhat agreed they are willing to pay more for
foods and beverages free from undesirable ingredients.
Many definitions of clean label are being circulated
throughout the industry. We are seeing consumers become
more interested in learning about the quality and nutritional
benefits of their food. To us, clean label means ingredients
that consumers understand and recognize, with fewer
ingredients, free from artificial additives, said Veronica
Cueva-Beach, vice president, Global Technology, Specialty
Food Ingredients, Tate & Lyle.
Data from Ingredion Inc.s proprietary research MMR,
Consumer Study, USA, April 2015, found 72 percent of U.S.
consumers usually or always read front of package claims,
while 64 percent read the ingredient list on the side or back
of the package. Whats more, 73 percent of consumers find it
important to recognize the ingredients used, and 67 percent
find it important to have a short and simple ingredient list.
Afrouz Naeini, senior marketing manager - Sweetness
& Beverage, Ingredion, said clean label becomes more
72% of U.S. consumers usually or always
read front of package claims
64%
important to consumers when there is an expectation for read the ingredient list on the side
freshness and wholesome, such as in dairy products, or back of the package
baby foods, snacks, nutrition bars and some beverages
73%
and cereals. of consumers find it important to
We see CPG companies seeking out simple label
sweeteners like tapioca syrup as well as non-GMO recognize the ingredients used
sweeteners. Plant-based sweeteners like stevia are
67%
continuing growth in line with the interests of customers for find it important to have a short and
sugar reduction in anticipation of changes to the Nutrition simple ingredient list
Facts labels and addition of Added Sugars, he said.
Bob Hansen, technical services manager, Briess Malt &
Ingredients Co., said convenience foods like bars, cereals and
healthy beverages are being closely scrutinized for label-
friendly sweeteners because consumers more frequently use
these products to make it through the day as small meals
or between-meal healthy snacks, and dont realize they are
consuming excess sugars with them.
For this reason, finding natural solutions that provide
sweetness without adding to the added sugars section of
the new nutritional label is paramount.Products that have
a strong basis in the use of large amounts of sweeteners,
such as cereals, bars and drinks that have been marketed as
healthy but have in fact contained large amounts of refined
sweeteners will have challenges in continuing to make
nutrition-label-friendly products with the same consumer
acceptance, Hansen said.
Baked goods, confectionery, snacks, breakfast
cereals, dairy and other applications all have
unique taste and functional benefits linked to sugar
or other sweeteners.
Jim Carr, Ph.D., vice president -
Applications and Technical Services, Tate & Lyle
Clean Label Challenges & Sweet Solutions

Replacing sweetening ingredients is not a simple task. While many
manufacturers are looking to clean up labels and reduce calories and
sugars, they cannot sacrifice great taste to do so.
The extent of sugar reductions has been limited by the quality of
sweetness or presence of aftertastes, such as bitterness, from high-
intensity sweeteners, said Wade Schmelzer, principal food scientist,
Cargill. With continued pressure to reduce sugar and calories in food and
beverages, maximizing sweetness intensity without compromising quality
has become the critical taste hurdle.
Cueva-Beach concurred, noting: One challenge manufacturers face
when formulating with natural high-potency sweeteners such as stevia is A popular stevia ingredient is
the bitter aftertaste associated with some of these ingredients. A popular rebaudioside A [Reb A]; but as
83 %
stevia ingredient is rebaudioside A [Reb A]; but as many as 83 percent
of consumers are sensitive to rebaudioside A bitterness. Therefore, many
products formulated with rebaudioside A must be combined with other many as
sweeteners that serve as masking agents.
Pam Stauffer, global marketing programs manager, Cargill, said
of consumers are sensitive to
effective blending of sweetener ingredients, such as stevia and erythritol, rebaudioside A bitterness.
can significantly improve the quality of sweetness, enhance sweet/sour
balance and deliver a more robust flavor, which are all critical sensory
characteristics for a successful product launch. Using stevia and erythritol
together can result in an excellent-tasting beverage and even optimize
formulation cost.
Cargill has been actively working on sugar reduction with stevia for many
years across multiple categories, including beverages, bakery, cereal and
dairy products. The ViaTech stevia portfolio has been designed to provide
significant improvements in sweetness quality compared to traditional stevia
leaf extracts, which enables deeper levels of sugar reduction and creates
opportunities for its customers to develop new products or reformulate
existing products with these upcoming label changes in mind.
Ongoing innovation through our stevia sweetener portfolio is helping Effective blending of
food and beverage manufacturers achieve optimal sweetness and sweetener ingredients, such
significant sugar reduction across categories, including beverages, bakery,
cereal and dairy products, Schmelzer said.
as stevia and erythritol, can
Baked goods, confectionery, snacks, breakfast cereals, dairy and other significantly improve the
applications all have unique taste and functional benefits linked to sugar quality of sweetness, enhance
or other sweeteners, noted Jim Carr, Ph.D., vice president - Applications sweet/sour balance and
and Technical Services, Tate & Lyle. For example, when manufacturers deliver a more robust flavor.
are seeking to reduce calories and sugar in solid and semi-solid food
There has been a
52 %
yearly CAGR in product launches
with monk fruit extract in the last four years and a
37%
yearly average growth for food and
beverage launches using stevia.
applications, the delivery of appropriate textural properties becomes

extremely important, he said. In these cases, innovative solutions require
the selection of specific clean label ingredients that provide not only
desired sweetness, but also proper functional attributes such as browning,
water activity, bulk solids and other performance properties, to deliver the
appropriate textural and taste experiences.
Solid-type food applications also require the sweetener to make contact
with taste receptors during consumption. Because only a slight dilution and
textural change occurs during chewing in the mouth, higher sweetener levels
are required to achieve a perceived sweetness level, Carr said. Solid foods,
Taste is other than those surfaces coated with sweeteners, inherently will require the
the biggest use of higher levels of sweeteners. Additional challenges are accompanied by
higher use-level limitations for these products.
challenge we
Cost constraints add another level of formulation challenges, and attention
still face when must be paid to balancing the choice of sweetening ingredients with the
it comes to affordability for the application. Synergistic combinations of clean label
clean label sweeteners and complementary clean label ingredients can help deliver
sweeteners. acceptable overall formulation cost and total cost of production when design
to cost is a focus, Carr said.
Laura Dembitzer,
marketing director, One of the key tasks of product developers is finding clean label
Imbibe sweeteners that can deliver both a higher level of sweetness and improved
quality of sweetness, essentially allowing deeper sugar reductions. Stevia
continues to resonate with consumers as a label-friendly sweetener.
According to Cargills proprietary research, stevia leaf extract is seen as
healthful and is an ingredient that will drive purchase interest on pack.
Citing data from Innova, Cueva-Beach said there has been a 52 percent
yearly CAGR in product launches with monk fruit extract in the last four years
and a 37 percent yearly average growth for food and beverage launches
using stevia. Categories most likely to be formulated with monk fruit extract
are sports nutrition supplements and meals, and sweetener packets and
liquids, she said.
Taste is the biggest challenge we still face when it comes to clean label
sweeteners, said Laura Dembitzer, marketing director, Imbibe. Theres
been a lot of progress with stevia in the past few years, in that there are a
lot of different varieties on the market and it has improved. But when you are
comparing it to a traditional carbonated soft drink or sports drink, there is a
definite taste profile in mind and you are working toward that benchmark.
To meet this demand, Imbibe offers SweetSense, an ingredient that can
be labeled as natural flavor to mask bitterness and amplify sweetness for
ingredients like stevia, she said. Mouthfeel remains yet another challenge,
as does aftertaste. And, not to mention, cost. A lot of brands want a natural
Fruit extracts sweetener, and then balk when they see the price, Dembitzer added. But
and natural the costs have started to drop as ingredients become more widespread.
distillates ADMs range of sweeteners and sweetener solutions provides developers
the tools to strike the right balance, noted Mark Rainey, vice president, global
can provide food marketing. This includes single-ingredient sweetener solutions and
sweetness blends including stevia and monk fruit. Like stevia, monk fruit, for example,
while also is an all-natural, clean label sweetener thats yet another great solution
satisfying the for natural or better-for-you food and beverages offering great taste with
growing trend sugar-free, no-sugar added and reduced-sugar options. It can be used alone
for real food or blended with other high-intensity sweeteners, flavor modifiers, natural
masking agents and more, Rainey said. Fruit extracts and natural distillates
ingredients. can provide sweetness while also satisfying the growing trend for real food
Mark Rainey, vice ingredients. These non-nutritive ingredients can add color, aroma, flavor
president, global food and important taste aspects to foods lower in sweetnessespecially when
marketing, ADM combined synergistically with other ingredients.
Market Forecast
Its apparent that clean label is a driving force behind the way that
companies are thinking about new and existing products. This new attention
to added sugar intake on packagingas well as consumer demand for
sweeteners that are natural, sustainable and healthfulprovides brands
the opportunity to increase use of alternative sweeteners when developing
or reformulating products. The key is identifying go-to-market segments
for naturally sweetened products and working with ingredient suppliers to
achieve brand success.
CATEGORY INSIGHT
Clean Label
Sweeteners
Raise the Bar in Beverages
by Melissa Kvidahl
W
hat comes to mind when you picture a natural ingredients are healthier than those made
with artificial ingredients. Further, 34 percent
clean label beverage? Perhaps its an hoped to see CSDs with added benefits on
artisan brew made in small batches with the shelf.
ingredients you might find in your own On the performance beverage side, consumers
are looking for holistic health benefits rather than
home pantry. Maybe its an organic tea made with an the caffeine boost provided by first-generation
eye to a more sustainable food chain. Or, maybe its a offerings. Mintel found nearly 90 percent of
natural shot boosted with health benefits. But, likely, consumers agreed performance drinks can help
them maintain a healthy lifestyle. In fact, three in
what doesnt come to mind is soda or an energy drink. five currently look to such beverages as a meal
Carbonated soft drinks (CSDs) and energy replacement, up from just 20 percent of those
drinks have both come under fire in recent who did so in 2012.
years. Soda, one of the latest targets of sin What these two beverage categories have
taxes in American cities and states, is public in common is theyre in a position to challenge
Nearly of U.S. adults enemy No. 1 at the American Heart Association, expectations and deliver on better-for-you
60%
said carbonated where decreasing sugary drink consumption is a products that meet the clean label demands of
soft drinks primary goal. Performance drinks, too, face a bad consumers. One place theyre already starting
made with reputation, as high doses of caffeine can lead to to do this is sweeteners, which, if you ask Laura
natural health problems. Dembitzer, marketing director at Imbibe, is the
ingredients are The good news is consumers arent No. 1 place to look.
healthier than discounting their favorite beverages. Theyre just Dembitzer pointed out all natural claims
those made asking more of them. dont cut it anymore. Not with consumers, who
with artificial One recent Mintel study found nearly are highly educated on such matters and want
ingredients. 60 percent of U.S. adults said CSDs made with more information, and not with brands and
manufacturers, some of which have faced legal action for using the term
and have since had to pull the claim. Now, to get the clean label positioning,
brands need to state the absence of a negative rather than the presence of
a positive, Dembitzer said. So rather than saying all natural, theyll say no
artificial sweeteners. And thats a really important claim.
When it comes to CSDs, much of the movement toward clean label
sweeteners is in the craft and natural soda category. And its a category
poised for growth, as a majority of Americans arent currently purchasing
such offeringsbut nearly half are interested in trying them.
The definition of health is changing from desiring low/no-fat and -sugar,
to real or unadulterated ingredients, said Elizabeth Sisel, Mintels beverage
analyst, in a statement addressing craft offerings. Craft and natural sodas
also provide new flavor experiences, including blends of fruits, spices and
herbs, while hitting naturally sweetened and premium ingredient trends.
Dollar sales of shelf- Sales data from SPINS supports these findings. Dollar sales of shelf-stable
stable sodas and sodas and carbonated beverages sweetened with fruit juice soared nearly 20
carbonated beverages percent between February 2016 and February 2017. Its agave-sweetened
sweetened with options, though, that steal the show with 72.4 percent growth between 2016
and 2017, reaching a market value of nearly $8 million. Keeping in line
fruit juice with this trend, sales of sodas sweetened with natural and artificial blends
plummeted 33 percent. Sodas sweetened with stevia, which still suffers from
soared nearly
20 %
a reputation of having an undesirable aftertaste despite strides in ingredient
formulation, also fell about 76 percent in sales. That said, consumers arent
discounting this ingredient entirely, as sales of sodas sweetened with stevia
alongside another sweetener jumped 12.4 percent.
Interestingly, clean label sweeteners arent yet making the same waves
between February 2016 in the sports drink aisle. Though the category overall grew nearly 25
and February 2017. percent between 2011 and 2016 to reach nearly $8 billion, per Euromonitor
International, alternative sweeteners arent yet widely popular. According
to SPINS, sales of performance beverages sweetened with agave shrunk
Its agave-sweetened options,

though, that steal the show with
72.4 %
growth
between 2016 and 2017, reaching a market value
of nearly $8 million.
On the other hand, sugar is also
seen as more desirable over artificial
ingredients like aspartame for a large
portion of the public and especially the
clean label consumer.
Chris Reed, CEO and founder, Reeds Inc.
36 percent between 2016 and 2017, as did sales of those levels more quickly than honey or agave, which are both lower
sweetened with stevia (nearly 25 percent) and a natural and on the glycemic index, Dembitzer said. Theres also the
artificial blend (down 46 percent). impression that sugar is more processed. Its a white, powdery
Indeed, a 2015 report from Packaged Facts found while substance. It didnt come from the earth, whereas honey and
36 percent of all U.S. adults consume sports drinks, there is agave, for example, are perceived as more natural. Sugar is
a major gap in the market as far as natural is concerned. An bad for your teeth. These are the things people think of.
opportunity exists, then, for new products with natural and On the other hand, sugar is also seen as more desirable
organic ingredients, as well as both caloric (cane sugar and over artificial ingredients like aspartame for a large portion of
agave) and non-caloric (stevia, monk fruit, etc.) sweeteners. the public and especially the clean label consumer, said Chris
Only recently are sustainability and Fair Trade claims reaching Reed, CEO and founder, Reeds Inc. Sugar is vilified but not to
the sports drink aisle. And, going forward, Packaged Facts the degree were seeing with aspartame, he added. Thats
suspects a focus on sugar in the years ahead will continue to considered really detrimental to health. So, many people,
put sweeteners at the forefront of differentiation. especially Lifestyles of Health and Sustainability (LOHAS)
consumers, will choose a sugar-sweetened beverage over an
Whats Up with Sugar? artificially sweetened diet beverage.
According to SPINS, sales of soda sweetened with sugar According to Mintel data released June 2016, cane sugar
remain flat. As it turns out, consumers arent rejecting sugar was consumers ideal carbonated drink sweetener, topping
across the board in their beverages, despite media and health both honey and stevia in popularity. Driving its popularity is the
industry pressure to the contrary. iGeneration, with 50 percent of respondents in that age group
On the one hand, sugar undeniably suffers from some preferring cane sugar over other sweeteners. To compare,
negative publicity. Sugar can cause a peak in blood sugar 35 percent of Millennials and Gen Xers chose the ingredient
Sodas sweetened with stevia, which still

suffers from a reputation of having an
undesirable aftertaste despite strides in
ingredient formulation, also fell about
76 %
in sales.
(Millennials chose honey at an equal clip), and just 30 percent of Baby
Boomers chose it.
That said, its possible that consumers love affair with sugar might be one
thats easily swayed. Across the pond, U.K. shoppers are preparing for a tax
on sugary soft drinks and sport drinks, set to go into effect April 2018.
Mintel research reveals one in three sports drinkers are preparing to cut
back on the amount of sugary varieties they consume, whereas one in five
are preparing to stop drinking such varieties altogether. And thats saying a
lot, since more than 70 percent of energy drinkers currently pass up low-,
no- or reduced-sugar options in favor of the sweet stuff. Further, half of
respondents said they would abandon their sports drinks altogether in favor
of another category like juice, smoothies or milk.
Mintels take? Products with naturally derived ingredients are poised to
grow in this time of flux. Whether that means appealing to the 37 percent of
consumers who want to know an ingredients origin or the 30 percent who
want plant-derived sweeteners, opportunities exist for brands that know what
their consumer wants and choose a sweetener accordingly.
Sweet Success
According to Dembitzer, there are two distinct consumer groups at play
in the CSD and sports beverage markets. The first group is made up of
consumers who want to reduce their sugar intake and are happy to do so
via artificial sweeteners, she said. This is still a large portion of consumers.
The other group is interested in clean label and natural sweetenersand
theyre even willing to sacrifice some taste to achieve their health goals.
Large brands like Coca-Cola and Pepsi are arguably making an effort
to appeal to both of these consumer groups with various offerings each
featuring a different sweetener approach. In 2014, Coca-Cola launched
Coca-Cola Life in the United States, a reduced-calorie soda that uses a blend
of cane sugar and stevia leaf extract. This joined Coca-Cola (sweetened with
high fructose corn syrup), Diet Coke (sweetened with aspartame), Coca-Cola
Zero (sweetened with a blend of aspartame and acesulfame potassium, or
Ace K) and other products. Similarly, PepsiCo added Pepsi True to its line of
beverages in 2014. With 30 percent less sugar, Pepsi True is sweetened with
sugar and stevia leaf extract.
More than Further, half
70 %
of energy drinkers
of respondents
said they would
abandon their
sports drinks
currently pass altogether
up low-, no- or in favor of another
reduced-sugar category like
options in favor of juice, smoothies
the sweet stuff. or milk.
Fanta, a Coca-Cola brand launched in 1955, just
debuted the biggest changes to the brand in its history. The
transformation includes a new visual identity, a revolutionary
asymmetric, spiral bottle, and a new recipe for Fanta Orange
that contains one-third less sugar.
At the heart of the brands transformation is a new visual
identity, designed to reflect Fantas fruity, fun and vibrant
nature. The new look will be supported by a multimillion-dollar
integrated marketing campaign that puts social at its core and
will feature out-of-home advertising, sampling and in-store
promotion throughout the year.
The new Fanta Orange Zero Sugar completes the brands
fresh look and feel, with one-third less sugar compared to
before. This builds on a 33 percent reduction in the sugar
content from 2006, with the recipe now down to 4.6 g per 100
ml from 6.9 g sugar per 100 ml.
This year looks set to be the biggest in Fantas history, with
a fresh new look inside and out. Weve been working hard
to reduce the sugar without compromising on the taste, and
were delighted to be launching this new look alongside a new
recipe with one-third less sugar than before, which consumers
have told us tastes better than ever, said Aedamar Howlett,
marketing director, Coca-Cola Great Britain.
Though Mintel found only one in 10 consumers is concerned
the natural version of their favorite soda brand wouldnt taste
the same, sales of Coca-Cola Life and Pepsi True are, by most
accounts, not meeting expectations. At Coca-Cola, an effort to
unify the brand is underway with the One Brand marketing
strategy which, among other initiatives, repackaged all its
offerings with similar graphics. Time will tell if this approach
can persuade Coke consumers to try the stevia version.
Still, while mainstream products like Coca-Cola are seeing
some challenges here, artisan brands are experiencing
explosive growth.
Hansens Sodas and Blue Sky Sodas, owned by The Coca-
Cola Co., were recently relaunched with new branding and
packaging to highlight their craft status and capitalize on
Cane sugar was consumers ideal
market differentiators: both have a long history, having been carbonated drink sweetener,
launched in the 1970s, and both are sweetened with cane topping both honey and stevia in
sugar. Hansens new branding features a throwback logo and popularity. Driving its popularity is
glass packaging, while Blue Skys new branding includes the the iGeneration, with
50 %
tagline Rooted in Real. of respondents in
Market leader Reeds Inc., founded in 1989, finds success
by targeting a specific consumer somewhere in the middle of
that age group
Dembitzers spectrum that places aspartame users and clean preferring cane
label extremists on each end. sugar over other sweeteners.
Our consumer is someone who does care about what drink clocking in at 120 calories per bottle, features just seven
theyre putting in their body, but theyre not on a fanatical diet, ingredients on its panel, including organic cane sugar.
Reed said. A self-proclaimed early adopter, Reed bet on the fact Consumers are starting to demand more from their sports
that his personal inclinations toward healthy living would reach drinks than just functional rehydration, said Ami Mathur,
the populous. I bet my whole life and career on that fact, he general manager - brand marketing, Honest Tea, which recently
said. Clean eating is not a fad. Its a trend, and its going to launched the Honest Sport line of performance beverages.
keep going. Theyre more aware of what theyre putting in their bodies, so
For Reed, a clean label sweetener is paramount. While theres more of an emphasis on ingredients than ever before.
the company offers a variety of beverages with different
sweetening optionsno sugar, low sugar, stevia, etc.the
sweetener of choice in Reeds Ginger Brew is fruit juice, from
apple and pear to grape. And the reasoning behind it parallels
consumer motivation: personal preference.
I believe fruit juices are a more natural option than sugar,
Reed said. I dont think all sugars are the same. Some are
more processed than others, and we use fruit juices with
minimal processing. Given the choice, I personally would rather
have a fruit sugar than a white sugar in a food or beverage.
At Rocky Mountain Soda Co., a clean label means a short
and recognizable ingredients list. We are proud that our
Rocky Mountain Soda and Oogave products only contain four
ingredients, all of which you can pronounce, said Drew Fulton,
company founder. The lines are also non-GMO (genetically
modified organism), vegan, kosher and all natural.
Oogave is sweetened with organic blue agave nectar, while
the brands LOCA line (short for low calorie) utilizes a blend
of organic stevia and organic agave nectar. Fulton said the
company worked with over a dozen different brands and
strengths to find the right stevia that didnt have a strong
aftertaste (it went with a high-purity organic option in the end).
The DRAM Apothecary line is sweetened with honey.
Similar to soda market trends, mainstream sports drink
brands are noticing the shift toward clean label and are
following suit with their sweeteners. Launched in August
2016, Gatorade G Organic, a USDA Certified Organic sports
Specifically, the
sweetener of choice is
organic cane sugar along
with organic fruit juice
because we believe that it
provides a great taste while
still providing the carbohydrates necessary
for a functional sports drink.
Ami Mathur, general manager - brand marketing, Honest Tea
The definition of a clean label sweetener at Honest The Futures Still Fizzy
Tea wouldnt be complete without mentioning the brands In October 2016, the World Health Organization (WHO)
commitment to organic and Fair Trade. At 100 calories or published a report maintaining that taxing sugary drinks could
fewer per bottle, Honest Sport beverages include such options lower consumption and thereby reduce obesity, type 2 diabetes
whenever possible. Having to meet third-party criteria gives and tooth decay. The report took aim at not just added sugars,
our ingredients another level of scrutiny that we think our but those naturally present. And it targeted not just processed
consumers have come expect, Mathur said. Specifically, sugars like HFCS, but also clean label sweeteners like honey,
the sweetener of choice is organic cane sugar along with syrups, fruit juices and fruit juice concentrates.
organic fruit juice because we believe that it provides a great WHO suggested a tax of at least 20 percent on such
taste while still providing the carbohydrates necessary for a products could save lives. According to the organizations
functional sports drink, she added. most recent data, about 40 percent of adults worldwide are
Still, sourcing clean label sweeteners can be a challenge overweight, and worldwide prevalence of obesity has doubled
for companies like Rocky Mountain Soda Co. and Honest Tea, since 1980 to reach 11 percent of men and 15 percent of
which place great value on certifications. Rocky Mountain women. Additionally, 42 million children under age 5 years
Soda Co., for example, used locally sourced beet sugar when were considered overweight or obese in 2015up 11 million
it first launched. It was what truly set us apart, Fulton said. over the course of the last 15 years. Diabetes diagnoses are on
But when Colorado farmers switched to GMO beets (despite the rise, too, with 422 million living with the disease in 2014.
his pleading them not to), Fulton was forced to switch up the WHO estimates diabetes was directly responsible for 1.5 million
sweetener. Ultimately, he ended up sourcing the non-GMO cane deaths in 2012 alone.
sugar they use to this day. In light of this, the future of the CSD and sports drink
Historically, weve had difficulty finding sourcing categories will hinge on whether manufacturers can continue
communities that can provide both organic and Fair Trade to offer functional beverages with minimal amounts of natural
ingredients on the scale that we need, agreed Mathur. Today, sweeteners, and a clean label that consumers can feel good
leveraging partnerships with brands like Coca-Cola have abouteven if their products are considered a treat rather
enabled Honest Tea to develop a supply chain with options. than a daily indulgence. I hear it all the time: Yours is the
Food Category of Added Sugars in the
U.S. Population Ages 2 Years and Older
Vegetables Fruit & Fruit Juice

1% 1%
Snacks &
Sweets Beverages
31% (not milk or
100% fruit juice)
47%
Grains
8%
Mixed Dishes
6% Sparkling In 2017
Dairy Condiments, Gravies
6% Spreads, Salad
Dressings A conversation about soft drinks
wouldnt be complete without
taking note of a trend poised to
2% transform the beverage market
in 2017: sparkling beverages.
Source: What We Eat in America (WWEIA) According to Mintel, taste is the
Food Category analyses for the 2015 Dietary Guidelines Advisory Committee.
No. 1 driver in this category, with
70 percent of shoppers perceiving
them to be tastywell above the
42 percent of shoppers who say
only soda I drink. Or, I was off soda and then I started yours. the same about non-sparkling
Consumers recognize our product as something different options. Further, consumers also
than a soda, Reed said. Its just ginger and spices. Its as perceived sparkling beverages
natural as it gets. And its this quality of our products that to be refreshing as opposed to
has catapulted us into a market leader. We were the first to other options.
brew a soda commercially using fresh ginger instead of flavor. Sugar-free Cascade Ice in the
Thats still a crazy idea today. Im an herbalist, and inspiring Organic Raspberry Lemonade flavor
functionality is a new way of thinking about these beverages. topped the list in terms of purchase
Indeed, for carbonated beverages to bounce back from their intent (74 percent), sweetened
bad rep, serious rebrandingand reformulatingneeds to with just fruit oils. Not far behind
continue. And if you ask Dembitzer, the future is bright. There
was sugar-free Dasani Sparkling
is still so much research and development going on, with
and Minute Maid Sparkling Fizzy
formulators looking for ways to use new and better sweeteners
with less aftertaste and better mouthfeel, she said. Brands Lemonade, made from carbonated
need to get as close to the taste profile of sugar but not be water, lemon juice, sugar and
filled with sugar. Thats where the opportunity is. other ingredients.
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INNOVATION IN ACTION
Reeds Inc.:
Dosing the World
with Ginger
by Judie Bizzozero
R
eeds Inc. has been a leader in the natural soft drink
segment since it rolled out its first product, Reeds
Ginger Brew, in 1989. In fact, theres a strong argument
that Founder and CEO Chris Reed was the father of the
craft soda category, when his idea for creating a refreshing,
functional soft drink made with only natural ingredients became
a reality.
Today, Reeds is a market leader in the growing craft soda
category and one of the top-selling brands in the natural and
specialty foods industryoffering more than 30 beverage
products under the brands Reeds Ginger Brews, Virgils Natural
Sodas, Sonoma Sparklers, China Cola and Reeds Culture
Club Kombucha.
Since its inception, Reeds has sold more than 500 million
bottles of its brewed soft drinks, and its product lines can be
found in over 15,000 natural and mainstream supermarkets
nationwide. Products also are sold through an additional
estimated 40,000 accounts that include specialty gourmet,
natural food stores, retail stores, convenience stores and
restaurants nationwide and in select international markets.
Ginger Does a Body Good

Reed wasnt looking to become a multimillionaire. All he
wanted was to create a refreshing nonalcoholic soft drink made Reeds Inc.
with natural, functional ingredientssomething that tasted Headquarters: Los Angeles
really good and was good for you. Unfortunately, nothing reedsinc.com
existed in the marketplace yet.
flavors; the company would later acquire the China Cola
natural cola product line. In 2012, Reed saw a go-to market
opportunity in the booming kombucha segment and launched
Reeds Culture Club Kombucha, containing a probiotic
kombucha culture grown in a special tea blend brewed from
yerba mate, oolong tea and spring water. The product line was
so good it won the 2013 SupplySide CPG Editors Choice Award
in the beverage category.
Cutting Calories Without Compromising Taste

In this new norm of clean label, there is an intense focus
on sugar reduction, which creates enormous opportunity for
natural sweeteners. With obesity levels ballooning and the
CEO and Founder Chris Reed explains his passion for dosing vilification of sugar by health professionals and consumers,
the world with ginger and how Reeds Inc. became the market the timing was right to introduce a low-calorie version of the
leader in the U.S. craft soda category.
companys popular ginger brew.
Today more than ever, sugar is in the spotlight, Reed said.
Theres so much chatter on the internet about how sugar
is the enemy, and nearly every day you read a news article
In 1987, he began researching the history of sodas and on its harmful effects on the body, including inflammation
found recipes dating back before the beginning of the modern and obesity.
soft drinks industry. At the UCLA library, he discovered a book
from the 1780s containing information about home brewing
sodas from whole roots, spices and fruit juices. Whats more,
these beverages also were used as herbal tonics. Reed
was hooked.
His background in holistic medicine eventually would lead
him to choose ginger as his go-to ingredient because of its
potential health benefits on digestion and inflammation. He
noted ginger has been used for centuries as a digestive aid,
motion sickness cure and general tonic. The recipe hails from
the Caribbean, where the art of home brewing ginger beer is
still practiced.
Each batch of Reeds ginger brew is carefully brewed from
fresh herbs, roots, spices and fruits aged in small batches by
expert brewmasters. The bold ginger flavor comes from the
actual ginger root; in fact, each bottle of ginger brew contains
between 8 and 26g depending on the variety.
Weve been the biggest proponent to moving ginger into
the United States, Reed said. If your digestion is working well,
then you have your health because you get all the nutrition
out of the food, and ginger is key to that digestive health,
Reed said. I recognized the market opportunity for a natural,
functional beverage. Plus, my love of ginger root as a flavor and
super healing root made me want to dose the world with its
health properties.
Reeds love for ginger didnt stop him from pursuing other
natural soft drinks. In 2000, the company bought Virgils Root
Beer and has since expanded the line to include additional
We chose stevia because it is the cleanest of the diet
sweeteners and it has a pretty good flavor. The flavor isnt exactly
like the full-calorie version, but for many consumers, its a fair
trade-off for a 60 percent reduction in sugar.
Chris Reed, CEO and founder, Reeds Inc.
Reed said Reeds Light 55

has become a solid seller,
thanks in part to the popularity
of the Moscow Mule craft
cocktail. The sweet, vodka-
infused cocktails go down far
too easily and can pack a high
calorie count, so offering a
reduced-calorie ginger brew
was a no-brainer for Reed.
The company spent six
months perfecting a recipe for
its Reeds Light 55 Calories
Extra Ginger Brew that hit the
market in 2012. The low-cal
version contains the same
ingredients found in Reeds
Extra Ginger Brewfresh
ginger root, honey, sparkling
filtered water, exotic spices,
pineapple, and lemon and
lime juice concentrateswith
the exception of raw sugar
cane, which was replaced
with stevia rebaudiana
leaf extract. The substitution enabled the calorie count to be in sugar. The reality is that if people accepted the flavor of
trimmed from 135 to 55 per serving. Like all Reeds products, aspartame, they will get used to stevia much easier. It just
the low-cal version is free from preservatives, caffeine, gluten takes a bit of time.
and genetically modified organisms (GMOs). Reeds is also finding success with its new fountain business
We chose stevia because it is the cleanest of the diet that was launched at the 2016 Natural Products Expo West, in
sweeteners and it has a pretty good flavor, he said. The part due to requests from large fast-casual restaurant chains
flavor isnt exactly like the full-calorie version, but for many looking to add naturally sweetened, reduced-calorie beverage
consumers, its a fair trade-off for a 60 percent reduction offerings to their menus.
Many restaurant chains are committing themselves to
remove GMOs, artificial ingredients, sweeteners, colors Food
For
and flavors out of the foods they are selling to their
consumers. Simply put, restaurants all over the country
are backing clean food concepts due to consumer
demand, he said, noting the company spent more than
two years developing and crafting the all-natural Bag in
the Box fountain soda flavors.
Thought
Small Marketing, Big Returns
Always the entrepreneur with an eye on the bottom
line, Reed invests in procuring the best ingredients for Discovering untapped white space
his products, as opposed to allocating a large marketing
budget. We rely heavily on word of mouth and social
can help companies to create and
media buzz created by loyal consumers, he said. This own a new market segment.
thinking allows the company to focus its money on
sourcing superior ingredients, and that quality makes us
stand out from our competitors. Sourcing clean label, natural
Reeds uses Facebook, Twitter, YouTube and its
website to create interest and educate consumers about ingredients may be more expensive,
its products. The brand only recently rolled out its first but keeping it real reaps more
commercial featuring Chris Reed touting all the healthy
benefits of ginger brew. rewards and loyal customers.
Marketing aside, being successful in any business
takes having the right product at the right time. You
have to have a reason for everything you do. For me, its Word of mouth and social media
dosing people with ginger because it tastes great and is
good for digestive health, Reed said. You really have to
sometimes can be more powerful
think about the marketplace and determine whats not than an expensive marketing and
being done and then fill the void with a great product.
Looking forward, Reed said products in the pipeline
advertising budgetenabling more
include more low-calorie options and beverages that money to be earmarked for product
contain additional exotic flavorsall served up with a
healthy dose of ginger. innovation.
INNOVATION IN ACTION
Lotus Botanical Elixirs:

Naturally Crafted to Drink Life In
by Judie Bizzozero
B
alancing life and work is a difficult task, and one that
can lead to stress and fatigue. While energy drinks Lotus Botanical Elixirs
provide a quick pick-me-up, its often followed by a Headquarters: Indian Wells, California
crash that leads to more mental and physical stress. Energy lotuselixirs.com
drinks also have come under intense scrutiny for their high
concentrations of ingredients such as caffeine, taurine and
sugar, and for deceptive advertising and marketing practices.
Harnessing Natural Power
Realizing the need for a natural, ready-to-drink (RTD)
Launched in 2014, Lotus Botanical Elixirs are lightly
functional energy product that would nourish the body from
carbonated beverages infused with lotus flowers, Rhodiola
the inside out, Scott Strader had a vision to create the ultimate rosea and schizandra berry, widely recognized by many
refreshment crafted from plants, trees and flowers made by cultures for thousands of years for their legendary rejuvenating
Mother Nature that would promote balance in the human body. effects, Strader said. The group of botanicals is classified as
We felt there was a need for a great tasting,efficacious adaptogens, which refers to herbs and herbal products used to
beverage that could provide a natural lift with nothing normalize body functions and strengthen systems compromised
artificial, said Strader, CEO and founder, Lotus Elixirs North by stress.
America. Coca-Cola started as a botanical elixir sold in We believe in the power of nature, and what we put in our
apharmacy with all-natural ingredients, but today, it contains bodies enriches the lifestyle we live. Plants create all of the life-
artificial ingredients. giving oxygen we breath, and ingesting them is natures way of
Going for the Gold
Lotus Elixirs recently expanded its line of lotus-
flower-infused drinks with a new sugar-free Gold
Lotus that launched at Natural Products Expo
West 2017. Gold Lotus features a proprietary
natural sweetening system with Lotus Elixirs
same unique formulation of botanical extracts,
highlighted by pure natural flavor of citrus and
peach.
We discovered a new stevia that is just
now coming to market that we feel is a game
changer for sugar-free natural beverages, so
weimmediatelycreated ourown proprietary
blend with organicerythritol that doesnt sacrifice
the taste of our product, Strader noted. Stevias
reputation for its bitter aftertaste was a top
concern because it is detectible in carbonated
beverages. I was not a fan of stevia from a
tasteperspective until I was introduced to this
latest version that has done a nice job of isolating
the only sweet part of the plant.
Once we made thedecision to use this
providing their pure natural power, Strader said. new stevia as part of our zero-calorienatural
Lotus Elixirs provide a healthy natural alternative sweetening system, all our ingredient suppliers
to help the body restore balance, renew energy and formulators worked seamlessly to come up
and vibrant well-being. with the best product possible, he concluded.
Lotus Elixirs originally launched in three
superfruit-infused flavorsWild Berry,
Cranberry and Raspberrycontaining all-natural
ingredients such as organic pure cane sugar and
caffeine from organic green coffee beans. Each
12-ounce can boasts only 60 calories.
Strader originally conceptualized a sugar-
free line of products; however, natural zero-
Consumers are caloriesweetenerswere just entering the
asking for more beverage space, and achieving the taste needed
transparency to attract and retain brand loyalty proved
challenging. Not one to rest on his laurels,
and better-for-
he chose to sweeten Lotus Elixirs with small
you options, so amounts of organic pure cane sugar and natural
the solution is fruit juices.
simple: give it And consumers drank it up. In 2015, Lotus
to them. Elixirs was the winner of the energy drinks
category in the 4th annual SupplySide CPG
Scott Strader,
CEO and founder, Lotus Editors Choice Awards. But Strader still had his
Elixirs North America eye on the zero-calorie prize.
Consumers are loyal to brands they trust,
and thats a concept some of the big beverage
companies have lost along the way, he said.
Consumers are asking for more transparency
and better-for-you options, so the solution is
simple: give it to them. In our case, they were
asking for low to no sugar with nothing artificial.
Rhodiola
rosea
Schizandra
Food For
berry
Thought
Lotus
Waiting to bring a product to market

Rhodiola rosea and schizandra berry with the right ingredient can be better
have been widely recognized by many
cultures for thousands of years for their than compromising your reputation to
legendary rejuvenating effects. enter a trending category.
Communicating your desired

Getting the Word Out, Naturally
outcome to your ingredient suppliers
Response to the line has been positive, with and partners helps create a recipe
Lotus Elixirs sold nationwide on Amazon and
through direct store delivery (DSD). We started for success.
out in a few stores inSouthern California,
focusing on the natural channel, which quickly
grew to hundreds of stores in select retail outlets, Using various formats such as
and national online sales through Amazon.com, video, audio and social media can
Strader said.
Product packaging and positioning in the communicate a targeted concept
marketplace has required more thought because
the terms Balance Mind & Body and Balance
to consumers.
Supplement are conceptual and subjective.
Packaging is bold and sleek, and the companys
website contains a treasure trove of information
in the form of articles, audio and video clips
explaining the benefits of the ingredients and
products. Whats more, the company relies on
social media platforms including Facebook,
Twitter and Instagram to gain a loyal following
of consumers who are looking for a healthy
lifestyle balance.
We have strategic influencers who are
instrumental in creating our lifestyle brand image,
which suggests Lotus Elixirs is all about balance
andhappiness under the stressful demands of
life, Strader said. A visual image has more than
60 times the mentalassimilationthan written
words. We can go anywhere our minds can
dream and our bodies can carry us. Consumers
dont care how you get there, but they will reward This company video explains how Lotus Botanical Elixirs nourish the
you for all your hard work. body from the inside out, naturally.
CONTACTS

Food Insider Journal EDITORIAL

Editor
Food Insider Journal focuses on Judie Bizzozero ....................................... judie.bizzozero@informa.com
clean label strategy and formulation, Assistant Editor
Courtney Johnson.................................... courtney.johnson@informa.com
exploring how the shift to simple and
Contributing Editor
natural is impacting the food and Melissa Kvidahl
beverage market. Editorial Intern
Alyssa Tufts ............................................. alyssa.tufts@informa.com
Content Marketing Manager
Karen Butler ............................................ karen.butler@informa.com
Legal and Regulatory Editor
Josh Long ................................................ josh.long@informa.com
SALES
Vice President, Sales, Health & Nutrition
Danica Cullins ........................................ danica.cullins@informa.com
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PRESIDENT Fred Linder Ioana Neacsu............................................ ioana.neacsu@informa.com
CHIEF FINANCIAL OFFICER Kelly Ridley Account Managers
VICE PRESIDENT, Anthony Arteca........................................ anthony.arteca@informa.com
HEALTH & NUTRITION Jon Benninger Todd Berger ............................................. todd.berger@informa.com
VICE PRESIDENT, CONTENT, Laurel Rivers ........................................... laurel.rivers@informa.com
HEALTH & NUTRITION Heather Granato
Account Executive
HUMAN RESOURCES DIRECTOR Sabrina Wolf Rodell Razor ............................................ rodell.razor@informa.com
Development Specialist Asia
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Food Insider Journal

Clean Label Strategy & Formulation

Vol.1 No.2 April 2017 US$20

Food Insider Journal

Taste the advantage of

Lets cut to the chase: ViaTech goes further

Call 1-866-456-8872 for a sample.

61% with several chronic illnesses, chief of which

Consumers Sweet on Clean Label

2016 sweeping overhaul of the

With Chronic In July 2010, the state of Washington enacted

Disease Risk items made with sugar, honey, or other natural

Global Obesity Rates

In 2014, more than

39% of adults aged 18

Industry Taking Action

Kellogg Co., Kraft Foods Group/Mondelez, Mars Inc.,

According to SPINS data, stevia and stevia blends in the

16 % growth in sales since 2015 across all retail

Honey and syrups also are being used to add sweetness

COCONUT PALM MAPLE SORGHUM AGAVE RICE TAPIOCA

Clean Label Challenges & Sweet Solutions

applications, the delivery of appropriate textural properties becomes

Its agave-sweetened options,

Sodas sweetened with stevia, which still

More than Further, half

Vegetables Fruit & Fruit Juice

LEARN MORE AT WEST.SUPPLYSIDESHOW.COM

Ginger Does a Body Good

Cutting Calories Without Compromising Taste

Reed said Reeds Light 55

Lotus Botanical Elixirs:

Waiting to bring a product to market

Communicating your desired

Food Insider Journal

Food Insider Journal EDITORIAL

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