When Kraft macaroni and cheese lost its signature, neon-tinged orange flare this year, it was instantly recognizable to consumers.
The shift from processed foods to natural alternatives had a game-changer and turning down the volume on color was a sign of the times. If Kraft's established, secure product was changing, suddenly no product was safe.
But does that mean foods with artificial ingredients are doomed to "natural" counterparts? Not necessarily. While artificial ingredients have waned in popularity, a more mosaic framework lies in the industry’s future.
According to a report from Allied Market Research, the global packaged foods market is expected to hit $3.03 trillion by 2020.
"Although the demand for natural ingredients will continue to grow, I think there will always be a need for a certain amount of what may be described as synthetic ingredients," says Paul Manning, president and CEO of Sensient Technologies. "To some degree there will always be performance requirements on certain products that suggest you're going to have some synthetic components in any multinational's portfolio. You'll have some synthetics, some naturals. Over time how does that progress? It's hard to say. I think certainly some brands lend themselves to a more natural message and some brands perhaps less so. But clearly the end consumer is going to vote."
And vote they have. Cereal and soda have seen significant declines, with soda in particular seeing a massive drop in consumption for the tenth consecutive year. Kellogg and General Mills are introducing new healthier products, while PepsiCo removed aspartame from Diet Pepsi, citing consumers as the reason for the switch.
Regulatory changes poke at industry
Much of the outcry for consumers has related to extra ingredients in food and beverages. This aligns with the FDA's proposal to include added sugars on nutrition labels, and more recently suggesting this include % daily value info.
"I think obviously it's putting more focus on the concept of added sugars," said Larry Reichman, partner at Perkins Coie. "Could cause manufactures to change what they put in food potentially. I'd imagine there'll also be a bit of debate about what an added sugar is."
The real question for the industry now is one that is as inevitable as a ticking clock. General Mills’ Trix, for instance, won’t include its bright blue and green colors after failing to find natural counterparts. Nestle is taking out artificial flavorings in frozen pizza. With ingredient removal this commonplace, is added sugar just another to take out?
"There are some people who are very conscious of what they eat and read labels, and there’s others who are much less conscious or care or don’t read labels," Reichman said. "I think food manufacturers are in a sense adept at catering to different groups of consumers."
He added that no one is saying added sugar isn't allowed in products, and that since it's a disclosure requirement, manufacturers aren't likely to push back at the degree they might for something like partially hydrogenated oils.
The FDA's mandate for food companies to remove partially hydrogenated oils from products has already led to pushback from the Grocery Manufacturers Association, which has asked for approval for low level use of PHOs.
"It’s not just a disclosure issue anymore — it is a requirement to reformulate," he said.
Sensient’s place in the market
Manning says Sensient, a global colors, flavors, and fragrances manufacturer and marketer, has "a very diversified business" — including synthetic and natural colors, natural flavors, plus other types of flavors and extracts.
"We are very well-positioned for whatever direction the market takes," he said.
As Manning puts it, there are trends (like natural colors or minimally processed and label-friendly ingredients) and there are fads (like narrowly-focused diets) — and there’s a clear distinction between the two.
"Fads come and go," he said. "There must be 17 new diets per year that become popular, only to disappear within about 18 months. But trends are the things that are here to stay. It’s difficult to predict that."
And the trend from artificial to natural ingredients is one the industry can’t readily backpedal on, nor is it in their best interest if it’s preventing sales stability and, in theory, growth.
The same goes for transparency in products. Adding more information to a product label is exactly what the consumers — and the FDA — are asking for, despite inevitable industry complications.