'Free-from' food category estimated at $7.7 billion in Australia

Monday, 08 July, 2019

'Free-from' food category estimated at $7.7 billion in Australia

A study on free-from foods by global research company The NPD Group has found that consumers who want to make healthier life choices are driving the growth in the free-from food category. The free-from food category, comprised of meals associated with health, lifestyle and ethical attributes (eg, gluten-free, no added hormones and free-range), is estimated to be worth $7.7 billion in Australia, generating 23% of foot traffic within the foodservice industry.

Almost a quarter of Australians said that they consume meals that are free-from (23%) to improve health (13%), because they are perceived to be better for you (13%), to support animal welfare (4%) and allergy related (only 3%).

Initially, free-from foods were manufactured to meet the requirements of those with dietary intolerances. Nowadays, demand for these products is more about consuming foods that are better for you.

Within the free-from food sector, four in 10 respondents (36%) indicated that their meals were vegetarian/vegan or allergy/intolerance related. Of these, 4% of respondents claimed to have had a gluten-free meal, which is 11% higher than a year ago. Research shows that people are restricting unhealthy food groups as a lifestyle choice, as they no longer need a medical reason to opt out of certain foods.

“What’s interesting is that it appears people believe eliminating food groups is better for them, but they don’t always understand why. There is an opportunity here for manufacturers of free-from foods to educate their customers on why their products are healthier both on pack and through their communications. We also know that consumers are willing to pay more for the health benefits associated with free-from foods,” said Gimantha Jayasinghe, Deputy Managing Director APAC at The NPD Group.

Millennials are driving the demand of free-from meals, with almost half (47%) of those purchasing falling within the millennial age bracket. Consumers are also seeking more vegan, plant-based and vegetarian options, with over half (57%) of those searching for these options falling into the older millennial age bracket (25 to 34 years of age).

Quick service retail (QSR) brands are resonating with the free-from consumer type. Meals with better for you and provenance attributes experienced marked growth in 2018, despite the price-sensitive landscape; consumers are willing to pay more for the health benefits associated with free-from foods. The average bill is $10.88, which is two times greater than the industry average.

Having tired of the products that don’t cater to their preferred diet, millennials are opting to consume products that taste good and offer nutritional value. “The food industry is evolving for the better,” Jayasinghe said. Continued innovation and availability of the free-from food sector will ensure its popularity with the millennial market.

For more information on The NPD Group and the CREST research, click here.

Image credit: ©stock.adobe.com/au/DragonImages

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