U.S. Soyfoods Market Showing Signs of Maturity with Slow Growth in 2004, Says New Report
August 29, 2005 --
Sooner or later it was inevitable. After years of blockbuster growth and mainstream integration, soyfood sales are finally slowing down.
According to the recently published market study, Soyfoods: The U.S. Market 2005, overall soyfood sales hit $4.0 billion in 2004, but showed the slowest year-over-year growth (2.1%) for the industry as a whole since the early 1980s, when the category began its upward climb.
"The industry's growth curve look like a classic example of a successful product's movement: from embryonic stage to rapid expansion and then to slower growth in its later years," says study author Peter Golbitz, president of Soyatech, Inc.
Just 2 years ago, the market was in double-digit growth as rapidly rising soymilk sales - along with rising sales of energy bars and meat alternatives - help to push the market up quickly. In 2004, however, 4 out of the top 5 soyfoods categories showed decreased sales (only soymilk posted increased - but modest - gains).
"While the decreases in meat alternatives, energy bars, tofu and meal replacements may be somewhat troubling for the category as whole because they represent such a huge portion of the market, there are a number of up-and-coming categories such as snack foods and other dairy replacements that might help to lift the category back up to speed in the near future," said Mr. Golbitz.
There are a number of reasons cited for the market slowdown in the soyfoods market report. One is that numerous news articles and reports have recently questioned the health benefits of consuming soy-based food products, leading to an increase in questions by consumers about whether or not to consume these foods.
Another may be boredom by the consumers who regularly eat soy products. In a rapidly evolving food market such as the one in the U.S., food marketers need to keep pushing the edge a little further with consumers to keep their interest. While products such as flavored tofu may be edgier than plain tofu, further innovations in packaging might be required to get new consumers to try these products.
"Shoppers are definitely looking for the next big thing in soyfoods," says Mr. Golbitz. "Some company, somewhere needs to make a bold move similar to the one that White Wave made in 1996 when it move its Silk brand soymilk into the dairy case next to cow's milk."
That brings up another possible reason for the industry's slow down says Golbitz. "If you look at the top 10 companies in the soyfoods market today, virtually all of the original founders and visionaries are gone." Bought out by bigger food companies during the boom years of the late 90s and early 2000s, most of the leading companies are now owned by the likes of Dean Foods, Kraft, Kellogg, General Mills, ConAgra and Hain-Celestial.
"While all of these companies are actually doing a fine job managing the brands and companies they acquired, they lack the passion their early founders brought to work with them each day," says Mr. Golbitz. "Company founders and entrepreneurs are, in general, big risk takers. Big food companies, on the other hand, tend to shy away from risk and are driven forward more by market data than vision."
"Soyfoods: The U.S. Market 2004" is a complete overview of the soyfoods market. It is built around an in-depth macro section that combines and compares all of the major sales categories for soy; it also contains 5 individual sections that provide deeper data on the top categories of soymilk, meat alternatives, meal replacements & supplement powders, energy bars and tofu. The report, the fifth in a series of reports by information partners Soyatech, Inc. and SPINS, is available for $2,900 (for the macro section), with the other additional sections available at an additional cost. You can download the prospectus at: http://www.soyatech.com/pdf/soyfoods05.pdf
You can also contact Peter Golbitz at 207.288.4969, x101 or at peter@soyatech.com for more information.
About Soyatech and Peter Golbitz
Soyatech is a publishing, market research, and consulting firm founded in 1985, specialized in delivering value-added information to the soybean, food, and feed industries. The company publishes the annual Soya and Oilseed Bluebook, the industry's leading source of information on companies and products, and a portfolio of daily, monthly and quarterly newsletters. The company website, SOYATECH.COM, is an award-winning business-to-business Internet site for the industry.
Company President Peter Golbitz is a world-renowned expert on the soyfoods industry and has published numerous articles, books and studies on the soyfoods industry.
About SPINS
San Francisco-based SPINS was founded in 1995 as the first company to offer natural products movement data to the industry. Today, it is the premier provider of industry reporting and consulting services for this rapidly expanding sector. SPINS' comprehensive offering includes retail measurement services, content-based reporting, consumer information and consulting services. For more information, visit www.spins.com.