Report finds growing demand for health products in UAE and KSA

The higher demand for innovative food and beverage ingredients is catalyzing the growth of health beverages and foods in the United Arab Emirates (UAE) and the Kingdom of Saudi Arabia (KSA).

Enhanced consumer awareness about the benefits of healthy dietary habits, changing lifestyles, and a rising per capita income due to a surge in oil prices have encouraged consumers to switch to healthy food alternatives.

New analysis from a Frost & Sullivan report entitled Strategic Analysis of GCC Health Foods and Beverages Market, finds that the market earned revenues of $850 million in 2009.

"The market has got a boost from the growing preference for foods with health and wellness advantages to offset the sedentary lifestyle due to urbanization," says research associate Srividyaranjani V.

"Functional ingredients, in particular, are going a long way in hiking the sales of health foods and beverages, and this trend is expected to continue as consumers become more aware of the greater functional benefits of ingredients."

To fulfill its abundant potential, the market has to achieve greater self-regulation and improve product standardization.

Market participants are striving to differentiate their products, innovate, and expand their distribution to stand out in the crowd and gain consumer acceptance.

Furthermore, health foods and beverages typically have a low base of consumers in this region, as people are lax about their eating habits and are not keen on novel foods. However, all this is changing, as consumers are becoming curious about these new products.

"Reacting to the greater consumer interest, it is important to strategically position products to create brand loyalty and product niches that will reduce confusion about products," notes Srividyaranjani.

"Better positioning to differentiate health foods from the conventional variants of the product will not only ensure greater product clarity, but also attract traditional consumers who are skeptical about consuming such products."

As this market is still nascent, participants will be looking to penetrate it deeply and extensively and focus on product development.

In even younger markets such as malted health beverages and sports and energy drinks, market expansion is the best way forward.