The tradition of going for a 10km jog and then indulging in a tub of ice cream and a bag of chips is a familiar one. However, with the rise of weight-loss drugs, new trends are emerging, especially in the food and beverage sector. As weight-loss drugs such as Ozempic, Mounjaro, and Zepbound, initially developed to combat diabetes, become widely used for weight loss, food companies are adapting to meet the needs of users who are looking to manage their weight more effectively.
The Weight-Loss Revolution
The hype surrounding weight-loss drugs is undeniable, with over 40 million Americans having tried such medications. However, usage remains relatively low, partly due to the high cost of the drugs, which can exceed US$1,000 per month. That could change soon. In late November 2024, the US government proposed expanding public healthcare coverage for weight-loss drugs, which could significantly reduce their cost, making them more accessible to millions.
This proposal aims to redefine obesity as a chronic disease, putting weight loss treatment higher on the public health agenda. If approved, it could lead to a significant global increase in weight-loss drug usage, especially in countries like the US and Australia, where obesity rates are high.
Changing the Menu
The potential widespread use of weight-loss drugs is already prompting changes in the food, beverage, and agribusiness (FBA) sectors. With consumers increasingly seeking healthier, nutrient-dense options, food companies are exploring new product lines designed to complement these drugs. High-sugar snacks, processed foods, and sugary drinks could see a decline in sales as consumers turn to lower-calorie, portion-controlled alternatives.
For example, Nestlé in the US has launched its Vital Pursuit range, offering frozen, high-protein, portion-controlled meals designed for weight-loss drug users. These meals focus on nutrient density and aim to promote a feeling of fullness. Similarly, brands like Conagra and Campbell’s are marketing products that align with the dietary needs of weight-loss drug users, emphasizing lower-calorie, easily digestible, and nutrient-rich foods.
Slim Pickings
Despite the weight-loss drugs reducing cravings and the tendency to snack between meals, some manufacturers report minimal impact on sales. A study from Grocery Doppio found that individuals using Ozempic bought 47% fewer baked goods, 13% fewer processed foods, and 28% fewer high-calorie beverages. Interestingly, 97% of consumers on weight-loss medications reduced their grocery spending by an average of 11%.
Retailers, especially supermarkets, are closely monitoring these shifts in consumer behavior, as they may witness increased demand for fresh produce like fruits, vegetables, and lean proteins, while snack foods and sugary drinks could see a decline in sales.
Down on the Farm
Upstream in the food supply chain, crops such as sugar and corn are unlikely to see significant impacts due to their continued global demand. However, the rising interest in low-calorie, nutrient-dense foods could lead to increased demand for leafy greens, cruciferous vegetables like broccoli and cauliflower, and plant-based protein sources like legumes. Nutrient-rich foods such as berries and avocados may also see greater consumption, while lean proteins like poultry, fish, and eggs may replace red meat.
Looking Ahead
While the current impact of weight-loss drugs on the food chain may be relatively small, the potential for a major shift is immense. For FBA companies, this is not just about reacting to trends but preparing for the future. As the usage of weight-loss drugs expands, food companies must be ready to adapt their product lines and strategies to meet the changing needs of consumers. Staying fit for the future means shedding old habits and embracing new opportunities in this evolving market.
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