‘Healthier’ brands challenge Krispy Kreme and Nutella

When Anthony Fletcher, former chief of snack brands Glaze and Innocent Smoothie, was looking for a new healthy eating project, he landed on an unlikely category: donuts.

His brand, Urban Legend, which launched just a year ago, is going head-to-head with Krispy Kreme in UK supermarkets in an attempt to convince hungry consumers to switch to low-sugar, low-calorie alternatives.

His banoffee pies, strawberry cupcakes, and “Choc Party” treats are made using a patented process that uses steam instead of frying to “harden” the dough, and is a well-known food brand. It positions him as one of the start-ups that are trying to replace him. with healthier options.

These start-ups could also benefit from the UK’s new anti-obesity regulations. The regulation limits where supermarkets can place high-fat, high-sugar, high-salt (HFSS) foods, but not versions with significantly healthier ingredients.

“The idea of ​​Urban Legend is not to ask the consumer to change . . . it’s to take the junk out of junk food, rather than making something that looks different to the consumer,” Fletcher said.

“Krispy Kreme is an all-inclusive luxury product. We wanted to recreate that taste experience without adding sugar, fat or calories.

Britain’s obesity problem, one of the worst in Europe, is putting the spotlight on processed food companies. Under pressure from investors, Unilever released its portfolio nutrition rating last month, which found just 35% fell outside the HFSS category.

Companies such as Unilever, which makes Magnum and Ben & Jerry’s ice cream and Hellmann’s mayonnaise, are aware of changing consumer habits and regulatory pressure to offer healthier products. Unilever has set new nutrition goals this year. In 2019, we acquired Graze, which makes healthy snacks like roasted nuts and seeds.

But entrepreneurs like Fletcher believe they need something more. His latest venture was inspired by a conversation with a senior public health official who said that despite the industry’s voluntary sugar reduction targets, diets across the UK continue to deteriorate each year. 2020, the first year after purchase.

The rise of healthy snack brands “had barely moved the needle,” he said. “I didn’t want to create another premium, healthy product.”

Instead, he turned to donuts as part of an attempt to make healthier foods more accessible and affordable for those most vulnerable to obesity.

Public health groups such as Impact on Urban Health, part of the non-profit Guy’s & St Thomas’ Foundation, say the high prices of healthy products and the prevalence of unhealthy foods are driving down the diets of low-income households. is likely not good. Lack of “money and headspace” to prepare healthy meals.

People in the UK are eating far more free sugar than recommended

“[For companies] Unhealthy food is cheaper to produce, tastes better and sells,” said Louis Bedwell, managing director of venture capital firm Mission Ventures.

New UK regulations have prompted some changes, but “healthier snack options are emerging, but they’re stocked in certain stores and often in more expensive categories.” It’s on a small set,” Bedwell said.

Multinationals are reluctant to take risks with new brands or healthier versions of existing brands, especially after a string of failures in areas such as low-sugar chocolate.

Meanwhile, according to corporate finance group Oghma Partners, around £42m of venture capital investment in the ‘healthy’ food category from 2018 to 2022 will be offset by £296m in alcoholic beverage brands, for example. It was very small compared to the investment.

To fill this gap, Mission Ventures and Impact on Urban Health launched the Good Food Programme. The program provides funding and advice to “Healthy Challenger Brands” including Urban Legend. option. They want these brands not only to succeed, but to influence food manufacturers around the world.

Another brand supported by the scheme is 7-year-old Jim Jams Chocolate Spread, which is a direct challenge to Nutella. Others include Naturerie Jelly with added fruit juice and fiber and Lutle’s His Chocolate Biscuits made with 40% root vegetables.

Such products are not without their own problems. Many low-sugar brands rely on sweeteners called polyols. This can have a laxative effect when taken in large amounts or by people with digestive problems.

The product should demonstrate that it can entice consumers to try new brands, that it tastes good enough to attract repeat customers, and that consumers won’t eat it in bulk due to its low calorie content.

Bakery products such as donuts are considered one of the most difficult categories to replicate in healthier versions, and chocolate is technically the most difficult, Fletcher said. But new techniques for replicating texture and flavor are allowing for more compelling alternatives, he added.

Dietary Sources of Free Sugars

However, Ferrero, the multinational company that makes Nutella, said, “Reformulation is not an easy option. We have yet to find an alternative recipe that consumers like.”

“The fundamental problem in food intake is calories, not sugar, so changes that reduce sugar and increase calories can be counterproductive.”

Nutella’s health focus is portion control, Ferrero said, and its marketing materials urge consumers to eat a 15g serving.Krispy Kreme did not respond to a request for comment. They also offer small “bite” servings.

Experts agree that tackling obesity requires broader changes, such as eating more fruits and vegetables.

Katharine Jenner, director of the Obesity Health Alliance said: Chocolate spread may be low in sugar.

Jim Jam's chocolate spread in a jar next to a sauce-covered banana pancake roll
Jim Jams is one of the brands supported by the Good Food Program © Ant Jones

“The food business needs good incentives, and that requires political will from the highest levels of government.”

Testing is popular for the first cohort of brands joining the Good Food Program. Jim Jams is available in all UK supermarkets and the Good Food Program says there has been a “huge switch” to the product among low-income households. The company became profitable this year.

Urban Legend Donuts are available at Tesco’s London branch and Selfridges, and are being piloted at Sainsbury’s. Fletcher admitted he was just getting started, but said he wanted to convert a significant number of buyers for Krispy Kreme, which brought in $1.4 billion in net profit last year.

Donuts are “products that make people feel good and affect their health. That’s why I chose donuts,” he said. “Healthier brioche never changed the world.”

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