As Asian consumers generally look increasingly towards convenience foods, the synthetic flavour industry is really taking-off. Reasons cited by experts include population growth and a developing middle-class that demands new flavour experiences.
As part of our special series on food and beverage markets in Asia, we spoke to leading Karen Stanton, regional marketing, sensory and consumer insights director from International Flavors & Fragrances (IFF), about specific trends within Southeast Asia.
“Markets in all the Southeast Asian countries are growing enormously, and the IFF has seen double-digit growth over the past couple of years, and solid low double-digit growth in the first two quarters of 2010,” said Stanton.
“Our main markets in Southeast Asia include Thailand, Vietnam, The Philippines Indonesia, and we have been based in the latter for over 50 years.
“Indonesia is the main market because it has the biggest population; ironically household incomes are the lowest in the region, although the situation is changing."
“Beverages in particular are doing well, with powdered soft drinks and flavoured waters popular. These markets are still very cost driven – people buy everything in small quantities, from shampoo to flavour sachets.”
“For instance, in Indonesia flavoured hot and cold cup beverages are particularly popular, and are sold for the equivalent of around 2 US cents on roadside stalls.
“Nonetheless, the rise of the middle classes is driving innovation, although there is a clear distinction between modern convenience foods from retail stores and popular ‘mom and pop’ street stalls selling products by the side of the road.”
Accordingly, Stanton said that flavour use within ready meals were “not yet part of everyday lives”, given that chicken flavouring in Southeast Asia entails adding a sachet of bouillon to a soup or stir fry at home, rather than a ready meal application.
So are consumers’ tastes changing as they are increasingly exposed to western flavours? “Where flavour trends go consumers do not demand western flavours, rather traditional takes on Western-style dishes,” Stanton explained.
“Chicken and beef are a key part of our portfolio, but In Southeast Asia people prefer dark over white meats, and strong flavours. For instance, when you make a soup in China, you might cook it for 6-8 hours, and boil it several times. Obviously flavour development needs to reflect such factors from a technical standpoint.”
Stanton said that multi-national flavour companies and smaller local manufacturers are active in Southeast Asia, the latter offering good distribution expertise and local connections.
This is especially useful given an “extremely challenging” regulatory environment in the region.“At the IFF we employ a huge team to navigate it successfully,” Stanton said. “Take Halal food in Indonesia. Ingredients need to be Halal-registered and factories inspected and approved across the whole supply chain.”
There are also tricky intra-regional quirks in terms of product development, Stanton said. For instance, ‘natural’ juice might be allowed a 10 per cent pure juice content in one Southeast Asian country, while 25 per cent was the threshold in another.
Cosimo Trimigliozzi, president of Givaudan Asia-Pacific, said the flavour producer was also seeing strong growth in that region, with sales up 10.6% for the first half of 2010 compared with the same period of 2009.
He said that popular Givaudan products “essential” to Southeast Asian markets included chicken, beef and pork flavours for use in noodle and rice dishes, while consumers also enjoy citrus, coffee and tea flavours “in a variety of formats.”
“This is driven by increased consumption from a growing population, in addition to wealthier consumers demanding new flavour experiences and more variety in their foods and beverages,” said Trimigliozzi.