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Sylvain CharleboisGluten has divided consumers into two camps: those who can’t get enough gluten-free products, believing that eliminating the little protein composite leads to a healthier life, and those who dismiss its sudden popularity as a cultural phase.

Even if you are puzzled by the gluten-free trend, it has clearly benefited the industry and, most importantly, consumers.

Sales growth of gluten-free products have been impressive. Increases have been particularly high in Europe and North America. Global sales of gluten-free products are at $3.7 billion and many experts expects that number to exceed $4.5 billion by 2020. The gluten-free feature has seen the greatest market growth since 2010, up 615 percent. Other health-oriented features, such as hormone-free (up by 200 percent), all-natural products (up by 155 percent), and even organic (60 percent) don’t even come close.

In a zero-growth, zero-interest-rate economic environment, the food industry, particularly food processors, are desperate to increase their volumes. And in a sales environment with challenging socio-economic factors, innovation plays a key role. Through improved packaging and, of course, better products, the industry can reinvent itself in numerous ways.

The fact that the anti-gluten movement overlapped with the increase in food prices is no coincidence. A rise in revenues enticed the industry to re-assess innovative risks. Product development came into style again.

Most consumers are unaware of how multifaceted the development of a new food product can be. From concept to market, costs can easily exceed $150,000 per product. And almost nine in 10 projects fail to reach the consumer or generate a single sale. In other words, a single success story can cost millions. That’s why the food industry had been risk averse until 2008, when prices started to increase dramatically.

The food industry has been known to misread the market climate, target the wrong group, hit the market with the wrong price point, or even cannibalize sales coming from other product categories. Any of these mistakes lead to failure. But the gluten-free sector is breathing some desperately needed air into research and development.

Previously, gluten-free products were produced for a small and underserved demographic (celiac disease, an autoimmune disorder, affects barely one percent of the population). The swift emergence of a large market of healthy lifestyle enthusiasts caught the industry off guard.

Despite the rising antagonism against the gluten-free portfolio, this industry has done some incredible work in recent years. Less than a decade ago, the inferior taste of gluten-free products likely pushed many consumers away. But recent food science innovations mean that the taste of many products, particularly gluten-free bakery, are virtually indistinguishable from conventional equivalents. Gluten is the protein composite found in wheat and some other grains that gives food products texture, elasticity and the ability to rise, so finding workable alternatives was both critical and difficult.

The industry has capitalized on the market momentum of gluten-free products. And the phenomena has captured the attention of prominent athletes and actors who showcase their new gluten-light dietary habits. As a result, the market has drawn a large self-diagnosed ‘gluten-intolerant’ segment of consumers.

There is a benefit to all of this product development and availability. The many consumers who actually do require a diet free of gluten now have access to better, tastier products.

Innovation is a trial-and-error process — chocolate-chip cookies, potato chips, Corn Flakes and even the microwave were discovered by accident. Research to support innovation must accept risk.

And the food industry must always evolve. Growth has been marginal this year and the industry now forecasts that the gluten-free segment will peak over the next five years. The industry should embrace the legacy of the gluten-free movement: the innovative talent that has been nurtured by it. And let’s hope those innovators develop yet more novel products that are good for both our health and the economy as a whole.

Dr. Sylvain Charlebois is senior director of the agri-food analytics lab and a professor in food distribution and policy at Dalhousie University.

Sylvain is a Troy Media contributor. Why aren’t you?

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