Sweet Intentions: 'Sugar Taxes' providing innovative opportunities

With the soft drinks industry levy looming, MPs recently debated the effect of advertising on childhood obesity. MP Maggie Throup claimed that 23% of reception children are overweight and obese, rising to 34% of year-6 children. Statistics like these may alarm producers and retailers of food and drinks, not least the general public. But the levy, advertising restrictions on HFSS foods, and surely more taxes and rulings of this sort to come, all create new markets and opportunities for innovation.

We spoke to a few businesses to find out what they're doing.

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Britvic are confident that they face into the levies from a position of strength. "By April, 72% of our total portfolio and 94% of owned brands will be exempt from or under the levy in GB", says Ben Parker, Associate Director. "We have been proactive and have taken an industry-leading approach to health since 2013, comprised of a three-pronged approach of:

1) Reformulation with no compromise on taste or quality, where our longstanding programme means we have not had to kneejerk to change recipes and we have removed over 20bn calories from GB diets on an annualised basis.

2) Innovation where our is pipeline heavily weighted towards low/no sugar – in F17 this was 68% of all projects across the group.

3) Marketing responsibly, where we don’t advertise high sugar products to u16s and have led all ATL advertising in relation to Pepsi with sugar-free MAX since 2005."

A good example of this work is with Subway. From July 2016 to July 2017 Subway stores removed around 3.7 billion calories from British diets after converting to the Britvic/PepsiCo portfolio – about two million calories per store annually – and Subway Ireland removed 273 million calories.

In mainstream retail last summer Britvic also activated Pepsi Max through a ‘taste challenge’ in a leading GB retailer. They removed 40m teaspoons of sugar from the category while driving penetration and incremental sales.

Weight Watchers
Weight Watchers welcomes the levy as a measure by which to help cut obesity. But it sees it as one part of a strategy of treatment and prevention – and it doesn’t necessarily see sugar as the enemy. “Our programme has always been routed in the latest science and consumer insights” says Claudia Nicholls, UK Marketing Director. “Through NPD, reformulation and broadening our product portfolio, we help our consumers by offering convenient, healthy treats – including biscuits and confectionery bars that are some of the healthiest options compared to many brands on the market.”

The soft drinks levy is ultimately there to discourage, rather than prohibit, unhealthy behaviour. Zizzi has decided to honour this purpose by highlighting the drinks that are affected, enabling customers to make informed decisions. "We're always expanding the healthier drinks options on the menu, and we champion products like Dash Water" says Kathryn Turner, Director of Food Development.

Waitrose was first to announce that they would ban the sales of energy drinks containing more than 150mg of caffeine per litre to anyone under 16. This decision was made in consideration of guidelines that anything above 150mg is not recommended for children. Since their announcement three other supermarkets have followed suit.

Tesco have kicked off 2018 with a campaign to make healthier choices easier for customers by backing Change4Life’s campaign to promote healthy snacking to children. They are also continuing their ‘Free Fruit for Kids’ scheme in large stores.

Nestle have been able to slash the amount of sugar in some of its chocolate bars by 40% but without, they say, compromising on taste. They have achieved this through researching ways to structure sugar differently. Their process makes sugar dissolve faster so that the chocolate tastes just as sweet even when less sugar is used.

As some of the examples above illustrate, the Soft Drinks Industry Levy already appears to be working: it is now expected to raise £385m a year, less than originally forecast, in light of product reformulations.
And the money that is raised is intended to be invested in programmes promoting exercise and healthy eating amongst school-aged children.