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On it goes. Launching a new food line is no small undertaking. Consumer research and continual tinkering with the formula can cost millions of dollars and require two years from concept to shelf. Diet foods are trickiest because a company must determine the trade-off between taste and calorie count that will please the most people. Sara Lee, recognizing that its carbcentric baked-goods line is vulnerable, has begun marketing Delightful breads with fewer carbs. The company sees a secondary market for low-carb products: the world's 171 million diabetics, for whom carbs can be a deadly sin. The number of diabetics will grow to 366 million by 2030, according to World Health Organization estimates released this week. "Low-carb products will make it easier for diabetics to control their diets while giving them access to foods that were formerly strictly limited," says Edward O'Neill, associate director of the food-processing center at the University of Nebraska in Lincoln. The diabetic market alone can sustain many of the low-carb products coming to life, he notes.
Unilever is investing more aggressively than most in carb counting. It rushed the Carb Options line--the company's largest brand launch in two years--to market in a blistering 12 months, half the usual time for new products. Mike Polk, chief operating officer of Unilever Bestfoods North America, predicts that sales of low-carb packaged foods will almost double, to $700 million, this year and will rise to $1 billion in 2005. "We want to be a big share of that market," he says. One reason that Unilever is embracing low carbs is that its Slim-Fast line of meal-replacement shakes (low calorie but not so low carb), whose sales peaked at $1 billion in 2002, has dropped off the radar; sales fell 21% last year. Kraft's SnackWells and other diet products have ridden the same roller coaster. Slim-Fast's recovery plan is to tailor 40% of its products to low-carb dieters.
--THE LOW-CARB AISLE
You may have noticed the additional shelf space that low-carb goods are getting in your supermarket. The Albertson's chain now offers more than 100 low-carb products, compared with just 10 less than a year ago. "We found it's having a profound effect," says Andrew Kramer, Albertson's director of ethnic marketing and specialty foods. Sales in his category more than doubled last year, led by growth in low-carb lines. Meanwhile, the central action alley at Wal-Mart SuperCenters crammed some 200 low-carb products into a 16-ft. run during prime dieting season after New Year's. The company is considering launching its own line of low-carb foods, which would surely narrow the price premium that many of these items carry.
--THE LOW-CARB MENU
You simply cannot be in the dining business these days and not have a low-carb lineup. Since sub-shop chain Blimpie's introduced its Carb Counter menu in October, sales have kept fattening up, 8% to 10% each month. Mirroring that success, T.G.I. Friday's says its restaurant traffic bumped up 10% for a couple of months after it introduced an officially Atkins-approved menu in December.