1. www.innovadatabase.com Health Claims For Children September 2011

2. www.innovadatabase.com Presentation Scope This presentation provides analysis of products positioned for children tracked by the Innova Database globally, also with a specific focus on the Latin America region. Children’s Products Analysis Overview – Top Market Categories – Top Active Health Positionings Global Latin America – Top Passive Health Positionings Global Latin America Children Product Trends & Health Claims Examples Insights & Opportunities

3. www.innovadatabase.com Children’s Products Analysis Overview

4. www.innovadatabase.com Global Top Market Categories

5. www.innovadatabase.com Global Top ACTIVE Health Positionings

6. www.innovadatabase.com Global Active Health In Decline Bone health is the only active health positioning to demonstrate growth.

7. www.innovadatabase.com Latin America Top ACTIVE Health Positionings Vitamin/mineral fortification is dominant for Latin America

8. www.innovadatabase.com Latin America ACTIVE Health Top Market Categories

9. www.innovadatabase.com Global Top PASSIVE Health Positionings

10. www.innovadatabase.com Global Passive Health Claims Stabilize Allergy and no additives/preservatives positionings have shown growth while other passive health positionings have stabilized or are trending downwards (slightly).

11. www.innovadatabase.com Latin America Top PASSIVE Health Positionings No additives/preservatives and natural positionings are a lot less used in Latin America compared to globally.

12. www.innovadatabase.com Latin America PASSIVE Health Top Market Categories

13. www.innovadatabase.com Latin America Summary Number of product launches tracked by Innova positioned for children 2007- 2010 Top market categories 2007-2010 Top Companies 2007-2010 Top Health Positionings 2007- 2010 Argentina 464Gum Chocolate Sugar Confectionery Sweet Biscuits/Cookies Dairy Drinks Arcor Cadbury Danone Nestle Bagley Vitamin/Mineral Fortified Allergy Gluten Free Added Iron Added Calcium Brazil 807Sweet Biscuits/Cookies Chocolate Sugar Confectionery Ambient Desserts Gum Nestle Pepsico Kraft Pandurata Carrefour Gluten Free Allergy No Trans Fats Vitamin/Mineral Fortified Low Fat Chile 118Sweet Biscuits/Cookies Dairy Drinks Breakfast Cereals Yogurt Chocolate Nestle Empreses Carozzi Dos En Uno Soprole Lechera De La Union Vitamin/Mineral Fortified Low Fat Added Calcium Low Calorie Low Cholesterol Mexico 320Dairy Drinks Sweet Biscuits/Cookies Gummies/Jellies Juice & Juice Drinks Sugar Confectionery Nestle Gamesa Tiendas Walmart Bimbo Vitamin/Mineral Fortified Low Fat Added Calcium Low Sodium Low Sugar

14. www.innovadatabase.com Children Product Trends & Health Claims Examples

15. www.innovadatabase.com Vitamin & Mineral Fortification Is Still A Force Although vitamin and mineral fortification is in decline globally, it is still the most popular health positioning for children’s products. The amount and type of vitamins and minerals used varies from product to product. Some products will claim a specific health benefit associated with the vitamins/minerals used, but generally products simply state that they contain vitamins and minerals. Mexico: Pet Zoo Lala Yogurt Drink with Strawberry Flavor. Low fat. Reduced sugar. Folic acid and vitamin B12 added. Guatemala: Kellogg's Choco Pops Cereal de Maiz, Trigo y Avena con Sabor a Chocolate: Corn, Wheat and Oats Cereal with Chocolate Flavor. With 8 vitamins and 4 minerals added.

16. www.innovadatabase.com Including Ingredients For Mental Development Australia: Nestle Milo B-Smart Chocolate Powder. Specially formulated for mental development, focus and concentration. Has iron and iodine for mental development, Active-B for energy release, Protomalt for mental and physical activities, and 25% reduced sugar and fat. National Heart Foundation approved. Milo B- Smart gives your child 35% of their daily iodine needs. India: Kissan Nutrismart Milk Powder: Vanilla Flavor. Contains Key Nutrients like iron and iodine which are known to help improve memory and learning. 100% vegetarian. B-vitamins contributes to normal function of immune system.

17. www.innovadatabase.com Omega-3 DHA Is Still Relatively Niche The use of Omega-3 for brain health has potential for considerable growth and can add value in regard to price premiums. Guatemala: Petit Crecimiento Nectar de Manzana: Apple Nectar for Kids. No added sugar. No artificial colors. Without preservatives. Omega 3 DHA. Studies show benefits in children’s mental development by consuming DHA. Australia: Vaalia Kids Vanilla Yoghurt. Packed with goodness. Probiotics for digestive health. No artificial colors, flavors or sweeteners. Preservative free. With Omega 3 DHA for brain function and concentration. Low fat. Low GI

18. www.innovadatabase.com Inherent Nutrition: Real Dairy Goodness Focusing on the inherent goodness of real ingredients for extra health appeal. Germany: Kuchenmeister Children's Milk Muffins. 2 x 75g small milk muffins filled with chocolate cream. Contains 40% milk! Brazil: Newbread Bisnaguinha: Mini Bread Rolls. Trans fat free. Quality food. With milk.

19. www.innovadatabase.com Incorporating Vegetables Where Possible Vegetables are being increasingly utilized in product formulations for children. Brazil: Little Chef! Looney Tunes Macarrao Alfabeto: Alphabet Shaped Pasta. Rich in vegetables, vitamins, and minerals. India: Godrej Tyson Yummiez Dinoz Veg Nuggets. Vegetable nuggets made with 5 vegetables.

20. www.innovadatabase.com Real Fruit & Vegetables For Flavor Canada: Dare Bear Paws Minis Oatmeal Mixed Berry Soft Bite-Sized Cookies. 6 x 35g packs of mini Bear Paws shaped soft bite-sized cookies with oatmeal mixed berry flavor. Each pack contains 8 cookies. Peanut free. Made with wholegrains. With real fruits. Trans fat free. Supported by the Heart and Stroke Foundation. UK: Planet Lunch Stick & Dip Smooth Tomato Dip. Planet Lunch Stick and Dip is made from 100% natural ingredients and consists wholegrain sticks and smooth tomato dip made with real vegetables.

21. www.innovadatabase.com Allergy Friendly Products Allergy conscious NPD is not slowing down and is of particular importance for products targeting children. Front of pack symbols have emerged to denote a product’s allergy friendly status. Canada: Leclerc Soft Baked Brownies. Certified allergen control: Absence of peanuts. Canada: Treasure Mills All Natural Brownie Bars. Ten individually wrapped all natural brownie bars. All natural. Trans fat free. Preservatives free. Nutritionally balanced. School Safe. Made in peanut and nut free facility.

22. www.innovadatabase.com Gluten Free Is Now Mainstream Gluten free claims are widespread for all types of products- even those you would not assume would contain gluten! Gluten free symbols are increasingly appearing on front of pack. Argentina: Arcor Mogul Moras Berries. Bat shaped fantasy gummies filled with berry flavor. Made with natural fruits. Gluten free. Indonesia: Orgran Gluten Free Farm Animals Rice & Corn Vegetable Pasta. Gluten free. Has diverse nutrition to wheat pasta and being gluten free also offers greater digestibility which is generally better suited to growing children, the very unique processes encompasses traditional methods to retain the delicate natural flavor of the grains.

23. www.innovadatabase.com “Free From” Trend Influence: Low Lactose Claims As gluten free claims are now well established, low lactose for easier digestibility is a potential new focus. Finland: Valio Kidius Gefilus Banaani Jogurttia: Low Lactose Banana Flavored Yogurt. Finland: Arla Power Cow Mansikkamaitojuoma: Strawberry Milk Drink. Only natural flavorings and colorings. Low lactose. High calcium.

24. www.innovadatabase.com Getting The Balance Right Balanced meal claims by incorporating fruit salad with chocolate cake in the one product. France: Les Crocozores Les Croco Cacao: Chocolate Cake with Fruit Salad for Kids. Eating well makes you happy. Balanced meal for kids. Tested and loved by kids. Simple and authentic recipes. No additives. No preservatives. Not too much sauce, not too much stuff, and lots of love.

25. www.innovadatabase.com Reduced Salt Snacks Get The Thumbs Up Salty snacks for children are getting a health makeover. A “thumbs up” symbol is used twice on the front of pack of this product to indicate the product contains less salt. Poland: Cheetos Robalos Corn Crisp Snacks with Barbecue Flavor. Whole grain corn. Source of dietary fiber. 40% less salt.

26. www.innovadatabase.com Reformulations For A Wide Range Of Products High percentage reductions of salt/sodium claims compared to original products are becoming more widespread. Spain: Lorenz Snack World Junior Farm Saltletts: Salted Soft Pretzels. Animal shaped salted soft pretzels, for kids. 30% less salt than conventional pretzel products. No preservatives. Australia: Kraft My First Vegemite Spread with Concentrated Yeast Extract. Specially formulated for children, 1+ years of age. Source of iron, vitamins B12 and B6. 50% less sodium compared to original Vegemite spread.

27. www.innovadatabase.com Sense of Simplicity The natural trend has been a strong driver for NPD, with the no additives/preservatives positioning demonstrating significant growth for children’s products in most parts of the world. UK: Peter Rabbit Organics Organic Orange and Raisin Cookies. No added sugar. Simply sweetened with fruit. Made using organic palm oil which is sourced from plantations which are sensitively managed. Emphasizing simple ingredients contained within. Italy: Coop Tortina Pastry Filled with Cherry Fruit. 6 x 36g oven made pastry filled with cherry fruit. Coop Tortina Cub 4-10 is unique and tasty snack because it is a snack with a mostly high percentage of fruit (21.3%), fiber (10.5%), very low calories (280kcal/100g). No salt and added.

28. www.innovadatabase.com Latin America Should Pursue Natural Children’s products with a no additives/preservatives positioning are not so common in Latin America. There is huge potential for NPD innovation using natural colors and flavors and simple and short ingredient lists. Brazil: Gomes da Costa Medalhao com Merluza, Tomate Queijo: Hake Medallion with Tomato and Cheese Filling. No preservatives. No trans fat. Rich in protein. Colombia: Yupis Gigantes Arequi Queso: Corn Snacks with Cheese and Caramel Flavor. No preservatives.

29. www.innovadatabase.com Front Of Pack Tick Of Approval Front of pack tick lists either stating what is NOT in the product or alternatively what the benefits are, is a simple and effective communication method employed. Netherlands: Organix Goodies Alfabet Koekjes: Mini Organic Biscuits. No junk promise. No salt, sugar or additives added. Suitable for vegetarians. Gluten-free. UK: Tesco Goodness 4 Fromage Frais Mousse Strawberry Vanilla for Kids. Made especially for kids, with parents in mind. Full of flavor and fun, this Goodness range of product is made with real ingredients and no artificial colors or flavors. Goodness is food your kids will love and you will feel good about. Good source of protein. Ideal for lunch boxes.

30. www.innovadatabase.com Energy Necessary For Active Kids Specific ingredient formulations can be used for energy claims, or alternatively, general (high) energy claims are used without reference to any specific ingredients. Malaysia: Nestle Milo Nuggets with Actigen- E. Bite-size chocolate nuggets version of milo energy drink with actigen E in aluminum bag. Contains a combination of B vitamins and minerals for sustained energy. Argentina: Cepita Apple Juice. Premium. No preservatives. Made from 50% apple juice. Rich in energy.

31. www.innovadatabase.com For A Bone Health Boost Bone health is the only active health positioning to be trending upwards. Calcium and Vitamin D fortification is often used for strong bones claims. Italy: Nestle Fruttolo Go! Fragola: Fresh Cheese with Strawberries. Source of calcium, proteins, and vitamin D. No colors. No preservatives. Australia: Yoplait Go-Gurt Freeze 'n Go Smooth Fruit Yogurt: Strawberry. Low GI for sustained energy. With vitamin D and calcium for strong bones. No artificial colors, flavors or preservatives. Friendly live cultures. 98% fat free. Gluten free.

32. www.innovadatabase.com Bone Health Claims Are Not Limited To Dairy Brazil: Nestle Passatempo Junior Biscoito Com Leite: Cookies with Milk Flavor. Nutri Active: Contains 15% calcium (recommended daily portion) + source of magnesium and zinc. Enriched with calcium, magnesium, and zinc. Calcium for strong bones. Hungary: Cerbona Disney Csokolades Gabonapehely: Chocolate Flavored Cereal Flakes. With calcium for strong teeth and bones, and for proper muscle function.

33. www.innovadatabase.com Protein Potential? Protein has been used in combination with fiber for weight management for adult products. Could protein be applied more for children’s products to keep hunger at bay? Canada: Janes FlatJacks Fully Cooked Breaded Chicken Breast Cutlets. Fully cooked breaded chicken breast cutlets. A delicious hot snack that can fill the gap after school with high quality protein that can carry kids to the next activity. Provides 8 grams of satisfying protein. Fully cooked. Zero trans fats. Low in saturated fat. USA: Can Do Kid All Natural Chocolate Crunch Nutrition/Energy Bars. All natural chocolate nutrition bar made of organic ingredients, especially formulated for kids. Made with 9 grams of protein and 16 essential vitamins and minerals. All natural. No high fructose corn syrup. No trans fats. Gluten free. Organic.

34. www.innovadatabase.com Protein Claims For All Product Types Protein source claims are apparent in products you would not normally associate as to contain protein. Brazil: FunClub Dentadas Jelly Lollies. Denture shaped jelly candies in raspberry, strawberry, and grape flavor. Protein source. Zero fat. Brazil: Mae Terra Ceboloko Organic Onion Flavored Corn & Rice Chips. With brown rice. Source of fiber. Roasted without monosodium glutamate. No artificial coloring. Source of protein, vitamins B and B9, and sugar. No trans fat. Free from GM

35. www.innovadatabase.com Less, Low & No Fat Is The Go Childhood obesity is a global health issue. Products with a low fat positioning should increase. Not-so-healthy snacks can be improved with a reduced fat content. Italy: Buondi Classico Yeast Proof Cakes. Individually packed yeast proof cakes. With 45% less fat compared to classic cakes. Argentina: Oreo Mini Sweet Cocoa Cookies with Vanilla Flavored Filling. Only 23% fat.

36. www.innovadatabase.com Yes For No Trans Fat Claims For Latin America Trans Fat free claims have front of pack prominence. Argentina: Mendia Plain Pasta Kids! No trans fat. Nutritious. Guatemala: Chocorisas Galletas Sabor Chocolate con Relleno Sabor a Fresa: Chocolate Cookies with Strawberry Filling. Zero trans fat. Zero cholesterol.

37. www.innovadatabase.com Low Calorie Claims Have Yet To Really Take Off General light and low calorie claims are not so widespread, but there is potential for growth. 100 calorie or less claims (portion control packs) however, are increasing in prevalence. Germany: Werder Feinkost Kinder Tomaten Ketchup: Low Calorie Tomato Ketchup. Low calorie tomato ketchup for children, made with sweetener, comes in a squeezable plastic bottle. No added sugar. Low calories. Made with sweetener. Gluten free. Lactose free. Contain natural sugar. Israel: Magic Time Sammy The Bear Pancake Syrup: Lite Syrup. 30% fewer calories than the regular syrup. Low carb.

38. www.innovadatabase.com Combating Obesity With Calorie Control The 100 calorie (or less) trend is still current and has now found its way to children’s products. UK: Weetabix Toffee Dazzler Oaty Bars. Five individually wrapped mix cereal bars with toffee pieces drizzled with yogurt flavored coating. The only 90 calorie bar range. Less than half the sugar of the average kids' cereal or fruit bar. High in fiber. Low in salt. Free from artificial colors and flavors. Suitable for vegetarians. Great for lunchboxes. USA: Lunch Buddies Dinos & Sharks Fruit Flavored Snacks. A variety pack of dinosaur and shark shaped snacks with fruit (strawberry, orange, grape, lemon, and lime) flavors. Naturally and artificially flavored. Made with real fruit juice. Excellent source of vitamin C. 100 calories per pouch.

39. www.innovadatabase.com Wholegrain Choices Are Well Established The benefits of wholegrain are understood by parents and demand should only increase for products containing wholegrain. Mexico: Nestle Nesquik Rellenos Crisp Squares Filled with Creamy Vanilla. Chocolate flavored cereal made from wheat, corn, and rice. With vanilla flavored cream filling. Wholegrain. Brazil:Trakinas Sem Recheio Sabor Chocolate: Chocolate Flavored Cookies. Made with wholegrain flour. Contains vitamins and minerals, energy, and fibers. Zero g trans fat per serving.

40. www.innovadatabase.com Fiber To Be A New Focus Now wholegrain is accepted, high(er) fiber claims will be a new claims focus for digestive health. New Zealand: Tasti Milkies Choc Strawberry Muffin Bars. A creamy strawberry milkshake flavored filling wrapped in a soft muffin coating. With fiber. Less than 10% fat and the Heart Foundation Tick. Approved by National Heart Foundation. UK: Kellogg's Coco Pops Choc 'N' Roll Breakfast Cereal. Contains folic acid. High in fiber. Made with wholegrain. With fiber from wholegrain wheat and oats to keep tummies healthy. Added with vitamins and minerals: vitamin D and calcium for strong bones and iron to help your immune function.

41. www.innovadatabase.com On-the-go Breakfast Options Expand Products are being positioned for multiple consumption occasions. Products for breakfast on-the-go is a growing market. Bulgaria: Danone Danonino Yogurt with Banana and Raspberry Flavor. Four cups of (2) banana and (2) raspberry flavored yogurt for kids. With live active cultures. Suitable for breakfast. Spain: Cheetos Merienda Tubos de Cereales Rellenos de Cacao y Leche: Cocoa & Milk Cream Filled Cereal Tubes. Crunchy cereal tubes filled with delicious cocoa and milk cream. Served in a small aluminum sachet. Ideal for a sweet snack.

42. www.innovadatabase.com School Canteen Approved Claims If it is approved for school it must be nutritionally sound. Australia: Tukka Tubz Double Cheeze Blaster Pizza Top Beef Lasagne. School canteen green light registered. Eat Clever. Not Whatever! Real fast food that's good 4 u too. Snack happiness! Full on flavor in just 5 mins! USA: Kellogg's Morning Jump Starts Breakfast To Go. Breakfast kit containing Kellogg's Frosted Flakes 1/3 Less Sugar, Kellogg's Pop-Tarts Frosted Blueberry, and Apple and Eve Apple Juice. The kits meet all federal whole grain, vitamin, and fruit requirements for elementary, middle and high schools when served with eight ounces of milk.

43. www.innovadatabase.com Insights & Opportunities

44. www.innovadatabase.com Insights & Opportunities Stricter health claims regulations and the influence of natural trends in recent years has resulted in a global decline in active health positioned products for children. Passive health positioned products for children have more or less stabilized globally, with the exception of the no additives/preservatives and allergy positionings which have demonstrated significant growth. The natural and “free from” trends have fuelled this growth. Opportunities for children’s products for Latin America: – Natural/no additives/preservatives NPD – Use of real ingredients, incorporating fruit & vegetables where possible – Omega-3 DHA and other ingredients for brain health – Calcium and Vitamin D for bone health – Reduced salt, fat, calorie product formulations – Fiber focus for digestive health