CBS Marketwatch.com
29 June, 2004

CHICAGO (CBS.MW) - "The second day of a diet is always easier than the first," Jackie Gleason once said, because "by the second day, you're off it."

While the low-carb diet craze seem to have somewhat more staying power, one food and beverage industry analyst suggested this week that the fad may well have peaked and could soon see much slower growth.

In a note to investors Monday, Wachovia's Jonathan Feeney cited "data from credible companies, a persistent split in the medical community and some weak specialty retail" figures as indications that "low-carb diet adoption rates in the U.S. are slowing."

That could provide relief for companies in high-carb categories, he continued, "provided the execution and competitive outlook are strong."

However, he cautioned, it is "not evidence of a reversal. We think the popularity of low-carb diets will have durable effects on some categories, but that trends are decelerating. This is sustained good news for the protein complex," including Tyson (TSN: news, chart, profile), Smithfield (SFD: news, chart, profile) and Hormel (HRL: news, chart, profile) and "sustained bad news for industries such as pasta and bakery where a sudden and unforeseen drop in demand has now created a need for painful rationalization."

To back that up, Feeney referred to consumer studies cited recently by PepsiCo (PEP: news, chart, profile) and Kellogg (K: news, chart, profile) indicating a slowdown in new dieters but "without any evidence of a quick reversal of negative trends in carb-heavy-categories."

He also he noted the "relative sparseness of medical evidence" that low-carb diets assist people in losing weight - one factor that has kept the ultimate food arbiter - the Food & Drug Administration - from giving the diets its stamp of imprimatur.

Feeney speculated that a half-hearted approach by dieters, leading to poor results, is also contributing to a slowdown as "peaks of diet fads are usually reached when enough people have tried and failed and failed to lose weight."

That hypothesis is born out by some of the available data, perhaps most notably a survey of 11,000 adults earlier this year by the NPD Group. Among its findings were that even among the "small fraction of the population [that] actually followed a lower-carb diet" - roughly 10 million Americans -- few were doing it properly.

NPD reported that adults who are cutting carbs are still eating an average of 128 grams of refined carbs a day, which is "considerably higher than the 20 to 50 grams of carbs per day some low-carb diets recommend for weight loss."

Said Feeney: "People want fast results without much effort. The low carb diets may just be another fad as people don't see results from their limited efforts and give up."

And, ironically, the low-carb diet may well become something of a victim of its own success as food companies rush to roll out new products to cash in on it.

"Variety and volume attract consumers to buy and eat more - thus interfering with their weight loss," Feeney noted.

Of course, whether or not the low-carb diet trend just slows down or fades out, it is almost certain to come back: Food fads come and go and come back with regularity, Feeney said, and "low-carb dieting has been around has been around for over a century."

To illustrate, he compiled a list of some 17 different diet plans dating back to 1862 and ranging from 1929's "Eskimo-Style Meat-Only Diet" (meat, fat, coffee and water) to last year's "South Beach." Even the Atkins Diet - the most popular of the current low-carb plans - has been around since the early 1970s.


http://cbs.marketwatch.com/news/sto...gle&dist=google

My prediction is that yes, there will be some slacking of lower carb food (aka frankenfood) sales and thus some analysts will declare low carb dead. What will really happen is that because of the hype, a greater number of people will try it. Out of this group, a large percentage will not do it correctly, (150 g! sheesh!) but there will be a certain percentage that do, and will be successful at it. This will increase the growing bulk (pun intended) of people that are successful on the diet. It's really going to be word of mouth that spreads this way of eating, and so the greater the number who are doing it successfully, then the number of people exposed to it in a successful context will grow, and I don't think it will be a linear growth! In other words, it goes back to the old shampoo commercial where a person told two friends and they told two friends and so on and so forth.

What this "craze" will do is to give an artificial lift to this process. Instead of hearing it from a person they know, a lot of these people will hear about it in the media and investigate it themselves. Once they start it, and it's the right diet for them and they do it correctly, they'll be successful. Then they become nodes of "infection" to educate their friends. It's a process that once it gets past a certain threshold, it takes off extremely rapidly. I'm sure anybody on the list more knowledgable of infectious diseases could give more details. I'm just working off of a class years ago on plagues in history. But this is a benevolent, voluntary plague. (unless you're a potato grower or a sugar company)

Give it time, some of the hype will fade, some of the products will die down, but what will be left will be a larger matrix of success stories to build from then before the hype.

That's my prediction, and I'm sticking to it!

Plane Crazy

I hate the word "craze" used by people trying to diss. LC eating.

But consider the source.


To back that up, Feeney referred to consumer studies cited recently by PepsiCo (PEP: news, chart, profile) and Kellogg (K: news, chart, profile) indicating a slowdown in new dieters but "without any evidence of a quick reversal of negative trends in carb-heavy-categories.

Kellogg's is getting killed. Pepsi owns Frito-lay, doesn't it? Pepsi has really kno LC products on the market.

One thing that I have noticed is that since I have started low-carbing, I no longer buy many boxed/canned products. I eat mostly fresh/frozen meats and vegetables. I don't buy the low-carb replacement foods (i.e. low-carb breads, pasta, etc.). All the manufactured food companies have lost my business. No matter what products they come up with, they will not get it back.

I'm with you there, Dodger. I stick to whole foods more than ever now, doesn't mean I stopped low carbing

DAMN! That's the spirit!

I'm definitely not buying as much packaged food. Just dairy, occassional loafs of LC bread. Everything else is meat and veggies! Mostly veggies.

This isn't analytical data - it's gossip. Remind me not to invest with Wachovia. The NPD group has been trying to dig itself out of a hole ever since last December when it first predicted the decline of low-carb. The following abstract from Opinion Dynamics is probably closer to the truth.



for the rest of this article see:

http://www.opiniondynamics.com/lowcarb.html#top

I probably don't buy as many low carb products as I did when they first came out, but I do buy some for use by my whole family such as the low carb Special K, Natural Ovens Bakeries bread and bagels, Carb Smart Ice cream and Carb Control yogurt as well as the new Dreamfields pasta and Carb Options garden sauce. Most of these things I use only rarely, but my DH and kids eat them a lot more (kids don't need to lose weight and DH has a higher metabolism and carb tolerance than I do).
The majority of our meals are still fresh meat and fresh or frozen veggies. If they're basing the rise or decline of low carb on how well the low carb products are selling, they may not be getting a completely accurate picture of the popularity (or lack of it) of low carbing since it's quite possible to low carb without any of those products, sticking only to fresh meat and produce.

Maybe the "experts" just THINK there are fewer people on low carb programs because we're all thinner.

Same here! And I've never felt better!

I've found the only low-carb frankenfood I'll eat is about once every two weeks I'll go to TCBY and have a tiny, junior cup of their low-carb lovers ice cream product thing. It actually does have cream in it. I wrote to them and got the ingredients. It's not too bad. The only real problem thing in there are the artificial sweenters. They've actually veered away from their normal Bad Fat, Naughty Fat line and added a fair amount of cream and fat back into it. I haven't had TCBY in ages until my wife dragged me there about a month back. I saw the low-carb lovers and tried it. It actually tastes a heck of a lot better than their other stuff because it's actually got real cream and real fat in it.

Other than that, I stick to whole food. Ever since I had an Atkins Peanut Butter Cup some weeks ago and it caused me to move into the bathroom, I've sworn off all other frankenfoods. They taste better anyway.

Plane Crazy

I hate it when I someone tells me that they are on atkins or low carb and when I ask them what phase they are on, they have no idea what I am talking about

The only LC frankenfoods I buy are the "Low Carb Diet" brand bars (the s'mores flavor is my favorite), and then only if I know I will be in a situation where I won't be able to eat a real meal (eg, being on a plane). I did try the Atkins bread last Thanksgiving and thought it was yummy toasted, slathered with butter, and topped with hot turkey and flourless gravy - in fact I loved it so much that I don't buy it because it's too easy to eat too much of it.

maybe just wishful thinking on the HC producers' part??? If they get the word out that people are not LCing anymore because it doesn't work, less people will try it??

I totally agree that the market 'study' would be skewed if based solely on sales of LC products.

I only buy the Heinz 1-carb ketchup and carb options sweet tomato dressing (2 bottles in 7 months) and I've tried a few other products just out of curiosity but find I do much better (not to mention feel 1000% better) if I don't buy them. They definitely trigger cravings for 'the real thing'.

In solidarity
Nicole