Monday, September 10, 2012

The US is a TIER 1 Country in Gluten Free Products on the GFP Matrix - Compared to Mexico & Brazil

When analysing gluten free markets, the main question that people with celiac disease will ask is "what's in it for me" ? Having an understanding of markets such as Australia and America is fundamental to understanding how many more suppliers are likely to enter the market and so drive competition and choice. If you are celiac or a gluten free supplier, these are two words that you hold dear to your heart: choice and low price . To understand how close we are to a mature market (when maximum competition drives prices down) it is useful to compare several countries and communities within these.

This analysis is based on Google search terms (for the month of Dec 08) used in the gluten free market. As Google usually has a large market share in most countries and also has specific country domains, this provides a perfect baseline to compare gluten free markets across the world.

This article is set out in the following format:

    Identification Of the Four Gluten Free Market Tiers
    Introduction Comparison Of Communities By Their Market Tiers

GFP MATRIX: Identification Of the Four Gluten Free Market Tiers

So far four market levels (TIERS) have been identified.

A fully matured gluten free market has not been reached yet due to the low diagnosis of celiac disease even in developed countries. So far, analysis has shown that the most developed gf markets are those in Australia, the US and Canada. Characteristics of the e-demand side of these are a high number of search terms and high search volumes.

Of the search terms used in tier 1 communities , they are typically dominated by generic gluten free terms where the first 2 to 3 terms represent over 55% of the top 50 searches . This is the case in Australia, US (English speaking) and Canada (English). It is speculated that in these countries there are a significant number of celiacs who have been diagnosed for a few years. They originally searched for information on the disease and diets required and now prefer to spend more time searching for generic gluten free terms. By doing so they have found that on the supply side of things products have been amassed in the one place. This means that by searching on generic terms they can easily find large gluten free sites that contain many gluten free products on which they can search internally for specific terms. While generic searches are large, searches on the celiac group are still the second highest and account for over 15% of the top 50 searches . Within this group two terms 'celiac' and 'celiac disease' typically account for over 85% of all searches .

The next level of market maturity (tier 2) is shown by communities like US Spanish speaking and Canadian French speaking communities. These communities are often smaller than the dominant communities (often English) in their countries but they have first world affluence available to them. They often have under 100 total search terms over a twelve month average. In this example, US Spanish has 17 search terms and Canadian French have 30. The relatively high level of affluence within these communities increases the individual's chances of being diagnosed and pursuing a often more difficult and costly gluten free diet (as compared with tier 4 markets. These 'second tier' communities also have a high search proportion devoted to generic gluten free terms but there is also a higher proportion of searches (than found in tier 1 markets) devoted to finding information on celiac disease such as through celiac diet and/or wheat allergy searches.

The third market maturity (tier 3) is shown by communities such as Mexican English speaking (101 searches) and Brazilian English speaking (100 searches) communities. These communities are much smaller proportions of the country population than tier 2 markets. They are often much more affluent than the main population ethnicity (through education/ employment) or having come from more affluent countries such as America. They tend to not search so much for generic gluten free terms (less than 45%) but have an increase in searches for celiac diet searches and specific food groups. This pattern is indicative of newly diagnosed people (having access to good medical attention). The other main trait of this market is that it includes people who have had the disease for a while and are now seeking specialist gluten free products such as 'gluten free restaurants' or 'desserts' - rather than staple gluten free foods such as flour or breads.

The lowest developed market (tier 4) is reflected by searches in Mexico (Spanish Speaking) 24 total searches and Brazil (Portuguese speaking) 23 searches. The communities also tend to have very low searches per head of population and may not have access to good medical facilities - often a large rural population. These people have a relatively small proportion of generic searches and a much higher number of 'wheat free' and 'celiac' searches. While they also have higher search volumes for specialty gluten free foods, rather than bread searches (main specialty in refined markets) or desserts, they tend to search for even more fundamental food staples such as flour and oatmeal. Counter intuitively they also tend to search for cakes and cookies. This is not necessarily related to the countries affluence but is more likely a social phenomenon where providing good food spreads for parties and extended family gatherings account for a large part of their social interaction.


Higher choice and lower prices will likely occur in tier 1 market countries as more celiacs are diagnosed and search for and buy more products. The development will reach maturity once the growth of the market goes through a point of inflexion in its growth and begins to plateau. Only long term monitoring of this demand can assess where that level of maturity approaches saturation.

The development of the market level definitions (tier structure) can be refined as more countries are analysed.

A practical application of this analysis for celiacs is to see what other celiacs are searching for and how developed the gluten free market is in their own countries. This article attempts to answer the question "what are the characteristics of a mature gluten free market".

This research and analysis was undertaken to see if there is a correlation between gluten free search profiles of developed nations and how this may differ from lesser developed countries in close proximity to the US.

This research was undertaken for the month of December 2008 Google search volumes for Gluten free products and uses monthly averages over a year in countries where search volatility is high and/or search volumes low. The analysis again shows a very strong correlation between the Australian and US Gluten free markets.

One of the first indictors or market maturity is considered to be the number of 'gluten free' related internet searches per 'population divided by 100'. This takes into consideration that approximately 1 in 100 people (diagnosed and undiagnosed) may be celiac.

The Adjusted GF Searches per month per celiac column takes into consideration internet usage, Google market share. The values are most accurate for the first three countries, 'developed' nations. These countries have a long established internet usage and Google was able to provide search terms up to its self imposed limit of 200 terms. The search values for Mexico and Brazil English speaking are likely to be inflated due to sparse information on the penetration of English language in these countries and Google's translation abilities.

The most important concept in this research is the gluten free grouping profiles . As explained below, all gluten free terms were assigned to one of seven groups . The top 50 search terms were sorted into these groups and groups were analysed for number of terms, proportion of the top 50 and the specific terms within each group. While the following pages go into the details of each country a summary of the analysis is:

Group Composition

The following shows some of the representative terms in each group.

Generic GF Product: This group of search terms all involve the word gluten and are generic in nature, such a gluten, gluten free, gluten free products, gluten free meals.

Gluten Diet: These are terms that are related to the specifics of gluten free diets such as: gluten free diets, celiac diet.

Gluten Free recipe: Terms such as gluten free recipes, gluten recipe, gluten free baking, wheat free baking

Celiac related: These are terms related to information on the disease such as: celiac disease, gluten intolerance, gluten allergies

Wheat free: Terms such as: wheat free, wheat gluten, wheat allergy

Locations: gluten free stores, gluten free shopping, gluten free restaurant

GF Specific Foods: gluten free bread, gluten free pizza, gluten free cakes, gluten free muffins

COMPARISON of Communities by their Market Tiers

Australia, US English, Canada English.

Australian, US English speaking and Canadian English groups had very similar profiles. Each country had the 'generic gluten free' group as its main group with the following volume proportions: AUS 65%, US Eng 64%, Canadian Eng 63%. In each case the same 'gluten and gluten free' generic terms rated as the top two overall searched terms by volume.

The celiac group was the second largest volume searched by all three countries: AUS (18%), US Eng (21%), Canada Eng (21%). Each category was dominated by over 85% by the terms 'celiac' and 'celiac disease'. Dual spellings in Australia.

US Spanish, Canadian French

One of the main things that affects the distribution profile of these communities is that US Spanish searches only comprised a total of 19 terms compared to US English that was capped by Google at 200. Per population of the American English V Spanish community, the English speaking community performed 4.2 times as many gluten free product searches as US Spanish speaking people on Google.

For the US Spanish community, the 'celiac' group was the highest volume proportion of any of the countries analysed. While the US and Australia searched for generic 'celiac' terms in this group the US Spanish search for 'celiac allergies'. This suggests a possible different approach to the way each country views celiac disease.

Compared to the US English, these communities also have a stronger interest in wheat issues. While the US English searched for 3 terms in this group it only made up 4% of volumes. The US Spanish searched for only one term: 'wheat intolerance' and it made up 18% of total search volumes. These factors suggest the US Spanish searchers are new to celiac disease and the market is immature compared to the first three countries.

The Canadian French speaking community had a similar profile to Canadian English but a much higher interest in the 'gluten diet' group and slightly higher interest in GF specific foods. These terms are accounted for by them looking at the specifics of what they can eat, and specific foods of gluten free 'oatmeal' and 'quinoa'. The higher interest in the diet group suggests that they are either more specialised in their searches than their English counterparts or are earlier in the disease diagnosis stage.

Mexican English / Brazilian English

In each community English is a very small minority of the population but is massively over represented in search volumes. As Google has country specific domains in each countries main language this statistic suggest that these English communities are more aware of gluten issues, are more affluent, and potentially represent a more mature search market.

There is a strong similarity between the Mexican English and Brazil English speaking group profiles. Both communities have a significantly reduced generic search focus but a similar increases in GF specific foods and Gluten Diet information. Quite a few of the English speaking people in these countries are believed to either be affluent locals or foreigners (ex pat US).

In the Mexican English speaking community, the highest searched group is 'gf locations' and the highest volume terms are related to gluten free restaurants. The second highest group 'celiac' is dominated by several equally search volume terms that use three and four word search strings. The third group 'gf specific foods' is dominated by searches for desserts. This suggests a split in focus between people newly diagnosed and those who are affluent enough to regularly search for gluten free restaurants and desserts.

In the 'Brazil English' community there was an even stronger fascination with gluten free desserts taking up three individual search terms - the first two accounting for 9% of all searches. Coelaic (UK spelling) was the second most searched group and it contained only one term which accounted for 24% of search volumes. The highest specific food searches were for cakes and muffins, whereas in US English and Australia top specific searches were for breads.

Mexican Spanish, Brazil Portuguese.

The profiles for these communities were the most unlike the US English and Australian. Mexican Spanish differs from market 1 profiles as much by its large reduction in generic searches as its large increase in searches on wheat issues. In fact three of the top 'wheat free' searches accounted for 44% of top 50 volumes. This suggests a community in early stages of diagnosis and discovery. The two highest specific gf food searches were for 'oatmeal' and 'flour'. These non luxury items, low search volumes and focus on wheat free issues suggests a non affluent community searching for fixes to staple food groups.

Brazil Portuguese has a very large population but low search volumes. In fact it has nine times the population of Australia, but less than half the searches on gluten free products. While generic gluten searches were the main search group at 44% (20% less than US and AUS), its first two terms were still the same generic terms. Of most interest is that this community has the highest specific food group volume proportion of all countries. And rather than an interest in food staples, they focus on gluten free cakes (18% of top 50 searches), and cookies 10%. They also search for gluten free flour (3%) and oatmeal (2%).

With the third highest group being 'wheat free' and gluten allergies Brazil's market resembles the split shown in Mexico (English) between learning about celiac disease and enjoying treats. However rather than searching on restaurants, the Brazilian Portuguese interest in cakes may be seen as a cultural choice (socialising and providing family spreads) rather than an opulent choice.

Original career in electronic engineering morphed into Corporate Marketing via MBA in 1998. In the Last few years I have had a strong interest in e-marketing and website optimisation. My strongest desire is to be working in the sustainability industry which causes large reductions in greenhouse gases. Save the planet, save the people