ROCKVILLE, Md. — Creating food and beverage products for children is a “tricky business,” said market research firm Packaged Facts. The main obstacle is differentiating children’s products from regular ones and knowing when that differentiation is desirable.

“Of course, marketers may use fun shapes, crazy colors, or character merchandising to appeal to kids,” Packaged Facts said. “However, this doesn't make a product exclusive to kids. Indeed, marketers may choose to target kids, yet the product may still be enjoyed by adults — or vice versa.”

For example, NurturMe, a company known for its quinoa baby food and toddler snacks, now offers organic ancient grain cookies with probiotics to appeal to both children and adults. Marketed as cookies "ideal for the whole family," the cookies are made with quinoa, millet and sorghum and contain less than 8 grams of sugar per serving. Available in cocoa and lemon honey varieties, the cookies are certified USDA organic, gluten-free, dairy-free, soy-free, egg-free and non-GMO.

The lines between children’s food and regular food products may be blurry, but the advantages are clear, Packaged Facts said. This gray area is one ripe for opportunity in innovation. Manufacturers may create new product lines that may be adapted to the needs and desires of children or more broadly as a family-friendly food or beverage. The children’s food and beverage market offers “significant promise” to CPG companies looking to expand their audiences, Packaged Facts said.

 To succeed in this market, manufacturers must understand the key factors of the demographic, which Packaged Facts discussed in its recent report, Food & Beverage Market in the US, 9th Edition. In 2018, the child population is 73.8 million, or 22.4 percent of the total US population. However, the number of children is not expected to grow significantly through 2020, so “industry players must engage kids earlier and retain relationships through the teen years to realize full market potential,” Packaged Facts said.

“The most effective marketers will leverage honed strategies to increase the connection with the core family market without alienating the childless household,” Packaged Facts said.

Additionally, the changing family dynamic has affected the market for children’s food and beverages. Millennials now represent a sizeable portion of the parent demographic, Packaged Facts said, and their approach to parenting differs from previous generations. Millennial consumers have a definitive perspective on what is important in products and brands they purchase. The growth of the multicultural population also has influenced the family demographic, requiring food and beverage manufacturers to leverage products that appeal to various traditional and cultural values.

Economic conditions also play a role in the growth and demand for children’s food and beverages. The core shopper of such products has one of the highest median household incomes. Add to that increasing consumer confidence, and “there is significant opportunity for category growth,” Packaged Facts said.

Perhaps the largest influence on the children’s food and beverage market is the parents. When developing new products for the category, manufacturers must consider the needs of both the parents as the purchasers and the children as the users. One area where balance between the two is key is in better-for-you offerings.

“Industry players are doing their part through new product development of healthier kid-friendly food and beverage, but there's clearly room for more players to find a seat at this table,” Packaged Facts said. “The stealth health movement is a good example of how industry purveyors are developing products to help parents increase kids' fruit and veggie intake while still retaining kid appeal.”

Seeking to strike that health and taste balance, PepsiCo, Inc. is introducing Tropicana Kids, a line of certified USDA organic fruit juice drinks designed for children. Made with 45 percent fruit juice mixed with filtered water, the beverages contain no added sweeteners or artificial flavors and come in fruit punch, mixed berry and watermelon varieties. The drinks contain 40 calories per serving and are packaged in pouches with a clear panel “so moms and dads can see the goodness inside and feel good about serving Tropicana Kids to their children,” PepsiCo said.

Along with healthy options, parents also highly value freshness and products on special sale/promotion when purchasing food and beverages for their children, Packaged Facts said. Parents also seek all-natural, non-GMO, no/low sugar and “no artificial ingredients” claims.

To meet these consumer demands, Kind Healthy Snacks is launching new Kind Kids granola bars. Made with oats, sorghum and quinoa, the products are gluten-free and contain 25 percent less sugar than the leading children’s granola bar, according to the company. Flavors include chocolate chip, peanut butter chocolate chip and honey oat.

“As Kind revolutionized the bar category with our nutrient-dense, whole nut and fruit bars, it enabled people to have a more nutritious, great tasting snack,” said Stephanie Perruzza, registered dietitian and health and wellness specialist at Kind. “With Kind Kids, we feel that parents are now able to make that same healthier and great tasting snacking choice for their kids.”

Other new better-for-you bar products in the children’s market include thinkThin thinkKids bars, OrgainKids bars, Power Crunch Snap Stick children’s protein snacks and RXBAR Kids.

PepsiCo’s Frito-Lay North America division also recently unveiled a new Non-GMO Project verified snack brand geared toward children. Slated for a summer debut, Imagine products include Yogurt Crisps in mixed berry and apple cinnamon flavors, and Cheese Stars in white cheddar and Parmesan flavors. The products are made with yogurt or cheese and contain 4 to 6 grams of protein per serving.

“Imagine is targeted to millennial families that are looking for snacks their kids will have fun eating and flavors they enjoy, but with more purposeful, positive nutrition that makes them feel better about what they’re eating,” said Tracey Williams, marketing director at PepsiCo. “If you look at the types of foods that consumers are giving their kids, they’re not always portable ... Yogurt is one of those foods that has the nutrients parents love, but it’s not always portable and easy to take with you.”

While clean labels and healthier products sway parents’ purchasing decisions, children are the key influencer of parents’ choices, Packaged Facts said. Fifty-five percent of parents said their children’s preferences and requests are especially important to them. Ninety-one percent of parents said they purchase a new food or beverage their children ask for at least some of the time, and 20 percent said they almost always do so.

“This provides incentive for marketers to continue to target the end user in promotional efforts,” Packaged Facts said. “The kids' food and beverage market offers a lucrative opportunity to all players who wish to navigate the tricky business of appealing to particular parents … and fickle kids.”