But according to a new report from UK-based analysts Euromonitor, there are still a number of factors holding back the development of functional products in this area, not least the image of snack foods and baked goods.
For while dairy products have a healthy image on which to build, snacks in particular are often hard pressed to convince anyone of their 'good for you' credentials - let alone the suggestion that they might have some specific benefit such as promoting gut health.
As a result, most of the functional foods in this sector have been bakery rather than snack-based products, Euromonitor said, although they still remain a niche part of the market.
Functional bread accounts for just 6 per cent of sales in this sector in 2003, according to Euromonitor, while biscuit, cakes and pastries accounted for a further 7 per cent. Snack bars were rather more successful, with a 15 per cent share of sales last year, but this came almost entirely from energy or sports nutrient bars rather than 'classic' snacks with a healthy spin.
The remainder of the market - 72 per cent - is taken by confectionery, where functional gum in particular is well established and where most of the most successful product launches have taken place in recent years.
But if functional bread remains a small category, it is nonetheless the one which has shown the most dynamic volume growth over the last few years, according to Francisco Redruello, packaged food analyst at Euromonitor, and is also expected to show the most dynamic value growth over the next few years.
"This is principally due to innovation, with a number of interesting product developments occurring, especially in the US, UK, Japan and Germany," said Redruello. "Given low profits on basic breads, many bakeries are working to differentiate and add value to their products. The development of functional breads is a tiny offshoot of this trend that is principally illustrated by exoticism, the use of different cereals and experimentation with herbs and other flavourings."
The Euromonitor report suggests that bread, in theory, shows more potential than other bakery products when it comes to the functional food sector, not least because it is generally regarded as a healthy product (Atkins diet notwithstanding).
Despite its dynamism, however, growth in the functional bread sector has not been as great as it could have been, the analyst said, with a number of products (breads targeted at menopausal women or growing children, for example) failing to get off the ground.
According to Redruello, this weak performance was exacerbated by the fact that marketing efforts to communicate the products' benefits to consumers were only minimal at best - highlighting the sheer scale of the problem for bakery and snack producers keen to take advantage of the huge potential of functional products in these increasingly health-conscious times.
Some products have been successful, however. In the US, the French Meadow comapny launched a 'men's bread', containing nutrients such as soya isoflavones and Omega 3 and 6 fatty acids, designed to tap the largely underdeveloped men's health food sector.
Meanwhile, the prebiotic inulin has also been added to breads in some markets, notably Germany and Australia. These include Mestemacher's Activ 3 and Pre Plus Vivat Brot in Germany, and one of George Weston's Hyfibe breads in Australia.
In Japan, bread which offers cosmetic benefits is proving popular, with brands such as DHA Manno Pan from First Baking claiming to improve the skin. Bread enriched with L-Carnitine is also available in Germany, claiming to boost energy particularly among active people and sports enthusiasts.
Redruello also highlighted a number of other possible developments in bread fortification, including the addition of soya isoflavones and trehalose, which are thought to increase the absorption of calcium.
The US market is perhaps the most well developed when it comes to functional bread products, with sales there reaching $47.9 million in 2003, but Euromonitor predicts flat sales at best there in 2004, no doubt due to the growing popularity of the Atkins diet, which is expected to affect bread sales in general.
In Europe, the markets are at earlier stages of development, with British functional bread sales reaching $12.1 million in 2003 compared to France's $0.3 million and Germany's $33.1 million. Tellingly, though, Germany is predicted to be the only European market where the functional bread sector is likely to grow this year, with sales increasing to an estimated $40.3 million. In France, sales will remain flat, while the UK market is expected to shrink to $7.3 million, again partly due to the Atkins effect.
As for the broader baked goods category, the main difficulty here is that of image, as snack foods, biscuits, cakes and pastries do not have the same wholesome image as bread on which to build.
"Biscuits suffer from a clash between the concept of health and that of indulgence, which many consumers are unable to reconcile. As such, they are mostly limited to the 'compromise' market of 'better for you' treats for children which appease both parent and child," the Euromonitor report suggests.
Some products, such as energy bars, have been more successful, of course, but these are still principally marketed through health food shops and gyms and targeted at serious athletes.
The total market for functional biscuits, cakes and pastries is therefore far smaller than that for bread - indeed in some countries such as the UK it is non-existent, according to Euromonitor's data.
Ironically given the failure of the functional bread sector to take off, it is France which has one of the biggest functional biscuit and cake segments, with sales of $80.9 million in 2003 and a predicted $90.6 million in 2004. Germany's market is dwarfed in comparison, with sales of just $2.6 million in 2003 and $3.1 million in 2004.
The US market is substantial, though, with sales of $78.9 million in 2003 and $84.2 million expected in 2004.
Euromonitor did not give figures for the Japanese market, but this has traditionally been one of the most important for functional foods - or FOSHU (foods for specific health use). This is reflected by the market shares of Japanese functional bread manufacturers Yamazaki and Takaki, which account for 24 per cent and 6.7 per cent respectively of the global market. Only Spanish group Bimbo comes close with 9.1 per cent, according to Euromonitor.
This story was first published on BakeryandSnacks.com.
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