Trends Fueling Innovation in the Food & Beverage Industry

25/gen/2021 11:23:08 Allied Market Research Contatta l'autore

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COVID-19 is an infectious disease that originated in Hubei province of the Wuhan city in China in late December. The highly contagious disease, caused by a virus, severe acute respiratory syndrome coronavirus 2 (SARS-CoV-2), is transmitted from humans to humans. Since the outbreak in December 2019, the disease has spread to almost 213 countries around the globe with the World Health Organization declaring it a public health emergency on March 11, 2020.

The outbreak of COVID-19 pandemic had led to partial or complete shutdown of production facilities, which do not come under essential goods, owing to prolonged lockdown in major countries such as the U.S., China, Japan, India, and Germany. In addition, the pandemic is expected to influence the food & beverages industry in the coming months.

One of the major trends that is expected to continue even in 2021 is consumer inclination toward healthy food products that are manufactured from clean ingredients or plant-based ingredients. The clean label ingredients will see continued growth, and the market is expected to witness notable growth, as new ingredients rangingfrom mushroom and algae will be introduced in the market.

The technological innovation such as Clustered Regularly Interspaced Short Palindromic Repeats(CRISPR) is expected to improve food safety and security across the F&B sector. The innovation in food ingredient is expected enhance the demand forglobal cuisine mashups on menus and in retail spaces.

Top competitors entering into health and immunity-based food offerings

According to research from the Archer-Daniels-Midland Company, the outbreak of the global health crisis has shifted the preference of consumers toward foods that benefit their immunity, and experts are predicting that will continue in 2021.Consumers spent most of last year focused on trying to stay healthy — and that desire seeped into their food choices.

Immunity-boosting ingredients have witnessed increase in sale.Thus, companies are expanding their portfolios with such features. Chobani recently announced a line of yogurt with probiotics, and Uncle Matt’s launched an Ultimate Immune Orange Juice Beverage.

Matt Kollmorgen, founder of Bee K’onscious, remembers fostering his love of honey as a child when a fast food chain would give him some with his chicken nuggets. Today, Kollmorgen's upstart honey company is taking a decidedly healthier approach to tout the benefits of the honey he purchases from producers in Brazil, Montana, and California.

According to  data from USDA's Economic Research Service honey production totaled 37 million pounds in 2019, down from 44.5 million pounds in 2001. Despite the decline, the value of production soared 200% to $108 million during the same period. Rise in value is due to the attribute of honey as a natural ingredient and as a healthier sugar substitute.

Technology-driven transformation

In the early stage of pandemic, headlines focused on outbreaks at food and especially at meat manufacturing plants. As a result, consumer were cautious about the origin of food and who makes it. As per experts at Allied Market Research, the trend is expected to continue in the year, with technology working to make food  manufacturing and work site more safe and reliant.

Meat processors have already expedited their plans to incorporate more automation and robotics to elevate the food safety and provide consumer assurance of quality of food. For instance, Tyson Manufacturing Automation Center are working on developing innovative technology such as robot camera that could detect defects in products.

Automation and equipment manufacturing company, Tyson invested $500 million in past three years to develop technology and automation equipment for food industry manufacturers. According to Banks CEO of Tyson "Tyson Foods and actually many of the Fortune 500 companies are in a pole position effectively to take advantage of these technological developments that we see very minimally utilized across corporate America.”

Demand for food flavor with health benefits and enhanced taste

The demand for food flavor is expected to intensify in 2021,as the effects of the pandemic continue, and consumer interest in novel tastes grows. As consumer have not travelled or dined out during the pandemic,they are seeking for innovative flavors to generate experience similar to dine out at their home during the pandemic. This trend is expected to continue in 2021, as consumersare focusing on home dine experience. Consumer inclination toward wellness increased during the pandemic, which further augmented the demand for ingredients such as traditional berries and fruits, butterfly-pea flower, and moringa.

Changes in consumer behavior to power innovation and growth in uncertain business environment

Consumers’ attitudes, priorities, and behaviors are shifting significantly due to the pandemic. This evolution has provided unique opportunity to food &beverage company to bring forward new products. Food &beverage manufacturers who successfully balance consumer health concerns with affordability are most likely to strengthen their foothold in the market.

Following are the behavioral shifts that will create opportunities for food &beverage manufacturers to gain market share in an increasingly uncertain business environment.

  • Increase in focus on the immune function and gut health connection

Consumers are being more concerned about their immunity as a result of COVID-19. As consumers strive to enhance their immunity, they are becoming more knowledgeable about how the human microbiome supports the immune system and overall well-being. Products containing probiotics, prebiotics, and postbiotics can benefit the microbiome and are already gaining momentum in the marketplace.

  • Nutrition, it’s personal

As COVID-19 increases consumer awareness of individual health risk factors, demand for personalized health and wellness solutions will take off in future. Every individual is unique and requires a customized approach to diet and exercise, and consumers are already purchasing more items customized for health and nutrition needs. Products that focus on improving nutrition, self-care, and general wellness will increasingly attract consumer attention.

  • Change in shopping values

An increased focus on health due to recent pandemic is triggering consumer health and wellness spending. Furthermore, concerns about economic decline have prompted a shift to value-based shopping, including growing demand for basic pantry staples, stimulating trade-downs to private labels, and increasing traffic to value retailers.

These behavioral shifts are likely to persist well after the pandemic crisis peaks. Brands should respond by developing tailored solutions aimed at giving them an edge in an ever-changing marketplace.

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