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food industry trends

Although the agri-food industry is considered to be a slow adopter of change, currently the sector is expected to change more in the next 10 years than it did over the last 50 (Accenture, 2017). This transformation derives from a number of factors, such as the environmental changes (e.g. global warming), the demographics (e.g. overpopulation, aging), the technological advances (e.g. nanotechnology) and the changes in consumer preferences (e.g. veganism).

Sustainability

Sustainability, is a major driver of change in the industry. Firstly, throughout the production chain the water and energy consumption are exceptionally high. Apart from this, agricultural sector constitutes the world’s second largest greenhouse gas emitter. Water pollution as a result of agriculture, leads to eutrophication, which is responsible for a significant damage to the aquaculture farms located near shore. The problem is severe in Greece, while 25% of lakes suffer from it.

Moreover, the global population is expected to grow from 7.6 billion today to 9.7 billion by 2050. Along with the need to feed those extra billions, the industry faces the immense challenge to curb emissions. However, the expected rise poses a great opportunity to tackle the food waste problem. One-third of all food produced in the world is wasted, while this quantity is almost enough to feed billions of people. 

Environmental sustainability means that a company is applying systems and activities to reduce the environmental impact of its operations. Sustainability innovation is an excellent opportunity for acquisition of a competitive advantage. Zero-waste initiatives, ban on the use of disposable straws, plastic water bottles, single-use coffee cups, are some examples of initiatives that can have a positive environmental footprint in the industry.

Transparency

Transparency (scrutiny on how every ingredient on a label is sourced) is an emerging trend that drives great change in the food and beverage industry. Tracing ingredients back through a chain of custody that upholds ethical standards and maintains the highest quality, is a consumer right recognized by the European Economic Community (1972) and has been a priority for many food and beverage manufacturers.

Nowadays, the abundance of information available to consumers, enables them to have an accurate view of the impact of the food they purchase has on the environment. This in turn means that consumers have been looking for safe, ethical, and high-quality nutrition choices. From production to packaging, there is a growing segment of consumers that are willing to pay more so they feel that they protect the environment. This trend is evident in the cleaner and clearer labels and in the rapid growth “organic”, “biological”, “GMO-free” certifications.

Health and Wellness

Health and Wellness is an increasing trend that has been another fundamental driver of change in the agricultural and food industry worldwide. The average consumer is by far more educated on the benefits of healthier choices, all the more often reading the back of packages before putting them into the cart. Added to this, the population in developed countries is aging at an accelerated rate, fueling a strong demand for healthier nutrition options. 

A healthy meal

Functional foods (food claimed to have an additional health functions) now have a very prominent role in the food industry, since consumers desire products that offer multiple additional health benefits. The organic market is no longer a niche market but a mainstream one, with observed double-digit growth rates each year, over the last decade. The development of a health and wellness driven image and the ability to charge more for organic food, has proven to be tempting for large supermarket chains that try to go organic. This trend presents major opportunities for Greece, due to the worldwide reputation of the Mediterranean diet as a key model for healthy eating.

Plant-based meat

Plant-based meat is usually made from extracted plant protein or whey protein, spices and binding ingredients, while there are substitutes for beef, pork, chicken or even fish. As plant-based diets are considered to be healthier dietary choices, more and more people are giving up meat by becoming vegetarians or turning to more veggie-friendly diets. The trend is growing particularly amongst young people (under 25), with 19 % of men and 25% of women not eating red meat . What’s more impressive, 16% of consumers regularly use plant-based alternatives such as almond milk, tofu, and veggie burgers but 89% of them do not consider themselves as vegan or vegetarian. The rise in popularity of plant-based meat is already so high, that multinational fast food companies such as Burger King, McDonald’s and KFC offer plant-based options in their menus.

This transition from animal-based towards plant-based alternatives drives a long-term change in the food production industry, along with various social and economic implications. Current production operations require extensive processing that minimize the environmental benefits. Hence, innovations along with technological advances are required to make plant-based food production sustainable.

Visually appealing meals

Visually appealing meals, is yet another millennials-oriented trend that seems to disrupt the food industry. Consumers prefer trendy and visually appealing meals and drinks. It is not only famous “foodies” influencing the public. Millions of people photograph their meals and drinks to share their new favorite finds on social media. A vast number of pictures containing foods and drinks is posted online every second. Food in not just a primary need we need to fulfil. What we eat is a lifestyle statement and at times a political one.

visually appealing food

This exploding trend has notable consequences for restaurants. Firstly, the role of design became paramount, not only in the presentation of dishes, but also in the presentation of the interior of the restaurant, the menus and even the toilets! Investing on social media and understanding the potential of the word “viral”, may well worth the investment, because all those people photographing a restaurant can provide a lot of free publicity.

On-line food orders and home delivery

Transformation of the market has already taken place through a plethora of new digital models by all stakeholders in the food chain globally. People have less to no time to cook, yet they still want to eat healthy professionally cooked meals. Hence, the solution is online ordering. The US food delivery market could grow to as much as $210 billion over the long term, which illustrates the potential of this trend in the food and beverages industry. 

There are numerous aggregator companies to handle delivery operations. The pace and number of changes will grow as companies experiment to develop competencies in the new digital ecosystem, offering an array of value-added delivery options to consumers at any time and any place (e.g. at work, at their houses, or even inside their refrigerators). To stay competitive, restaurants have no choice but to include home delivery in the portfolio of their services and make sure that their menus are accessible online. 

Finally, several farmers as well as food manufacturers, are also relying increasingly on direct-to-consumer (D2C) sales, mainly online, shortening traditional commercial circuits involving intermediaries, wholesalers and retailers.

 

The food industry is on the verge of revolutionary changes, with traditional market models being digitized and production methods becoming unsustainable due to two major drivers: 

  • consumer trends that push production towards healthier dietary choices,
  • the recent COVID-19 virus crisis, that pushes the market towards digitization in order to limit physical interaction.

Businesses need to adapt into this new era in order to stay competitive. Only those who have the agility to innovate will survive.

 

For more information, please do not hesitate to contact us at: info@sevensigma.gr


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