Capitalizing on Consumer Trends in F&B

It’s a good time to be small in the food and beverage industry. Experts predict that the 'big brand' era in F&B manufacturing will soon be eclipsed by the small and the niche, and it’s easy to see why: at the rate at which global consumers update their tastes, diets and eating habits, opportunity now favors the small and middle market players—provided, that is, they stay quick on their feet. F&B companies must be nimble enough to respond to and reinvent for changing consumer preferences and global trends, or risk finding themselves at the bottom of the industry food chain.

But what to innovate, and where? Paying attention to key consumer food trends can point F&B companies in the right direction—in both geographical location, and product sector.

Country-specific trends

It’s crucial for companies to decide which products to develop where. The industry is facing enormous growth potential: BMI Research forecasts the global food and non-alcoholic drinks industry to grow by 6.1% in 2018 and to average an annual growth rate of 6.8% over the next five years. To capitalize on these growth opportunities, global export and international marketing are integral tools in any manager’s strategic arsenal.

Of course, consumer trends also adopt local flavors, and a company’s F&B export offerings should match them. BMI Research predicts that rising incomes in emerging markets like Mexico and China will see local diets gradually shifting to become more like developed states, which offers rich opportunities for premiumization in various F&B sectors.

Consumers in Mexico are spending more on meat out of total expenditure every year, particularly in the poultry and beef steak sub-segments where higher quality cuts are more readily available. China is a key driver of the outperforming growth of dairy, as rapidly emerging café and bakery culture sees young Chinese city dwellers increasingly resembling Western countries in their consumption habits. To exploit export opportunities in these respective countries, companies who play in F&B sectors that are able to offer premium products can tailor their export strategy according to these major trends.

General consumer trends

More broadly, there are trends that speak to consumers across the board—in particular, demands for more fresh, healthy and natural F&B choices, which bodes well for the health food market. A recent study reported that global food companies reformulated about 180,000 products in 2016 to meet changing preferences for healthy diets.

An RSM survey suggests various key trends companies should look out for, according to the experience of other middle market industry players:

From RSM US

While most companies seem attentive to health and wellness products as a key area for potential sales growth, the RSM survey points to a neglect of other trends that could present lost opportunities for maximizing strategic potential, particularly for non-US companies. Opportunities to develop convenient/easy-to-prepare food products have not been fully leveraged by most non-US companies, with similar gaps in ingredient transparency and labelling, non-allergen products, and non-GMO products, despite all these trends registering high in producing positive effect on sales over the last two years.

In sum, for food and beverage companies to sustain growth, they need to determine how to stay agile and adaptable: by harnessing a broad range of consumer trends, and by adopting international marketing strategies to cater to country-specific trends. Building a memorable brand can seem daunting amidst a veritable buffet of global food and beverage products... after all, it’s eat or be eaten in the F&B industry. But the opportunities are ripe for the picking. It’s time for the traditional giants to move aside—this is the age of the small and savvy. Interested in exploring your F&B export opportunities? Contact us to learn more about how we can help you grow your exports.

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Global Marketing Associates has been helping companies expand globally for over 15 years, including successful entry into the US. Contact us for a free consultation to learn more about how we can help your company succeed.