Foodnavigator-usa Podcast

Starting or running a business is undeniably hard – for everyone. Even if someone appears to be strolling down easy street, chances are they still wake up panicked in the middle of the night, check their work email on their phones in the bathroom and stress over balancing budgets just like everyone else.

While online purchases of food and beverage currently account for only a small fraction of the categories’ total sales, consumers are embracing online grocery shopping at an exponential rate – making it a channel where industry players need to be for the long term success of their brands.

At IFT earlier this month, banana fosters flavor was everywhere – on popcorn, in cookies, even in coffee – but according to the ingredient company Virginia Dare its star power status at the show wasn’t just because it is a traditional dish of the conference’s host city of New Orleans.

When large food companies began cutting back on in-house R&D in favor of investing in startups’ with promising ideas, some either didn’t factor in or miscalculated the resources and time needed to scale-up their acquisitions before seeing returns – leaving them with a gap in their innovation pipelines and no easy way to fill it themselves.

As the line begins to blur between food and beverage, consumers are looking for more than just hydration from their drinks – they also want function, but according to market research firm Mintel figuring out which benefits resonate with which consumers in which category is a challenge that has many manufacturers stumped.

The CBD market is exploding with the ingredient popping up in everything from bars to beverages to confections and everything in between – driving up sales to more than $200 million in 2018 by conservative estimates and an expected $3.8 billion by 2025, according to market research.

Members of the Organic Trade Association converged in Washington, DC, last week to celebrate the segment’s continuous improvement, and to brainstorm with each other and legislators potential solutions to ongoing challenges facing the industry.

Despite what your parents told you growing up – looks matter – especially for food and beverage products in the current era of Instagram where more than 500 million people around the world check their photo feeds daily and 68% of Millennials photograph their food before eating it.

While the rapid growth of the plant-based market in the US initially may have been fueled by demand for alternatives to animal-protein and -dairy, the trend is quickly evolving as consumers’ tastes become more sophisticated and they begin to embrace plants for what they are – and not just what they can mimic and replace.

The exponential growth of non-dairy milk sales and variety in the US, in many ways has been a harbinger for the overall plant-based movement, but as demand for the beverages continues to rise – so too are consumers’ standards, which could prompt a shake-out in the near future.

Attracted to recent high-dollar acquisitions, consumer demand for healthy and sustainable options, and the opportunities created by a diversifying retail landscape, the number of investors flocking to the food and beverage industry continues to grow exponentially as does the amount of capital they are betting on increasingly earlier stage companies.

While the vast majority of Americans still buy their groceries in supermarkets or at supercenters, their loyalty should not be taken for granted as other stores – including limited assortment, club, specialty and even farmers markets – are stepping up their game to capture market share.

Blockchain technology may be best known for its ability to securely move crypto-currencies such as Bitcoin around the word, but the technology can do much more -- especially in the food and beverage industries.

By 2050, the Earth’s population is predicted to reach upwards of 10 billion people who will require significantly more food than is produced today, which many predict is not feasible without drastic changes in the way food is produced, transported and consumed.

In recent years, the healthy eating trend had expanded dramatically beyond a fad for the few to gain a stronghold with mainstream shoppers, but produce is still at a significant disadvantage when it comes to capturing the attention of children and teenagers -- especially when it is pitted against the star-studded campaigns used to market sugar sweetened beverages, confections and salty snacks.

With annual retail sales of cold brew coffee estimated at more than $29 million in 2017 and predicted to grow to $170 million by the end of 2025, it is easy to see why at Natural Products Expo West in Anaheim earlier this month so many new players were entering the market with RTD options or leveraging the smooth, chocolaty flavor profile in products across categories.

CBD far and away stole the show as the hot new ingredient at Natural Products Expo West in Anaheim last week, but it wasn’t the only notable trend with promising market potential or significant recent development.

With newcomers launching practically every day in the food and beverage industry, the pressure is on for legacy brands to up their innovation game – and according to industry giant Unilever the best way to do this is to start with modern consumers’ core values and address their top concerns.

Whether through multi-million dollar investments in startups or high dollar mergers and acquisitions of larger, established companies, the food and beverage industry currently is being flooded with funding, and with it many opportunities as well as challenges.

For many food and beverage brands, their product packaging is their first – if not only – touchpoint with consumers, and yet all too often companies treat it as an afterthought or as little more than a protective exterior for what is inside.