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Post Time:2018-11-27Author:F2C

From highly sought-after brunch to prevailing salad staples and avocado boom, more and more new concepts and food ingredients set food trends in the past few years. Last year, some unexpected dark horses stirred up the food industry.

According to the latest report on catering industry released by restaurant management platform Upserve, jackfruit and coconut are replacing deli meat to become the favorites of Western people. Greek yogurt (strained yogurt) launched by start-up Chobani touched off a Greek yogurt fever in the US and promoted its market share in yogurt in the US to upsurge from almost 0% to 46%, becoming one of the most popular side dishes for consumers. Halo Top, an ice cream brand that prides itself as a healthy food good for even those losing weight, was listed as the "top selling ice cream brand in the US" due to its Internet celebrity-like appearance, tempting taste, low calorie, low sugar and other advantages. And it constantly impacted ice cream retail giant Unilever. Whole Foods, a fresh food market brand that "wants everyone to enjoy healthy organic foods", was acquired by Amazon for 1.37 billion USD, which urged food retailers to understand their game with giants in a new way and consider how to upgrade their technologies, strategies, brand communication and distribution model...

Under fierce competitions, companies and entrepreneurs focusing on food are now exploring technology-based innovations that cover product upgrading, green packaging, supply chain efficiency, etc. On this basis, what will be the development trends of global food industry in 2018?


1.Retailers will continue to expand their private brands and squeeze CPG brands

When Costco's private brand Kirkland Signature took up a quarter of Costco’s total sales, more retailers realized that differentiating themselves from their competitors with private brands could enable them to better control the classification and assortment of products on shelves and attract consumers to repurchase their products.

Walmart, Kroger and Safeway have unveiled their private brand products one after another, which are usually popular and cheap. According to Kroger, a retailing company with a history of over one hundred years, the growth of its private brands in 2018 will be an important driving force for its transformation. In the coming year, more retailers will promote and expand their private brand products to gain more market shares.

2.CPG brands will set up their own distribution channels to counter restrictions imposed by retailers

Even if retailers establish their own brands, CPG brands still have to rely on them. Currently, leading food companies like Kellogg's and Kraft Foods do not run their own stores or sell products on their official website, but it is certain that things are slowly changing.

The most typical example is Nestlé, who vigorously promoted its distribution channels in 2017. It invested in Freshly, a direct-to-consumer catering delivery start-up, in June 2017, hoping to increase its market share with Freshly's customer data. Three months later, it spent another 500 million USD in acquiring Blue Bottle, an Artisinal coffee chain. After these moves, Nestlé actually controlled dozens of physical coffee shops in the US and opened its first Nespresso design concept store. These are all Nestlé's innovative attempts in setting up distribution channels.


3.Combining offline sales with online sales, food companies will overturn traditional designs of packaging labels

In the past, beautifully designed CPG products could stand out on store shelves. But on e-commerce platforms, commodity brands are faced with a completely different situation. On the one hand, they tend to use bold colors and simple labels to attract shoppers on social networking sites such as Instagram. On the other hand, when conducting online marketing, they can display both packaging and products in it. Products inside the packaging are shown to consumers through pictures, which is much clearer than packaging labels and can attract consumers' attention to natural ingredients and other product features.

4.CPG brands will establish a risk partnership with Amazon

For CPG brands without a e-commerce store of its own, cooperating with Amazon seems to be a very attractive and necessary option. In doing so, they can not only quickly reach consumers, but also enjoy Amazon's value-added services such as IT and online management.

Some companies have tried this method by forming a risk partnership with Amazon. For example, Tyson Foods and Amazon teamed up to launch Tyson Tastemakers meal kits and Oreo Cookie Club Subscription Box. But this is just an expedient measure. If CPG brands rely on Amazon to sell products, Amazon will get their consumer data. Besides, Amazon tend to provide more rights and interests support for private brands.


5. Food companies will use more environmentally friendly packaging

Based on anti-corrosion, preservation and other needs, environmental pollution issues generated in the process of delivery have become a common problem in food industry. In the past few years, bad news on Blue Apron, the largest semi-finished grocery chain in the US, came out one after another due to problems with cardboard, plastics, and large ice packs used in shipping containers.

In 2018, catering start-ups and food companies may pay more attention to the impact of packaging on the environment. Amazon's approach may bring some changes. This home appliance retailer giant has provided "frustration-free packaging" for more than 1 million products. Less materials are used in this new packaging than traditional one. According to Amazon's senior manager of customer packaging, this program can save 83 million cartons annually.

6.Two-way wall-breaking fusion between foods and beauty products

Eating beauty supplements is nothing new. Attention from venture capital institutions and capital injections are bringing good opportunities for food brands focusing on beauty. Food companies dedicated to skin and hair protection, and protein supplementation have recently become the hot targets of investors.

Even food delivery start-ups have begun to set foot in beauty industry. Sakara and Urban Remedy are selling skin care package products, including collagen and probiotics. To be more precise, the desire for botanical ingredients is sweeping food and beauty industry. The trend of healthy eating is being sought after by beauty brands.


7.New plant proteins will embrace explosive development

With the growing popularity of plant-based products, food manufacturers are looking for new vegetable proteins beyond soy and nuts--pea protein may be the most cutting-edge trend. Peas meet the needs of people with soy or nut allergies for protein, and have low fat content.

Attempts made by start-up Ripple Foods promoted the sales of pea protein to a certain extent. It mainly sells pea-based vegetarian dairy products in the US and has now received 43.6 million USD of financing. Recently, it also launched a new product--pea yogurt. Other companies such as Aloha and Beyond Meat use pea protein to change the current vegetarian trend. Industry leaders including Campbell have also launched their own pea protein products. As the production of pea protein increases, other proteins such as mushroom protein and spirulina protein will come onto the market, too.

8.Meat and dairy product companies will be affected by vegetarianism and plant production will be explored

As more consumers turn to healthier vegetarian products, meat companies naturally take notice of these trends. While continuing to focus on meat production, they have begun to hedge bets by investing in vegetable proteins.

Two cases in point are Tyson Foods, a US meat company who owns the largest market value, and Cargill, the biggest private meat and agricultural products giant.

The sales of plant proteins increase almost twice as fast as animal proteins.

With ever growing consumer demands and investments from leading institutions, vegetarian and plant-based food companies are expected to continue encroaching on the market share of meat in 2018. In the next 5-10 years, more meat producers may invest in or acquire plant protein companies to maintain their market competitiveness.


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