At-home meal occasions benefited cooking ingredients and meals tremendously in 2020, with 9% value growth in constant terms. Compared to pre-pandemic sales in 2019, there was a large jump in sales up to 2021, making the category a USD434.9 billion market globally.
With cooking and eating at home expected to persist to some extent in the near future, demand is set to grow consistently in 2022 and beyond. This is in part due to the shift in habits and lifestyles, as the pre-pandemic trend towards dining out lost momentum in 2020.
Greater impact of foodservice on retail innovations
In 2020 and 2021, many foodservice operators tapped into retail to gain an alternative revenue stream, exposing consumers to the concept of restaurant food at home. For example, one of the largest Italian producers of fresh and ready-to-eat fruit and vegetables, La Linea Verde, launched the DimmidiSì Poké Bowl in 2021. Prior to its release, there were no ready-to-eat poké products produced and distributed on a large scale and sold through retail. The compartmentalised ingredients guarantee the product a shelf life of seven days, an advantage over fresh poké bowls purchased via fresh meal delivery as these must be consumed within a day.
With retail food manufacturers competing more aggressively with foodservice operators, products must be innovative and embody a positioning and experience beyond packaged meals. This also raises the attractiveness of products created by renowned chefs or restaurants.
Digital evolution enhances channel development and strategies
The emerging subscription model of meal kits has carved greater relevance of e-commerce for meals at home in some regions and will create opportunities for other digital strategies. These developments have triggered new business models, such as dark kitchens, as added competition to meal fulfilment.
Digital evolution will also impact the way companies communicate with consumers, especially as consumers become more involved in their meals. Rising interest in ingredient provenance has escalated the need for traceable food products. For instance, as use cases for QR codes continue to grow on the back of their significant rise since the early days of the pandemic, it may play a bigger role in communicating authenticity and origins.
Holistic wellness gains relevance as functionality balances with "natural"
Focus on nutrition is gaining in importance as consumers are expected to become increasingly discerning of the food they eat. However, natural positioning continues to gain favour, causing consumer goals for holistic wellbeing to escalate. Notably, there has been an increase in products labelled “natural” or “naturally healthy” within cooking ingredients and meals categories between 2018 and 2021, bucking the trend shown by other health attributes.
Nutritional benefits of meals must be supported by a more holistic positioning of wellness. Healthy food strategies are evolving such that products are positioned to be aligned with other food beliefs and values, such as sustainability and the perceived benefit of ancient ingredients.
Shift towards local, authentic ingredients
Despite interest in artisanal brands, products and flavours, many consumers might be resistant to the perception of high prices that come with a premium or gourmet positioning. Authentic ingredients that are adapted to local cuisines may encourage spend among consumers wary of premium positionings, but who still desire novel offerings. In 2021, 26% of 21,457 global consumers in Euromonitor International’s Health and Nutrition Survey selected a preference for ingredients from their country of origin.
Nuna, a Bolivian brand of jams by Nanda Corp SRL, strikes a balance between taste and functionality, as well as indulgence and wellbeing. The brand is known for using local ancient ingredients such as Yacón yams, a root native to South America. Yacón is associated with extensive nutritional properties, claiming to even be suitable for diabetic consumers. Using locally sourced ingredients and adaptation to local palates is particularly applicable to cooking ingredients and meals given their suitability to local cuisine/meals. Consumers actively supporting local communities during the pandemic may continue to seek out domestic brands and products.
Plant-based meals gain traction and further align with sustainability
As the plant-based trend further penetrates markets beyond milk and meat analogues, businesses are introducing an increasing range of plant-based options. Cooking ingredients and meal players are pushing for plant-based variants to their existing brands in markets such as the US, the UK and Germany, in order to gain a bigger share of the dining table.
While the hype seen over the last few years remains fresh, brands are expected to align a plant-based positioning to a sustainability narrative for longer-term relevance. Hence, meal kits have a major role to play in promoting sustainability, as the pre-portioned model promotes zero food waste.
For further insights, see the report World Market for Cooking Ingredients and Meals.