In 2018, global value sales of meal solutions (cooking ingredients and meals, and staple foods) is projected to collectively comprise 53% of total packaged food sales, amounting to USD1.2 trillion. Over a five-year period from 2013, the top 10 growth markets gained USD79 billion, of which China and India contributed a lion’s share, followed by the US. South Korea, Indonesia and Vietnam have also recorded impressive absolute value sales over the same period, totalling five Asian countries among these top 10.
Beyond these markets, the expansion of meal solutions tends to be more stagnant, as snacks and dairy products and alternatives have led growth. Hence, innovation is essential in making these categories more dynamic and to incentivise consumers to cook at home.
Euromonitor International Consumer Lifestyles Survey has shown a shift towards “all-day grazing,” where more people are consuming smaller portions of food dispersed throughout the day instead of three big meals. Combined with the sustained demand for more health and nutritious benefits, innovations have incorporated ancient grains and plant-based ingredients.
Amidst the surge of portable food, consumers are valuing their meal times more than ever and perceive them as social gatherings. 43% of surveyed respondents dine out at least once a week for social opportunities. Blackbird, a foodservice in Switzerland has evolved from a café, to social club, to family-friendly diner over 2014-2018 to better cater to the changing priorities and demographic of its customers. Consumer palates have consequently become more sophisticated and exposed to different ethnic cuisines, because of various menu and curation offered by foodservices, and demand for a similar experience at home.
Increasing focus on ethical labelling
Consumers’ changing priorities have also shone a spotlight on the ethical values of the brand and company they buy from. Manufacturers have strived to position themselves favourably to consumers by making their corporate social responsibility more apparent. This transparency typically takes in the form of certification and claims.
In fact, clean labelled packaged food and drinks is a 260 billion dollar market in 2018. In the US, Unilever Group and Kraft Heinz have gone head-to-head in introducing “real” varieties of Americans’ staple condiments like mayonnaise and ketchup. These condiments feature ingredients such as cage-free eggs or True Source certified honey used as natural sweeteners in a bid to lead the clean label race.
Food safety continues to be a growing rhetoric especially in emerging markets and customers trust religious labels to certify the authenticity of ingredients and food hygiene. Beyond their own wellbeing, consumers are also increasingly concerned for animal welfare, and the effects of packaging on the environment. Australasia has shepherded the recycling movement, with almost half its products sold in a recyclable packaging, while flexitarian diets are increasingly aspired.
Looking ahead, it can be expected that innovations will merge several characteristics in line with the three themes outlined above and marry them with ethical values. This strategy is likely to be adopted by manufacturers within more stable categories and in more developed markets. Nevertheless, manufacturers in emerging markets can look to these examples to anticipate the growing demand for their own base of customers in years ahead.