Last year was a big one for the food and beverage industry. Sales surged past $7.8 billion in 2019, representing a nearly 4% increase over 2018. While that might seem like modest growth, food and beverage sales emerged as the fastest-growing e-commerce category in 2019.
Experts expect some of the trends that shaped last year to persist throughout 2020, including the lingering effects of the trade war, the soaring popularity of CBD and hemp products, and the public’s unwavering concern for sustainability. Industry leaders remain optimistic, and 84% predict continued revenue growth in 2020, according to the “Mazars 2019 Food & Beverage Industry Outlook.” Executives interviewed for this study also expected consumers to continue demanding healthy products, private-label brands, and free-from offerings in 2020.
Despite economic damage from the COVID-19 pandemic, and that many businesses remain closed or are operating at lower capacities, optimism persists. According to a survey from Mattson, a Silicon Valley food innovation and development firm, roughly half of food and beverage business leaders believe manufacturers will emerge from this crisis in better shape than before. Respondents attribute optimism to the flood of consumers returning to home cooking and a more robust supply chain.
The Mattson survey also found that innovation is still alive and well, with nearly two-thirds of companies reporting that they’re working on new concepts or products. This kind of market insight is why TraceGains invited Barb Stuckey, president and chief innovation officer at Mattson, to headline TGCon Live 2020 on Aug. 18.
Mattson helps clients, from startups to Fortune 500 companies, identify new food business ideas, and bring them to life with commercially viable prototypes, developing them through to market-readiness. Stuckey is also the author of “TASTE: Surprising Stories and Science About Why Food Tastes Good.”
Stuckey, who will discuss food innovation trends at TGCon Live 2020, has ideas about what will drive growth in the food and beverage space in 2020 and beyond. She expects alternative foods, or “great fakes,” as she dubs them, to see continued growth. That includes brands such as Impossible Foods, Endless West, and RightRice.
She agrees the issue of sustainability isn’t going away, especially with younger consumers increasingly concerned about climate change. The drive toward more sustainable food and beverage products includes the growing use of high-tech ingredients that enable manufacturers to do things that wouldn’t have seemed possible a few years ago.
Ingredient Innovation Explosion
“As one single example, take the consumer desire for low- and no-sugar natural products that will continue to grow in all categories, as we already see,” Stuckey wrote in a recent Forbes article. “To do this well, we need to go beyond the stevia leaf. That’s where food tech comes in.”
Stuckey suggested sugar reduction and proteins are just two markets, “experiencing an explosion of ingredient innovation,” pointing to Amyris, one example of a company that’s making an artificial sweetener with yeast.
Did You Miss TGCon Live 2020?
Don’t worry if you weren’t able to attend TGCon Live this year or missed a Stuckey’s session. The entire conference is available on-demand at no cost here.