From a renewed emphasis on supply chain transparency to the rise of plant-based proteins, 2021 promised sweeping changes to the CPG business as the world’s economies sought to bounce back from a year lost to a global pandemic.
In February, we compiled a list of the food, beverage, and dietary supplement trends we expected to shape product innovation in 2021 here. Now that July is in the rearview mirror, and the Delta variant of COVID-19 threatens to derail the recovery, we thought it might be a good time to check back in on those forecasts.
1. Clean Labels Still All the Rage
An early 2021 Innova Market Insights survey found that six in 10 global consumers wanted to know more about where their food comes from – and what goes into it.
When consumers are increasingly engaged, better informed, and making purchases based on dietary restrictions, ingredient considerations, and health concerns, manufacturers understood that ensuring compliant and accurate label claims would remain a critical part of doing business.
That trend seems to have held. According to a new study by the International Food Information Council (IFIC), nearly two out of three consumers say that ingredients have a moderate or strong influence on their food and beverage purchases. And 63% of consumers said they were paying more attention to ingredient lists.
2. Plants Show Staying Power
Over the last several years, consumers have been buying up plant-based food and beverages – and proteins in particular – in droves. In 2020 alone, plant-based protein sales soared 63%. Additionally, a United Soybean Board study found that nearly two-thirds of Americans aged 16-49 consumed more plant-based foods and beverages in the last two years.
Based on a robust holiday season, analysts expected the trend to continue in 2021. Rapidly improving technology will only improve on what’s already a $7 billion market. Many food and beverage manufacturers have started tweaking their formulation processes to keep pace with rising customer demand.
And while it’s still too early to. Crunch 2021’s sales numbers, plant-based milk, and meats continue to dominate the market. However, some newer players have started to make waves. For example, BlueNalu, a pioneer in the plant-based seafood market, plans to begin production this year. And a variety of plant-based cheese startups are making a move into the market as well.
3. Consumers and Companies Alike Embrace Sustainability
At the start of the new year, analysts expected consumers to spend up to $150 billion on sustainable products in 2021. Driven by increasingly eco-conscious consumers, sustainability has grown beyond its fringe roots and become mainstream.
Despite the optimism, some industry analysts thought the pandemic might interrupt sustainability efforts – at least in the short term. But a 2021 MIT State of Supply Chain Sustainability report found that 80% of companies “claimed the crisis had no impact or increased their firm’s commitments to supply chain sustainability.” In fact, 83% of respondents said that the pandemic either accelerated their efforts activity or, at least, increased awareness and ignited a sense of urgency.
This past year has shown that supply chain sustainability is more than a trend; it’s a roadmap for the way forward for food and beverage companies
4. Personalized Product Demand Still Drives Innovation
Since the onset of the pandemic, consumers have shown a renewed interest in their health and wellbeing, with growing demand for healthy alternatives and dietary supplements. This pursuit has led to the emergence of personalized nutrition options: food, beverage, and nutritional supplements that work for individual consumer needs. Innova found that nearly two-thirds of consumers worldwide have embraced new lifestyles and added products that help support them.
With technology getting better every year in the personalized space, a steady flow of new products tailored to individual needs continues to flow into the market. Consumer demand has remained strong, and companies have spent 2021 trying to keep up, with options ranging from dietary supplements to complete diet plans.
“Any company that’s not doing personalization is going to die. Every person in the next five years is going to ask for foods that are personalized for them,” Naveen Jain, Founder, and CEO of Viom, told NutraIngredients-USA, the leading news source for the functional foods and dietary supplements industries in the United States.
Industry giants like Mars Inc. and Nestle have already begun making inroads into this emerging market:
- Mars acquired a majority stake in Foodspring, a German protein shake and snack company that’s emerged as one of the largest and fastest-growing targeted nutrition businesses in the European Union.
- While Nestle bought Persona Nutrition, a personalized vitamin business based in Washington state.
Manufacturers must speed up supplier and ingredient qualification if companies want to succeed in this space. An increased variation in SKUs means companies must find and qualify reliable supply chain partners. With growing product lines, accelerating formulation, and every other step of the new product development process is becoming a greater priority. Brands that want to personalize product lines must transform how they manage their supply chains and food safety system. A manual, disjointed approach can’t support increased scale.
5. Health and Wellness are Still Priorities
As the Delta variant surges, consumers in 2021 remain interested in bolstering their immunity. Innova’s research shows that six out of 10 global consumers want products that strengthen their immune systems, with “one in three participants saying that concerns about immune health increased in 2020.”
Consumers want products packed with nutrients, botanicals, and probiotics. Brand owners are shopping for immunity-boosting ingredients and investing in research into the microbiome’s role in health. A growing number of 2021 product launches include claims like “immune health,” “immune-boosting,” and “immunity support.”
It’s no secret that label claims remain one of the biggest bottlenecks that slow down formula and recipe development. Researching regulatory information like allergens, thresholds, international jurisdiction limitations, safety alerts, and associated science citations for health claims can take too long. If not done correctly, it can lead to significant brand damage and legal problems. To succeed, companies need a more reliable way to substantiate claims and functional product benefits. TraceGains makes it more accessible, with instant access to regulatory documents, citations, established business rules, and over 300,000 scientific studies.
Networked Formula Management
If your business is looking to get out in front of the trends shaping innovation, we can help. We’ve heard from many companies that the amount of time it takes to create and update formulas and recipes slows down product development. First, it takes too long to find suppliers and ingredients. Then, you have to wade through an enormous amount of paperwork to ensure you have what you need. And that’s just the beginning.
We wanted to make it easier. You connect with your suppliers on TraceGains Network and get instant access to the supply chain data and documents you need to speed up your formulation process. Our network has grown for over ten years. Today, companies find that, on average, 80% of their suppliers are already on TraceGains. Learn more about networked Formula Management here.