Where and what consumers eat is changing, and this is driving innovation in the retail food industry. Below we’ve compiled some of the interesting food trends we have seen in our work and experienced firsthand, followed by tactics that communities can take to support and encourage food innovation.
Trends in how consumers are getting grub.
Meal and food delivery is making eating quicker and easier.
In the land of next-day delivery, the rise of ordering your groceries or dinner online and receiving them in your pjs is a likely counterpart. Food can be delivered ready to eat (through services like UberEats, DoorDash or ChowNow), ready to cook (think Blue Apron or HelloFresh) or ready to prepare (Misfits Market offers a produce delivery service for misshapen but fresh produce). Gradations of food delivery also exist such as the pull-up delivery (ordering online and driving to the store to receive the goods) or picking up vittles at other locations you frequent, such as work or the gym. Fuel4Life is one service we have used.
For more on food deliver trends, see this month’s Featured Indicator, where Jessica Ulbricht explores the Instacart Online Grocery Shopping Dataset, which contains over 3 million grocery orders from 200,000 users.
Temporary dining establishments are creating their own market demand.
Popups! Food Trucks! Tastings! Oh my! Temporary dining establishments such as these bring a sense of scarcity to food offerings – better get it while it’s here! – that have helped them create a buzz to succeed. Whether centered around a downtown or at the county fairgrounds, food-focused events are a big draw, pulling regionally for things like chowder, bacon, and even garlic. And, they are good for food entrepreneurs with limited overhead, flexible locations, and the ability to try a product before making larger batches or committing to a permanent location.
Restaurants are accommodating convenience and choice.
Consumer preference for ready-to-eat food is increasingly leaning towards fast, casual, convenient, and with all the choices. This is apparent in these trends we’re seeing:
- Food Hubs. Harnessing the power of multiple food-based (and related) businesses can have a multiplier effect. A food hub in this instance, is the collection of businesses in separate buildings but on one lot. The Artisans Park in Windsor, Vermont is an example of a such a hub.
- Food Halls… are all the rage. Think of an amped up, artisanal version of the food court at your once thriving mall. Bonus: Businesses often graduate and expand into their own location, making room for an array of offerings. Salt City Market in Syracuse, NY is one great example due to open Fall of 2020. They link food entrepreneurs together at the ground level, and offer live and workspaces on the upper stories.
- Dark Kitchens. Also known as cloud kitchens, these are establishments whose sole mission to prepare and deliver food. With so many delivery services available, these facilities are skipping the tables and wait staff altogether, focusing on getting food directly to people in their homes. An office favorite is Nine Miles East near of our Saratoga Springs office (which also offers a meal delivery service!).
Trends in what consumers are choosing to eat.
Non-meat meat has entered the conversation, and the grocery store.
Americans eat more meat per capita than any other place in the world. However, with mounting concerns over climate change and animal welfare, the crop of available alternative meat products has skyrocketed, with sales estimated to hit $7.2 billion by 2025. While big players such as Kroger have gotten into the game, it was only after the success of many small entrepreneurial endeavors. One such entrepreneur is Ethan Brown, who’s little company Beyond Meat started in 2008 is now valued at over $10 million, employing over 350 people.,
Specialty foods are rising in demand.
Besides plant-based meat, there are countless other food product trends in this ever-evolving industry. Nationally, the specialty food sector is expanding rapidly, outpacing non-specialty sales growth in almost every category. Specialty foods are considered unique and high value, often made in small batches. Between 2015 and 2017, specialty food sales grew 12.9%, compared to 1.4% for food overall. By 2022, specialty food is expected to account for 22% of all food sales, compared to about 16% today.
Some key trends in specialty food include:
- High growth in refrigerated and frozen food categories, with ready-to-drink tea and coffee; frozen meat alternatives; refrigerated entrees; and frozen desserts topping the list.
- Specialty snack foods comprises a large and growing share of the specialty market, with high-growth categories including jerky and meat snacks, yogurt and kefir, wellness bars and gels, nut and seed butters, and rice cakes.
- Specialty beverages have outpaced specialty food growth.
- Gluten-free, non-GMO, and convenient/”easy to prepare” are the leading areas of innovation for manufacturers.
- Ethnic foods and flavors continue to grow in popularity.
- Indoor, vertical farms that primarily grow greens are becoming a trend outside urban areas.
Ways to support and encourage food innovation in your community.
With consumers looking for convenience, casual environments, and lots of options including environmentally conscious options, how can communities adapt to these food trends to encourage their development? Here are some tactics:
Assess your resources. First, what does your unique food landscape look like? What school programs offer food instruction? How can you get the local food pantry involved? Understand the resources, from arable land to storage facilities to existing start-up programs and businesses. Connect with them to listen to their barriers for growth, and work with the resources you have to connect the dots. Additionally, an analysis of the food supply chain will help identify opportunities and gaps for growth in your area.
Build a relationship with your local health department to ensure excellent communication. Set up a meeting to run through some potential trendy scenarios and understand what will be needed from the food entrepreneur. Work to ease the permitting process through on-demand webinars, clearly articulated websites, and other resources. If your health department does not have a definition of a shared kitchen, work to make this happen.
Examine your entrepreneurial resources. Entrepreneurs have a greater chance of success if they have connections to networks in the community, access to capital, a culture and coaches that support them, and a political climate that facilitates their growth. Examine these resources in your community to understand the strengths and weaknesses of your entrepreneurial ecosystem. Speak to food innovators (your local farmer’s market is a good first bet) and understand needs, desires, and frustrations along the way.
Allow it! How easy or hard is it to have a food truck in your community? A pop-up event? What are the concerns of the existing business owners? Understand the path an event planner or entrepreneur needs to take to facilitate any one of these innovations and make that path as clear and seamless as possible.
Never stop marketing. Spread the word to your contacts (personal and professional) regarding food events and food stories. Identify local social media influencers in the community and engage them as advocates, even if food is not their primary focus – everybody eats!
In all, access to food is one way communities can differentiate themselves in the consumer market. The extent to which you facilitate these innovations can result in less vacant retail space, increased entrepreneurship opportunities, and added employment. The retail landscape can be stale, but your food-sector doesn’t need to be!
 Specialty Food Association. The State of the Specialty Food Industry. 2018.