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Three trends driving food and beverage innovation in Canada


Consumers are changing the way they interact with brands and how they purchase products, which is re-writing the rules for all industries, including food and beverage manufacturers. Consumers are no longer basing their product choices on taste and price alone – they’re looking at all aspects of a brand, from how goods are produced to how they’re marketed. To meet these new demands, companies need to innovative to capture all opportunities to hook the customer. In this article, we’ll explore three trends that are shaping consumer behaviour, and what leaders in the food and beverage industry should be thinking about to make sure they stay ahead of the competition.

Meals on-the-go

Canadian attitudes towards meal planning and preparation are shifting. We’re eating on the run nearly half the time. As a result, demand will continue to grow for prepared and portable foods, significantly impacting food portion size and packaging. According to Agriculture and Agri-Food Canada, in recent years snack foods have been one of the fastest-growing product categories in Canada. Demographics are also influencing Canadian food consumption habits. With nearly half of adults eating alone, and with household sizes decreasing, convenient, quick and individually sized meals will only increase demand.

Functional foods

As the aging population in Canada grows, so will their purchasing power. It’s projected that in 2015, Boomers will control more than half of the money spent on grocery food. This generation is innately health conscious – raised during the years the Canadian Food Guide was first introduced – and they’re label readers and calorie counters. As their health concerns increase, another trend emerges: food-as-pharma products that respond to health issues like osteoporosis, high blood pressure and diabetes will be increasingly in demand. These so-called functional foods – foods containing ingredients with perceived medicinal benefits – are being sought out by consumers as a way to target illness or lower the risk of disease.

Organic food movement

For more than a decade, the organic food movement has driven a shift in purchasing habits by consumers and institutions alike. Concerns over health and nutrition, food safety and quality, local economies and the environment, have all played a role in this phenomenon becoming a norm. For the past seven years, the organic food industry has grown about 15 per cent per year. For businesses throughout the food supply chain, organic food is a way to differentiate from the competition and create new opportunities with a targeted audience. Take a look at the Whole Foods chain, for example. Each year, about 35 to 40 new Whole Foods stores open, and it’s predicted that the chain will continue to grow at this rate for the next 10 years.

So how do leading companies address these trends and stay ahead of the competition? The key to success here is innovation. Companies have an unprecedented ability to understand their consumers. By starting with the behaviour that motivates your customer base, you’ll be able to predict trends and translate them into innovative products that attract consumers. Leaders in the food and beverage industry can take advantage of these trends by improving their business intelligence and customer service capabilities.

Technology has made reliable consumer insight easier than ever to capture. Once you have those insights, you can innovate to create offerings that represent the value of your brand. Leading companies are keeping track of the trends explored above, learning what their consumer wants and needs, and restructuring their organization to deliver it.

In the recent PwC report Growth strategies: Unlocking the power of the consumer, we outlined some key questions that will help direct organizations to stay ahead of market trends:

  • Does your organization have a clear strategy in place to look out for and capture emerging business opportunities?
  • Do you have the right talent in place?
  • Will your organizational culture support organizational change?
  • Does your organization have the right metrics in place to measure success?

Addressing these areas will help position your organization for success by putting the right resources and investments in place to adapt to change. Innovation requires a sound framework, but by listening to your customers and staying on top of emerging trends, you’ll be better able to foster long-lasting relationships with your consumers.

Mauro Fratarcangeli is an Audit and Assurance Group partner in the Toronto office of PricewaterhouseCoopers LLP, and is PwC’s National Food and Beverage leader. He is also a member of the Private Company Service team. Fratarcangeli has 25 years of dedicated experience serving the needs of dynamic mid-market private companies. He also has significant experience with high growth, global middle market private companies in a variety of industries including manufacturing, distribution and real estate. Contact him at [email protected] or at (416) 218-1433.