The specialty food industry experienced success both during and after the pandemic, with trending items becoming commonplace staples; however, in this ever-changing landscape, new ingredients, flavors, and attributes can quickly gain and lose popularity.
During last week's SFA Buyers' Market webinar, "Category and Segment Trends Driving the Industry," David Lockwood, researcher behind SFA’s State of the Specialty Food Industry report, 2023-2024 edition, and Melanie Bartelme, SFA Trendspotter and associate director at market research firm, Mintel, shared insights into the latest category and segment trends that will impact the specialty food world.
They presented information regarding the following five category and segment trends:
• Frozen, shelf stable, and refrigerated
• Plant based
• Snacks
• Foodservice vs grocery
• Grains and pasta
They discussed the historical rise of frozen and refrigerated foods, as well as the resurgence of shelf-stable, center-store items.
“Surprising to me, what we saw this year was double-digit growth in shelf stable which is like recessionary behavior. We’ve had a lot of talk of a recession but no actual recession, as there are high employment levels and people have money in general,” said Lockwood.
The rise of shelf-stable food sales comes after nearly a decade of frozen and refrigerated items taking market share from shelf-stable foods. Between 2013 and 2017, Lockwood said that headlines like “Death of Center Store” were commonplace as retailers grew their frozen aisles, followed by a surge in their refrigerated sections.
“My personal view is the next two or three years will be way less eventful,” he said.
Bartelme added that a reason for the growth of center store could be concurrent with consumers’ desire for ease. She spoke about the comfort that frozen and shelf-stable foods provide to someone wanting to make a meal, being able to quickly prepare one with a jar of sauce or canned soup, and not having to worry about expiration dates.
When it came to evaluating the progress of plant-based foods, Lockwood shared that consumers and retailers are gearing up for a second stage of maturity in the category.
“Plant-based 1.0 is what you’ve been seeing pushback from consumers on. These products will roll away, and we will get the revolution that has already begun, plant-based 2.0,” he said.
Plant-based 1.0 includes foods that are often alternates, that don’t taste comparable or have room for improvement when it comes to flavor, and don’t provide as many nutritional benefits as consumers would like, he explained. Bartelme and Lockwood spoke of the innovation that is yet to occur in this space. On the product side, plant based is rife with opportunity, harnessing ingredients like mycelium, koji, algae, bacteria, insects, hemp, soy, and more. Plant based has grown to include products not specifically derived from plants but share a mission to transform products, they said.
The next generation of plant-based products will favor taste, price parity, and clean nutrition, and some of these products have already hit retail shelves.
To learn more about the trends driving the specialty food industry, watch the webinar on demand in the SFA Learning Center.
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