Written by Mohit Agrawal, manager of the Dubai office at Simon-Kucher & Partners (www.simon-kucher.com)
With the Great British Food Festival just around the corner, the UK F&B industry is once again starting to blossom following the impact of the pandemic. But what can we expect from the industry in the coming years?
From consumers growing increasingly aware of the environmental impact of their eating habits to the rise of ghost kitchens and personalization in customer engagements, Simon-Kucher and Partners shares its expert advice on three F&B trends that will influence the industry in 2022 and beyond.
A trend in conscious eating is on the rise
With UK consumers looking to not only eat healthier and more organic foods, but also invest in products that are more ethical and environmentally sustainable, conscious eating is a trend that’s set to only increase in popularity throughout 2022.
In fact, a recent survey by the Food Standards Agency (FSA) found that 73% of UK consumers believe it’s important to buy food that has a low impact on the environment, with 54% agreeing they’d like to make their diet more sustainable. This is also a trend seen specifically in the younger generation, with 66% of 18–24-year-olds in the UK agreeing that they’re more likely to buy from an ethical and sustainable retailer.
In response to this, more and more F&B retailers are introducing sustainability initiatives to source more ethical produce, reduce waste, and decrease their environmental footprint. For example, large retailer Tesco PLC has committed to increasing their sales of plant-based meat alternatives by 300% by 2025, as well as decreasing manufacturing and agriculture emissions by 35% and 15% respectively by 2030.
To stay ahead of this trend, it’s important for UK F&B vendors to evaluate and improve the sustainability of their current products, as well as be able to clearly communicate the features and benefits of their ethical practices with consumers.
Adoption of leaner food service models
In 2021, the UK food delivery market saw a strong growth of 6.5%—with the market predicted to grow a further 5.3% in 2022. With UK consumers ordering in more than ever before, F&B vendors are turning to alternative service models to satisfy the demand for speedy, high-quality, and affordable home-delivered food.
This has led to an acceleration in the adoption of “cloud” (also known as “dark” or “ghost”) kitchens—services that host numerous vendors under one roof and that only offer food delivery services, with no space for consumers to dine in. In 2021, the UK was home to an estimated 750 cloud kitchens, with that number only set to rise throughout 2022 and beyond.
And it’s not only big players like food delivery service Deliveroo—who saw a 12% increase in vendors using its “Deliveroo Editions” cloud kitchens throughout the pandemic —that are benefitting from the wide-scale adoption of leaner service models. Smaller start-ups have also thrived, with London-based Karma Kitchen raising £252 million in series A funding during the pandemic and planning to build a further 30 sites in the coming years.
To stay relevant in today’s F&B market, more traditional vendors should evaluate and consider leaner food service models to help grow their revenue, cut costs, and satisfy customer demands.
A higher demand for personalized experiences
As consumers spend more time interacting with and buying from brands online, delivering personalized experiences across digital touchpoints is a growing trend in 2022.
Research shows that 62% of UK consumers are more likely to return to brands that recognize them as individuals, with 43% exclusively buying from brands that understand their preferences by offering personalized deals and more.
To build strong relationships with their consumers, many F&B vendors are using data collected from customer interactions to personalize their experiences with their services. Online food delivery platform Uber Eats is just one of many platforms that have had great success in offering personalized feeds and meals—with each customer being presented with a tailored set of restaurants, cuisines, and dishes that are based on their historical use of the app.
To ensure consumers return to their brands time and time again, F&B vendors should look to build customer engagement via personalization and tailored communications across digital touchpoints.
Trends such as conscious eating, leaner service models, and personalized customer experiences are set to continue to rise throughout 2022 and beyond. F&B vendors looking to thrive in a highly competitive environment need to quickly learn to adapt, or else perish.