Sustainability + Indulgence + BFY

David Lockwood, consultant director at research firm Mintel, and David Browne, a market research analyst and brand consultant, reviewed the category trends, channel breakdowns, consumer shopping behaviors and product positioning claims shaping the market

“We’re fast approaching the point where specialty is basically 20% of all food and beverage sold through any outlet selling grocery,” Browne said. “That’s a major milestone.”

“Specialty beverages are growing faster than food, up 13% from 2016-18 compared to 10% for food. Both food and beverage are seeing mature categories advance further”

Lockwood further noted that functional drinks grew 4% in 2018 and will “explode” in the next four years; emerging brands have more flexibility to capitalize on this than larger companies, he said.“To stand out in any channel, positioning is key. Within specialty, products with all-natural and organic claims drew the most traction, with 68% and 55% purchase rates, respectively, and are popular across demographics. Non-GMO wasn’t far behind, with a 45% purchase rate, and fair-trade at 36%. Despite “natural” lacking a concrete definition, it’s “still resonating with some consumers because they still see it,” Browne explained.

Indeed, consumers increasingly want products that emphasize transparency and traceability, and companies are responding: 36% of specialty food and beverage purchases were spent on products labeled as “all-natural,” 32% on those labeled “non-GMO” and 30% on “organic.