food and beverage industry growth Archives - Business Intelligence

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Food and beverage companies

Thought Leader Insights: Key Challenges in the German Food and Beverage Market

Germany is Europe’s largest market for the food and beverage industry. The changing food habits of German consumers are prompting several international food and beverage companies to set shop in this region. Food and beverage companies in Germany can also expect to see significant investments and growth over the next few years. The lucrative market prospects make the German food and beverage market a highly lucrative one, consequently, leading to cut-throat competition. In this article, an Infiniti Research thought leader, who has expertise in working with several global food and beverage companies overcome their business challenges, shares some critical insights on the German food and beverage market and describes strategies for players to succeed in the long run.

What makes the German food and beverage market challenging?

Given the fact that Germany is one of the largest economies in the world and its huge market size makes it extremely challenging for companies doing business in this region to become a significant player in the market. In the food and beverage industry, every category is characterized by immense competition and each brand attempts to be recognized by consumers by telling them a unique story. Often food and beverage companies struggle to achieve this with several players trying to do the same thing and sometimes companies even try to communicate too many things at the same time. This often ruins the effectiveness of a message in reaching the target audience and creating an impression in their minds about the brand. Also, due to the increased level of competition, both the consumers and buyers are very skeptical in this market. It takes considerable time and effort to convince them of their first purchase, and then it takes a great product in order to be purchased regularly. Despite all these factors, what makes the German and food and beverage market appealing is the fact that once a brand gets a foothold in the German market and people start to like it, both consumers as well as buyers become loyal partners.

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Is there any common pitfall while entering the German food and beverage market?

There is often a lot of impatience when it comes to launching a new product in the German food and beverage market. This is especially true in the case of companies that are fairly young and inexperienced in venturing into international markets. It is important for such players to work collaboratively with market experts who can validate the idea of expansion plans. Another pitfall that becomes crucial in a German market entry is when brands overly follow the lean approach and try to venture into the market without the right preparation in terms of product quality, packaging, websites, or marketing strategy. Germans are not as proficient in English as many of their neighboring countries like the Netherlands or Scandinavia. So, being fluent in German is key if you would like to convince both consumers as well as buyers about your product.

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Processed food industry

Playbook for Success in the Modern Food and Beverage Industry

The total revenue of the global food and beverage industry is skyrocketing with each passing year. Although the quality of products or service plays a significant role in the survival of food and beverage companies, this no longer remains the only ingredient for success in the food and beverage industry. With the ever-changing market trends and the growing need to satisfy changing consumer demands, companies in the sector must be on their toes to grasp new food and beverage industry trends. It is also important for businesses in the sector to identify ways to leverage maximum benefits from the market opportunities. Based on our discussions with several prominent food and beverage companies from different regions, here are some key takeaways on how the food and beverage industry is changing and what companies in this sector must do to thrive.

With consumer demands and preferences changing rapidly, it’s time for food and beverage companies to take a fresh look at their strategies to better connect with target consumers. Request a free proposal to know how we can help you achieve this.

Trends disrupting the food and beverage industry

Catering to a new group of shoppers

The old rules of the CPG no longer work with the new-age shoppers. Millennials and Gen Z consumers are inclined to brands that fit their lifestyle. This group of consumers are known to shy away from manufactured marketing of traditional food and beverage industry products. They favor ‘real ingredients’ and expect labels to be clear and easily understandable. Moreover, the internet has brought about drastic changes to customer expectations not only online but also in the store. Younger consumers want to be able to order ahead, pay, and capture loyalty rewards, all by using their phones. Catering effectively to this new group of consumers should be a major milestone for companies in the food and beverage industry.

Direct to consumer channels for launching new products

New players in the food and beverage industry often start out by selling directly to consumers, mostly using online channels. Direct to consumer brands are often more successful in capturing deep data on their target consumers which can be further used to deliver personalized consumer experience, refine product strategy, and build long-term customer relationships. By selling directly, players in the food and beverage industry can also experiment with new business models. Furthermore, when these brands plan to move to brick and mortar, it can dramatically enhance their chance of success.

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Focus on smart growth

With so many brands in the food and beverage industry and ample choice available to consumers, retailers are often quick to pull the chord on products that fail to deliver quick sales or even attract new customers. When launching a new product in the food and beverage industry, it is always better to start small in order to be able to manage the complexities of retail distribution. Brands that focus on expanding too rapidly could run into crippling cashflows or may even face critical manufacturing or supply chain problems. Also, increased focus must be given to communicating stories at the shelf via packaging, promotions, shelf-edge marketing, and the other tried and tested tools of retail marketing.

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Food and beverage industry

Market Intelligence Solution to Support a Food and Beverage Company in Devising a Sound Go-to-Market Strategy

Food and Beverage Industry Overview

The past decade has been tumultuous for the food and beverage industry due to the rapidly changing consumer behavior, technological advancements, and stringent regulations. In addition, safety issues, supply chain complexities, and food packaging challenges have started coming to the forefront. Given these industry characteristics, it is becoming imperative for food and beverage companies to find new ways to achieve operational excellence. Fortunately, companies that respond proactively to these challenges can position themselves for long term success.

FOOD AND BEVERAGE INDUSTRY TRENDS 

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Business Challenge

The client is a food and beverage company based out of Europe. The company focused majorly on producing and supplying organic food items and health drinks.

Our client, a food and beverage company was facing immense competition from local players in Europe. Adding to its woes was the fact that the consumption of organic food was low in the European market compared to the United States. To understand how they could improve their market position in the United States, they wanted to explore lucrative opportunities in the US food and beverage market. However, they required a detailed understanding of the prevailing market dynamics, including the competitive forces, trends, risks, and challenges. They partnered with Infiniti Research to leverage their expertise in offering market intelligence solution.

Other food and beverage industry challenges the client wanted to tackle by leveraging Infiniti’s market intelligence solution were:

Food and beverage industry challenge #1: Food safety

Due to the increasing risks to both the public and a company’s reputation, food safety was becoming a major concern in the United States. In addition, product design, hazards encountered during production processes, quality control, and packaging had an impact on food safety. With Infiniti’s market intelligence solution, the client wanted to analyze factors affecting food safety in the US and understand how the top food and beverage companies tackled with this challenge.

Food and beverage industry challenge #2: Regulatory compliance

With Infiniti’s market intelligence solution, the client wanted to gain an accurate and complete overview of all applicable regulations and regulatory requirements in the US food and beverage industry.

Food and beverage industry challenge #3: Supply chain issues

With Infiniti’s market intelligence solution, the client wanted to analyze all the vulnerabilities and risks in the supply chain. Additionally, they wanted to identify the right partners to support them in transportation needs.

Food and beverage industry challenge #4: Food packaging

As packaging highly influenced a customer’s buying decision, American food and beverage companies had to focus on adopting innovative and safe packaging alternatives. Therefore, before entering the US, they wanted to understand trends and innovations in food packaging.

To learn more about how our market intelligence solution can help companies deal with the rising industry challenges, contact us!

Solutions Offered

Initially, our experts conducted US food and beverage industry analysis. This involved analyzing trends in food and beverage industry, understanding emerging regulations, assessing the local market, and identifying the right scale of opportunities in the US food and beverage industry.

As a part of the market intelligence engagement, our experts also conducted a risk assessment study, which helped the client to understand current and potential risks in the US food and beverage industry, in terms of supply chain and food safety.

Furthermore, by conducting a customer needs assessment study, our experts helped the client to understand the needs and demands of customers regarding organic food products. Additionally, our experts helped the client to understand trends and innovations in food packaging materials. Also, the client was able to thoroughly understand the business strategies of their key competitors and evaluate US food and beverage industry growth rate for the next five years.

Results Obtained

The insights obtained from Infiniti’s market intelligence solution helped the company to thoroughly understand the US food and beverage industry, including the competitive forces, trends, risks, and challenges. Also, the client was able to understand the untapped opportunities in the market. Our experts also assisted the company in the food and beverage industry in devising a sound go-to-market entry plan.

Also, the client introduced several new products and health drinks in the market by considering the needs and demands of American consumers. In addition, their innovative and sustainable packaging alternatives helped them capture huge traction in the US food and beverage industry. Their products achieved huge success in the US food and beverage industry. Within two years of entering the new market, they were able to realize savings of over $3.2 million.

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