Western Grocer Serving the industry since 1916
Written by Mohit Agrawal, manager of the Dubai office at Simon-Kucher & Partners,
The past few years have been difficult for the F&B industry—and it’s easy to see why. But the road to recovery is looking bright, with the market expected to grow by 24.3% in Canada in 2022.[1]
With vendors beginning to recover from the mass disruption caused by the pandemic, Simon-Kucher and Partners shares its expertise on three F&B trends that we can expect to see in 2022 and beyond.
The rise in sustainable eating
With consumers growing increasingly interested in sustainable, ethical, and environmentally responsible food practices, a rise in conscious eating is predicted for 2022.
In fact, an estimated 71% of Canadians agree that it’s important for them to understand where their food comes from, with four in five consumers spending more on fresh produce and non-dairy substitutes in 2021.[2]
This drive for more organic and environmentally friendly food is leading many F&B retailers to evaluate the impact of their practices on the environment. One such retailer is Ontario-based food vendor Maple Leaf Foods, which became carbon-neutral in 2019 and currently works to produce sustainable, ethically sourced meat and plant-based protein.[3] To further its efforts, the brand has also committed to reducing its environmental footprint by 50% by 2025.[4]
An estimated 72% of Canadian consumers favor shopping at food retailers that are sustainable and have strong ethical practices[5]. To keep up with this trend, F&B companies should look to improve the sustainability of their current offerings, ensuring to promote and communicate the benefits of adopting these sustainable eating practices.
More optimized and compact food service models
With 35% of Canadians admitting to ordering takeout more frequently due to the COVID-19 pandemic,[6] a desire for fast, high-quality, and affordable food has driven many F&B vendors to invest in more compact, optimized, and flexible service models.
One answer to this is the rise of “Cloud” kitchens—otherwise known as “ghost” or “dark” kitchens—which are services that host multiple F&B vendors and focus solely on takeout and delivery, with no option to dine in. These services first began emerging throughout Canada in 2018 but have only continued to increase in popularity ever since.
The adoption of cloud kitchens is becoming more mainstream across not only small businesses, but large F&B vendors, too. Following the success of the eight pilot cloud kitchens launched in Canada by fast food chain Wendy’s in partnership with REEF in 2020, a further 700 ghost kitchens are expected to open across Canada, the US, and the UK by 2025.[7]
In 2022, competition between F&B vendors will only grow more fierce. Vendors operating using traditional practices should consider adopting more lean service models—such as cloud kitchens—to amplify their revenue opportunities and facilitate expansion without the real estate costs.
Personalization to build relationships with consumers
In an increasingly digital-centric age, consumers expect high degrees of personalization across their digital touchpoints with brands. And, perhaps unsurprisingly, this is a trend that’s set to keep on growing throughout 2022 and beyond.
In fact, 46% of Canadians expect a personalized digital experience with brands if they are to return for further purchases, while 45% only shop with vendors that understand their preferences—for example, by offering tailored deals.[8]
This trend is leading large companies to use big data to tailor both their customer’s online and offline experiences. Take Starbucks, for example—its rewards program uses customer data to tailor special offers, communicate with them on their preferred channels, and personalize digital campaigns.[9]
To compete with an ever-increasing number of vendors in a progressively digital world, F&B retailers should invest in their personalization strategies to improve customer experiences across digital touchpoints and show that they can anticipate and understand their needs.
Looking ahead
With sustainable living, optimized service models, and customer personalization only set to grow in popularity throughout 2022, F&B vendors that can adapt quickly to evolving trends and adjust their strategies to suit customer needs can not only stay ahead of the curve, but also ahead of their competitors.
[1] https://www.foodserviceandhospitality.com/top-10-foodservice-trends-for-2022/
[2] https://www2.deloitte.com/content/dam/Deloitte/ca/Documents/consumer-business/ca_futureoffood_pov_en_AODA.pdf
[3] https://www.jpmorganchase.com/news-stories/building-a-new-sustainability-model-for-the-food-industry
[4] https://www.mapleleaffoods.com/our-commitments/environment/
[5] https://www2.deloitte.com/content/dam/Deloitte/ca/Documents/consumer-business/ca_futureoffood_pov_en_AODA.pdf
[6] https://www2.deloitte.com/content/dam/Deloitte/ca/Documents/consumer-business/ca_futureoffood_pov_en_AODA.pdf
[7] https://www.cnbc.com/2021/08/11/wendys-to-open-700-ghost-kitchens-by-2025-with-start-up-reef.html
[8] https://www.e-channelnews.com/two-thirds-of-canadian-consumers-return-to-brands-who-treat-them-as-an-individual/
[9] https://formation.ai/blog/how-starbucks-became-the-leader-in-customer-loyalty/
