Will meatless meat, CBD and cold brew coffee help food retailers differentiate?
While local, gluten-free and organic products still ruled the 2019 Summer Fancy Food Show in New York this week, plant-based protein alternatives and items with CBD added are coming on strong. Cold brew coffee, probiotics in the form of yogurt starters and bone broth are also making waves in the specialty food category.
The exhibit floor featured meatless meat in the form of sausage, jerky and even “meatballs.” There was CBD-infused juice, baked goods and marzipan. And there were booths offering demos of vegetable-infused ice cream, maple water and sesame milk. These trends were heavy in the domestic U.S. booths and not so much in the international ones, which stick to the tried and tested (dried apricots from Turkey, maple syrup from Canada, cheese from France, cured hams from Italy, etc.).
The Specialty Food Association, which sponsors the Fancy Food Show, reported specialty food outperformed total retail food sales in 2018, up 10.3 percent versus 3.1 percent. Assortment expansion and increased availability of specialty foods through more channels is driving the segment’s growth. For instance, digital outlets, which currently represent less than three percent of sales, have grown 41 percent since 2016.
The SFA also revealed that the fastest growing categories in dollar sales are refrigerated plant-based meat alternatives, rice cakes, frozen plant-based meat alternatives, water and refrigerated RTD tea and coffee. The top selling specialty food categories haven’t changed that much, year over year, and include cheese, meat, poultry, seafood, snacks, coffee and baked goods.
Among the top take-aways from the SFA’s annual update is that reduced packaging and food waste are hot points and that the convenience store channel is an under-tapped market for specialty foods. Dave Donnan, recently retired from A.T. Kearney, confirmed that c-stores are moving rapidly into specialty foods, mentioning an operation in Chicago where data driven curation of its assortment includes a growing number of specialty products.
DISCUSSION QUESTIONS: Which of the new food trends is currently having the greatest impact on the retail shelf? Which current trend do you think will be most relevant in five years?