Industry Trends
Increased consumer demand for food and beverage products is fueled by the continuous growth of the world population. The world population is estimated to reach 9.1 billion people by 2050 according to the OECD. At the same time, per capita daily caloric intake for the world’s population is increasing. According to the State of Food and Agriculture report from the United Nations’ Food and Agriculture Organization (FAO), average caloric
intake has risen from 2,280 kcal in the 1960’s to upwards of 2800 kcal, and is expected to rise further. Simply stated, more people multiplied by higher caloric intake equals increased food consumption.
In many developed countries, markets for food and beverage products are mature and consequently see slow or stagnant volume growth. Many
companies are therefore focusing their marketing efforts on emerging and developing markets where a growing affluent and media-savvy middle class have started purchasing western products. Increases in income have led to more diverse diets and increased consumption of fruits, vegetables and meat. Also, the demographic composition of the population in developing markets differs from many western countries in that there is a greater
proportion of young people – hence a growth market for certain products like alcoholic beverages or soft drinks. Some companies have started targeting these new market segments in developing countries with innovative approaches. For example, Unilever has targeted the bottom of the pyramid segment in India by selling small portions of soap and shampoo.
This initiative led to improved health among the poorest (mainly in urban areas), while simultaneously increasing Unilever’s sales. Similarly, Coca-Cola India launched Vitingo, a competitively priced orange flavored beverage fortified with micronutrients.
