From the growth of delivery services to working-from-home, the pandemic has disrupted everything from the way people socialize to how industry titans conduct business. Two years into the COVID crisis, 94% of Fortune 1000 firms reported experiencing volatility related to the pandemic, with 75% saying they have been adversely affected.
Here’s how the pandemic has impacted beverage trends and beverage production, and how beverage technology is helping fill the gaps.
1. The rise of shelf-stable products
As lockdowns and health concerns made eating out less appealing, consumers began to turn to ready-to-eat meals. The restaurant industry was particularly hard hit, racking up a staggering $165 billion in losses in the U.S. between March and July 2020, as people spent record amounts of money at grocery stores and embraced cooking at home.
After the infamous toilet paper wars of March 2020, more consumers than ever before are understanding the importance of having plenty of food and beverages at home to avoid unexpected shortages of essential supplies. Packaged food and beverage companies are witnessing an upsurge in demand for their products, such as shelf-stable foods and beverages including milk products, as consumers rush to stock the pantries.
2. Supply chain disruptions
The COVID pandemic threw a wrench into the well-oiled machine of food and beverage production and transport to wholesalers, retailers, and consumers. With materials and products limited and their delivery taking longer than ever, unprecedented supply chain disruptions posed a unique challenge that was felt by consumers and companies alike.
When COVID spread throughout China, delays in raw material supplies and industrial stalls quickly followed. With so many manufacturers and wholesalers dependent upon China for both finished products and critically needed supplies, Chinese lockdowns left scores of international food and beverage companies in the lurch.
As truck drivers and freight captains fell ill and lockdowns prevented the movement of people across regional and international borders, various transportation obstructions stopped materials from reaching their destinations. Factories were shut down, and less workers were available to both man storefronts and manufacture beverage products.
“The continuity of our supply chain is the greatest challenge we face during this time of significant uncertainty and widespread closures across various states,” Matt Weiss, CEO of snack company RIND, told Food and Beverage Insider. He noted that his company was far from the only food and beverage business contending with the unprecedented disruptions.
3. Technology to tackle staff shortages and safety
A range of industries have embraced beverage technology and automation to help ease the burden as less workers were available. According to Kearney, the move to automation, including the use of chatbots and robots, will likely last long beyond the end of the pandemic and increasingly be adopted by a diverse array of businesses.
Due to both restrictions on movement and health concerns, consumers are embracing contactless solutions for their purchasing needs. Online food shopping, curbside pickup and straight-to-door delivery services have grown exponentially in popularity, signaling a new preference for the convenience and safety of virtual shopping.
4. The trend to try new things
The pandemic has also changed consumers’ level of brand loyalty. Whether due to boredom at home or supply chain disruptions that meant their preferred products weren’t readily available, PNC found that a whopping 50% of consumers tried different brands during the pandemic. 66% of those consumers said that they’re likely to stick with the new brands they’ve recently discovered.
So now’s the time to attract new audiences and new brand supporters. Don’t be afraid to reach out to us for advice on how to do that.
5. Thinking local
The uncertainty of importing beverage products from abroad has caused consumers to embrace domestic brands. The latest beverage trends are focused on prioritizing local products, both to support hard-hit regional businesses and for the convenience of avoiding supply chain disruptions.
The Japanese Ministry of Agriculture recently published survey results which found that beverage companies who had forged a strong connection with domestic consumers could significantly boost sales. Some 50% of domestic food and beverage manufacturers said their consumers now prefer to buy local, and many businesses are wisely leveraging that to build brand loyalty and boost their revenue.
The pandemic has provided critical lessons for beverage companies around the globe, and has served as a sharp reminder that the physical location of consumers and brand does matter. For more advice on how to manage the challenges created by the pandemic, you’re invited to join the RC family and ask us your questions. We’d love to support your brand and help you develop your strategy for mitigating everything from supply chain disruptions to changing consumer preferences.
