The food and drink market is one that every single one of us engages with. It is a place where change is the only constant, and not just as a result of the extraordinary challenges of the past year.
There are a host of factors that are driving change in the industry. These include increased population growth, urbanisation, immigration and evolving consumer trends. While these impact the types of food and drink that are in demand, there are also technological, environmental, economic and political factors that affect the journey from field to fork.
A unique market
Market research helps businesses operating in the food and drink sector to get to know their customers better, as well as providing insights that will help them to identify new ones. That’s well understood, and it applies to all areas of market research. What makes the food and drink sector unique is that it serves every individual in the world.
This means that market segmentation, a vital tool for market researchers, is even more important in this sector. There is a whole array of segmentation metrics available, but here are three common ones by way of illustration:
- Price – this is seen across various food and drink sectors, from restaurants that focus on a particular per-head price band to supermarkets with two distinct own brands, one focused on economy and another on what is perceived to be higher quality.
- Location – smaller independent businesses in the food and drink sector will align themselves to the local market, while larger ones might focus on specific regions or certain countries.
- Cuisine – perhaps the most obvious of all, the industry can be segmented into specific types of cuisine. So it is that you have businesses that are focused on pizza or kosher food or Indian food.
Market research does more than just identify these different segments. It also delivers insights into how they are evolving, whether they are growing or contracting, who occupies them and how different segments intersect with one another. All this helps businesses to critically assess their segmentation strategies and ensure they are aligned with market realities.
Food and drink market research allows businesses to stay ahead of the curve and identify opportunities before they are yesterday’s news. Recent months provide so many illustrations of this.
We have seen political factors, changes in consumer behaviour and technological innovation all come together to drive some of the most dramatic changes the market has ever experienced.
Yet some of these were foreshadowed even before all the changes that came about in 2020. For example, food delivery was already a rising trend, while restaurant sales were barely holding steady. Those businesses that have been early movers in recruiting delivery personnel, developing and rolling out their own mobile apps, implementing kerbside collection processes and other such innovations have been the ones that have found opportunity in these challenging times.
Market research provides the key to riding ahead of these winds of change.