Strategic Themes in Food and Nutrition: Coronavirus Update: September 2020

STRATEGIC THEMES IN FOOD AND NUTRITION: CORONAVIRUS
UPDATE
September 2020
INTRODUCTION
THE CONTEXT
FOOD AND NUTRITION’S STRATEGIC THEMES AND
HOT TOPICS
ASSESSING COVID-19’S IMPACT ON THE STRATEGIC
THEMES
CONCLUSION
INTRODUCTION
Scope
▪ Unless otherwise specified, values expressed in this report are in US dollar terms, Disclaimer
using a fixed exchange rate (2019). All volumes are expressed in tonnes. Much of the information in this briefing
is of a statistical nature and, while
▪ All forecast data are expressed in constant terms; inflationary effects are every attempt has been made to
ensure accuracy and reliability,
discounted. The historic period refers to 2014-2019; the forecast period is 2020- Euromonitor International cannot be
2024. held responsible for omissions or
errors.
Figures in tables and analyses are
calculated from unrounded data and
Snacks may not sum. Analyses found in the
briefings may not totally reflect the
USD539 billion companies’ opinions, reader discretion
is advised.
Dairy Products and Coronavirus (COVID-19) has had an

Alternatives unprecedented impact on food and
nutrition, an industry that was
USD567 billion
Packaged Food
already in a continuous pattern of
change. Through extensive
USD2.4 trillion worldwide research, a series of
Cooking Ingredients and Strategic Themes reshaping the
global market had previously been
Meals identified; in this report those themes
are assessed to see how they have
USD392 billion been impacted by the pandemic,
indicating how consumer concerns
and behaviour have shifted in terms
Fresh Food Staples of food and nutrition.
2.1 billion tonnes USD867 billion
© Euromonitor International PACKAGED FOOD: STRATEGIC THEMES IN FOOD AND NUTRITION - CORONAVIRUS UPDATE PASSPORT 3
INTRODUCTION
Key findings
COVID-19 has The overriding impact of COVID-19 on food and nutrition has been the shift of meal occasions
changed the into the home, driving up food purchased. Alongside this have come greater considerations of
food landscape health, reduced consumer mobility, shifting channel use and a global recession. All have had
significant implications for food and nutrition’s Strategic Themes.
The majority of Most of the food and nutrition hot topics (the building blocks of the Strategic Themes) have
the Strategic been accelerated by COVID-19’s impact, with the result that the Themes themselves have
Themes have followed suit. For example, the pandemic has accelerated the Back to Local and Return to Roots
accelerated hot topics, while decelerating The Internationalisation of Food. So overall the Strategic Theme of
Food Provenance and the Country of Origin Effect has accelerated.
Some hot Some hot topics across the food and nutrition Strategic Themes are judged to have felt no overall
topics are impact. This does not necessarily indicate they are untouched - rather it can show they are
pulled in both experiencing both positive and negative effects. For example, a hot topic centred around interest
directions in a premium foodstuff may be boosted by those who are now looking for healthier options, but
losing out from those eschewing higher-priced items in the teeth of the global recession.
Very strong With the pandemic generally increasing consumers’ engagement with food, there are few hot
negative topics within the Strategic Themes that have undergone very strong negative impact. One
impacts are exception is the Plastic-Free Future hot topic, where the pandemic has paused progress. Plastic
rare has been re-embraced across food and by consumers eager to reduce the possibility of infection.
The future of While a vaccine should mean life under COVID-19 changes, when and to what degree remain
the Themes is open questions. More certain is the ongoing negative economic impact, and the fact that health
uncertain will remain front of mind - thus themes/hot topics in food and nutrition influenced by these
factors are likely to be affected for some time.
INTRODUCTION
THE CONTEXT
HOT TOPICS
THEMES
CONCLUSION
THE CONTEXT
Recession hits as pandemic forces governments’ hands
▪ The COVID-19 pandemic has forced governments to quarantine Global Real GDP Growth
entire countries, disrupted global supply chains, slashed 2018-2024
business and consumer confidence and affected financial 8.0
markets. The global economy is entering a recession, the like of
which has not been seen since the Global Depression in the 6.0
1930s.
▪ COVID-19 severely impacts both the supply and demand sides 4.0
of the economy. At the same time, monetary policy tools are
almost exhausted due to the slow recovery from the Global 2.0
Financial Crisis of 2008-2009. Interest rates have not recovered,

0.0
so central banks have to resort to Quantitative Easing
%
programmes (QEs), but QEs have limited effect on labour
-2.0
markets, consumer spending and other aspects of the real
economy.
-4.0
▪ Thus, countries have to turn to fiscal stimulus. However, the
response to fiscal stimulus will be limited too as long as people -6.0
are quarantined in their homes. In the meantime, governments
are helping businesses and citizens by providing emergency -8.0
loans to cover expenses and lower the spillover effects through
economies, but uncertainty surrounding the pandemic limits -10.0
2018 2019 2020 2021 2022 2023 2024
economic activity.
▪ Euromonitor’s baseline forecast for global real economic C19 Baseline C19 Pessimistic1
growth in 2020 is in the -6.0% to -3.0% range and between C19 Pessimistic2 C19 Pessimistic3
3.5% and 7.0% in 2021. Source: Euromonitor International Macro Model
THE CONTEXT
In-home eating surges; health concern grows
▪ The pandemic has had a huge, unpredicted impact on food - on how much we buy, how we buy it, on what and
where we eat.
▪ The biggest single impact came from the shifting of millions of eating occasions into the home. As lockdowns
went into force across the world, restaurants, bars, cafés, institutions which served food (eg schools) - all
closed, increasing the amount of food consumed in home and consequently the amount of food needed to be
bought at retail. Although lockdowns have eased in many countries, foodservice has generally not resumed to
the pre-pandemic level, with operators unable to operate at previous capacities (due to the need for social
distancing) and many consumers remaining reluctant to increase their risk of exposure.
Y-o-Y Growth, Packaged Food Volume Sales, Retail vs ▪ As befits a health crisis, consumer interest
Foodservice 2015-2020 in foods that promote good health - or boast
health-boosting properties - has increased.
10% CI&M Retail Widespread knowledge that underlying
5% health conditions increase the risk of
CI&M Foodservice
mortality from COVID-19 has contributed
0%
Staples Retail here, as have government campaigns aimed
-5% at increasing the population’s health.
Staples Foodservice
-10% ▪ Ranged against this somewhat is the impact
Dairy Retail of the global recession on consumer
-15%
spending power. Put simply, healthier
Dairy Foodservice
-20% foods/foods promoted as healthier can often
-25% Snacks Retail be more expensive (eg organic versus non-
organic) and many consumers may have to
-30% Snacks Foodservice
cut spending as unemployment increases.
2015 2016 2017 2018 2019 2020
THE CONTEXT
Online grocery benefits and food choices shift
▪ Further important changes came in how consumers "Where do you typically purchase": Food
shopped for food. The amount purchased on shopping and Beverages 2020
trips increased and those trips became more infrequent
as consumers sought to avoid infection. In person at the store
▪ Online grocery has seen a significant boost as consumers Online on phone

sought to comply with lockdown rules, vulnerable adults
Online on computer
self-quarantined and - during the early stages of
lockdowns in many countries, as demand outstripped Online on tablet
supply and shelves were empty of some items - people Traditional conversation on phone
sought to secure what they wanted by ordering online.
Online on another device
▪ Retailers across the world have subsequently ramped up
investment (or gone online for the first time); producers Do not buy this product or service
have also reacted by launching direct-to-consumer (DTC)
Other
operations. In the US, for example, Q2 2020 saw Amazon
increase delivery capacity by 160% and triple its grocery 0% 20% 40% 60%
pick-up spots; May saw PepsiCo launch two DTC services Source: Euromonitor International Digital Consumer Survey, fielded March
- PantryShop.com and Snacks.com. to April 2020; n=20,203
▪ Beyond choices for health reasons, the impact of the pandemic has also altered the types of food being
purchased. In the early part of lockdowns, food with long shelf life or storage ability (ie freezable) was favoured.
The huge reduction in consumer mobility meant that food designed to be eaten on the go suffered. And
producers focused on popular SKUs, often cutting ranges and putting NPD activity on pause so they could meet
surging demand.
▪ All of these factors have had significant implications for food and nutrition’s Strategic Themes.
INTRODUCTION
THE CONTEXT
HOT TOPICS
THEMES
CONCLUSION
FOOD AND NUTRITION’S STRATEGIC THEMES AND HOT TOPICS
Food and Nutrition’s Strategic Themes and hot topics
▪ Reflecting the fact that the food and nutrition industry is changing continuously, in 2019 Euromonitor
International conducted extensive global research through its analysts and clients in order to determine
the Strategic Themes reshaping the global market. They are outlined here, and explained with hot topic
definitions over the next two slides.
Consumer Sustainable Eating Food Provenance Functional Food
Plant-Based Eating Mindful Eating and Food Tech and the
Segmentation in and the and the Country of and the Regulatory
and Alternative the New Food Digital Economy
the Era of Eating Environmental Origin Effect Environment
Proteins Beliefs
Occasions Cost of Food
Clean Label
Anytime, Animal Conscious Digital Food as
and the Era of Back to Local
Anywhere Welfare Consumption Traceability Medicine
Minimal
Processing
New Value Dairy Organic for Healthy Eating Returning to Food with
Data-Driven
Equation Alternatives Me, Organic in a Post Roots Functional
Health
for the Planet Better-for-You Claims
World
The
Lifestage New and Packaging Functional
Edible Insects Plastic-Free Internationalis
Nutrition Ancient Technology Nutrients
Future ation of Food
Ingredients
Sensory Lab-Cultured The Fight Labelling and

Against Food Food Delivery
Experience Meat Regulations
Waste
Permissible
Meat The Role of
Indulgence
Analogues Ethical Brands
The Strategic Themes and hot topics explained (1)
Consumer Segmentation in the Era Plant-Based Eating and Alternative Sustainable Eating and the
of Eating Occasions Proteins Environmental Cost of Food
Breaking down eating occasions - the who, As consumers seek more sustainable and Environmental concerns over the future of the
where, when, what and why that define how ethical meat and animal products, alternatives planet are forcing consumers to change their
consumers interact with food. have sprung up to meet demand. perspectives on food.
Anytime, Anywhere: Time-pressed lifestyles Animal Welfare: Labels and processes that Conscious Consumption: Consumers are
lead consumers to become more fluid eaters. provide consumers with assurance that the increasingly purchasing with purpose as they
They want on-the-go, portable foods that often animals used in the production of food have question the environmental impact of eating.
blur traditional category lines. Companies want been treated better. Claims and standards They are also demanding more transparency
to meet consumer needs at any time and in here include free-range, organic and certified on where their food comes from.
any location. humane.
New Value Equation: Many markets have Dairy Alternatives: A growing array of non- Organic for Me, Organic for the Planet: A
seen a “hollowing out” of the middle. Growth dairy alternatives to milk, yoghurt and other new wave of interest in organic food is being
has shifted to the extremes, with dairy products, with soy, almond and coconut driven by the impact of pesticide use on both
premiumisation and value for money trends being the main substitutes. “Non-cow, but biodiversity and individual health. One great
growing simultaneously. Mid-market brands dairy” development is also underway using example is bee-friendly products that avoid
have struggled as a result. proteins found in cow’s milk. pesticides called neonicotinoids.
Life Stage Nutrition: Older and younger Edible Insects: Already considered a Plastic-Free Future: People are responding
consumers increasingly define eating traditional snack in some parts of the world, to the widespread use of plastics with an
occasions. Brands are targeting these groups edible insects are positioned as a sustainable understanding of the environmental damage it
as focal points in the push for more source of protein in the West. Insects emit far can cause. The goal is to move towards a
segmented product portfolios. These groups less greenhouse gases, use less water and world that is less dependent on plastic use,
have unique nutritional needs that need to be require less feed than beef or poultry. especially single-use plastics.
met.
Sensory Experience: Eating is becoming a Lab-Cultured Meat: Scientific advances have The Fight Against Food Waste: Fighting
sensory experience. People want food to take created the potential for meat to be replicated against food waste by making sure that all that
them on an adventure. Texture, mouthfeel, from cell tissues. This offers environmental is produced is eaten or used. The goal is
flavour fusions and exotic tastes are growing. and animal welfare benefits. It also raises new efficient processes that ensure that everything
In the age of social media, even the ethical fears and regulatory hurdles for mass reaches the consumer and is then used before
appearance of food is crucial. adoption. it spoils.
Permissible Indulgence: Occasions Meat Analogues: Developments in taste and The Role of Ethical Brands: Food
increasingly need to balance health and texture have spawned a new generation of manufacturers that actively aim to deliver
indulgence. This is changing the nature of meat substitutes aimed at reproducing the positive social or environmental impacts
indulgence, however, as people treat exact flavour and feel of meat. Meat-blended alongside the goal of profitable growth. Brands
themselves less frequently with better-for-you products are also offering meat combined with increasingly take on a role of social
or premium products in smaller packages. plant-based content. responsibility.
The Strategic Themes and hot topics explained (2)
Mindful Eating and the New Food Beliefs Food Provenance and the Country of Origin Effect
Consumers are closely scrutinising ingredient labels with a view towards As globalisation opens people to cuisines from all corners of the globe, a
less processing, balance and trendy niche ingredients. reactionary movement harkens back to local food identities.
Clean Label and the Era of Minimal Processing: Processed food is The Internationalisation of Food: Growing interest in other cultures is
increasingly under fire. Consumers increasingly seek natural and authentic generating demand for global cuisines. Urbanisation is also creating uniform
products, with no artificial colours, flavours or sweeteners. Clean label is interest in more convenient food. Immigration and population shifts bring
simplification of ingredients. cuisines across borders.
Healthy Eating in a Post Better-for-You World: Healthy eating in the right Back to Local: Against this backdrop of globalisation, consumers are also
balance. People aim to reduce bad nutrients such as sugar, salt or carbs, turning back to locally-sourced food and native ingredients as a source of
while increasing good nutrients such as fibre or protein. Full-fat is back on- identity. This includes indigenous inputs, home-grown food and country of
trend, in lower quantities. origin claims.
New and Ancient Ingredients: New niche ingredients arise with promising Returning to Roots: Going back to an idea of what came before;
health benefits - some backed by more evidence than others. Some reach manifesting in food as the rise of “old-fashioned” or “traditional” ingredients
longevity and others prove to be fads. Motivations are a return to wholesome and recipes. Nostalgic packaging and “retro” brands that harken back to
and natural food. “good old times” are trendy.
Food Tech and the Digital Economy Functional Food and the Regulatory Environment
Technology is changing the fundamental relationship between consumers People increasingly demand functionality from their food. Functional claims
and their food on many different frontiers. are in focus - both among consumers and regulators.
Data-Driven Health: Technology is making it easy for people to monitor and Food as Medicine: Consumers look for prevention rather than cure. Instead
track their own health. Wearables and fitness apps are becoming of supplements, they seek food with a medicinal purpose that promises
commonplace, while personalised nutrition and DNA-customised diets for better health and is backed up with scientific evidence. Gut health is one key
each person offer potential. topic on this front.
Digital Traceability: As provenance grows in importance, technology plays Food with Functional Claims: Functionality of products is often a key
a role in improving food traceability. From blockchain-based ingredient argument in consumers’ purchasing decisions. Consumer beliefs drive sales
tracking to supply chain digitisation, concepts such as farm-to-table are now of products with functional claims, even though they may not be scientifically
possible on a mass scale. proven.
Food Delivery: Technology is changing how we buy food, specifically in Functional Nutrients: Awareness about ingredients and nutrients is on the
online ordering and delivery. E-commerce is creating new business models rise. High-protein or high-fibre products enjoy popularity, and new products
such as meal kits, direct-to-consumer brands, ghost kitchens, click-and- featuring these functional ingredients are targeting new consumer segments
collect and third-party delivery. and occasions.
Packaging Technology: Technology is revolutionising food packaging. Labelling and Regulations: Regulations on food and drinks continue to
Functional packaging, “smart labels” for traceability and sustainable tighten. Voluntary or mandatory labels, taxes, advertisement and distribution
packaging are all new frontiers. Recyclability, reusability and food waste are restrictions force manufacturers to adapt to meet both regulations and
all focus areas for the latter. consumer demand.
INTRODUCTION
THE CONTEXT
HOT TOPICS
THEMES
CONCLUSION
ASSESSING COVID-19’S IMPACT ON THE STRATEGIC THEMES
Assessing impact on the Strategic Themes
▪ Across the following slides, the effect of COVID-19 on the Strategic Themes is assessed via the following
framework: each hot topic is reviewed to see if the impact of the pandemic has accelerated it, has maintained/
supported it (without accelerating it), has had no impact, has decelerated it or has paused it. The balance across
this spectrum then determines whether the overall Strategic Theme has been accelerated or decelerated.
Maintains/Supports
Accelerates trend trend - but does not No impact on trend Decelerates trend Pauses trend
accelerate it
▪ Although there are few aspects of life that have not been Hot Topics Hot Topics
impacted in some way by the COVID-19 pandemic, there are Accelerated/ Decelerated/
Maintained Paused
some hot topics across the food and nutrition Strategic Themes
where there is no overall impact. This can be because the
pandemic brings both positive and negative effects - for
example, if a hot topic looked at interest in a particular type of
healthy food, it may be the case that purchases were reduced by
some shoppers as the recessionary impact hits their budgets, but
may have increased from others because of the association with
health.
▪ An example of an assessment is given here, imagining a dummy
theme with six hot topics. Overall, this theme would be judged to
have accelerated as a result of COVID-19.
Consumer Segmentation in the Era of Eating Occasions (1)
▪ The impact of COVID-19 on Consumer Segmentation in the Era

Hot Topics Hot Topics
Accelerated/ Decelerated/ of Eating Occasions is difficult to sum up, as it has contradictory
Maintained Paused effects on the different hot topics within.
▪ A quite straightforward deceleration has occurred to the
Sensory Experience hot topic, as foodservice options have shut
down/been restricted across markets. Much of the demand for
flavour fusions and exotic tastes (and, indeed, “Instagrammable”
food) was served through restaurants. Consumer interest in
these aspects of food has certainly not disappeared, however.
▪ Deceleration has also occurred to the Anytime, Anywhere hot
topic, as lockdowns across markets and compliance with social
distancing regulations have severely curtailed consumer
mobility, massively lessening the need/opportunity to eat “on
the go”. In particular, the switch to home working for so many
Consumer Segmentation in
has removed a key driver of eating food out of home and on the
the Era of Eating Occasions move - the fact that people needed to accommodate busy
Overall: Accelerated working lives.
▪ However, it is this brake on the snackification of food that has meant an acceleration for Permissible Indulgence. As
eating occasions shifted in-home (as foodservice and institutions closed, and when reopening did so with lower
capacity) consumers’ shopping baskets became larger, they stocked up on food purchases (especially in the early
stages of the pandemic’s grip) and limited shopping trips because of infection fears and new rules/guidelines.
Snacks became a bigger feature of the larger shopping baskets; consumers turned to them as a source of comfort
amidst challenging times. But impulses which once could be served immediately on the go could now only be met if
snacks were already on hand; “Impulse” essentially became “pre-planned impulse”.
Consumer Segmentation in the Era of Eating Occasions (2)
▪ Life Stage Nutrition focus has also accelerated, albeit in an indirect way in many markets. While the pandemic
increasing demand has curtailed new product development (NPD) activity in this space to some degree (with
many companies operating at capacity producing existing lines), a universal awareness that older adults are
more at risk from COVID-19 has been established. As people increasingly look to their diets to guard against
disease, it is often these consumers who are most keenly aware that what they eat is more important than ever.
Factors or Ingredients Looked For on Food or Drink Labels, By Age Group, 2020
50%
40%
30%
20%
10%
0%
45-59
45-59
18-29
30-44
45-59
18-29
30-44
45-59
18-29
30-44
45-59
18-29
30-44
18-29
30-44
45-59
18-29
30-44
45-59
18-29
30-44
45-59
18-29
30-44
60+
60+
60+
60+
60+
60+
60+
60+
Contains fibre Does not contain Does not contain Does not contain Does not contain Has limited or no Has limited salt or Has limited sugar
artificial GMO ingredients high-fructose corn trans fat or artificial no added salt or no added sugar
sweeteners syrup hydrogenated oils ingredients
Source: Euromonitor International Health and Nutrition Survey, fielded January to February 2020; n=21,739
▪ Finally, the New Value Equation aspect of this Theme is perhaps that which "There won't be a middle class
has most-straightforwardly accelerated, as the pandemic-driven global any more in a way… Some of
recession (with a larger fall in GDP growth in 2020 than was even seen in that middle class is going to go
2008-2009) means that overall, consumers will have lower disposable
down and have to make trade-
income, less money to spend on food and will increasingly look to economy
offs and therefore down-
ranges and private label. Retailers are responding; the UK’s largest grocery
trading.“
retailer Tesco now directly cites its discounter rival Aldi in its price
comparisons; Aldi itself is expanding rapidly in the US and is set to become
the third biggest US grocery retailer (by stores) by 2022. - Emmanuel Faber, CEO Danone
Plant-Based Eating and Alternative Proteins (1)
▪ The hot topic of Animal Welfare has seen an acceleration; the public
perception of the initial cross to humans of the virus is rooted in the Accelerated/ Decelerated/
idea that poor welfare/hygiene at a wet meat market contributed. Maintained Paused
The inescapable link to animals in the human food chain has meant
increased scrutiny; the constant reports regarding the virus
spreading through meat processing plants around the world merely
reinforced this. This has also led to the major impact of COVID-19 on
this Strategic Theme; namely the positive push it has given to Dairy
Alternatives and Meat Analogues.
▪ These alternatives to animal-based protein sources have greatly
benefited from their association with health. For dairy alternatives,
this is largely around the issues of digestion and allergies/intolerance
(ie to lactose) but also awareness of food chain issues that may have
an impact, such as GMO or antibiotics in feed. On the meat analogues
side, the positive response is to do with the fact that they are an
Plant-Based Eating and
alternative to processed, red meat - a foodstuff with a poor public
health profile, having been linked by high-profile media with cancer, Alternative Proteins
heart conditions and obesity. Overall: Accelerated
▪ With health being a key motivator for plant-based eating, dairy alternatives currently hold one key advantage over
meat analogues - they are often sold/promoted on their key ingredients, and producers can push the nutritional
value of base ingredients such as walnuts and peas (omega-3 and high protein, respectively). In particular, the fibre
content of oats aligns with increased interest in the gut-brain axis (see Functional Food and the Regulatory
Environment section later in this report).
Plant-Based Eating and Alternative Proteins (2)
▪ On the other hand, meat analogues have particularly benefited in their own
right; in the US, where meat supplies ran short during lockdown, analogues’
placement on shelves meant they could extend their customer base. Their
novelty (in a world where home cooking has surged) has also helped, as has
producers’ willingness to embrace direct-to-consumer (DTC) models in order
to reach customers - even Impossible Foods, which prior to the pandemic was
foodservice-focused, launched buy.impossiblefoods.com in June 2020. Source: buy.impossiblefoods.com
▪ The pandemic appears to have had less impact on the hot topics Edible Insects and Lab-Cultured Meat. The
former is often used as an ingredient used to boost protein content (in bread, for example) but any potentially
significant surge has been curtailed as NPD activity has been restricted and sustainability concerns - a key
selling point for insect protein - have shifted somewhat; the environment as an issue took a backseat for many
consumers as the pandemic has dominated discourse. Lab-Cultured Meat development continues apace, but the
pandemic has not seen any positive adjustment to estimated timelines for commercial availability. Pioneer
Mosa Meats now says it aims to reach the market in Europe in the first half of 2022 - its previously stated target
was 2021, although this slip has not been attributed to the impact of COVID-19.
North America and Western Europe Meat Substitute (MS) and Milk Alternatives (MA)
8,000 Value Sales 2015-2020 30%
USD million
6,000
20%
4,000
10%
2,000
0 0%
2015 2016 2017 2018 2019 2020
Meat Substitutes Milk Alternatives y-o-y growth MS y-o-y growth MA
Sustainable Eating and the Environmental Cost of Food (1)
▪ The turn to Conscious Consumption has accelerated due to

Accelerated/ Decelerated/ COVID-19, with the main driver being increased interest in
Maintained Paused traceability rather than environmental impact (while the latter
remains primarily important to some consumers, overall it has
taken a backseat in significance for many). In April 2020 the
UK’s Birmingham City University claimed a world first,
announcing it was developing the “Coronavirus Clearance
Certificate” using blockchain technology to allow producers to
determine that COVID-19 risk has been mitigated throughout
the supply chain.
▪ The Role of Ethical Brands has also accelerated, while shifting in
emphasis somewhat as the social - rather than environmental -
aspect gained prominence. So brands have rushed to
demonstrate how they are helping consumers who are more
vulnerable to the virus or more likely to struggle financially
because of it. In this, food and nutrition brands (including
Sustainable Eating and the retailers) have played a key role and in doing so have acted to
Environmental Cost of Food head off any criticism that they are doing well out of the
Overall: Accelerated pandemic’s impact, with food retail sales increasing so
significantly.
Citing International Labour Organization (ILO) statistics showing
over one in six young people are jobless due to COVID-19, Nestlé
Source:https://www.nestle.com/media/pressreleases/allpressrele
ramped up its workforce initiative providing jobs and training for
ases/half-year-results-2020#youth young people in West Africa, Mexico, the UK and the US.
Sustainable Eating and the Environmental Cost of Food (2)
▪ The Organic for Me, Organic for the Planet hot topic has been pulled in both directions - while consumers who
choose organic because they believe it is healthier (“Organic for Me”) may have increased consumption,
premium price points will have deterred others needing to cut costs. In addition, the “Organic for the Planet”
aspect has been tempered with greater interest in local supply. If non-organic farming methods are necessary in
order to grow food locally, this may take precedence with the jolt of empty shelves still in the minds of
consumers used to buying foods that are only available because of international transport.
▪ The latter experience has, however, accelerated the Fight Against Food Waste. Thanks to the visual
demonstration of the vulnerabilities of food supply, making the most of all food has become ever more vital.
After all, household food retail bills have increased as all eating occasions moved into the home. This hot topic
was always a blend of an economic and a sustainability issue, and the former has become more important.
▪ One of the few hot topic areas of analysis where a definitive pause can be said to have occurred is that of the
Plastic-Free Future trend. Plastic use has been re-embraced as producers/consumers look to reduce the
possibility of infection. Among industry professionals, this shift is most likely to be thought of as a mid-term
change. It is also clear that over time, fewer are seeing it as a short-term change, more think it permanent and
fewer think that there will be no change overall.
Predicted Increase in Demand for Plastic Packaging, April-July 2020
40%
Respondents
30%
20%
10%
0%
Short-term change only (Q1 Mid-term change, but will Permanent change No change Not sure
and Q2 2020) eventually return to pre-crisis
norms April - total April - F&B July - total July - F&B
Source: Euromonitor International Voice of the Industry survey, fielded April/July 2020; n=2,837/1,410 total, 498/260 food and beverages
Mindful Eating and the New Food Beliefs (1)
▪ While the issue of health has been a focus of

Hot Topics Hot Topics consumers throughout the pandemic, and health in
Accelerated/ Decelerated/ food has become increasingly associated with the
Maintained Paused
Clean Label and the Era of Minimal Processing hot
topic in recent years, two key factors mean that the
impact of the pandemic has (overall) had a negative
impact.
▪ The first is that consumers are increasingly looking to
fortification to aid health in fighting off the disease,
seeking additions/fortifications to food that allow for
claims such as probiotic, prebiotic, immunity support
etc. (for further details, see the Functional Food and the
Regulatory Environment section of this report).
▪ The second is that sales of centre aisle products have
surged as consumers looked to stock up, for long shelf
life, for nostalgia, for ease, and simply because they just
had to cook so much more. The very brands that were
Mindful Eating and the New in slow decline due to being considered old hat and
unhealthy because of processing have been boosted
Food Beliefs considerably by the pandemic.
Overall: Maintained/Supported ▪ This has all currently slowed the progress of this clean
label trend. That said, its association with health makes
this a deceleration rather than an end; consumer
interest remains and this trend is not going away.
Y-o-Y Sales Growth (%) in ▪ There has also been a noticeable increase in interest regarding
Packaged Food 2016-2020 meat alternatives, driven by a number of factors (as discussed
20 under Plant-Based Eating and Alternative Proteins); association with
health; contrast with meat’s association with the virus; long(er) life
in some cases; availability (and placement) where meat supplies
15
struggled; and novelty in a world where home cooking has surged.
▪ These products are at the forefront of the healthy versus processed
10
battle, and leveraging this as a point of differentiation is becoming
ever more common. In August 2020, LightLife published an open
5 letter to Beyond Meat and Impossible Foods criticising its rivals for
using (in its words) “hyper-processed” ingredients, GMOs,
0 “unnecessary” additives and “fillers and fake blood”. Impossible
almost immediately responded:
-5
2016 2017 2018 2019 2020
“This is purely fear mongering. There is no legal definition of what
processed food is and no understanding among consumers about
Shelf Stable Ready Meals
what processed food is other than a gut reflex that this means
Shelf Stable Beans
Twinkies, and therefore it must mean junk food, and therefore it
Frozen Processed Fruit and Vegetables must be bad. In reality, literally everything we eat is a process
Chilled Processed Meat between nature and science, including the organic banana you just
RTE Cereals bought at Whole Foods.”
Frozen Processed Meat
Shelf Stable Soup
- Rachel Konrad, Chief Communications Officer, Impossible Foods
▪ A hot topic that has certainly accelerated in importance is Perceptions/Definition of Health

Healthy Eating in a Post Better-for-You World - quite simply, and 2020
as befits a health crisis, the pandemic has grown interest in foods
Mental wellbeing
consumers see as fitting into a healthy diet, with good nutrition
Drinking enough water
appreciated as a way of fending off disease and helping to ensure
good base health (the most effective way of dealing with the Maintaining healthy weight
virus, as the figures on the impact of underlying health Longevity/living long

conditions show). Fitness and endurance
▪ Furthermore, the attention paid to mental health - already Feeling “good”
increasing over recent years - has also grown under the shadow Physical strength
of COVID-19. The mental impact of bereavements, stressful work Low stress
(and unemployment) situations, lockdowns/isolations, and fear Eating a balanced diet
of what were once everyday activities are all playing a part. Food Avoiding alcohol
that claims to help relaxation, mental wellness and sleep are Getting enough sleep
beneficiaries. Emotional wellbeing
▪ Finally, the turn to New and Ancient Ingredients pre-COVID-19
Avoiding illness
was primarily driven by demand for health benefits, which - as
Healthy appearance
discussed - has been supported by the rise of COVID-19.
Absence of disease
However, an overall acceleration has been somewhat curbed, as
Avoiding smoking
reduced food and nutrition NPD activity has focused more on
direct health-boosting claims as producers have generally Other
retrenched to core lines in order to meet demand. In addition, None of the above
some premium lines may face difficulties as recessionary effects 0% 25% 50% 75%
come into play and shopping habits are increasingly focused Source: Euromonitor International Health and Nutrition Survey,
online and on larger baskets/fewer trips. fielded January to February 2020, n=20,166
Food Tech and the Digital Economy (1)
▪ Engagement with Data-Driven Health has accelerated throughout

the impact of the pandemic, with motivations extending beyond Accelerated/ Decelerated/
the fact that consumers are more health aware than ever before Maintained Paused
(appreciating that ill-health has a significant bearing on individual
response to the virus).
▪ Consumers have been forced to turn inwards to maintain their
health, as lockdown conditions often specified that one of the only
reasons to leave the home was for exercise, and locations that aid
fitness (gyms, swimming pools etc) were shut down.
Furthermore, what we might term “incidental exercise” (such as
walking children to school, or walking from a transport station to
a place of work) were eliminated, increasing the importance of
deliberate, planned, but non-facility-using exercise.
▪ Digital Traceability has been one of the key hot topics increasing
in prominence as a result of COVID-19. While the origins of the Food Tech and the Digital Economy
virus’ transfer to humans remain somewhat ambiguous, there is a Overall: Accelerated
general appreciation that it crossed from animal to human and
that consumption of meat was involved. That, plus the continued
stories in the media about food workers contracting the disease have formed a link
with food in many minds. Consequently, reassurance over exactly where food is from
has gained even further prominence. Products boast labels allowing consumers to
Source: https://fairfood.nl/en/
digitally access this information; new blockchain-based systems such as Fairfood’s
solutions/trace/ “Trace” allow consumers, farmers, producers and traders to “discover their chain”.
Food Tech and the Digital Economy (2)
▪ While Digital Traceability can be said to have experienced one of the most clear Foodservice Delivery
influences from COVID-19, the hot topic of Food Delivery has perhaps been most Usage 2020
directly impacted. With social distancing, lockdowns, and the closure of 30%
foodservice eat-in and shift to delivery models, online in food has surged. More
people are buying online than ever before, retailers are investing strongly in order 25%
to capitalise, people have turned to takeaways where meals out are no longer
possible (or feared because of infection risk) and third-party food delivery apps 20%
have boomed.
▪ Through all this, the blurring of the lines regarding delivery/retail has continued: 15%
third-party apps deliver takeaways but have also moved into purchasing groceries
10%
for delivery as well. In this, they fulfil the promise of same-day delivery in a way
that most retailers cannot. Competition is fierce: Uber now delivers groceries in 5%
Latin America, Canada and the US. DoorDash added grocery delivery to its app in
August 2020, which followed a July 2020 move into retail by launching an online 0%
convenience store in six US cities. But immediacy is also being addressed
elsewhere: online retail giant Amazon is currently running a trial in Leeds, UK
with supermarket Morrisons, allowing Prime subscribers same-day delivery.
▪ Packaging technology is perhaps the only hot topic here where the influence of
COVID-19 is not initially so clear, however overall this is another area of
acceleration. While it is true that plastic has resurged, de-emphasising Order online directly from a
restaurant
developments around alternative materials, it is also true that COVID-19 has
Order online from a third-party
created new frontiers in the packaging world. Smart labels for traceability have delivery platform or website
become more important, development of anti-pathogenic packaging has surged, Source: Euromonitor International
and emphasis on the “unboxing” experience has increased with consumers now Digital Consumer Survey, fielded March
less likely to interact with packaging on retail shelves. to April 2020; n:20,203
Food Provenance and the Country of Origin Effect (1)
▪ Food Provenance and the Country of Origin Effect is a particularly

interesting Strategic Theme, in that it contains hot topics that both spur Hot Topics Hot Topics
and counter each other - namely that as consumer appetite for Accelerated/ Decelerated/
Maintained Paused
international cuisine grows, different countries’ cuisines homogenise to
some extent, creating the reaction of greater interest in “home country”
food.
▪ A clear way in which the impact of the pandemic has curtailed
experience of international cuisines is in the massive reduction in
international travel worldwide (and even in inter-regional travel within
countries). Some borders are simply closed, and international travel is
severely restricted.
Outbound Tourism Departures 2015-2020
1,600,000 20
1,400,000 10
1,200,000 0
% y-o-y growth
1,000,000 -10
'000 trips
800,000 -20 Food Provenance and the

600,000 -30 Country of Origin Effect
400,000 -40
200,000 -50
Overall: Accelerated
0 -60
2015 2016 2017 2018 2019 2020
Outbound Departures Year-on-year growth
Food Provenance and the Country of Origin Effect (2)
▪ The closure of foodservice also strikes here; restaurants are where many consumers are able to experience
food/cooking they are unable to replicate at home. So far, even in markets where restrictions have eased, many
consumers are reluctant to return to eating out at pre-COVID-19 frequency and operators are unable to host at
the capacity they were before. Many small/independent restaurants have simply gone out of business.
▪ This does not, however, mean that the appetite for international food ends. Indeed, this may even grow at a
more micro level; as meal occasions have shifted into the home and consumers increasingly cook for
themselves and their families, the desire (need?) to keep things interesting may drive retail of “exotic” food and
ingredients as the pandemic continues to influence day-to-day existence.
▪ The Back to Local and Returning to Roots aspects of this Strategic Theme have more clearly accelerated,
however. One aspect is the way consumers have looked for comfort and nostalgia from food, looking back to a
time before the pandemic for mood boosting to combat the mental toll of living under the shadow of disease.
▪ The second, and possibly more relevant, is the increased importance of
food security in consumers’ minds. The interdependence of various 15.9%
countries on food supply was ably demonstrated in the early stages of the of food and beverages
pandemic in the West. Shelves ran empty of key products as demand rose industry professionals say
and supply lines were tested, just as the disease meant that it was harder that one of the most likely
for goods to travel to where they were needed (borders closed, methods effects of the COVID-19
of travel were ruled out, delays increased etc) and workers were pandemic is their company
restricted in their cross-border movements or themselves became shifting to a localised
infected. Local supplies became a way of ensuring that food would be supply chain
there, on time and (in some consumers’ minds) would be safe, as
Euromonitor International Voice of the Industry
suspicion lingered regarding the origin of foods and the virus. And, of Survey, fielded July 2020, n:259 Food and Beverages
course, buying local meant supporting the local economy. Industry Professionals
Functional Food and the Regulatory Environment (1)
▪ The Functional Food and the Regulatory Environment Strategic

Theme is one of the most straightforward to assess, as it Accelerated/ Decelerated/
encompasses the hot topics of Food as Medicine, Food with Maintained Paused
Functional Claims, and Functional Nutrients - all of which have
grown in importance as consumers look to food in order to
maintain/improve their health and lessen the potential impact of
a COVID-19 infection.
▪ One clear factor here is the extra impetus given to the drive to
reduce obesity rates and advice over which (and how much)
foods to eat. Since COVID-19 hit, the fact that obesity increases
risk of mortality has been widely acknowledged, however in
August 2020 this was quantified with extremely concerning
results (given obesity rates worldwide). Researchers from the
University of North Carolina, using data from 75 studies
worldwide and almost 400,000 patients found that obesity Functional Food and the
results in an increased risk of hospitalisation of 113%,
admission to intensive care risk increase of 74%, and increased
Regulatory Environment
risk of death from COVID-19 of 48%. Overall: Accelerated
▪ The acceleration in importance of the food as medicine and functional food concepts here also ties in with
growth in the popularity of food (and drinks) promoting gut health, as the concept of the mind-gut-body axis
(“happy gut, happy person”) has gained currency among consumers. Probiotics, prebiotics, fibre, fermented
products - all were already seeing popularity surge, but with an acknowledged positive influence on overall
health/immune response, the pandemic has accelerated interest.
Functional Food and the Regulatory Environment (2)
Packaged Food SKUs Featuring Immune ▪ Of all the Food as Medicine/Food with Functional Claims aspects
System Health Claims Sold Online by to feel the pandemic’s influence, immune health is perhaps the
Region 2019 most obvious. And this is a true acceleration - demand is not just a
feature of 2020, but is building on the back of consumer interest
and producer response, increasing the number (and variety) of
Asia Pacific foods claiming immunity-boosting properties.
▪ Once again, the gut health/immunity-aiding crossover is in
Eastern Europe evidence here, as fermented products such as kefir address both
and were already rising in popularity before the impact of the
pandemic.
Western Europe
▪ The hot topic of Labelling and Regulations is one where it is hard
to definitively state that the pandemic has caused an acceleration,
North America
as numerous countries around the world were already moving
towards making nutrition labelling (of varying types) mandatory
but in the context of less specific aims than virus prevention (for
Middle East and Africa the majority, it was the fight against obesity).
▪ A more accurate description is to say that this hot topic has been
supported/maintained by the pandemic. A good example comes
Australasia
from Mexico, where the sale to children of junk food and drinks
high in sugar has been banned in Oaxaca. The move is an attempt
Latin America to cut the incidence of obesity and diabetes - according to the
state’s own data, it has the highest childhood obesity rate in
0 2,000 4,000 Mexico (and the second highest for adults). Offenders face fines,
SKUs with claim
business closures and - if found reoffending - jail.
INTRODUCTION
THE CONTEXT
HOT TOPICS
THEMES
CONCLUSION
CONCLUSION
Conclusion
▪ The general acceleration of the Strategic Themes makes sense on an intuitive level; as consumers around the
world saw their options for buying/consuming food reduced and as eating occasions shifted, even those
consumers least likely to eat at home (for example, office-based workers with long hours relying on takeaway/
eating out) were forced to engage with food, shopping for home, eating at home and cooking at home.
▪ The acceleration of the Strategic Themes also derives from more than this forced increase in engagement. Given
how life has changed under the shadow of COVID-19, it is clear that an increased focus on many aspects of how
food and nutrition works in our lives has occurred. The most obvious example is health, especially as
understanding of the risks of the virus developed and the role of underlying health conditions became
appreciated. In contrast, however, consumers have not given up on food indulgence/treats - but they have had
to adapt to not being able to fulfil these needs on the spur of the moment.
▪ Looking ahead, in terms of COVID-19’s influence on the Strategic Themes, is a risky business. Initial hopes for a
vaccine and rollout in 2020 have faded, and even if this was achieved questions remain regarding reinfection
and risk. What is more certain is that economic impact is - and will be - negative. To what degree is yet unclear
(hence the scenario-based forecast discussed earlier) but those Strategic Themes/hot topics influenced by
consumer spending power will continue to be affected for some time. It is also likely that health will remain
front of mind for as long as the virus threat persists, meaning the Strategic Themes/hot topics related there will
continue to be spurred by COVID-19. A less-certain area is that of consumer mobility, with a number of hot
topics directly affected. Governments around the world are walking a tightrope between encouraging people
back to work/spurring economies and ensuring that the spread of the virus is contained.
▪ What can certainly be said is that, across the Strategic Themes in food and nutrition, the impact of COVID-19
has been an overall acceleration to their progress, with the majority of the hot topics that make up the Strategic
Themes becoming more important to consumers throughout 2020.
CONCLUSION
Conclusion: summary
Strategic Theme Hot topic 1 Hot topic 2 Hot topic 3 Hot topic 4 Hot topic 5
Consumer Segmentation in the
Anytime, Lifestage Sensory Permissible
Era of Eating Occasions New Value Equation
Anywhere Nutrition Experience Indulgence
Accelerated
Plant-Based Eating and
Lab-Cultured
Alternative Proteins Animal Welfare Dairy Alternatives Edible Insects Meat Analogues
Meat
Accelerated
Sustainable Eating and the The Fight
Conscious Organic for Me, Plastic-Free The Role of
Environmental Cost of Food Against Food
Consumption Organic for the Planet Future Ethical Brands
Accelerated Waste
Mindful Eating and the New Clean Label and the Healthy Eating in a
New and Ancient
Food Beliefs Era of Minimal Post Better-for-You n/a n/a
Ingredients
Maintained/Supported Processing World
Food Tech and the Digital
Packaging
Economy Digital Traceability Data-Driven Health Food Delivery n/a
Technology
Accelerated
Food Provenance and the
The International-
Country of Origin Effect Back to Local Returning to Roots n/a n/a
isation of Food
Accelerated
Functional Food and the
Food with Functional Functional Labelling and
Regulatory Environment Food as Medicine n/a
Claims Nutrients Regulations
Accelerated
Maintains/Supports
Key: Accelerates trend trend - but does not No impact on trend Decelerates trend Pauses trend
accelerate it
FOR FURTHER INSIGHT PLEASE CONTACT
Tom Rees
Industry Manager - Food and Nutrition
tom.rees@euromonitor.com
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STRATEGIC THEMES IN FOOD AND NUTRITION: CORONAVIRUS

Dairy Products and Coronavirus (COVID-19) has had an

Recession hits as pandemic forces governments’ hands

Financial Crisis of 2008-2009. Interest rates have not recovered,

In-home eating surges; health concern grows

Online grocery benefits and food choices shift

▪ Online grocery has seen a significant boost as consumers Online on phone

Food and Nutrition’s Strategic Themes and hot topics

Sensory Lab-Cultured The Fight Labelling and

The Strategic Themes and hot topics explained (1)

The Strategic Themes and hot topics explained (2)

Assessing impact on the Strategic Themes

Consumer Segmentation in the Era of Eating Occasions (1)

▪ The impact of COVID-19 on Consumer Segmentation in the Era

Consumer Segmentation in the Era of Eating Occasions (2)

Plant-Based Eating and Alternative Proteins (1)

Plant-Based Eating and Alternative Proteins (2)

Sustainable Eating and the Environmental Cost of Food (1)

▪ The turn to Conscious Consumption has accelerated due to

Sustainable Eating and the Environmental Cost of Food (2)

Mindful Eating and the New Food Beliefs (1)

▪ While the issue of health has been a focus of

Mindful Eating and the New Food Beliefs (2)

Mindful Eating and the New Food Beliefs (3)

▪ A hot topic that has certainly accelerated in importance is Perceptions/Definition of Health

virus, as the figures on the impact of underlying health Longevity/living long

Food Tech and the Digital Economy (1)

▪ Engagement with Data-Driven Health has accelerated throughout

Food Tech and the Digital Economy (2)

Food Provenance and the Country of Origin Effect (1)

▪ Food Provenance and the Country of Origin Effect is a particularly

800,000 -20 Food Provenance and the

Food Provenance and the Country of Origin Effect (2)

Functional Food and the Regulatory Environment (1)

▪ The Functional Food and the Regulatory Environment Strategic

Functional Food and the Regulatory Environment (2)

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