CONSUMER

TRENDS
Driving Sustainability
in Food and Beverage

Custom content for AiPalette by studioID

Hardly a week passes without a food and beverage
company making some sort of announcement about
its sustainability efforts. This July, for example, Hostess
Brands — the makers of iconic snacks such as Twinkies and
Ding Dongs — announced the latest in a series of moves
designed to reduce waste and address climate change.
The company opted to jettison the tin ties traditionally used
to keep Hostess Donettes in their bags. The move, along with
others to incorporate recyclable packaging, is expected to save
215,000 pounds of steel each year, over 150,000 pounds of
plastic and 700 pounds of glue.
Hostess is by no means the only food and beverage company
publicly proclaiming its commitment to reduce packaging waste,
reduce carbon emissions and produce products that are healthier
for both people and the planet. For example, 32 companies from
countries such as the U.S., Japan, Mexico, South Korea and those
across Europe have all committed to achieve 100% renewable-
energy targets. Many of the companies that have signed on to
the RE100 initiative are familiar to consumers around the globe,
including Kellogg’s, General Mills, Kirin, Coca-Cola and Danone.
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In addition, the food-focused research
and creative agency McKinney’s most
recent breakdown of emerging food
trends reads in large part like a report
about sustainability. Indeed, among the
trends identified is increasing interest
in edible packaging as a way to move
past single-use plastic that results in
significant greenhouse gas emissions
and is wreaking havoc on ecosystems
around the globe.
“Sustainability is a trend seen across the
world, and the demand for sustainable
products is mainly driven by consumers’
demand for products that are good
for the planet’s wellbeing as well as
their own.” said Salomi Naik, head of
innovation for Ai Palette, a company that
provides AI-powered predictive analytics
that help food and beverage companies
identify trends before they emerge.
“Consumers the world over are looking
for products that they can brag about as
sustainable, tasty and healthy.”
Ai Palette’s predictive analytics shows
that in the United States the popularity of
plant-based foods is driven by a desire
to cut carbon emissions. The topic has
around a quarter of a million social
media engagements and a four-year
compounded annual growth rate (CAGR)
of about 45%.
An increasing number of U.S. consumers
are looking at a plant-based diet as a
sustainable form of living, with around
13% of all consumer data points related
to sustainability also talking about plant-
based foods.
Health is the third biggest driver for
sustainability in the United States as
consumers feel a sustainable diet and
lifestyle leads to better health and wellbeing.

Ai Palette’s predictive analytics shows that in the

United States the popularity of plant-based foods
is driven by a desire to cut carbon emissions.
The topic has around a quarter of a million social media
engagements and a four-year compounded annual
growth rate (CAGR) of about 45%.

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Sustainability is a trend seen across the world, and the demand for sustainable
products is mainly driven by consumers’ demand for products that are good
for the planet’s wellbeing as well as their own....Consumers the world over are
looking for products that they can brag about as sustainable, tasty and healthy.

Salomi Naik
Head of Innovation for Ai Palette

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Sustainability is all
about consumer demand
In part, the rationale for aggressively
addressing climate change and other
sustainability challenges is an outgrowth
of self-interest on the part of food and
beverage companies. For instance, the
effects of climate change are reducing the
ability of farmers to produce the crops and
goods large and small food companies
need to develop their products. A recent
Stanford University study found that
global farming productivity is 21% lower
than it would be without the negative
effect of climate change.
But at a foundational level, the main
reason sustainability has vaulted to the
top of the food and beverage industry’s
list of priorities is market demand.
For example, a number of surveys of
consumers in the U.S. and around the
globe found that shoppers are continuing
to prioritize sustainable food even as
inflation has caused prices to spike. And
while a demand for organic and other
food associated with wellness is clear,
consumer sustainability expectations
also extend to packaged food. A survey
by Cargill earlier this year found that 55%
of global consumers were more likely to
purchase packaged food such as potato
chips and cookies if they included a
sustainability claim.
 The imperative for food and beverage
companies, of course, is to respond to
the market-driven push for sustainability.
Put another way, sustainability is driven
by demand, and companies that want to
stay relevant and valuable to existing and
prospective customers have to respond.
“Sustainable products are the need of the
hour,” Naik said. “Which means it is imperative
for businesses to adapt to this trend.”
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Examples of how companies are responding
to sustainability demands by global
consumers are not hard to find. While all fall
under the larger umbrella of sustainability,
they come in many iterations and appeal
to specific components of sustainability.
“Some of these products are plant-based,
especially in the United States to some
extent. For example, we see products such
as Oak Milk Latte emerging as a top choice
for consumers,” Naik said. “Traceability is
also a driver for sustainable products as
consumers want to know where their food
is being produced and how it moves from
farm to table.”
Many companies are looking into
plant-based alternatives to popular
food products that also improve their
sustainability. “We introduced our first
product in 2021, TiNDLE, with the intent to
deliver on the qualities that consumers are
looking for in chicken, which are primarily
flavor, aroma, and texture. In partnership
with leading chefs and restaurants, we
decided to focus on delicious plant-based
chicken,” said Alex Ward, chief operating
officer of the food tech startup, Next Gen
Foods. “Not only is chicken the most widely-
consumed animal protein in cuisines all
over the world, it’s also versatile enough to
work in every type of dish. TiNDLE delivers
on those fronts and performs excellently
in many formats, from stews and curries
to fried chicken and grilled kebabs – the
possibilities are endless.”

We introduced our first product in 2021, TiNDLE, with the intent to deliver on the qualities that
consumers are looking for in chicken, which are primarily flavor, aroma, and texture. In partnership
with leading chefs and restaurants, we decided to focus on delicious plant-based chicken... Not only
is chicken the most widely-consumed animal protein in cuisines all over the world, it’s also versatile
enough to work in every type of dish. TiNDLE delivers on those fronts and performs excellently in many
formats, from stews and curries to fried chicken and grilled kebabs – the possibilities are endless.

Alex Ward
Chief Operating Officer of the food tech startup, Next Gen Foods

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Using data to identify trends and develop new products
But here’s the question decision-makers at food and beverage
brands must ask themselves: Do they have the kind of data-
driven insights about customer tastes and priorities necessary to
develop and release sustainable products that people genuinely
crave? The danger, of course, is to constantly react to trends
and demands that have already played out. When brands chase
trends, they inevitably find themselves trying to carve out a spot
in an already crowded marketplace.
Far better is when companies can pinpoint and understand
sustainability trends well before they hit the mainstream in a
particular country or region. Ai Palette works with food and
beverage companies to do just that. “Ai Palette’s proprietary
trend-spotting platform allows food and beverage brands to get
the insights they need to launch best selling products,” Naik said.
“These insights are available to them in real time so they can spot
trends and predict which products will be preferred by consumers.”
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Understanding a trend before it crystallizes and influences
customer behavior and choices is not something that can be
accomplished using intuition, or even focus groups or traditional
market research. Instead, comprehensive data and sophisticated
analytics are needed to give food and beverage brands the
confidence they need to invest time and resources into product
development that can meet emerging consumer demand.
companies seek to target. That can mean collecting information
from social media and search platforms relevant to a market and
category. Of course, not everything on social media genuinely
reflects consumer attitudes and tastes. Which is why Ai Palette
also assembles menus that reflect the changing dishes and
ingredients that people select both when they visit a restaurant
and dine at home.

Here’s how Ai Palette helps food and beverage companies. It
starts with assembling a diverse and large set of data sources.
For example, Ai Palette’s platform ingests online consumer-
engagement data relevant to the geography and consumers
Additional data comes from product information and user reviews
about e-commerce sites and physical stores. In total, Ai Palette has
analyzed 12 billion data points, a number that is growing quickly.
While the sources and quality of data are obviously important,
identifying relevant trends and grasping their trajectory and
implications come only through rigorous analysis.

Ai Palette’s proprietary trend-spotting platform allows food and beverage

brands to get the insights they need to launch best selling products, these
insights are available to them in real time so they can spot trends and predict
which products will be preferred by consumers.”

Salomi Naik
Head of Innovation for Ai Palette

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That’s what Ai Palette’s algorithms provide. The company’s
algorithms use natural language processing and computer vision to
understand the many regional and category nuances among food
and beverage options. This is possible in part because Ai Palette’s
algorithms track information in 16 languages. The comprehensive
data collection and the continuously improving algorithms can
provide brands with real-time information on a trend and where it’s
likely headed over the next six months.
These insights guide product development and strategy and
uncover the potential for new or even re-imagined products. For
example, a growing trend in sustainability is around the damage
caused by plastic pollution. Producers of bottled water grasp
this trend and are experimenting with packaging that is less
environmentally harmful, such as boxes and cans instead of
plastic bottles.
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Helping Kellogg’s navigate a pandemic

Kellogg’s worked with Ai Palette to better understand consumer tastes in

Asia. When people were stuck at home during the pandemic, demand for
a quick breakfast of cereal evaporated. This was obviously a challenge
for Kellogg’s, the maker of iconic breakfast cereals such as Corn Flakes
and Special K. With lots of time on their hands, many former cereal eaters
started cooking at home.

For Kellogg’s, the first step was to understand what consumers were
cooking and why — a question that had different answers from country
to country. Kellogg’s partnered with Ai Palette to investigate. The work
involved analyzing 485 million data points — from consumer forums about
cooking, social media, search and recipe sites — in the multiple languages
spoken in Malaysia, Singapore, Philippines and Thailand.

The research surfaced a number of important insights. With a pandemic

omnipresent, people were more mindful of their health. But they also
wanted recipes that were easy to prepare and injected some joy
into their lives. Beyond those generalized trends, the
research also pinpointed the 50 top-trending
recipes in each of the four countries and
highlighted those recipes that included cereal.

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 We saw a 2x increase in search, showing higher
intent for the brand, and the campaign has driven
incremental growth through higher product adoption.

Sanjib Bose
Chief Marketing Officer of Kellogg’s Southeast Asia

“We discovered that consumers themselves have become
innovative and have used cereal as an ingredient in creating new
recipes for taste, crunch and ease of use,” said Sanjib Bose, chief
marketing officer of Kellogg’s Southeast Asia. “This helped us zero
in on meal occasions and recipes that we never thought would be
our food connections.”
In response, Kellogg’s developed recipes that included its cereal
that could be eaten for snacks and at meals. In addition, Kellogg’s
launched a social media campaign to raise awareness about the
potential to include cereal as an ingredient in popular recipes.
“We saw a 2x increase in search, showing higher intent for the
brand, and the campaign has driven incremental growth through
higher product adoption,” Bose said.
As food companies across the globe seek to respond to consumer
demand for sustainability, identifying trends early will be an
essential part of differentiating their offerings. This is only possible
by tracking, analyzing and understanding consumer attitudes about
sustainable food and beverages. Ai Palette can provide that insight.

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Ai Palette is a predictive analytics technology company
that helps CPG brands around the world create best-selling
products by discovering trends as they emerge. Ai Palette’s
proprietary technology tracks trends in 21 countries and
15 languages, across 50+ platforms. Customers include
Kellogg’s, Hersheys, Diageo, Nestle, Cargill and Olam, who use
the platform in the United States, Asia Pacific, China, Europe
and Latin America. The company was founded in Singapore,
has an engineering hub in Bangalore and business offices in
the United States and Asia Pacific.

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