Food Gets a Lifestyle Rebranding

All the digital forces that are influencing food trends

The food industry is going through an interesting time, with multiple intersecting trends that are working together to change how and what Americans choose to eat.

Similar to other industries disrupted by digital upstarts, the food industry is also being reshaped by Amazon and Instagram across the value chain, along with a rising number of direct-to-consumer (D2C) brands popping up in the space. These new entrants emerged in response to a growing need for wellness-oriented food products, partly born out of the influencer culture. And as digital healthcare and wellness continue to become commercialized products, wearables and smart kitchen appliances are set to reshape the way we think about meal planning and grocery shopping. When you can get all kinds of the food you want right from your phone, the line between food delivery, grocery shopping, and home cooking starts to blur and merge into one unified experience.

We’re now choosing a data-driven, lifestyle-based approach to eating. Lifestyle brands seek to inspire, guide, and motivate people, and their consumption reflects how a consumer chooses to live the rest of their life. Responding to these trends and their market implications, the food industry is quietly undergoing a rebranding as it aims to elevate the often casual choices of food to become part of a meaningful lifestyle.

This gradual behavioral shift may not seem apparent now, but given time, its implications will start to show across multiple industries such as agriculture, CPG (the food & beverage sector), grocery retail, and restaurants. Let’s take a look at these trends one by one and explore how they intersect and influence how consumers are choosing to make food a lifestyle, not only nutritious, choice.

Aside from the influencer culture driving consumers to healthier diets, the rise of fitness wearables and digital healthcare options are making consumers more acutely aware of what’s going into their body. The cheaper fitness-oriented wearables flooding the market are giving, consumers easy access to devices that can track their health and quantify the results of their workouts into calories burned. This naturally increases consumers’ attention towards monitoring nutrition and calorie intake, and a whole crop of nutrition-tracking app popped up to help people monitor their food intake.

As we pointed out in our analysis of rising consumer control in food retail (grocers and food services), the rise of private label products and D2C food brands is giving the traditional food brands a run for their money by going directly to consumers, by virtue of being owned by the distributor or via owned online and social channels. Responding to the healthy eating movement, the private label products found on Amazon adopt the same wellness-oriented branding found with the D2C brands, and they are quickly changing consumer expectations around food quality and price.

For Amazon, the fact that many food brands willingly sell their products online via its platform is not only a great testimony to its aggregating power and strong customer base (it is where half of all U.S. online shoppers start their shopping journey, after all), it also provides Amazon with an underrated competitive advantage in the data it collects. Amazon gathers valuable insights on sales trends and shopper behavior from the data on brand performance on its site, which it funnels into design and marketing for private label, making those products even more competitive..

Similar to Amazon, D2C brands are able to capture interesting behavioral data on their consumers that are currently unavailable in most brick-and-mortar settings, which they can use to deliver more personalized consumer experiences, refine product strategy, and build long-term loyalty. In addition, going directly to consumer first can dramatically enhance the chance of success when these brands expand into brick and mortar retail, because they’re not bogged down by traditional 3rd party selling models and have the data to make better retail decisions from the outset.

Furthermore, Amazon is also looking to conquer the food market by conquering the kitchen. As various smart home devices, such as Echo speakers and the Alexa-powered AmazonBasics microwave oven, start to infiltrate the kitchen, they create new digital touchpoints that offer Amazon a chance to learn more about their customers and their food and cooking habits. And the more Amazon learns about them, the better Amazon can reach them with value offers and services. By controlling the future interface of the kitchen, Amazon would be able to heavily influence what kind of food products consumers buy when they get used to simply asking Alexa for a healthy recipe or add some beef patties into their shopping cart. If that happens, Amazon would become the platform where food brands will have no choice but come on board as a commoditized supplier if they wish to reach an Amazon household.

To fight for their rightful places in the digital kitchen, food brands are starting to become better service brands that engage their customers beyond the point of sale. Innovative packaging, branded voice skills, and partnerships with smart home appliance makers are all viable options for food and food-adjacent brands to pursue as they extend their customer relationship beyond the shelves at the grocery store. In a word, they need to become lifestyle brands that cater to the rising demand for wellness-oriented, personalizable food.

As emerging technologies like autonomous vehicles and blockchain continue to mature, they will continue to bring forth new integration points in the food industry (i.e. food delivery and supply chain management, respectively). There are still many new points of integration and potential business models for food brands to explore as new customer channels emerge.

Unlike other industries that have been fully digitized, digital forces will always have to contend with the physical realities of food production, transportation, storage, and delivery. As much as we have digitized our lives, eating ultimately remains a concretely physical experience. This means that food brands will have to stay connected to and always deliver on that physicality of food, no matter which digital channels they use to reach their customers. And any services that enhance the experience of buying, storing, cooking, and tasting of products should be actively explored to establish your brand as a consumer-oriented lifestyle brand.

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