Rapid technological development is impacting all aspects of our lives. Consumer habits and preferences are changing. We no longer need to go to a store to do our weekly shopping or contact a call center when we want a pizza. We've got used to personalized recommendations from AI: sometimes the app knows better what exactly we need at the moment.
What else can we expect shortly? What trends are just emerging, and which ones have already firmly established themselves and will soon become the norm for us?
We conducted a small study of ecommerce food trends based on data from the first quarter of 2024. Here we’ll tell about strategies that will help companies succeed. Also, you’ll find here our assumptions about the future of the Global Food & Beverage Market (F&B).
This article is a must-read if you plan to enter the F&B Market or are already a participant in the niche. You will learn: how to create a product from scratch, adapt to changes in the external environment, gain significant competitive advantage, and minimize risks for your business.
Estimated Market Size and Key Drivers
According to The Business Research Company forecasts, the global F&B market volume in 2024 will be $85.25 billion. The average projected annual growth rate is 20.7%. The main online buyers in the food service industry are smartphone users. With their increasing numbers, the potential for online orders of food and beverages also increases. This tells us that now more than ever it is important to react quickly to trends and identify new opportunities for innovation and development. This may include developing new products, improving production processes, or expanding market reach.
Other Key Drivers:
- In 2023, the number of downloads of niche applications in the F&B sector reached $1.95 billion.
- The average revenue per app download is $1.04 USD.
- The total revenue from in-app purchases (IAP) in the food and beverage market in 2023 was $0.42 billion USD.
- The share of the USA in the Global Food & Beverage Market is projected to reach $3.80 billion by 2027.
However, there are several reasons why Americans (except millennials) still prefer to shop in-store: it gives the opportunity to inspect, taste, and smell the product before purchasing. And also to pick up the order immediately. Let's not forget about the social aspect (shopping with friends). However, there is also the flip side: 54% of surveyed Alibaba users admitted that they prefer online shopping to avoid large crowds.
It is important to understand that the Global Food & Beverage Market is a vast industry that encompasses production, distribution, and sales. We cannot compare the strategy of ecommerce for restaurants and cafes with the sales strategy for manufacturers, suppliers, and retail chains.
For instance, an average American orders ready-made food for home delivery about 2-3 times a week. However, he makes grocery purchases at a supermarket or via the Direct-to-Consumer (D2C)* model no more than once a month.
*D2C or DTC is a business strategy whereby a product or service manufacturer bypasses traditional distribution and sales channels such as retail stores or intermediaries. It is gaining popularity as it allows for direct communication with customers, collecting purchase data, and more flexible pricing and marketing management.
There is another important metric you need to know, as it can lead to a significant drop in company revenue. According to Tmall Fresh data, a huge number of their consumers (43%) ultimately abandon their carts without completing the checkout process.
To avoid abandoned carts, various strategies can be used, such as sending reminders via email or SMS, providing personalized discounts, and offering more favorable terms.
When Wezom's team gets such a request, in 90% of cases, we find errors in the service: a complex or unoptimized checkout process, a limited number of payment methods, or inconvenient and slow delivery.
eCommerce Trends That Will Affect Your Food Business
Key trends that have already taken root in the e-commerce food industry include the growth of subscription purchases, the popularization of the "buy now, pay later" (BNPL) model, and overall increased speed in order processing and delivery. However, there are also new trends that need to be taken into account and implemented if you want to ensure your company's sustainable position.
Chatbots for Better Customer Experiences
Chatbots are aimed at saving time and resources, both for the user and the company itself. The practice of a customer not "playing" with filters on the website but rather submitting their request to a bot is becoming increasingly popular. This greatly simplifies the task, especially when the buyer has no time or desire to browse through the entire product catalog.
A properly configured AI-based chatbot can easily assemble a cart based on a request like "thin crust pizza with pesto sauce". Often, this is much easier than navigating through multiple steps: Catalog → Pizza → Vegetarian → Filter: Thin crust (apply) → Filter: Pesto sauce (apply)
It's important to note that not every customer is a tech-savvy internet user who knows how to navigate any type of website. Therefore, they may spend a considerable amount of time searching for the desired product, especially when companies prioritize uniqueness and "tasty" design over the importance of quality User Experience.
Using chatbots significantly optimizes the speed of responses from the sales and/or technical support departments. This also impacts user experience. In the era of "fast content," even some extra 2-3 minutes of waiting can result in the abandonment of a purchase.
Utilizing data analytics for personalized recommendations
Implementing machine learning in your project can significantly increase sales, by at least 10% or more (according to a report by McKinsey). Smart algorithms process user profile information, browsing history, and purchase history to recommend products that the user is most likely to buy.
Such a level of analysis and personalization is impossible in an offline store and can only be implemented using cloud solutions. As an example, one can mention Amazon Fresh with its impressive personalized recommendations.
Augmented Reality (AR) and Virtual Reality (VR) technologies for selling food products.
Augmented Reality (AR) and Virtual Reality (VR) technologies can be utilized to create engaging marketing campaigns and increase brand loyalty.
For instance, Lidl (a European retail supermarket) launched an application offering access to exclusive offers and AR-based games. Users can win discounts or bonus points, encouraging interaction with the brand and increasing the average purchase amount.
Another example is Kellogg's, a leader in breakfast and snack production. They developed a VR program allowing users to explore the farms where ingredients for their products are sourced. This solution enabled customers to feel a sense of connection and a fundamentally new level of trust. This led to a 34% increase in sales during the active advertising campaign.
Developing applications for IoT
The Internet of Things (IoT) is used for real-time monitoring and inventory management: tracking product expiration dates, and automatic replenishment of supplies.
As an example, let's take smart refrigerators with built-in displays and control systems. They can integrate with delivery services through special applications and support voice control (Amazon Alexa or Google Assistant). Therefore, the most advanced participants in food and beverage ecommerce are already implementing promotion through voice assistant services in their SEO campaigns and developing applications for such interfaces. While this has not yet become a widespread trend, there is already a certain stable tendency.
Creating a digital ecosystem
Modern consumers are spoiled with quality service. To impress them, an f&b ecommerce brand needs to be more than just a delivery tool. Therefore, creating online platforms and ecosystems is getting global development.
For example, a restaurant's app can be used not only for ordering ready-made dishes or booking a table but also as a platform for sharing dishes and recipes, creating interest-based communities. It can function as a food subscription service or offer sets for cooking dishes according to the brand chef's recipe. Also, selling farm products through restaurant apps or unique kitchenware, tableware, and other thematic products is becoming more common.
DelightDale: What a Trendy F&B Market App Should Be Like
We're sharing how we implemented a cross-platform mobile application and web store on a single backend using the most cutting-edge trends and technologies.
About the project
The main idea that the client approached us with was the development of a "space of aesthetic pleasure." DelightDale is all about a new culinary experience and vibrant emotions after every order. Therefore, we immediately identified several priority areas of work:
A flawless technological foundation that the team will build from scratch. The use of off-the-shelf solutions in this case is unacceptable. They won't provide the flexibility, scalability, security, and independence necessary for a successful business. Meticulously crafted UX/UI Design. These should be truly "appetizing" visual solutions that ensure an unforgettable user experience.
Developing a unique AI algorithm that functions as a culinary consultant and sommelier. It also generates personalized recommendations that perfectly align with the user's taste preferences. This project is subject to an NDA (name changed). However, we're ready to share the solutions that our team is genuinely proud of.
Development Task
A food ordering mobile application must include the following components:
- a visually rich catalog with appetizing descriptions and user-friendly navigation.
- interactive pages for new arrivals and bestsellers.
- instant search based on machine learning.
- a shopping cart that users won't want to abandon.
- a personal account with the ability to save delivery addresses on the platform and link multiple cards.
The final point also sets the task of enhancing security and confidentiality of information. Therefore, the decision was made to use the symmetric encryption algorithm AES Encryption.
It's also crucial to seamlessly integrate the order tracking system into the digital platform. This includes precise geolocation tracking and the ability to monitor the courier's movements dynamically, all without intrusive notifications.
To efficiently and quickly implement all the tasks described above, we decided to adhere to the iterative structure of Scrum. Work was carried out in short (in our case, two-week) sprints. It took the team just under 6 months to create the key components of DelightDale.
Technology Stack
The choice of technology stack and software architecture was undisputed and unanimous. The foundation for the project was the PHP framework Laravel. We preferred it because of its elegant syntax, powerful routing system, and opportunities for future expansion through Composer. In our view, this set of advantages aligns most accurately with the client's needs.
The foundation of the mobile application was a universal cross-platform framework Flutter. It utilizes its own rendering engine, which was important for ensuring high performance. After all, even a second delay in the food service industry can result in lost customers for the company.
Each sprint included planning, grooming (refinement of the backlog), and retrospectives.
Design
As mentioned earlier, it was extremely important to focus on UX/UI: creating a user interface that is as intuitive as possible, even for inexperienced users. The client should not have any questions like "Where should I click?" or "What's next?"
However, let's now touch upon another important aspect — aesthetics. The client requested us to create a space for visual pleasure. Taking this into account, we turned to a focus group to understand how to elegantly bring this to life. The result was the choice of minimalistic and subdued colors with small bright accents. As a result, the product sells itself, and everything around it is merely complementary, enhancing the overall impression.
Project results
The project holds great promise for the future; we've already incorporated functionality for scaling and expanding into the B2B direction. The release of the web application was successful, while the Android and iOS applications are currently undergoing alpha testing.
According to feedback from end users, we've managed to embody the concept of unique culinary experiences and a new dining experience. The gastronomic consultant feature received particular acclaim: customers are pleased with how our trained AI selects wine to complement specific types of meat and recommends exquisite wine and cheese pairings.
Final Thoughts
Developing a successful eCommerce platform is always a challenge for a team. This is especially true in the food industry niche, where numerous integrations with payment systems, logistics platforms, courier services, and many other details are crucial. Additionally, a convenient and simple UX combined with a well-thought-out admin panel with CMS functions is essential.
Therefore, achieving the brand's mission, delivering a unique user experience, and establishing a strong market position is impossible if you rely solely on ready-made solutions. A personalized mobile application is not just a means to increase sales and improve service quality but also a key tool in the modern digital world.
Your idea + our technological capabilities = incredible results.
