Consumer products M&A update: Q4 2018
As consumers increasingly become more conscious about their food, the consumer products industry is having to quickly adapt to these changes. The increasing shift towards on-the-go meals, food label transparency and purchasing aligned with personal values are just a few of the food-related topics changing the industry. This Consumer Products mergers and acquisitions update provides Deloitte Corporate Finance LLC insights and market data analysis that shed light on mergers and acquisitions trends in the Consumer Products industry.
Consumer products trends
- On-the-go1,2: As the boundary between snacking and dining shifts, the ways in which foods are marketed and packaged are changing to accommodate a new generation of on-the-go consumers. Companies across the snacking spectrum have taken note of the uptick in demand for convenience and have responded with new packaging formats designed to make meal preparation and consumption faster and easier. Food manufacturers are feeling the effects of this trend as well, seeing an increase in orders for snacks that can present similar health and nutritional benefits of a complete meal, while offering portability.
- Artificial Intelligence (AI)3: AI is one of several disruptive technologies that consumer product companies are looking to take advantage of as these technologies continue to evolve. This technology can help strengthen a company’s competitive advantage in the marketplace and enhance the customer experience in a number of ways. Many companies are currently utilizing automated processes to realize greater efficiencies, augment decision-making, efficiently allocate resources, and are even employing AI to generate product and service innovations.
- Transparency4: The modern US consumer increasingly wants more and more insight into how their food is made, where it comes from, and exactly what the ingredients are, challenging food producers to improve transparency of their operations and production process. With 75 percent of shoppers saying that they are more likely to switch to a brand that provides more in-depth information beyond what is provided on the label, being transparent about what is going into a product is becoming essential for many food and beverage brands.
- Self-expression5: Many of today’s consumers are aligning with companies that represent similar values to their own. For “Gen Zers” in particular, food is more than sustenance, it is a symbol of personal values and a form of self-expression. With 44 percent of consumers stating that social and cultural factors have gained importance to them over previous years, many companies are listening more to what consumers are saying and beginning to integrate this increased awareness and monitoring of expression into their core marketing processes.
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2 “The Power of Snacking.” Nielson, 7 Dec. 2018.
3 “The adoption of disruptive technologies in the consumer products industry.” Deloitte, 7 Jan. 2019.
4 “Food Retail Study Determines Transparency Yields Greater Brand Loyalty.” FMI, 18 Sep. 2018.
5 “2017 Top Trends in Fresh Foods.” IRI, Sep. 2018.