Rearview mirror

One year (and some weeks after the arrival of the pandemic into Europe and the consequent beginning of the lockdown), and while the UK heads towards the de-escalation, it's now time to analyze what we forecasted back in the day, and how that contrasts with what we know today.

It was impossible to predict the impact of the avalanche heading our way, and difficult to understand every one of its implications. However it's unavoidable to revisit those texts (for example my own predictions presented in March 2020 in : https://www.dhirubhai.net/posts/activity-6647822534094000129-Ki55) and separate what went the way we imagined from what caught us totally off guard. Maybe that will hint some of what is coming next.

The pandemic is far from over, even further is the recovery to the days before it hit us. But we have lived with it longer than a year, and we start to see the light at the end of the tunnel, so it's clearer and easier now to see the future.

Back then, we talked about 3 trends to grow and affect new and existing product development: Proximity, Regulation and Functionality.

So regarding proximity, it's ongoing and growing stronger. Actually, nowadays supporting small or local biz (as per Globaldata research) for 38% of the consumers consulted is even more important than before the pandemic, furthermore, for 16% of the consumers it has become the Top Priority. A trend you can expect to see for a while as the economic consequences linger around.

Around regulation, the news volume might not have been as remarkable these days. But I wouldn't discard extra vigilance around certain ingredients/categories, the same way we have observed with the last steps around the CBD edibles category and extra regulation, in particular in the UK.

On the growth of functional drinks, already 1 out of 5 drinks has functional features (as per Innova Market Insights) and 57% of consumers state that functionality is either always or often an important factor in their purchasing decision.

Even more obvious is the evolution of the Route to Market. New channels emerged, boosting an increase in the digital and virtual interaction with consumers and the forced tilt to home consumption.

It's easy to corroborate the growth of the digital channel in the latest months. A remarkable growth was forecasted but nevertheless the lockdown was a gigantic catalyzer for it. The increase depends on each national market, but we see increases from 33 to 50% in different important markets. That, considering that it was already, for instance, a 10 billion USD business for the Black friday in the US, and an even more impressive 25 billion USD volume for the Singles day in China. Massive.

This has of course been articulated around the E-commerce behemoths but also around some small local heroes that have boarded the Direct To Consumer (DTC) wave. The Take Away and Delivery market is estimated to have grown a 73%. But it has also implied the cultural transformation into the home or domestic consumption and another example of the remote experience.

It's not unexpected, with 54% of the millenials continuously looking for new experiences and sensations.

Forced by the new rules imposed by social distance and hygienic measures, those experiences had to follow the road of virtualization. But it's not all fun & games, and we have seen a gigantic increase, first in the online education (webinar galore! prepare your agenda), telemedicine, videoconferencing and services and finally the Uberization of labour (the individual as a product through apps)

That without entering into the sociological impact of the crisis. The difference in impact between segments, regions and sectors, the adjustment of available expenditure for each family...

What's next for consumers? : a profound movement of relocalization to rural areas, a vindication of the home office and a new order of priorities for many professionals. But I will leave that for a future post.

I can already see a polarization of businesses between both superplayers and the small local heroes that survived and evolved with the storm. And of course the germination of some of the next era entrepreneurial sensations that we can't even imagine right now (Foodtech and next generation ingredients, hello and welcome to our lives!)

Hopefully, this change will have been for the best. At least I'm sure that we now see the future with a lot more optimism. At least, we have learnt to fully appreciate some of the best parts of contemporary life that we had previously taken for granted, which is not a minor change.

Now free from the bunkers.

Jaime Teulon