Developed markets account for an overwhelming share of food spend and manufacturer focus globally. In recent years, this has proven concerning as packaged food and beverage volume sales have stagnated in those core markets with little sign of future growth. Post-pandemic on-trade recovery has been just as underwhelming, with consumers struggling to find time or money to spend away from home and foodservice operators trying to recover traffic while tempering menu prices. Amid ballooning real estate, labour, and ingredient costs, as well as the double-edged sword of third party fulfilment proliferation, convincing people to dine out requires a new playbook.
GLP-1 acceptance, consistently rising costs, and shifting spending power are shaping future consumption trends
“Peak calorie” describes the coming plateau of total volume growth for food and beverage consumption in developed markets.
While average household spending on food and beverages grew by 25% in developed markets over 2019-2024, total calorie volume sales in retail and foodservice rose by only 2%
Source: Euromonitor International
This is not attributable to a single factor so much as a confluence of long-tailed global drivers. Unit prices of food and beverages have been careening upwards since 2022 and, barring concerted effort to stem or reverse climate crisis and global fragmentation, will only continue to rise. Accessibility and acceptance of GLP-1 drugs is also proliferating, not just changing how much but also what specifically we will consume. Finally, larger demographic changes are widely disrupting FMCG, as millennials and Gen Z slowly attain disposable income and re-baseline the brand equity of previous generations.
Many retail food and beverage manufacturers in North America have already adjusted strategies away from a volume growth mindset towards value growth. In beer, we see this with an increasing share of sales and marketing spend moving to premium brands like Michelob Ultra and the Modelo portfolio away from the saturated mid-priced segment. In soft drinks, the biggest disruptors in carbonates have not been value brands or private label but better-for-you sodas like Olipop and Poppi that command a premium price point as opposed to long dominant players. In packaged food, high-value ingredients like protein, fibre, collagen, and creatine dominate innovation trends by tapping into a wellness-driven populace, regardless of their GLP-1 usage.
This leads to the next potential avenue for premiumisation in food and beverages in developed markets: the on-trade. As consumers focus less on caloric load in value proposition, the broader set of attributes aligned with quality factor heavily into where and why people dine. Traditional portion sizes, a losing fight in menu pricing in the forecast as ingredient costs surge, can be de-emphasised towards smaller servings with higher-demand ingredients and make away-from-home eating and drinking occasions defensible. To boot, restaurants, bars, and cafés can tailor their outlets and engagement strategies to meet the non-nutritional needs of consumers through space design and hospitality.
Stand-alone limited-service restaurants will become an uncanny valley between packaged ready meals and full-service restaurants
While modern food and beverage consumption has historically been intertwined with occasions, the persistence of time debt and generalised anxiety in developed markets in recent years threatens much of the ceremony in favour of utility. This starts to tease a greater split in how dining is bucketed: function-aligned vs occasion-aligned. As flavour and texture become relatively negligible in cost and retail SKU variety can compete aggressively on novelty with chained LSRs, it becomes substantially harder to justify treating oneself away from home when those options can be found through retail and much more amenable to promotional activity. Grocers are increasingly adept at providing hot food options at competitive prices, with some of the more successful anecdotes operating as loss leaders to drive channel traffic.
Full-service restaurants, though, have a much higher ceiling to incentivise occasion-aligned dining. When convenience becomes a lesser priority, the resonance of experience takes precedence in achieving repeat visits. A diverse core menu and rotating limited-time items may bring in new customers, but specialisation on a smaller list of offerings can be just as effective if the experience is compelling and consistent. The upper hand in foodservice in the post-pandemic era will extend beyond affordability; you will need to justify why your third space warrants what consumers feel is their limited stock of money and time.
Download our new white paper, Peak Calorie: Food and Beverage in the Low-Growth Era, for in-depth trend descriptions, case studies and strategic recommendations
