Brace Yourself - the Beverage Industry is Ready for Another Disruption
The food and beverage industry is the largest retail category in the U.S., and it is constantly evolving. Throughout history, there have been many disruptive events that have impacted the industry in major ways. It seems like the industry is ripe for another disruption. Here are five reasons why ecommerce seems to be the next big disruptor for the food and beverage industry.
- History Repeats Itself
From the start of supermarkets only selling canned goods versus what they sell today, to club stores like Costco, Sam’s Club, and BJ’s, the recession of 2008 and now the pandemic, there are a handful of events that have occurred over time that caused significant disruptions in how the food and beverage industry distributed and sold its products.
- Big Commercial is Out
Big commercial brands who once commanded the industry with their unbeatable marketing are now struggling to find an online presence in a world where customers are spending much of their time online, including grocery shopping. A 2015 Nielsen study found that about one-quarter of shoppers order groceries online and 55% are willing to do so in the future.
- The Amazon Effect
The success of Amazon and its expansion into different industries, including food and beverage, has played a major role in how much and what people are willing to buy online. Because of the Amazon effect, online selling platforms like WooCommerce and Shopify have seen significant advancements in both their technology and users. This advancement allows young entrepreneurs to easily and more cost effectively develop and create a selling platform.
- Need for a Creative Story
This ties in with reason number two. People are looking for brands with an authentic story, and that is something big commercial brands are lacking. Whether it’s a product that is locally made, 100% sustainable, or offers added functional benefits, young, vibrant brands with a story will gain the day.
- Technical Savvy Youth
If you haven’t noticed, technology is improving at a rate that can sometimes feel hard to keep up with. Younger generations like Millennials grew up learning and adapting to this technology, and the even younger generations don’t know a world without this technology. Because they grew up with this technology in hand, these younger shoppers – the next buying demographic -- are naturally acclimated to shop online anywhere, anytime.
Given the history of disruptive events to the food and beverage industry, it seems natural to think it’s only a matter of time before another event comes to shake up the industry. The pandemic seems to have provided just the right conditions for this to happen. During the pandemic, more people shopped online from home with many people enjoying the convenience of online shopping and making this a regular practice as we move out of the pandemic. In addition to changing customer behaviors with online shopping, the pandemic also led to the creation of many new online businesses or the creation or expansion of online stores for existing businesses. For example, Graasi is an organic functional water company that is a 100% ecommerce business that launched in early 2022. Do you think ecommerce is the next disruptor for the food and beverage industry?