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5 Beverage Industry Trends and How ERP Solutions Enable Innovation

5 Beverage Industry Trends and How ERP Solutions Enable Innovation

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5 Beverage Industry Trends and How ERP Solutions Enable Innovation

Nov 18, 2021

John McCurdy
A bottling plant worker inspects two bottled drinks.

The beverage industry has been anything but stagnant of late. Just a casual perusal of grocery store shelves demonstrates the explosive proliferation of options, from teas and coffees to sodas, alcoholic drinks and any of a number of other product categories.

For beverage businesses like yours, it’s vital to understand what’s driving this innovation. Most would agree that changing consumer demands are the primary cause, and considering the amount of disruption the past several years have seen, the list of important considerations for product positioning—sustainability, convenience, health and indulgence, to name a few—is becoming longer and more nuanced.

There are many different directions your company could choose for new lines to capitalize on shifting customer preferences. Let’s examine some of the trends emerging in the beverage market as a result of these changes and how an industry-specific enterprise resource planning (ERP) system can facilitate the alignment of your offerings with new expectations.

1. The Call for Greater Sustainability

Sustainability of food and beverage businesses and products is now top-of-mind for consumers and industry decision-makers alike—in fact, it was chosen by survey respondents as the top trend to prioritize in the IDC Global Food and Beverage Industry Trends and Strategic Insights whitepaper commissioned by Aptean. Another study conducted by Cone Communications found that 88% of consumers are more loyal to brands that support environmental causes.

What makes a beverage or production process “sustainable” can vary, but plant-based drinks—especially dairy alternatives like oat and almond milk—are looked on favorably because their manufacture does not tax the environment to the degree that more traditional processes do. Material sourcing is also a critical concern, as consumers want to be assured that the ingredients and packaging of their products do not come at the expense of the land and people that produce them.

A good example of a successful sustainable product is the line of organic and vegan-friendly beverages from Whole Earth Foods. The company’s mission of making both people and the planet healthier resonates with consumers who want to do good with the money they spend on beverages.

A beverage ERP platform can help your organization reach its sustainability goals. It’s important to note that the complete visibility into your processes that these systems give you will help to eliminate waste and incrementally improve on efficiency. Such solutions also facilitate the introduction of new, more sustainable suppliers with total supply chain management and traceability tools.

2. The Rise of Premium Drinks

Premiumization in the beverage industry has experienced a significant surge as consumers confined by lockdowns and quarantines search for sources of excitement and indulgence. Gin and spiced rum have both experienced increases in sales, as have wines priced at $20 and higher per bottle.

It’s not just in the alcoholic drink category that this trend is gaining traction, though—premium sodas and teas made with local, seasonal and natural ingredients are also increasingly popular. This overlaps to some degree with the desire to make consuming the beverage a fun and memorable experience, which is one of the reasons behind the massive bubble tea craze.

Whether or not the global economy continues to show signs of a recession may be a key factor in determining these products’ long-term viability, but for now, premium offerings are all the rage. Look no further than the Dr. Pepper Snapple Group’s acquisition of the Bai brand and their antioxidant infusions and superteas for proof.

When your research and development teams are working on your business’s next premium beverage release, they’ll need the kind of recipe and formula management features that only a purpose-built ERP system can provide. With the functionality of an advanced solution like Aptean’s beverage ERP, they’ll be able to make the minute adjustments and precise measurements to get the taste and appearance for the product just right.

3. The Popularity of New Packaging Options

Experimentation in packaging of beverages is primarily driven by consumers’ desire for convenience. Ready-to-drink (RTD) options like bottled cold-brewed coffees and meal replacement shakes continue to see success, and the RTD market is expected to grow at a 6.1% compound annual growth rate (CAGR) through 2025.

Boxed beverages—especially those that use a recyclable material for their carton-like container—are also catching on, even outside the more traditional boxed wine category. Tetra Pak cartons, which even have a plant-based polymer coating that ensures that they are 100% renewable, are an instance of this kind of innovation.

Meanwhile, the increased focus on ecommerce due to pandemic-related closures and stay-at-home orders has forced beverage manufacturers to look into the durability of their packaging materials, as well as ways that customized labels and bottles can add extra appeal to products. As such, companies like yours would be smart to consider a new solution that serves to both better protect your goods in transit and help them stand out from competitors.

ERP solutions enable this sort of innovation by allowing your teams to specify the kind of packaging by product within your system so that the right vessel is always chosen for the beverage product in question. The flexibility of these platforms will also help when introducing a new configuration to the mix.

4. The Desire for Novelty in Alcohol

While the old standbys of beer, wine and spirits certainly still have a place in the industry, new and different alcoholic offerings are in high demand. Canned cocktails and hard seltzers with no sugar added are some of the most prevalent among new options on store shelves, and both overlap nicely with the RTD trend.

Hard coffee and kombucha products have taken typically non-alcoholic drinks and spiked them, whereas no- and low-alcohol beers and “mocktails” take the opposite approach, delivering on traditionally boozy tastes without any of the intoxicating effects. While these are two very different emergent categories, they demonstrate customers’ craving for something out of the ordinary.

We’ve mentioned the popularity of some premium liquors, but another hot topic is the concept of “craft” drinks, or those that are produced by independently owned businesses in small batches. Consumers frequently associate the term with beverages that are hand-made, authentic and made with higher quality ingredients.

The recipe and formula management module in Aptean’s beverage ERP can empower your product development teams to try out new alcoholic versions of traditional drinks, as well as alcohol-free takes on alcoholic beverages in your lineup. Working on these new offerings will mean introducing new ingredients in your supply chain, but fortunately ERP solutions’ traceability features will help you keep the movement of materials and the data tied to them straight.

5. The Appeal of Health Benefits

More attention on wellness and new ways of conveying products’ health benefits is our final key beverage trend. For example, the immunity boosting properties of certain drinks and ingredients now receive top billing on packaging to attract more conscious consumers.

“Functionality” is another term with increasingly widespread use, specifically on products with probiotics like kombucha and yogurt drinks from Chobani, Activia and other brands. Adaptogen add-ins and CBD infusions are also highly marketable to those looking for beverages that can reduce stress and have positive effects on mood.

Low sugar and high protein content continue to be important for those individuals who are trying to manage their weight and fitness. Electrolyte drinks are also quite popular among this crowd, including natural options like coconut water as well as new offerings from the BodyArmor and Essentia brands.

ERP for beverage companies can facilitate the introduction of new healthier lines for your brand with the recipe and formula features mentioned previously, but another way that these solutions can assist in your efforts to attract health-focused customers is through fully configurable labeling tools that can ensure key benefits are advertised prominently. You’ll also be able to really scrutinize the sales performance of your novel offerings with the robust financial analytics functions.

Setting a Foundation for the Fast-Moving Future

These trends show just how quickly the beverage industry is evolving. While sugary sodas, simple fruit juices and other traditional options will likely always have their fans, any organization should pay heed to this list of beverage industry trends and consider how these movements will affect the viability of their lines in the coming years.

To be able to adapt and operate with the confidence and agility that these changing times require, it’s vital to fully modernize your company with a digital transformation. The foundational piece of any such initiative is ERP software, and here at Aptean, we’re proud to offer solutions based on in-depth industry knowledge, hands-on experience and best practices.

Our beverage ERP also benefits from a Microsoft Dynamics 365 framework—which affords cutting-edge integrations and regular upgrades—as well as options for cloud deployments that suit the on-the-go nature of the larger food and beverage space. We also strive to act as a partner in the implementation process, from offering a request for proposal template for your initial search to helping create a realistic roadmap based on your unique circumstances.

Want to learn more about Aptean’s beverage ERP and what it can do for your business? Contact us today.

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