The Latin American food and beverage industry looks set for continued success in 2024, following positive growth in 2023. Argentina, Brazil, Chile, Colombia, Mexico, and Peru collectively grew food industry volumes by +1.8% reaching 102,051.5 million kilograms and beverage industry volumes by +3.7% reaching 212,807.27 million liters in 2023 compared to the previous year, according to GlobalData, a leading data and analytics company.
Alexis Becerra, Consultant and Food & Beverage Analyst at GlobalData, comments: “LATAM Food & Beverage growth in 2024 will be driven by the increased purchasing power of an expanding middle class, the widespread adoption of AI and digital innovations in retail and online channels, a continuing consumer shift towards health awareness and healthier options, and increasing on-the-go and indulgent consumption supported by the revival of the region’s tourism industry as consumers look for more convenient and portable food and drink options.”
These growth factors will support five key trends in the LATAM food and beverage market in 2024, which will empower consumers to make informed choices and offer food and beverage brands exciting opportunities for innovation and growth.
1. Social shopping
Social shopping refers to the practice of buying and selling goods and services through social media platforms or networks, which are shortening the path to purchase and may turn them into favored shopping destinations for many consumers.
Platforms such as Instagram and TikTok have become popular for social shopping, as they provide seamless links between product recommendations on social media and the ability to purchase them using smartphones and smart devices.
GlobalData’s Q3 2023 consumer survey revealed that recommendations on social media are important to 45% of all consumers and 59% of consumers shopping online more frequently. Brazil’s Grupo Pão de Açúcar, the largest food retailer, partnered with Yalo to launch a WhatsApp sales channel, offering express delivery and click-and-collect options. This showcases technology’s role in enhancing the shopping experience whilst providing convenience.
2. Health Conscience Consumption
Health-conscious consumption refers to the trend of consumers actively seeking out and choosing products and services that support their personal health goals and contribute to a healthier lifestyle. These consumers are looking for transparency in nutrition labels and seeking products with clean labels.
Consumers are also increasingly attuned to brands being selective about the health claims they highlight and what they withhold, giving rise to the “Health Hushing” trend. Indeed, 51% of consumers remain confused about which food and drinks are healthy for them, according to GlobalData’s Q1 2023 consumer survey, making health and wellness a growing opportunity for food and beverage companies.
3. Restrained Hedonism
Restrained hedonism refers to a consumer behavior where individuals exhibit self-control and moderation in their pursuit of sensory pleasure and enjoyment. For brands, this means that consumers may still indulge in snacks, desserts, and alcoholic beverage but prefer options that are low in calories or low in sugar and opt for low-alcohol or alcohol-free options to satisfy their cravings without compromising their health goals. Some consumers may also opt for meat-free alternatives as a way to enjoy indulgent meals while still practising restraint in consideration of their health.
According to GlobalData’s Q1 2023 survey a quarter to over a third of consumers consume healthier option food and drink products at least four times a week. Brands such as Bimbo, FEMSA and Nestlé, have successfully implemented premiumization strategies in the Mexican market with product innovation that helps consumers to achieve their health goals. Nestlé has launched the premium instant coffee brand Taster Choice and Bimbo’s Cero Cero bread and Tortillinas offer low-calorie options, with FEMSA launching a range of low-sugar soft drinks.
4. Value Skepticism
This refers to both the skepticism or doubt that consumers have towards the claims and information provided by brands and the unhappiness they feel about “greedflation”. While the true impact of “greedflation” on rising prices is debatable, there is little question that consumer patience for price hikes is wearing thin. As consumer goods companies come under increased scrutiny, consumers will be more than willing to forego brand loyalties for a superior value proposition.
They may also be less likely to increase their spending if they are unsure about how their money will be used or if they feel uncertain about the credibility of the brand’s claims, which makes it more likely that they will revert to brands or products that they know and trust.
5. Value Connoisseurship
Consumers are taking pride in their resourcefulness, buying dupes or secondhand to save money, shop ethically, and express themselves. In addition to the economic benefit of purchasing secondhand items, there is a certain social cachet and ethical status earned from participating in the circular economy. Traditional small scale producers are benefiting from the proliferation of informal markets across Latin America, where consumers prioritize traditional culinary practices, locally sourced ingredients, and artisanal production methods. This is driving demand and an opportunity for brands to provide authentic, high-quality food and beverage products, which reflect each country’s cultural heritage.
Becerra adds: “Latin America’s food and beverage sector is a dynamic and growing industry, which will benefit from trends such as social shopping on social media platforms, health-conscious consumption to help consumers maintain their health and wellbeing goals, and continuing to provide high-quality, unique, and personalized products and experiences.”
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