Circana, one of the major firms tracking consumer behavior, says growth in the food and beverage sector is expected to stabilize after highs experienced during the pandemic and the following period. Specifically, Circana expects food and beverage retail growth to settle in the 2-3% range in 2027, versus the nearly 7% CAGR seen between 2019 and 2024.

Circana notes “tight volume trends” will continue as consumers weigh financial concerns with changing lifestyle priorities – like GLP-1 use, for example. Digital tools like AI can also make “product discovery more informed and efficient,” Circana adds.

"Consumers are no longer simply trading down or cutting back," says Sally Lyons Wyatt, global executive vice president and chief advisor at Circana. "They are becoming more intentional and efficient. Whether through pack-size optimization, private label and brand selection, AI-assisted shopping or reducing waste, shoppers are finding smarter ways to achieve the outcomes they want while navigating persistent financial pressures."

So, what does this mean for food manufacturers? While I imagine profit margins are already under pressure, consumers will seek products that balance price with value. For example, The Hershey Company said it would revert 3% of its Reese’s products to previous milk and dark chocolate recipes after consumers pushed back against its use of chocolatey coatings.

Additionally, consumers will continue to seek products that support their nutritional goals. Protein has been king lately — especially among GLP-1 users who require smaller portions — but fiber is expected to make a comeback as well.

When it comes to using AI to make purchasing decisions, that means manufacturers must optimize product descriptions for AI search. Microsoft recommends including answers to questions users might ask, as well focusing on facts and use cases over vague marketing language.

From an operations standpoint, food manufacturers must manage many challenges, but it’s also important to keep the consumers in mind at all times – and across departments.