Emerging Trends Shaping the Restaurant Industry in 2020

A global market that is now worth almost $900 billion (USD), the restaurant and hospitality industry is constantly changing and growing. Heavily influenced, as it can often be, by a mix of consumer needs and demands, technology, health, and new developments in flavours and cuisine, the industry at the start of this brand new decade looks dramatically different from how it was in 2010. 

Today, concepts matter as much as produce, and consumers are keen to patronise those restaurant businesses that fit with their lifestyle ideals as much as their taste in food. 

Here’s a summary of some of the key trends that are emerging into dominance in 2020, and will likely continue shaping the industry for many more years to come. 

Health and Wellness-focused food

As more and more people across the world develop an awareness of healthy eating habits, food intolerances, and the benefits of organic produce, the health and wellness food market is well placed to be a key trend over the next decade. In fact, the sector is expected to grow at a rate of 5.94% between 2018 and 2022, and while that may not seem like a substantial figure it equates to approximately $280.97 billion in terms of market value. 

Consumers are making concerted efforts to consume less processed foods, and restaurants are meeting the demand by offering menus centered around unprocessed and whole grain foods, along with probiotic, prebiotic and fermented foods and drinks. 

“Alt-milks” and alternative dairy products are proving to be more than just a passing fad, taking on a life of their own in 2020 as more and more companies are producing products with better nutritional properties, with a mass market appeal that reaches beyond those consumers affected by allergen issues. 

Plant-based eating, too, is also a top priority for many of the consumers in today’s restaurant and foodservice markets, pushing for more research and experimentation with alternative proteins and ingredients. While pea protein has taken over from soy as the building block to most plant-based menus and food items, other forms are breaking into the market that are derived from mushrooms, legumes like chickpeas, and nuts, grains, and mung beans. 

Even more diverse are the developments made by companies like Sustainable Bioproducts and Prime Roots into alternative meat and protein sources. The former is trialling a “high-protein volcanic fungus” as a food product that it hopes will hit the market later in 2020, while Prime Roots has already made its koji-based meat and seafood alternatives available to the industry and consumers since the start of the year.

Sustainability

Reversing climate change is on many people’s minds in 2020, so naturally, reducing food related waste and increasing sustainability within the industry is another trend emerging to the forefront this year. According to research, food related waste costs the industry a total of $100 billion annually, and with 52 million tons of food being sent to landfill every year in the US alone, it’s clear why. 

In 2020, restaurant businesses are beginning to use the latest technology to identify where food is being discarded and wasted, before implementing measures to combat it. Meanwhile, others still are actively working on repurposing waste produce into new menu items, or transforming it into brand new ingredients. Organisations across all levels in the industry are now beginning to question their role in the global food chain, adopting circular economy principles to renegotiate their positions and establishing better value exchanges with local and mid-range suppliers, producers, and distributors to minimise their carbon footprint. 

There’s continual incentive at a governmental level too for businesses in the food sector to prioritise sustainability as part of their key corporate responsibility initiatives. Over 12 different countries are in the process of passing new climate change laws that will eventually lead to sustainable economies, Germany has slashed VAT for restaurants from 19% down to 7% for 2020-21, and even multinational food sector corporations like Danone are now pledging for “an ecological transition” as the industry navigates the second half of the year. 

Innovative home delivery services

Due to the increased penetration of digital technologies, more consumers than ever are opting to increase their screen time through activities like playing home games on online platforms, mobile gaming, and streaming content on platforms like Netflix over the more traditional forms of entertainment. As a consequence, there’s been a surge of usage in the home delivery sector. 

The food delivery sector is now worth approximately $35 billion globally, with over one third of US consumers opting to use the services of third party delivery services like DoorDash and Uber Eats. In order to compete, traditional restaurant businesses are implementing various sophisticated delivery systems, incorporating new innovations like contactless delivery,  Artificial Intelligence, robot-enabled kitchen sections, and even driverless cars, which should push up the delivery sales of restaurant businesses significantly over the next five years. 

Continuing with the home delivery trend, ghost kitchens (aka cloud or virtual or dark kitchens) will also begin to push their way into the mainstream after finding their niche here in 2020. Significantly reducing the cost of overheads, labour, and premises, and ensuring that menus can remain innovative and meet consumer demands, the ghost kitchen business model may well have the biggest impact on the future of the industry yet – US-based ghost restaurants are expected to generate an additional $300 million for the industry in annual sales – and will likely secure significant interest from long-term investors. 

Smart Eating

Machine Learning and Big Data are no longer alien concepts in the food service industry, as many businesses are realising that embracing technology will lead to a profitable revolution. 

In addition to the benefits that adopting big data can bring to home delivery services, it also poses a wealth of benefits for restaurants and food chains, particularly when it comes to business development. Big data can be implemented by a restaurant to do everything from measuring stock consumption in parallel with market trends, to long term monitoring of the effects of certain temperatures on food quality, and even gauging customer needs by collating social media and internet reviews into meaningful, actionable information. 

The food and tech relationship goes beyond innovative delivery services and business models, however and in 2020, Smart Eating concepts are making their way from niche restaurants into consumers’ homes. 

The food-tech sector already experienced global growth of 43% during FY 2018/19, robot waiting staff are no longer a surprise in many restaurants and hospitality businesses, and according to AgFunder, 70% of restaurant goers in France are regularly exposed to technology at the dining table. 

It’s also a trend that will be driven by consumer adoption, particularly as biohacking (a lifestyle trend focused on optimising brain and body at a cellular level) continues to go from strength to strength. The popularity of global dietary movements like DNA and blood type nutrition, combined with consumers’ increased interest in knowing where their food comes from indicates that advanced technology is a core part of the global food and hospitality industry. Meanwhile, as the worldwide interest in wearable tech increases from health conscious consumers, innovations which monitor and track healthy eating habits, will become much more commonplace.

We hope you liked this article on emerging trends in the restaurant industry. Do let us know your thoughts in the comments section below. 

Aditya Sarkar

Aditya Sarkar

Aditya Sarkar is a Marketing Manager at LimeTray. When he isn't being a Marketer, he likes solo-travelling, playing all kinds of sports and chilling out with friends! He's reachable at aditya.sarkar@limetray.com