FRUIT TRADE By Marta Kwiatkowski and Christine Schäfer. Ideas Impulses Insights

Transcription

1 FRUIT TRADE 2025 By Marta Kwiatkowski and Christine Schäfer Ideas Impulses Insights

2 Hello!

3 GDI Gottlieb Duttweiler Institute 1 Imprint Authors Marta Kwiatkowski, Christine Schäfer Editor/Text Andreas Güntert Layout/Illustration Joppe Berlin GDI 2017 Publisher GDI Gottlieb Duttweiler Institute Langhaldenstrasse Rüschlikon/Zürich, Switzerland on behalf of Messe Berlin GmbH Messedamm Berlin, Germany

4 Content 03 Preface 04 Introduction 08 Key Trends and Drivers 13 Trends To Watch > Production > Distribution > Consumer Behaviour 29 Conclusion 21 Annex

5 GDI Gottlieb Duttweiler Institute 3 Preface Dear Members of the Fresh Produce Trade, We would like to thank all participants for their contribution to Ideas Impulses Insights, the trend study on the future of the fresh produce sector. In the preparation of this trend report, international experts from the entire value chain were interviewed. On this basis, we were able to determine the developments considered to be most disruptive from the perspective of the sector. Together with the expertise of the renowned Swiss think-tank, Gottlieb Duttweiler Institute, the most relevant areas of action were thus defined. This trend report will allow you to anticipate the key issues affecting the trade and sensitise both stakeholders and decision-makers to them. It will help you to answer questions relating to your business proactively: What major changes do international experts expect in the fresh produce sector? Which issues will we be dealing with in ten years time? Which innovations will our customers expect? The findings of the survey will be presented on the 25th anniversary of FRUIT LO- GISTICA (8-10 February 2017) and continuously discussed in our media activities throughout the year. The Ideas, Impulses and Insights from this trend study are a heartfelt thank you to all customers and partners in the fresh produce sector. They have guided FRUIT LOGISTICA throughout the past 25 years, and have made it the most important platform of the fresh fruit sector. As FRUIT LOGISTICA, we continually strive to conduct an intensive exchange on the future prospects of the sector with you growers, traders, technicians, logistic specialists, retailers and service providers. We are looking forward to hearing your views on this work, and remain with kind regards, Your FRUIT LOGISTICA Team

6 4 FRUIT TRADE 2025 Introduction While food production is increasingly geared towards efficiency and cost effectiveness, and becoming a highly technical area, consumers long for authenticity and transparency in their food consumption. However, the value chain has become increasingly complex and obscure in recent years. From the consumers perspective, the food industry resembles a black box. In addition, frequent scandals have undermined their confidence. Consumers have become more critical, and expect more simplicity and authenticity. Food is still expected to taste good and act as a feel-good factor. After all, consumers seek an intuitive, pleasurable and sensual experience when it comes to food. Local traditions and rituals are more popular than ever, and stand for food that people are familiar with. In recent years, unfair food production conditions and unsustainable production methods have increasingly garnered criticism. As a result, regional foodstuffs and products from fair and organic production have been gaining popularity for some time representing a counter-trend to globalisation in food production. And consumers are prepared to put their hands in their pockets if these criteria are satisfied. At the same time, drastic changes can be observed on a global scale; Asia for instance is becoming an increasingly interesting export market. China s middle class is emerging, and urbanisation is progressing fast. The longstanding onechild policy coupled with increasing affluence have resulted in a high level of preparedness to pay for the best quality products for the next generation. Stronger demand coupled with higher price acceptance means that many producers now sell to Asia rather than to Europe. As a result, trading channels for fresh fruit are also changing direction, away from Europe with its trend towards declining consumption and towards Asian growth markets. Moreover, consumers are no longer waiting for the larger distributors to react. They are beginning to prefer to create the desired transparency and sustainability in the value chain themselves as urban farmers or gardeners. Such niche phenomena exert pressure on the market, because they create new lifestyles for urban dwellers which are quickly taken up by conventional businesses. Urban farming and gardening are romantic niches which can be organised even better if they are supported by high-tech. Social demands to get the most out of life increases pressure on personal efficiency. Consequently this requires detailed planning, coordination and a high level of mobility. As everyday life becomes increasingly complex, consumers look for simplification and optimisation. With the support of new technologies, personal organisation is becoming easier. Digitalisation has already revolutionised entire industries, not only the music and tourism sector. It is now also becoming a significant factor in the food industry. Visits to a large retailer for the weekly shop can be substituted by the convenient option of home delivery. The aspiration towards efficiency coupled with the desire to maintain a healthy and balanced diet also involves fast and nutritious take-away meals and the ability to buy food in small quantities while on the move. While online shopping currently only accounts for a small share of food purchases, it is quickly gaining momentum. And this growth is sometimes driven by new players with purely digital business models the digital platforms. From delivery services to organic farms, restaurant services or smart meal box providers what all these concepts have in common is that they do not necessarily require their own distribution

7 An historical view of the value chain GDI Gottlieb Duttweiler Institute 5 Past Present Future Production High level of self-sufficiency in own gardens Local agriculture First mechanisation Low level of self-sufficiency Trend towards urban gardening Globalised agriculture Large-scale, partially automated production Production increasingly regional/urban New concepts in urban/vertical farming Non-industry producers (Google, Toshiba etc.) Fully-automated mixed cultivation production Distribution First exotic fruit imports Online trading Autonomous Weekly markets in towns Colonial goods Strong seasonality of production Key locations: Consumers come to the producers Partial return to street markets Continuous availability of fresh produce, seasonality less important Primarily via retailers: Consumers come to the store Smaller urban delivery services On demand/instant delivery Crowd-sourced delivery Rise of the platforms: Producer comes to the consumers Consumer behaviour Housewives: Responsibility for the family s nutrition Primary requirement: Satisfying hunger Marketing of food origins Health awareness Organic boom Marketing of product characteristics Processed fresh produce/ready-made healthy recipes Limited knowledge about nutrition Food is primarily consumed at home Fast Good: Fast, convenient and healthy Flexibility, eating anytime and anywhere Transparency/Requirement to know ingredients and origin of products Controlled lifestyle Diets Fast to-go supply that is healthy and aligned with individual nutritional values

8 6 FRUIT TRADE 2025 The value chain is becoming atomised and increasingly digital PAST PRESENT FUTURE Grower Farm Farm Farm Other production Urban Farms Wholesaler Processing Processing Market Retailer Platform Consumer analog digital Quelle:GDI 2016

9 GDI Gottlieb Duttweiler Institute 7 centre or ownership of the products. Their sole purpose is to bring a wide range of providers and suppliers together on a single shopping platform, and either carry out delivery to the consumer themselves or via a logistics partner. The product is going to the customer more and more, instead of the customer going to the retailer. Consumer preferences today are already diverse and complex. In view of a food industry that is engineered to the very core, people long for simplicity, authenticity and sensuality when eating. They crave regionality, environmental protection, animal welfare, health and pleasure. They want good food for a good life. However, consumer demands are developing much faster than the reality can satisfy, and this becomes apparent in ever higher expectations for instance in superfood products. A key factor here is that we still have only limited knowledge about nutrition. We react to marketing slogans rather than sound scientific data. An apple a day keeps the doctor away was a marketing slogan in the USA almost 100 years ago. In this respect, apples may even qualify as the first superfood product. Whenever a lifestyle icon such as Gwyneth Paltrow uses her blog to advocate the advantages of Goji berries, promotes avocadoes to power fruit status, or rolls out the red carpet for kale, the desired effect may come in the absence of any scientific evidence. The word of Ms. Paltrow and her colleagues alone suffices to catapult a fruit into sales orbit, and position it as a new item on the menu of millions of followers. However, lifestyle individualisation and technical innovations in people s diets result in customised recipes and the careful analysis of ingredients. This is not limited to attributes such as healthy, organic and sustainable, but also involves products that are tailored to individual needs and a personal health style.

10 8 FRUIT TRADE 2025 Key Trends and Drivers Uniqueness for the masses: Individualism instead of individuality The individual is the mainstay of society. Particularly in relation to digital natives, digitalisation has taught us that almost every product or service can be customised and personalised. Yet these unlimited options for self-fulfilment are also experienced as isolation and overload. As much as we strive and seek the product that is ideally tailored to our needs and wishes, we also follow the lead of the rest of society with tried and tested products. In terms of fresh fruit and vegetables, this means that traditional produce will continue to be popular. At the same time, however, diets that are optimally tailored to our requirements, and the origin of the products themselves will become more significant.

11 GDI Gottlieb Duttweiler Institute 9 Health style: The society of longevity The starting point for these trends is a positive one: we are becoming older and older. Globally, lifeexpectancy is increasing, especially in more highly developed countries. The society of longevity has long become a reality. Better food, better hygiene and better medicines provide us with longer life and better health. Sport and a balanced diet are part of our everyday routine. In the past, health only became an issue when people actually experienced (age-related) ailments. Today, even healthy people have become sensitised. With discipline and effort, we strive to optimise our body and soul. At the same time, however, this compulsion to lead a healthy lifestyle leads to a counter-reaction. The good life also means letting yourself go from time to time, ignoring the rules of good sense. Consequences for the fresh produce trade 2025: In this context, fresh natural products are continuously gaining popularity, almost taking on the role of preventative medicines. This is the reason why consumers are also increasingly interested in the composition of food products and their benefits. This trend manifests itself for instance in the fact that the new head of Nestlé, the biggest food corporation in the world, comes from the hightech health sector rather than the traditional branded food industry, as his predecessors did. The health-science and skin health sectors which were established by Nestlé in 2011 report directly to the CEO. Compulsory innovation, margin pressure and future viability concerns can thus even transform more conservative companies which have enjoyed longstanding success.

12 10 FRUIT TRADE 2025 Flexibilisation: The always-on society Digitalisation gives us access to inspiration, information and shopping 24/7. This has been achieved particularly through the availability of smartphones and their high level of market saturation. Digital natives have grown up with digitalisation and naturally integrate their smart devices into their routines. People use their smartphones hundreds of times each day. They use them to bridge waiting times at train stations, amuse themselves in boring meetings, or research something on the internet. These opportunities completely transform the requirements and expectations of today s consumers. Waiting times are now rarely accepted. People want immediate availability and delivery of products. Besides, quality and price comparisons are also easier and faster online. While consumers take advantage of this transparency, it increasingly leads to another obligation the ability to obtain information about everything online increases the pressure on conscious shopping activity. Not only are companies becoming more transparent, consumers are too. Data records which products have been purchased in the past, thus facilitating the use of incentives such as discounts on future purchases. Above all, this instant gratification is becoming a key theme for digital natives, since feedback and special offers are always immediate and customised. Whenever you pass a relevant store or product on the shelf, you receive an offer directly on your smartphone. Consequences for the fresh produce trade 2025: In future, fresh products will be bought online just as often as clothing, furniture or foreign travel. Moreover, fast delivery services which bring

13 Start Again GDI Gottlieb Duttweiler Institute 11 M&S Supplier Map Please select from below or use the map to zoom or select Select a country Clothing Food Global information the products to people s homes offer extra convenience. Larger retailers have long been operating their own online shops. Smaller ones are disappearing or serving a niche market with special sales concepts. Digital platforms from outside the sector are also establishing themselves as new players on the fresh produce market. Smaller start-ups, as well as global players such as Google or Amazon, have been offering such services for a while. They join forces and as a result the sale of fresh produce becomes consolidated. It is also obvious that those who control the data today can respond to consumer needs on a more individual level, and satisfy their demands better. Tech companies have a key advantage here. Origin: Increasing transparency in the supply chain Digitalisation has also sharpened our awareness. Access to information on all aspects of production promotes transparency. Many producers handle this offensively, encouraging consumers to trace the supply chain all the way back to the individual farmer online. Naturalness, sustainability, transparency and responsibility are now in great demand. In Western societies interest in material things is declining. Instead it is the unique and individual experience which is becoming more important. As part of this trend, food is practically elevated to the status of a new religion. Knowing about the production, origin, and history of a product constitutes a new form of luxury. As a result producers are becoming more important in terms of marketing strategies. They

14 12 FRUIT TRADE 2025 are used for storyline marketing purposes. Growers are becoming the new heroes. Consequences for the fresh produce trade 2025: When comparing the fresh produce sector with other industries, we see that global branding is only loosely anchored in the fresh produce business. Can the Chiquita-effect be transferred to other produce? Would it be possible to present an orange, berries, or a particular type of nut in a fashion similar to a wine label, so that it would be perceived as an independent brand, and be positioned as such? Consumers these days mostly consider fruit a commodity. One might hope that a brand promise would facilitate the achievement of better and more stable prices, as well as competitive advantages based on product differentiation. Nevertheless, based solely on their seasonal and perishable nature, subtle variations between harvests, and the complexities of storage and transport, it is obvious that it would require tremendous effort to elevate a mandarin or an avocado to the level of the next Mars bar or to gain the legendary perception achieved by brands like Nutella. On top of all this, considerable resources would be essential to ensure the success of a new brand on multiple communication channels. The idea of selecting particular sections of the value chain for specific branding might therefore appear more attractive. But this begs the question, to what extent are fruit producers actually able to set trends themselves? This links back to the subject of branded goods. It should be significantly cheaper and easier to market the producer and the origin as brands than it is to elevate individual products to branded item status. Thus producer branding at the start of the supply chain would be a more realistic option, as in the case when manufacturers try to communicate directly with the end consumer via the internet. In areas where the relationship with distributors and retailers is not negatively affected, the establishment of communities based on travel opportunities or Grand Cru deliveries could help to establish a closer bond with the end consumer. Life style carnivores from affluent countries might secure prime meat products as a dividend if they invest in Highland cattle. Or premium dairy products through cow leasing. So what would stop life-style fruit and vegetable fans from adopting a banana plantation for example? Or track the movements of their personal share in a raspberry crop? If the grower sees this as a risk to his relationship with the retailer, it might be possible to get the latter on board as part of the concept. Every supermarket manager must have an interest in creating islands of superior quality in their fresh produce segment. In view of the increasing efforts of the large retail chains to collect big data, it should be possible to develop such activities in a targeted way. The regional managers of the leading supermarket chains should already know which outlets would be suitable as special points of sale for such products.

15 GDI Gottlieb Duttweiler Institute /84 22 Trends To Watch Production: How will the food supply for the world population be guaranteed in 2050? Population growth, larger cities, increasing health awareness agriculture is having to facing these challenges to an ever greater degree each year. By 2050, world population is expected to increase to 9.7 billion. 1 How will it then be possible to feed all these people with traditional farming practices? In addition, urban growth is encroaching on farmland, while the demand for fresh vegetables and fruit resulting from increasing health awareness continues to rise. In 30 years time more food will have to be produced on a dwindling production area. How can we overcome this challenge? Scientists are under extreme pressure to develop efficient new cultivation methods which require less space and preserve natural resources while at the same time helping to remedy the major issue of food waste. 1 news.nationalgeographic.com/2015/07/world-population-expected-to-reach-9-7-billion-by-2050/

16 14 FRUIT TRADE 2025 Industry 4.0: The internet of things, big data and precision farming What is it all about? As part of the 4th industrial revolution and the internet of things, agriculture is taking a big step towards full automation. Machines, plants and computers communicate and cooperate directly with each other. Since computers are continuously becoming smaller and better embedded, people hardly notice their presence these days. And as a result of the constant interaction between the different computers, enormous volumes of data are being produced. The retail trade and food service sectors have already been using big data for some time to understand customer actions and attitudes. This mass data should equally help to support agriculture. In this case it is not about collecting customer information, but rather generating information about factors which might influence the effectiveness of agricultural production. Precision farming is a term that is often used in relation to big data in agriculture. Precision farming or precision agriculture involves taking account of ground or microclimate variations within a particular cultivation area in order to optimise yields. Subsection-specific cultivation allows for measures such as adjusting the amount of seed or fertiliser used to specific ground conditions, thus helping to reduce the application of chemicals. Assessment of opportunities and risks Big data and precision farming allow a significantly more efficient cultivation of land, resulting in more sustainable agriculture with lower crop protection use and less irrigation. Opportunities: While precision farming is usually based on big data, big data does not automa-

17 GDI Gottlieb Duttweiler Institute 15 tically equate to precision farming. Big data analytics can also utilise data from weather stations and satellites, and other sensors used primarily for scientific purposes. This allows, for instance, the prediction of crop disease epidemics. Risks: Big data usually means that insights are based on historical data. Unforeseen circumstances are not necessarily considered. The effort and financial resources necessary in implementing precision farming on smaller areas of land would have to be quantified in advance. Examples: Variable-Rate Application (VRA) means that the seeds and fertiliser are distributed in variable quantities based on land mapping and alignment with the specific ground conditions. Flint River Partnership The Flint River Partnership strives to optimise field irrigation in Georgia. By means of an analysis service run on an IBM super-computer, data from thousands of local weather stations, satellites and commercial weather networks is analysed to provide highly localised weather forecasts for the next 72 hours in 10-minute intervals. Vertical farming: The high-rise green revolution What is it all about? Vertical farming could be become the future of agriculture. Scarcity of resources, population growth and urban sprawl necessitate a rethink in terms of food production. In the past, fields and plots have been laid out at ground level. To facilitate the better utilisation of available land, the vertical farms of the future grow plants on several different levels. The roofs of these farm scrapers could be fitted with solar panels, wind turbines and rain water collectors. Underneath, vegetables, fruit and fish are cultivated by means of aeroponics, hydroculture, aquaponics and aquaculture. These can then be marketed directly in shops and restaurants located on lower floors. Assessment of opportunities and risks Vertical farms increase the yield per square metre of ground area, while also significantly reducing resource consumption through closed-loop operation under greenhouse conditions. Due to the controlled environment, fruit and vegetables can be produced all-year round. And since the plants in the greenhouse towers are not at the mercy of the elements, the risk of crop failures caused by severe droughts or floods is eliminated. Opportunities: Since farm scrapers are primarily operated in urban areas, distribution mileage to distributors and consumers is reduced, resulting in further resource savings. Risks: Critics note that the additional input required for artificial lighting, irrigation and other operational tasks could cancel out any savings based on the geographical proximity to the buyers. Examples: Sky Greens in Singapore is the first commercial vertical farm in the world. Soil cultures and hydrocultures are arranged in A-shaped rotating towers which ensure optimal distribution of sunlight and nutrition through their rotation.

18 16 FRUIT TRADE 2025 farmedhere.com FarmedHere in Chicago is the largest organic indoor vertical farm in the USA. FarmedHere employs an aquaponics system which combines fish farming in aquaculture and plant breeding in hydroculture. infarm.de InFarm (Indoor Urban Farming) designs and constructs vertical farms in various sizes which are used both by private households, and by restaurants, hotels and supermarkets. Nemo s Garden focuses on depth, rather than height. Plants are propagated in air-filled plastic chambers below sea level. Sea water condensation is used for irrigation, while consistent temperatures, large amounts of sunlight, and the absence of pests create an optimal climate. FarmTech & open source: Automation of agriculture What is it all about? Not even agriculture can escape digitalisation. New technologies are changing the way in which food is produced today and in the future. From specialised harvest robots, through high-precision agricultural machinery, to soil and plant monitoring with sensors in the soil agriculture has undergone fundamental changes over the past few decades, as has society as a whole. Assessment of opportunities and risks Scientific advances and technological progress in food production open up new possibilities for farmers and producers all over the world. Networked digital farms reduce the workload and help to make agriculture both more efficient and more sustainable. Opportunities: Big data analysis helps to estimate the required quantities of specific types of produce, facilitating optimised production, and therefore reduced food waste. Risks: If the natural origin of fruit is emphasised, and the expertise of fruit-growing specialists highlighted, the positive image of agriculture based on technology may be difficult to align with consumers emotional expectations. Examples: openag.media.mit.edu/hardware The food computer is a technology platform for controlled plant growth chambers. Robot systems are employed in specialised chambers to monitor climate, energy and plant growth. farmbot.io Farmbot Genesis is a fully-automated farming robot capable of both planting and irrigating. Its software is 100% open source, allowing anyone to benefit and contribute. Phytl Signs is a wearable for plants claiming to facilitate communication between people and plants. In contrast to other systems which monitor the soil and solar radiation, Phytl Signs processes plant signals directly and informs the user about the plants level of relaxation or stress, or of any diseases.

19 GDI Gottlieb Duttweiler Institute 17 New players: Google & Co. want to be involved What is it all about? The consolidation of agriculture and digitalisation ultimately enables traditional agricultural enterprises to use technological developments for their benefit, and brand new players to enter the market. Large technology firms with no previous agricultural experience are at the forefront of this movement, contributing extensive technological know-how. Once they have a foothold in the food-tech sector, these companies will be able to diversify their offer, utilise vacant space, and set an example in terms of sustainability with a resultant positive impact on their image. Assessment of opportunities and risks Tech giants entering the food sector have raised the knowledge level in the industry exponentially. The research departments of these companies are not restricted to theoretical questions, but can test and verify their theories immediately in their own indoor farms. Opportunities: Technological development is accelerated, and new opportunities arise and that applies to the competition as well. Moreover, the entire sector becomes more efficient as a result of increased competition from new market entrants. Risks: Problems could arise if companies such as Google try to keep their newly developed technologies for themselves, and protect these from imitators through patents. This could lead to traditional agri-firms being squeezed out of the market.

20 18 FRUIT TRADE 2025 Examples: goo.gl/sbywzp Google produces fresh vegetables in former shipping containers using the Leafy Green Machine by Freight Farms. goo.gl/i3ju47 In its GrowWise Center on the High Tech Campus in Eindhoven, Philips is researching optimal lighting and suitable climates for indoor farming to optimise production. Packaging smarter, personalised and more sustainable What is it all about? Consumer demands for convenience, together with the industry s requirement for efficient logistics in terms of the improved freshness of fresh products, have both resulted in an increase in plastic packaging in recent years. Although the example of Germany shows that the recycling of plastics has seen an enormous increase from 11.6 % in 1991 to a staggering 99.5 % in , consumer perception of this issue is usually quite different. They are often confronted with images of polluted oceans and animals trapped in plastic packaging. As a result, consumer acceptance of 2

21 GDI Gottlieb Duttweiler Institute 19 such packaging is continuously declining. Nevertheless wish and reality are often miles apart, and consumer behaviour is hybrid. Convenience often wins out because the consumer wants healthy food fast in suitably portioned sizes. In reality the volume of plastic waste almost doubled between 1991 and Retailers such as Original Unverpackt who avoid any form of packaging certainly have their finger on the pulse of the time. Conventional plastic packaging is no longer en vogue, and natural, bio-degradable packaging materials that can extend freshness are already being intensively researched. Furthermore, smart technology can allow packaging to respond to its specific content, thus for example adapting the best-buy date and the freshness of the product. Packaging is also developing in other ways. Voges Packaging, for instance, has developed Gropak which allows mushrooms to continue to grow during transport and storage. Assessment of opportunities and risks Consumer acceptance of unnecessary packaging is continuing to decline, even though this trend is in conflict with the desire for convenience. Surveys in Europe show that the majority of consumers would approve a ban on plastic bags. REWE has already stopped selling plastic bags from its outlets at checkout in Germany. Aldi will also ban this type packaging from its stores in The subject of packaging is thus expected to become increasingly important for consumers and lawmakers alike. area of convenience. Legal framework conditions still thwart the development of novel packaging materials in Germany. German packaging regulations dictate that TÜV-certified bio-degradable plastics may not be disposed of in industrial composting facilities. Examples: Gropak is a packaging concept that allows fresh products to continue to grow both during transport and in the store. original-unverpackt.de Original Unverpackt is a supermarket concept that avoids using one-way packaging. Bump Mark is a bio-reactive freshness label. The sticker s texture changes according to the freshness of the packaging material. Opportunities: New technologies facilitate biodegradable and ever smarter packaging. Packaging-free retailing is gaining popularity. Risks: Novel packaging concepts are significantly more expensive than traditional ones, and put increasing pressure on a low-margin sector in the yougov.de/news/2016/10/09/62-prozent-fur-verbot-von-plastiktuten/

22 20 FRUIT TRADE 2025 Distribution: The digital race for the final mile How does food find its way to distribution centres, supermarkets, restaurants and consumers after production? Digitalisation is responsible for fundamental changes in this area too. However, digitalisation is not the only trigger for change. Our lifestyle is also changing continuously. As a result of individualisation and flexible working-time models, fixed mealtimes are no longer the rule. Consumers want instead to be able to eat anytime and anywhere. Moreover, traditional fast food such as burgers, pizzas and the like are no longer in tune with the spirit of the times. Today, fast alone is not enough food must also be healthy and good. Since people are often short of time for shopping, or even cooking, new ways of bringing healthy food to consumers are required. New technology: food deliveries by R2-D2 What is it all about? Technological advances open up completely new logistical possibilities. The distribution of goods from A to B without direct human involvement has already become reality due to automation. Drones move deliveries from ground-based to air-borne transport, significantly reducing transport times both in high-traffic cities as well as in rural areas with difficult terrain. However, progress is not limited to airspace. Plenty is happening on the ground as well. For instance we already have delivery robots which autonomously move through streets and skilfully evade obstructions such as pedestrians or street lights. It appears to be only a matter of time before autonomously moving cars, trucks and trains become part of regular traffic. Assessment of opportunities and risks With the assistance of transport robots, drones and autonomously moving vehicles, transport routes and times can be shortened, facilitating faster delivery of products to the customer. Opportunities: This allows difficult terrain and traffic jams to be avoided in urban and rural areas. Moreover, autonomous transport possibilities reduce the need for delivery staff, freeing up these employees for other activities. Risks: An adjustment period will be required before robots and drones are fully integrated into our everyday life to ensure smooth operation. Traditional transport users still need to get used to the newcomers in road traffic. New legislation may also be required to regulate the interaction between existing and new transport users on the roads and in the air. Examples: The Estonian start-up Starship has developed a robot which claims it will revolutionise local delivery services. millhousemaui.com/drone-to-table With Farm to Table, fresh produce is delivered directly to the restaurant several times a day, where it is served only a short time later. goo.gl/8nxlvo According to DHL, it is not a question of if but a question of when logistics will undergo a radical transformation caused by driverless vehicles.

23 GDI Gottlieb Duttweiler Institute 21 PEDESTRIAN _ 015_12387 DISTANCE 325 M 00:28 Healthy delivery: More than just fast food What is it all about? Until a few years ago, delivery services were still associated with pizza, burgers and Asian food. However, the food delivery sector is trying to lose this unhealthy image with balanced alternatives. In cooperation with restaurants, delivery services now also offer fresh menus prepared by a cook with star ratings. People who prefer to cook themselves but shy away from the effort involved in shopping and menu planning are also catered for. DIY delivery services allow customers to make a selection from a variety of fixed menus, and then deliver the right quantities of the ingredients including the recipe to the door. Assessment of opportunities and risks Consumers want to be fit and healthy. Achieving this objective requires exercise as well as a balanced and healthy diet. However, customers often lack the time to go shopping due to the flexibilisation of society and increasing job demands. Opportunities: The new healthy delivery services cater to an existing yet previously unsatisfied desire for fresh fruit and vegetables. Thanks to these services even very busy people can have a supply of fresh food at home, or at least the possibility to have a balanced menu delivered instead of traditional fatty foods. Moreover DIY delivery services motivate their customers to try new recipes, and provide keen hobby cooks with a continuous supply of new ideas and inputs. Risks: If these types of delivery service want to keep up with the times, they must be flexible in their offer. For instance, a supplier selling superfoods who continuously lists new exotic fruits

24 22 FRUIT TRADE 2025 must keep up with the increasing complexity of orders, storage and expertise. Examples: deliveroo.de Deliveroo brings restaurants and customers together. The customer selects food via the platform which is delivered straight from the restaurant to the door by Deliveroo drivers. Hello Fresh compiles various recipes on a weekly basis and delivers the matching ingredients in the right quantities to the customer s home. the customers are prepared to pay a significant premium. Tony s Farm offers various subscriptions for weekly deliveries of seasonal and organic products. While Everytable does not deliver to the door, it brings food into the neighbourhood. What makes it special? The menus are priced in accordance with each area s economic situation, making healthy food affordable to everyone. Growing concerns about food safety in China have sparked the popularity of organic foods amongst locals and expats in Shanghai, for which

25 GDI Gottlieb Duttweiler Institute 23 New players in the distribution game What is it all about? Various companies which have never been involved with food before are now entering the delivery sector. These are often companies which already have a logistics network due to their core business, such as Amazon or Uber. These new players often offer a delivery service without producing the food themselves. For instance Uber does not own any taxis but links supply and demand for taxi services via its platform. UberEATS follows the same principle: restaurants and rumbling stomachs are connected via an app. Assessment of opportunities and risks More competitors means more competition, and ultimately lower prices or innovative new offers. Both benefit the consumer. Opportunities: Thanks to the new platforms, restaurants are now also able to enter the delivery business. Previously logistical problems prevented their market entry. This opens up the market and helps to diversify the offer. Risks: New players in the delivery sector could squeeze even established businesses out of the market if the latter fail to adjust or do not do so fast enough. Examples: fresh.amazon.com With Amazon Fresh the US internet corporation Amazon is stirring up the food trade. ubereats.com Uber has already managed to cause problems for taxi and other transport firms. The company is

26 24 FRUIT TRADE 2025 now turning the food delivery sector on its head with UberEATS. Google Express delivers products from various companies such as Costco, Target or Whole Foods directly to the door. Consumer behaviour: The customer is king? Or dictator? Or slave? On the one hand innovations are created because technological advances open up new possibilities. This is called technology push. On the other hand, innovations are based on changes in customer requirements which suppliers are forced to respond to. This is called a market pull or demand pull. A shift in customer requirements is particularly evident in the areas of health and sustainability. This creates challenges for companies. Consumers are not satisfied with a healthy diet alone. They also want to know where their food comes from, and the conditions in which the products were produced and processed. Transparency: The glass supply chain What is it all about? Consumers no longer want to be left in the dark. Greater health awareness also creates a need for information and transparency. What exactly am I eating? Which ingredients does it contain? Where was it produced, and under which conditions? Enterprises from many different sectors have already recognised this requirement. In order to ensure long-term customer loyalty, they try to satisfy this desire by various means. Assessment of opportunities and risks The demand for organic and fair-trade products continues, and consumers are willing to put their hand in their pockets to pay for them. However it is virtually impossible to differentiate between organic or fair-trade fruit and vegetable products on the basis of appearance or taste alone. As a result, official certification has to be supplemented by transparency in the value chain in order to provide assurance to the consumer and justify the higher price. Opportunities: Not only do consumers benefit from this transparency. Producers and the environment are also winners if production is actually as fair and sustainable as claimed. Risks: Anyone claiming transparency is sitting in a glass house and must be able to cope with very close and critical observation. Examples corporate.marksandspencer.com/plan-a Plan A is a Marks & Spencer initiative for protecting the planet. The ultimate goal is to become the largest sustainable retailer in the world. An interactive supply chain map shows which products are manufactured by whom in which location. Farmcation combines farm with vacation. The company runs various courses and events to connect consumers with producers, and generally deepen understanding of the food supply system. How many calories does this drink contain? Which melon is sweeter? Is my avocado ripe yet? The SCiO molecular scanner knows the answer to these and other questions. It scans the chemi-

27 GDI Gottlieb Duttweiler Institute 25 cal composition of food, drinks and even medications, and transfers these directly to the smartphone within a very short time. Convenient health: Healthy lifestyle without major effort or cost What is it all about? We are striving for a better version of ourselves, and improve our habits with sports and a healthy lifestyle. Success is measured with smart wearables and compared to the results achieved by friends. However many people feel that eating a healthy diet requires too much effort and time, and is also rather complicated. Moreover, focusing on quality seals and organic labels is no longer enough. Natural food is increasingly being presented in a pharmaceutical context. New business ideas and platforms try to make a healthy lifestyle more attainable for us. Ingredients are broken down and presented in a transparent manner, and delivery services provide us with a daily smoothie tailored to our requirements. Assessment of opportunities and risks Growing consumer demand for fresh and healthy food inevitably also increases demand for fruit and vegetables. Their composition and health effects will thus be even more in the limelight in the future. Opportunities: Tools and technologies which help us to achieve our personal objectives are becoming more important. This also applies to suppliers and service providers who offer healthy, perfectly portioned convenience products.

28 26 FRUIT TRADE /23 5 _15 43 Risks: Anyone promoting food as having healthpromoting properties must be confident that this is the case. The next food-related alarm might otherwise not be far off. It can also damage credibility if healthy eating alone is expected to achieve better health. Traditional medicine generally assumes that health is the result of a balanced diet coupled with a minimum amount of exercise. Examples sageproject.com The Sage Project offers a data platform that provides a new type of food labelling containing ingredients, nutritional values and composition of the products, coupled with information on the exercise times required to burn the calories off again. twitter.com/hashtag/weighthis With the new health awareness, diets alone are no longer in. Health over weight loss is the motto. With #weighthis, Lean Cuisine is launching a campaign which encourages users to only take account of the weight of things that really matter. owenandalchemy.com/elixirs With their elixirs, Owen + Alchemy go a step further than the competition. Beyond Organic emphasises the mystical side of juicing, and highlights the fact that products also have an effect on health, and can be considered to have medicinal value.

29 GDI Gottlieb Duttweiler Institute 27 THIS SHIT IS LOADED EAT GODDAMN FIBERS SO DAMN GOOD You ll never skip breakfast again HYPE The Age of Memes When social celebrities are faster than science What is it all about? A meme is an idea, behaviour or style that quickly spreads from person to person within a culture. This spread takes place via the written or spoken word, gestures, rituals, or other imitable phenomena. Today, the most famous form of meme is the internet meme. These memes are spread via the internet in image, audio or video format at incredible speed, and are correspondingly versatile and sometimes very short-lived. Memes are used in marketing to achieve a viral effect and reach a greater number of people with minimum input. This is called viral marketing. An example of this is the Will it blend? campaign from Blendtec. In these entertaining videos, a scientist throws various objects ranging from iphones, through glow sticks to Justin Bieber CDs into a Blendtec mixer to prove its quality. The hype about superfoods is clever marketing. It cannot be scientifically proven that so-called superfoods such as blueberries or avocados have a higher concentration of nutrients than other types of food. However, the term has become established in everyday life and was primarily introduced to the masses through food bloggers and Instagram users. This trend also shows in the sales figures. Since 2000, the quantity of avocados sold in the USA has quadrupled 5. On the one hand, these superfood hypes boost the consump- 5

30 28 FRUIT TRADE 2025 tion of fresh fruit and vegetables. On the other hand, the industry s ability to manage or influence the phenomenon is very limited. Assessment of opportunities and risks Opportunities: If a viral campaign takes off, it can achieve an unexpectedly large audience. The associated media costs are also relatively low. Risks: It is very difficult to plan and to control such campaigns. Cooperation with celebrities can fall into a legal grey area if it is not declared as advertising. Examples: Website and book with healthy recipes to promote a healthy lifestyle. Since everything is spiced with a good pinch of expletives, the tips are very popular on the internet. itm.marcelww.com/inglorious With Inglorious fruits & vegetables, the French retailer Intermarché launched a major campaign against food waste. Vegetable soup and fruit juices from inglorious fruit and vegetables are served to convince customers of the flawless quality of the products. Humorous images turned the campaign into a viral hit. goo.gl/6ev7qs / goo.gl/eza09r Stars like Miranda Kerr use social media to market products. Celebrities post a selfie with the product on their personal Instagram account, reaching millions of followers keen to emulate them and their lifestyle. Corporations trying to position their products with a younger target group often pay millions for this form of celebrity endorsement.

31 GDI Gottlieb Duttweiler Institute 29 Conclusion The most recent studies and forecasts by the United Nations show higher growth in total world population than has been assumed so far. There are currently around 7.3 billion people 6 on the planet today, and the reliable expectation is that this figure will increase to 8.5 billion people by This significant acceleration in the rate of growth is also evident in the fact that the world population has tripled between 1950 and One crucial reason for this development appears to be technical innovation, and the associated continuous efficiency gains in global food production, as well as improved medical care. In affluent societies, interest in health and healthy fresh food is growing. Demand for fresh fruit and vegetables should therefore increase. In reality, however, the opposite applies. In Germany, for instance, demand is falling, at least in terms of sales volume. 8 According to the 2016 GfK Consumer Index, Germans are consuming lower volumes of fresh fruit and vegetables. However several parameters indicate that potential for higher consumption exists, and that the industry must therefore utilise these opportunities better. The fact that new, non-industry players are moving into the business makes a focus on these opportunities even more important. This benefits markets such as China, ensuring major changes in the flow of goods from West to East because of the strong demand for fresh fruit and vegetables. Production: New efficiency and authenticity The tech race is also happening in the fruit and vegetable segment. New measurement technologies are becoming more professional and precise, facilitating higher quality cultivation. Big data makes production more autonomous, secure and efficient. This promotes cost-effective and precise cultivation methods. In the best-case scenario, this means that healthy, fresh food is not reserved for the elite alone. But not so fast: New players primarily from the tech sector itself are playing an increasingly significant role in the differentiated market. They have the technological know-how, and can put this to use very quickly, thus achieving a competitive advantage. Moreover, diversified companies such as Philips are dedicating production facilities to this development, creating space for the innovative, vertical cultivation of fresh produce. Traditional agriculture must adapt to these new players, and also implement innovative technologies to remain competitive. Critical success factors for the production of tomorrow: > Approach: Am I efficient and silent, or am I authentic and talk about it? Authentic means in line with the way the romantic urban dweller imagines the production of his carefully selected vitamin serving people celebrating fruit with great expertise and pride in their work, not GPS-controlled devices ensuring maxi- 6 United Nations, Department of Economic and Social Affairs, Population Division (2015). Population 2030: Demographic challenges and opportunities for sustainable development planning (ST/ESA/SER.A/389). 7 United Nations, Department of Economic and Social Affairs, Population Division (2015). Population 2030: Demographic challenges and opportunities for sustainable development planning (ST/ESA/SER.A/389). 8 Consumer Index Total Grocery , GfK