How much does a food company actually spend on market research?

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All through 2020 and the first quarter of 2021, there was rampant hesitation on part of food and beverage companies to explore new avenues. The good news today is that the pandemic intensity is decreasing, business is picking pace, and supply chain roadblocks have been mostly resolved. Big data and AI experts specializing in the realm of food trends and beverage innovation are helping both new and existing brands make in-roads. If you are interested in starting a new food business or expanding an existing one, the right market research and insights are crucial for your success.

Food and Beverage Market Research: Expectations versus Reality

As a new or budding entrant in the industry, you might be surprised when you come across nominal $100 to $500 market research reports available online. You might be tempted to opt for these as a one-time purchase, instead of collaborating with a full-fledged data service provider. But the fact is that these reports merely provide a superficial overview, with hardly any deep or relevant insights. Liaising with the Right Food/Beverage Innovation Expert for Market Research is important because:-

  • Compared to traditional food market reports, modern data-driven research offers much more accurate and holistic insights. 
  • Manually analyzing data and drawing inferences is subjective to a great extent. It is also prone to errors, gaps, and inaccuracies. 
  • Data-driven food and beverage insights are a lot more concrete and precision-based. With AI-driven predictive models, you can be privy to not just the latest food trends, but also the right opportunity window to act upon strategically. This secures your investments to a great extent and ensures a high ROI.
  • For start-ups with budgetary limitations, pay-as-you-grow contractual terms and conditions are usually provided. This ensures that you don’t have to bear the entire cost upfront, with the required flexibility to match your business growth.

Four-Fold Guide to Setting the Right Market Research Budget

For the food and beverage sector, the after-effects of the Covid-19 pandemic are still evident. Labor shortage, infrastructural challenges, and fast-changing consumer trends are sizable challenges to deal with. With detailed market research, you can gain the required clarity to steer your business in the right direction. So rather than settling for the lowest quote, consider the following 5 steps to set the apt budget for your market research:-

  1. Devote at least 20 to 30% of your total marketing budget to market research- Given the high level of uncertainty in the food business, in-depth research is a must. Your total marketing ROI directly rests on your market research quality.
  2. Be specific about the type of reports and databases required- If you are collaborating with an expert team for food market research USA, you need to be clear about what kind of data you require. Do you need market segment-wise data on consumer preferences or product-specific market trends? Make sure your contract mentions these aspects.
  3. Opt for customized reports if you have the required budget. This will go a long way in differentiating your business from competitors. It is also a good way to chalk out a plan for market disruption.
  4. Always choose data analysts who specialize in the food and beverage sector. This will assure you of holistic insights and lucrative results.

Conclusion

Food market research USA has highlighted major shifts in consumer purchase patterns and dietary preferences in the post-Covid-19 era. From clean, ethical labels and enhanced nutritional value to supply chain transparency, eco-friendly manufacturing, packaging, and distribution, the discerning consumer today wants a lot more than just taste or cost-efficiency. As an entrepreneur, gaining insights into the latest consumer trends is pivotal. Liaising with the right data analytics team that specializes in food and beverage market research will ensure high ROI for your business ventures.