4 Ways Data Analytics Aids the Growth of the Food and Beverage Industry

Tuesday 28th Jun 2022 |

Data analytics is crucial in the decision-making process across all sectors, including the food and beverage industry. 

Before the pandemic, McDonalds acquired Dynamic Yield at a whopping $300 million. The Dynamic Yield technology is a personalization software that offers tailored customer experiences. It is also a product recommendation platform. Data is its fuel. 

For perspective, Netflix and Amazon use product recommendation systems. And the systems account for over 30% of their revenue

However, the application of data analytics in the food and beverage industry does not stop at customer experiences and marketing. It can also enhance operational efficiency and ensure adherence to safety controls.

But before exploring how data analytics aid the growth of the food and beverage sector, let’s understand first what data analytics entails. 

What Is Data Analytics? 

Data analytics involves the extraction of insights and trends from raw information. The information could be unstructured, like comments on social media forums. Alternatively, they can also be structured like data on an Excel spreadsheet. 

Whatever the format, data analytics can process the information from your business systems to uncover insights on patterns and trends from the data sets. Its usefulness applies to every business’s decision-making. That’s why there is high demand for top data analyst jobs and related roles. 

For the food and beverage (F&B) industry, its applications drive growth from supply chain to advanced marketing. Let’s explore ways data analytics is aiding the growth of the F&B industry.  

Handling Changing Customer Behavior

Consumer tastes and dietary patterns are the most consistent change in the F&B sector. Failure to adapt to these changes can eat up retailers’ revenue. Harnessing data analytics can help uncover customer behavior and dieting patterns. 

Now customers, especially Gen Z and millennials, prefer healthy foods. Not to mention the products must be eco-friendly too. But, even healthy and eco-friendliness are too general. 

Some customers have specific preferences and tastes. 

These nuanced differences and tastes forced Coca-Cola to introduce Diet Coke and Coke Zero. They are sugar and calorie-free. The company analyzes customer feedback to provide customized drinks with different tastes. Coke Zero was the major driver of the company’s growth.  

On the other hand, McDonald’s is taking the cue from the great importance of data analytics. In 2019, it acquired Dynamic Yield, an Israel tech firm specializing in personalization. As mentioned earlier, a similar system employed by Amazon and Netflix drives more than 30% of revenue. 

The same could apply to McDonald although there are no details from the fast-food chain. According to McKinsey, personalization can drive a 5%-25% revenue lift. That means personalization systems can drive growth in the F&B retail sector. 

Personalization systems are AI-powered data analytics platforms that can crunch huge data sets from customer data. The systems have machine learning models that can query and learn from past customer behavior.

As a result, it easily uncovers future trends based on past data. The best part is it can do so for each user at a granular level. So, you can anticipate and handle any consumer behavior and trends personally. That gives F&B firms the ability to scale their revenues. 

Enhanced High-Impact Marketing 

The nuanced insights from consumer behavior can also be vital in driving high-impact marketing. Armed with predictive analytics, you can accurately focus demand across customer segments and target your campaigns appropriately. 

For example, different menus can be presented to you based on the weather and other variables. McDonald’s employed digital boards that showcased varying menus based on weather. So, the boards suggest a specific menu like McFlurries when it’s hot and another list when it’s cold. 

Such product promotion and, to an extent, pricing strategies are largely done by sentiment analysis. Sentiment analysis is part of marketing research from social media accounts. It allows F&B brands to track what users are saying about their products. 

Enhancing brand awareness and loyalty becomes very crucial, even in social media. Using data analytics like sentiment analysis gives you an upper hand on how to enhance brand awareness and loyalty. 

So, based on what your users feel on social media, you can capture their wishes and feelings with your campaigns. Digital marketing is no longer based on guesswork. Data analytics empowers brands to drive high-impact marketing campaigns. 

For example, it can analyze negative reviews and help you devise preventive campaigns to curb the same. In short, it will improve brand image and loyalty through better marketing. 

Ensure Regulatory Compliance 

Both consumers and regulators demand quality and transparency from F&B’s production process. So, the firms must avoid product recalls or safety issues like contamination. One way of ensuring product quality is by tracing its origin, ingredients, and how it is produced. 

Data analytics platforms can trace products from farm fields to forks or glass. Such transparency builds customer trust and cushions the firms from regulatory fines or withdrawal of operating licenses. 

For example, Chipotle Mexican Grill was fined $25 million by the US Food and Drug Administration (FDA) on food safety grounds. Some of the reasons for the fine were cross-contamination due to overworking and not keeping food at recommended temperatures. 

Using big data analytics could have prevented the regulatory lapse. For example, Chipotle can use smart sensors that track product condition, temperature, and shelf-life. By tracking shelf-life (expiration dates), it becomes easy to prevent foodborne diseases amongst users. 

So, data analytics is very helpful in quality assurance and regulatory compliance. You can think of growth if you don’t meet quality standards. In short, by ensuring regulatory compliance, data analytics provides stimulus for growth without worrying about hefty fines. 

Better Operational Efficiency 

Predictive data analysis helps streamline operational efficiency. Accurately predicting future demands allows you to get your house and inventory in order. Retailers can track consumer behavior and anticipate their choice and each step they take across the store. 

That gives you ample time to plan, organize and maximize engagement for more conversions or a better customer experience. For example, using data analytics, Kroger has an exceptional understanding of its shoppers and their next moves. 

As a result, it can offer an ultra-personalized experience and exceptional operational efficiency. That leads to customer satisfaction which means more sales and growth in the sector. 


Data analytics is pushing the growth of industries, including food and beverage, to new levels. It uncovers valuable insights that are crucial in strategic business decisions. It also drives growth through ultra-personalization, compliance adherence and high-impact marketing. Its crucial role can not be overlooked. 

Data analytics roles will continue to rise as businesses and customers produce more data. You should be ready to take up these roles and create more value for the industry. 

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