🤖 AI’s Coming For Your Dinner…

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AI is now omnipresent. The sudden explosion in generative AI-powered services like ChatGPT and Midjourney has yanked the entire world into the future faster than any of us could say ‘aye?’, let alone ‘I’. That includes the food and beverage industry.

Today we explore how AI is being employed in the F&B industry, and what the future of food looks like powered by this technology.

Today:

• In The News: Krispy Kreme’s pivot, Oatly’s new CEO, gene-edited pork, and more

• Trending with Gen Z: A five-day diet of candy and wine in the wilderness

• Innovation Deep Dive: Exploring AI For F&B

  • 1. What is the trend?

  • 2. How is AI being used in F&B?

  • 3. Which companies are using AI?

  • 4. What’s next for AI in F&B?

📰 In The News

A curation of our favorite F&B innovation stories from the week. Can be read in less than a 🧻 break.

• Washington State University received the first-ever FDA approval for gene-edited pigs for human consumption. The gene-edited pigs are being used for sausages which will be served on the university campus.

• Flash Coffee receives $50 million USD in series B funding to continue the expansion of its high-tech coffee stores across APAC.

• Oatly names a new CEO. Jean-Christophe Flatin will take the reins at Oatly from June 1st, replacing Toni Petersson who has served as CEO since 2012.

• Consumers are drinking more at home and less on-premise according to a recent report that analyzes the latest trends in alcohol consumption patterns. Gen-Z and millennials continue to demand non-alcohol drinks.

• Krispy Kreme is evolving from donut store chain to “donut logistics company”. The transformation involves closing underperforming stores and focussing on delivering fresh donuts to partner grocery and convenience stores. The company saw 12.5% revenue growth in the first quarter of 2023.

📱Trending With Gen-Z

What social media is telling us about Gen-Z’s cravings! Can be enjoyed during an 🛗 ride.

🍷🍫A woman who went missing in the Australian wilderness last week captured the attention of the internet for surviving on candy and wine for five days. She was rescued by police and is reportedly in good health after being treated for dehydration.

Meanwhile, many uni students were left scratching their heads for having received no media attention, despite surviving on the same diet for 3+ years

🚀 Innovation Deep Dive: Exploring AI For F&B

Weekly deep dive into an F&B trend. Can be read in less than a 🚋 ride.

Seemingly futuristic and imperfect one or two years ago, AI is now visibly transforming society. It’s thanks to public launches of generative AI-powered services like ChatGPT and Midjourney that the zeitgeist has been so consumed by the technology. But, as many industry readers will likely know, AI has been making waves in F&B for some time now.

Companies have already employed AI for ingredient development, restaurant layout design, production efficiency, and consumer intelligence. Spice maker McCormick used IBM’s Watson AI to predict new flavor combinations for example. You may have seen this on McCormick’s Instagram page which showcased its AI-inspired designs (now defunct).

Now though, the recent generative AI tipping point has sparked new waves of excitement around the potential of the technology.

#1. What is the trend?

Talk of Artificial Intelligence - simulating human intelligence with machines - is nothing new. But recent advances in a certain field of AI have got the whole world buzzing about the potential of this technology. These so-called generative AI are poised to transform the industry in many ways.

Keyword: Generative AI

Source: Ask a Techspert: What is Generative AI?

These models have become so sophisticated that they produce human-level outputs. You can now outsource a range of human tasks to them such as writing, programming, and even image design. Industries worldwide are racing to figure out how to employ this new generation of highly capable AI.

#2. How is AI being Used in F&B?

Generative or not, AI is already being used in F&B across the entire value chain. Here are some examples of how:

🧐 Quality Control and Inspection: AI-powered computer vision systems can efficiently detect defects and inconsistencies in food products.

🚛 Supply Chain Optimization: AI is revolutionizing supply chain management by predicting demand, optimizing inventory, and tracking products throughout the supply chain.

🧑‍🍳 Recipe and Product Development: AI systems can analyze large amounts of data to identify new food combinations, flavors, and textures. See the McCormick & Company example above.

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🌿 Precision Agriculture: AI is enabling precision agriculture by using data-driven insights to optimize crop yields, monitor soil health, and manage resources.

🧑‍🔬 Food Safety: AI-powered cameras, scanners, and testing devices are being used to ensure food safety across the entire supply chain by checking for and spotting defects with a high degree of accuracy.

🥗 Personalized Nutrition and Recommendations: AI is changing how consumers interact with food by providing personalized nutrition and meal recommendations.

🗑 Waste Reduction and Sustainability: AI is playing a vital role in reducing food waste by monitoring and predicting spoilage and optimizing resource usage. This not only reduces costs but also contributes to a more sustainable food industry.

🏭 Advanced Manufacturing and Automation: AI-driven robotics and automation are streamlining food and beverage manufacturing processes, increasing efficiency, and reducing labor costs.

With so many potential use cases and the buzz around generative AI, it’s hard to ignore the technology. Companies taking a wait-and-see approach to AI are no doubt feeling the pressure to adopt the tech in some form or another. Let’s take a look at some real examples of companies that are either employing or offering AI solutions in the F&B space.

#3. Which companies are already using AI?

• AbInbev - The company used generative AIs ChatGPT and Midjourney to create the packaging design for its 150-year anniversary Beck’s product, Autonomous.

• AI Palette - it’s a food trend-spotting platform. It analyzes billions of online data points to give real-time predictions about consumer preferences and market trends. The software uses this data to identify new ingredients and flavors by F&B companies.

• Aromyx - this Silicon Valley startup uses machine learning to provide customers with highly sophisticated sensory data about how consumers experience food and drink.

• Bel Group - partnered with AI startup Climax Foods to develop plant-based products that mimic the taste, texture, and nutritional profile of animal dairy almost perfectly.

• John Deere - the farming equipment company now says over half its products are AI-enabled. This includes tractors that drive themselves and combines that adjust their settings to waste as little grain as possible.

• NotCo - The Chilean plant-based product maker has been using AI to identify plant-protein formulations. The company developed the AI itself and it is now a key back-bone of their R&D operations. NotCo is using its AI to help companies like Starbucks and Kraft Heinz develop plant-based offerings.

• Seebo - Using process-based industrial artificial intelligence, Seebo helps manufacturers to predict & prevent quality, yield, waste, and throughput losses. An EU-based baking company reportedly used the technology to reduce underweight products and save around $1 million annually.

• Subway - the sandwich chain has deployed smart fridges in some locations in the US which allow customers to talk to the fridge about products inside. The fridge is fully cashless and gives customers anytime access to Subway products.

• Walmart - the retail giant has been developing its AI infrastructure for years and as a result, much of its operations are now supported by the tech. When Hurricane Ian forced the company to close a large distribution hub last year, it used AI-powered simulation to reroute deliveries from other hubs to ensure stores stayed stocked.Subscribe now

#4. What’s Next For AI?

AI is going to become more capable, and fast. Right now, it still has some hurdles to overcome before it makes sci-fi-level impacts on the F&B world, however.

• High Costs - Implementing AI in the food and beverage industry can be costly. Systems that automate production for example come with a high price tag and are only options for companies with the resources and infrastructure to fully benefit from them. There is a risk AI-powered conglomerates may corner the market with smaller firms left unable to compete.

• Skill Gap. AI is complex. It requires specialist knowledge to implement effectively and maintain. There is currently a deficit of skilled AI workers in the F&B industry.

• “The machines are taking our jobs” - it’s a legitimate fear that AI could replace human positions, and create a backlash. But it’s important to recognize that this technology will create new tasks and new roles.

• Privacy - personalization requires a deep understanding of customer data. Reports show that 81% of consumers are concerned about providing their data for marketing, consumer experience, and other services. F&B companies using consumer data for AI-powered systems, such as personalized meal planning, must be clear about what data they collect and how it’s processed.

• Transparency - It’s not always clear how AI is making decisions. As the F&B industry is highly regulated, AI’s lack of clarity may cause compliance issues.

Despite these challenges, it’s important to recognize that it’s still early days in the era of AI. Right now many F&B players are focussing on exploring the potential of the technology for their business. What’s important now is that companies stay aware of the shortcomings of AI as they experiment with it.

After all, AI brings game-changing benefits. From a 10X reduction in product development timelines to increased sales from eerily accurate food recommendations, the tech offers F&B a new world of efficiency, agility, and innovation. Past the point of no return, companies only option is to explore and adapt.

📈 Numbers On The Market For AI

Can be enjoyed during an 🛗 ride.

What is the size of the AI opportunity for F&B? We asked Google and aggregated the deluge of estimates to save you some time.

• The general consensus is the market for AI in F&B is projected to skyrocket over the next 5 years, with estimates ranging from 30 billion in 2028 to almost 80 billion by 2030.

• Overall, PWC estimates that AI will contribute over 15 trillion USD to the global economy by 2030.

• According to a McKinsey survey, global adoption of AI has doubled since 2017, with around 50% of companies now having employed AI in some form or another.

• APAC - the overall market for AI in APAC is projected to reach 12.5 billion in APAC by 2025.

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