Food and Beverage Product Innovation Trends to Watch in 2025

It is a new year and with that comes new opportunities to evaluate where to invest innovation dollars and improve product strategies. Whether you are interested in brand new products, line extensions, or making product changes, there are many things to consider when deciding where to invest. Here are a few of 2025’s general trends to watch for as you start the new year.

1. Health and Wellness Cannot Be Ignored

Consumers want to perceive products as being healthier. Many see food as medicine, a way to prevent and treat chronic disease, or as part of an overall healthy diet. They tend to value Non-GMO and natural products. The Institute of Food Technologists (IFT) in its’ top food trends for 2025 indicates a focus on salt and sugar reduced foods, as well as clean labels moving away from ultra-processed foods. While health is important, consumers also continue seeing higher prices, so they have to balance health objectives with their wallets.

It is not just consumer tastes though, as regulations are also on the rise. 2024 brought the anticipated FDA final rule for defining “healthy” . The Food and Drug Administration (FDA) Human Food Program released its’ 2025 priority deliverables including a proposed front of pack nutrition labeling rule, initiatives to support sodium reduction, and strategies for improving micro and chemical food safety. The United States Department of Agriculture (USDA) also released required nutrient limits on added sugars and sodium for the child nutrition program. Even state governments such as California are moving to ban some food additives and ultra-processed foods . This is not unique to the United States, as Mexico for example, has a law banning cartoon characters from marketing products with excessive bad nutrients.

The point being that there is a focus on health. Substitute ingredients, smaller products, and other innovative ways will likely continue to be implemented in 2025. It is up to individual companies how use this opportunity to meet requirements and gain a strategic advantage, whether through new product innovation and/or educating consumers about products in a way that they embrace.

2. Embracing Automated Intelligence (AI)

AI can be extremely valuable in helping manufacturers and consumers innovate and improve products and processes while getting faster to market, but it also remains challenging for many to embrace. Some recent key product innovation application areas include:

• Capturing consumer preferences and trends to help generate new product ideas and accelerate time to market.
• Horizon scanning of regulations and trends which can change frequently. This helps to reduce costs and human error, while analyzing products for customers, food safety, and regulatory requirements automatically.
• Automating manual processes like reviewing COA’s or taking supplier data from documents and automatically transferring the information to an internal system. This accelerates product setup while focusing users on more value-added work.
• Personalized training for users like answering their questions through Microsoft CoPilot or enabling the creation of new ideas like a consumer evaluating alternate ingredients for a recipe.

There are many ways that AI can help save money, time, and provide a competitive advantage. It is evaluating what you are trying to achieve and how AI can help you get there that makes the biggest difference.

3. Supply Chain Collaboration

Companies need to receive and supply time critical information with their external partners. Supplier data needs to be reviewed, updated, and transferred to internal locations. Product specifications and attributes need to be created and provided in a consumable format to customers, manufacturing floors, and other external partners like co-manufacturers, advertising agencies, or third-party labs. This process in many cases is manual, subject to human error, and extremely ineffective. Users spend hours combing emails and multiple locations to gather such information.
Regulations and public outcry are also accelerating the need for efficient supply chain collaboration. The ability to quickly trace food from source to plate has become more dire as shown with recent high-profile food recalls (i.e. McDonald’s and Boar’s Head).

Automated Supply chain collaboration is also increasingly seen as a need. Sharing and receiving information with external customers and partners by providing them with what they need and when they want it can save both time and money while provide a competitive advantage. Consumers can get personalized information at their fingertips.

Many companies continue to manually collaborate internally and externally, while others are using technological solutions. Providers are getting more expensive though which makes it financially challenging for manufacturers to invest. Many are looking for alternative and more cost-effective options.

4. Food Safety Continues to Increase Its’ Impact on Product Innovation

While food safety is regulated, consumers and supply chains more and more look for and rely on it. This was seen with the infant formula shortage and other recent high profile food recalls. New product introductions can cause unnecessary disruptions to operations such as increased allergen cleaning costs and added non-value frequency to product testing expenses.

Regulation changes also continue to come. For example, in the United States, food additive approvals, post market chemical reviews, and what is considered Generally Recognized as Safe (GRAS) are under close observation. The FDA is making it easier for new manufacturers to enter the infant formula market. State and even federal legislatures are also discussing banning food additives and providing clean-label products.

Food safety elements should be evaluated up front in new products as costs can be eliminated or lessened significantly if caught early on before commercialization.

5. Sustainability & Upcycling

Sustainable products that do not harm the environment or deplete resources continue to rise. Reasoning includes consumer demand, focus on waste reduction, introduction of more plant-based and alternative proteins, and local sourcing and fair-trade products to combat environmental factors. Sustainability practices can be costly though and it is critical to consider how to provide a product your customer can afford. Opportunities like upcycling, for example, enable companies to reduce waste, offset costs, and potentially offer environmental friendly products at a value.

Again, this is a list of some and not all of the trends that will impact the industry as a whole in 2025. Companies need to be willing to adapt and find ways to set themselves apart in new product innovation. Reach out to New Dynamic and Dynamic FRM™ to let us help set you apart as you navigate these trends in 2025.