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Beverages

Adapt to consumer preferences and new consumption occasions, create innovative products, leverage commerce channels and connect with shoppers for profitable growth.

What’s going on

Human needs like hydration, nutrition and social connection are driving convergence in the beverage industry. The integration of online and offline channels offers seamless, omni-channel experiences with reduced information overload. Technology is driving swift reinvention—from AI agents providing personalized recommendations to robotics revolutionizing beverage creation, packaging, marketing and dispensing.

5 ways beverages are changing

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Human-centric choices

Functional beverages with benefits such as hydration, nutrition and performance are essential for consumers. Consumer preferences for innovative beverages with unique flavors, attractive packaging and distinctive branding also drive growth. These preferences further strengthen the connection between beverages, personal betterment and social connectivity.

Reinvention core processes

Beverage companies are reinventing their core marketing, commerce and sales processes using data, AI and new ways of working to create an integrated continuum of capabilities beyond functional silos, fostering genuine consumer and customer relevance and simplifying the path-to-purchase.

AI-enhanced value chains

Beverage companies' extensive data fuels AI deployment across the value chain, from R&D, to sourcing to distribution. Structured and unstructured data enable real-time insights and rapid reinvention by optimizing ingredients, formulas and packaging. AI and gen AI are also empowering the next gen salesforce with next-best actions, trends and personalized advice to enhance customer service.

Proliferating use of automation and robotics

Beverage production and distribution are traditionally labor-intensive, but automation is transforming these processes. The industry now employs autonomous vehicles for closed-loop transport, lights-out manufacturing and automated planning. Robotics augment workforce capabilities, reshaping operations and ways of working to boost productivity and resilience.

Increased competition and product innovation

Every day a diverse set of players enter the industry with new brands and products. Innovation partners deconstruct beverage components—from packaging to powder—to facilitate new combinations and enhance product innovation. This fuels competition, pushing industry leaders to innovate and uncover new ways of working. Boundaries blur as adjacent industries converge to seize new market opportunities.

What you can do

Create human relationships with consumers beyond a single purchase. Data and AI uncover insights to create personalized connections, driving a flywheel effect where tailored experiences enhance individual engagement and improve the experience.

27%

of consumer goods’ CXOs expect that in the next 2 years, their intelligence capabilities will significantly enable them to interact with consumers more intuitively.

Differentiation in beverages spans science-based benefits and multi-channel shopping. Use emerging tech to swiftly formulate products that evolve with consumer needs, ensuring they remain affordable and accessible.

80%

reduction in data processing time through the use of generative AI, resulting in bringing new products and services to market 40% faster.

Drive growth by quickly tapping into pockets of demand. Use data and AI to respond to trends, adopt new commerce channels and deliver the right product at the right time. Design flexible service models to follow demand.

20%

boost in consumer engagement and 35% rise in customer NPS achieved with generative AI

Change is constant, so reinvention never ends. Leaders cannot approach reinvention as a contained effort but must build the capability to continuously adapt, making change a core part of the organizational DNA.

60%

of consumer goods executives anticipate incremental revenue growth of ~20%-39% through AI adoption over the next three years

Sustainability challenges impact the industry's resilience. Companies must tackle stress on water supply, high CO₂ emissions and reliance on climate-vulnerable ingredients by reinventing packaging, distribution methods and focusing on scope 3 emissions.

4.7x

higher operating margins were achieved by companies with consistently strong ESG performance between 2013 and 2020, compared to those with mediocre ESG scores.

Our leaders

Maria Rey-Marston

Managing Director – Strategy & Consulting, Supply Chain & Operations, Innovation Lead

LinkedIn

Oliver Wright

Senior Managing Director – Global Consumer Industries Group Lead

LinkedIn

Karen Fang Grant

Managing Director – Industry Networks & Programs, Global Research Lead

LinkedIn