Luxurious Indulgences

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3 mins read

Why Are Consumers Seeking Premium F&B Products? What Types of Premium Products Are Gaining Popularity? What Stage of Maturity Is the Luxury Trend Moving Towards?

Although inflation is increasing in the United States, American consumers want to spend money on food and beverage products with a “premium” tag. While the trend of consumers looking for premium products has been around since consumption began, this trend is on an upward growth trajectory into 2023 and will continue to stay on that path!

According to Ai Palette’s research, “Premium” among U.S. food and beverage consumers is growing steadily across various categories at a four-year CAGR in the high-single digits. While this trend is “Matured” in most categories, i.e., there is already a high number of brands catering to this demand, a growing number of consumers are seeking premium indulgences, and the trend is expected to grow into 2023 and beyond. This high growth means food and beverage brands may need to relook at positioning brand value and messaging with consumers and incorporate the demand for premiumization of everyday food and beverage products among consumers.

The chart below indicates the growth trajectory. For example, the growth rate for “Premium” within U.S. ready-to-eat snacks and foods is growing at a 16.45% YoY growth rate and a 10.5%4-year CAGR based on over half a million data points. An exciting observation within the chart is that the trend took off sometime in the second half of 2022 when the conversation around inflation was still raging in the United States.

“Premium” is Driven by the Thirst for “Natural”


Across categories in the United States, “Natural” is the primary driver for premium food and beverage products.

In the Dairy category, premium cheese made by small, artisanal farms is highly sought after. This is due to consumers’ preference to go local with their food choices and encourage small businesses. The 238% CAGR underscores this for the “Natural” driver of premium products within the U.S. Dairy category.

Consumers Want Premium Meals and Snacks They Can Share (And Brag About)

It is well-known in the restaurant industry that for an establishment to succeed, the food they serve must be a treat to the eyes in addition to their patrons’ tastebuds. In the Instagram and TikTok culture, food and beverage that is good enough to be shared on Instagram or bragged about among friends will have a massive advantage.

This culture has now established itself in consumers’ homes who want to cook delicious and Instagram-worthy snacks and meals for their friends. Whether for the weekend barbecue with friends or an evening with a loved one, premium food and beverage products are making it to the tables of thousands of consumers.

Sustainable = Premium

Sustainability is the consumer buzzword of this decade, and many consumers are equating sustainable foods, such as naturally made, organically grown, locally sourced and ethically prepared, as premium.

Brands wishing to innovate, keeping in mind the demand for premium products, must take sustainability seriously since this aspect is often considered a prerequisite for an F&B development to be premium.


Brands looking to innovate in the “Premium” products and ingredients space still have ample opportunity to launch exciting products. The theme is here to stay and may soon be on an upward trajectory.

Like our insights, speak to our experts to understand how we can help your F&B brand launch best-selling products faster.