On February 18, major food and beverage companies like PepsiCo and Coca-Cola are shifting their focus. They are embracing shorter ingredient lists and smaller pack sizes as more people turn to GLP-1 drugs for weight loss. These medications, primarily for diabetes and weight loss, are changing eating habits.
Data shows that nearly three dozen companies have discussed GLP-1 drugs or weight loss during earnings calls this year. That’s up from just 14 last year and only five two years ago. This trend indicates a strong belief that GLP-1s are not just a passing phase.
According to EY-Parthenon, the rise in GLP-1 usage could lead to nearly $12 billion in snack sales lost over the next decade. PwC analysis reveals that about 20% of U.S. households now have someone using these drugs, doubling the number in just a year.
Peter ter Kulve, CEO of Magnum Ice Cream, shares insights from consumers. He notes that while GLP-1 users still enjoy treats, they are now eating less mindlessly, reducing binge-eating behavior.
In response to these market changes, Coca-Cola’s new CEO has called for faster innovation. Kraft Heinz recently scrapped a plan to split the company, instead committing $600 million to revamp its core products, including Oscar Mayer meats.
Big Food companies are boosting their capital spending. General Mills expects a 23% increase in their budget this year, according to LSEG data. PepsiCo has introduced “Simply NKD” snacks, rebranding popular items to remove artificial ingredients. They are also testing mini-meals with brands like Sabra and Siete.
“There are more opportunities than threats,” says PepsiCo’s CEO Ramon Laguarta, reflecting optimism about adapting to consumer trends.
Coca-Cola is ramping up production of its protein-infused Fairlife milk, and General Mills launched higher protein Cheerios in late 2024 to cater to changing breakfast demands. General Mills’ CEO, Jeffrey Harmening, believes GLP-1 drugs will fundamentally influence food choices, prompting consumers to opt for smaller portions and nutrient-dense foods.
Conagra Brands is also in on the trend. They’re investing in snacks like Slim Jim meat sticks and placing heavy emphasis on protein-filled and portion-controlled options, especially appealing to younger generations like Gen Z and millennials. “Everyone is allocating R&D dollars to this trend,” says Peter Mangan from Portage Point Partners.
Even smaller companies, like Snap Kitchen in Austin, are adapting. They are expanding their menu to include meals rich in fiber and lean proteins, thanks to insights from GLP-1 users about their changing preferences. CEO Mitchell Raisch mentions that this shift has sharpened their focus and sped up their product development.
Data reveals that GLP-1 users are consuming 40% fewer calories. Dessert and alcohol intake have decreased significantly, while fresh produce consumption is up by over 70%. Families are shopping with 4% to 6% smaller carts, and single households have seen declines of up to 9%. “We’re only beginning to see the ripple effects of this physiological change,” suggests Ali Furman from PwC.
These insights reveal just how much GLP-1 drugs are reshaping the food landscape. As more people adopt these changes, the impact on the food industry is set to deepen.
