Plant-Based Meat Goes Mainstream

The consumption of plant-based meat products recently reached a tipping point due to intense consumer demand and aggressive expansion strategies among savvy brands, including market leader Beyond Meat. Now product innovation and competition in this category are shaking up the global grocery and consumer packaged goods (CPG) sectors.

Last year total U.S. retail sales of plant-based meat substitutes grew more than 23% to exceed $760 million.¹ citation stuff According to Nielsen sales data, plant-based product sales are growing by double digits across most categories, whereas animal-based foods in those same categories face slow growth or declining sales in every region across America. Today major grocery retailers are taking consumers’ hunger for plant-based meat seriously.² Bushnell, Caroline. Plant-Based Makes Kroger’s Top Five Food Trends for 2019. GFI.org. October 30, 2018.

Why is plant-based meat so popular?

Younger adults in particular are fuelling the trend toward plant-based meat, as they are informed, values-driven consumers who care about eating healthy foods, animals’ well-being, sustainability, and the ethical and social impacts of the products they buy.³ Evans, Pete. Plant-based eating goes mainstream as Beyond Meat targets Canadian grocery shelves. CBC News. April 27, 2019. ^,4Ryan, Tom. Where’s the (alt) beef? RetailWire. April 29, 2019. A survey by market intelligence agency Mintel found more consumers are reducing meat consumption and moving towards plant-based diets. Nearly 80% of American Millennials eat meat alternatives (vs. half of non-Millennials) and one-third of U.S. consumers (and 40% of Millennials) plan to buy more plant-based food products in the next year.⁵ Johnson, Patty. What Consumers Really Think About Meat Alternatives. Mintel Blog. October 1, 2018.

The nonmeat market is attracting people who like meat,
not just vegetarians and vegans.

~ Dr. Sylvain Charlebois, Senior Director, Agri-Food Analytics Lab⁶ Charlebois, Sylvain. Vegan cheese and fake meat: A recipe for food appropriation? The Globe and Mail. February 15, 2019.

Even The Economist declared 2019 the “Year of the Vegan” due to veganism’s magnetism, as a quarter of 25- to 34-year-old Americans say they are vegans or vegetarians.⁷ Parker, John. The year of the vegan. The Economist. December 5, 2018. One in three Americans considers themselves a flexitarian, which means they do not follow a specific eating style, and instead combine plant-based and meat-based diets.⁸ Gervis, Zoya. One third of Americans consider themselves ‘flexitarian.’ New York Post. October 26, 2018. Flexitarians and consumers who skew more carnivorous are shifting their consumption away from animal meats, which has increased demand for plant-based meat beyond the loyal audience of vegans and vegetarians.

Nearly half of U.S. consumers cite health concerns, including heart health and weight management, as the main factor driving both their consumption of plant-based proteins and meat reduction.⁹ Johnson, Patty. What Consumers Really Think About Meat Alternatives. Mintel Blog. October 1, 2018. In addition, taste and affordability are key success factors for plant-based products that compete with meats derived from animals.

Global spotlight on Beyond Meat

California’s plant-based meat supplier Beyond Meat has been making global headlines, especially since its impressive initial public offering (IPO) on May 2, 2019. Beyond Meat has earned phenomenal demand for its meatless fast food burger, which is available in 27,000 restaurants around the world, helping the brand take the lead in this thriving category.

The company’s successful business strategy involved deliberately partnering with quick serve restaurants like A&W before selling to grocery chains. Seeing and tasting the cooked product in a restaurant may have proven more appetizing to consumers than seeing uncooked products in a grocery store cooler, helping Beyond Meat earn consumers’ trial, trust, and loyalty. Now, Canadian-based chain Tim Hortons is testing how well Beyond Meat’s plant-based sausages perform in select markets.

To keep up with this food trend, rival Burger King is launching its plant-based Impossible Whopper in more markets and McDonalds is currently testing its own plant-based burger exclusively in Germany.¹⁰ Lucas, Amelia. Beyond Meat shares hit all-time high after Tim Hortons adds its sausage to menu. CNBC. May 15, 2019. ¹¹ Schaltegger, Megan. A Plant-Based Burger Is FINALLY Coming To McDonalds. Delish.com. May 13, 2019.

Market responsiveness delivers more consumer choice

Grocery retailers and CPG brands are seeing how well plant-based meat products are faring in foodservice, and are now adapting to this insatiable consumer demand.

• Whole Foods Market stores have devoted an entire freezer exclusively to vegan brand Beyond Meat and added signage to encourage consumers to “Try the trend” by purchasing the brand’s plant-based burgers and sausages.¹² Pointing, Charlotte. Whole Foods Just Dedicated an Entire Freezer to Beyond’s Vegan Meat. Live Kindly. May 8, 2019.
• Costco carries Don Lee Farms’ vegan Organic Plant-Based Burgers, which “bleeds” just like real beef. Within 60 days of launching the product nationwide, Costco sold 1 million units.¹³ Axworthy, Nicole. Kroger Introduces Vegan Bleeding Burger to 2,000 US Locations. VegNews. April 17, 2019.
• Kroger recently announced it would add Don Lee Farms’ vegan bleeding burger to its assortment in 2000 U.S. locations.¹⁴ Ibid.
• Walmart carries multiple plant-based meat brands, including Gardein and Yves Veggie Cuisine, which People for the Ethical Treatment of Animals (PETA) named among “vegan meat brands that are changing everything.”¹⁵ Vegan meat brands that are changing everything. PETA. 2019.
• Trader Joe’s carries a wide assortment of vegan meat products, including its private label Chickenless Crispy Tenders and Meatless Meatballs.
• Nestle, the world’s biggest packaged foods group, introduced meat-free burgers under the Garden Gourmet “Incredible Burger” brand.¹⁶ Nestle goes vegan with meat-free burger range. CNBC. April 2, 2019.
• Unilever acquired the Dutch meat-substitute company The Vegetarian Butcher.

Additional plant-based meat brands include Boca Foods, Field Roast Grain Meat Co., Lightlife, Morningstar Farms and Tofurky. Consumer demand for plant-based meat is so powerful that this trend has even attracted investments from traditional meat companies, including Cargill, Hormel Foods Corp., JBS, Tyson Foods Inc. and WH Group.¹⁷ Linnane, Ciara. Beyond Meat goes public with a bang: 5 things to know about the plant-based meat maker. MarketWatch. May 6, 2019.

Plant-based meat goes global and gets competitive

Consumption of plant-based meat is now a major international trend affecting business strategies within the grocery sector. In Canada, the newly revamped Canada Food Guide now emphasizes eating plant-based proteins like legumes, beans, and tofu more often than those from animal meat, which is boosting sales of plant-based meats.¹⁸ Young, Leslie. Canada’s new food guide emphasizes eating plants, drinking water and cooking at home. Global News. January 22, 2019. Meanwhile, UK grocery giant Tesco now prominently displays vegan and vegetarian foods, including plant-based meats, in the meat aisle to give consumers food options that ‘promote health and sustainability.'¹⁹ Chiorando, Maria. Tesco To Sell Vegan Foods In Meat Aisle – To ‘Promote Sustainability.’ Plant Based News. April 5, 2019.

Given plant-based meats’ threat as a substitute for meat derived from animals, the livestock sector is fighting back. Missouri, Nebraska, Tennessee, Virginia and Wyoming are among the states that have started to take action to regulate the use of the term “meat” on product labels for items that are not derived from animals.²⁰ Charlebois, Sylvain. Vegan cheese and fake meat: A recipe for food appropriation? The Globe and Mail. February 15, 2019.

In contrast to animal meat, Beyond Meat burgers’ ingredients include pea protein isolate, expeller-pressed canola oil, and coconut oil. The Garden Gourmet Incredible Burger contains soy and wheat protein, beets, carrots, and bell peppers to replicate the texture and taste of a traditional hamburger.²¹ Taylor, Kate. It requires 22 ingredients for the Beyond Burger to replicate the taste and texture of a classic hamburger — here’s what they are. Business Insider. May 3, 2019. ²² Schaltegger, Megan. A Plant-Based Burger Is FINALLY Coming To McDonalds. Delish.com. May 13, 2019.

Profiting from plants

This summer, global retail companies will see lots of sizzle in the plant-based meat market. The explosive growth of this segment is driven by consumer demand for product variety and quality that align with consumers’ values, including the booming health and wellness lifestyle. In response, grocery retailers and brands are delivering new product innovations to stay relevant and competitive, and improve their top line performance by adapting to consumers’ evolving tastes.