Lightlife president predicts more segmentation in plant-based meat, defends ‘real food’ stance: ‘It was not a PR stunt, we wanted to start a conversation…’
Curtin - president at brand owner Greenleaf Foods, which is owned by meat processor Maple Leaf Foods - was speaking to FoodNavigator-USA following the launch of Lightlife plant-based chicken products and Field Roast stadium dogs.
"We believe segmentation happens in every single category, there's going to be different lanes,” said Curtin, who says the next wave of products will have cleaner ingredient decks and improved nutritional credentials. "What will make retailers pick A over B?"
Overall, he said, "People want to eat healthier and they see eating plant based food as a healthier option. People like the fact that Lightlife is now 100% vegan, that everything's Non GMO, and we strive to be as minimally processed as possible."
'We not only cleaned up our ingredient deck, we challenged everybody else to do that as well'
Whether Lightlife’s products are in fact less processed or nutritionally superior to those of Beyond Meat and Impossible Foods - brands Curtin targeted in a controversial ‘open letter’ penned last summer - is by no means obvious, according to some commentators, who note that all plant-based burgers are 'processed' and that from a nutritional perspective, Lightlife’s burger has similar amounts of protein, saturated fat and sodium to the Beyond Burger, no added B vitamins, and less fiber.
However, Curtin said the campaign - which was also designed to highlight Lightlife's reformulation work to remove “unnecessary” ingredients such as “eggs and carrageenan” and clean up labels - had been "incredibly well received" by consumers.
“I'm really proud of it. Consumers told us that this is what they're looking for and, and we not only cleaned up our ingredient deck, we challenged everybody else to do that as well.
"It was not done as a PR stunt, it was done to start a conversation in a category that is still relatively new."
"We have unwavering confidence in the potential of this business and the investments that we're making in plant protein. We've built our organizational structure, invested in brands, brand strategies, and product innovation and we've made strategic investments to strengthen our manufacturing base.” Michael McCain, CEO Maple Leaf Foods (Q1 earnings call May 2021)
A challenging quarter for the plant-based segment
So how are Maple Leaf Foods’ plant-based brands (Lightlife, Field Roast, Chao) performing?
The company's plant-protein sales declined 8.1% year-on-year in Q1, 2021, dented by tough comparables vs the pantry-loading phase of the pandemic in late March 2020, and continued weak foodservice sales, said Curtin, although he was pleased with the performance of Field Roast Chao plant-based cheese, Lightlife tempeh and other legacy products, which are sold in the produce set: “We have really good momentum there.”
Curtin did not provide any numbers, but acknowledged that it had been tougher going in some retailers’ fresh meat cases (many of which now feature dedicated plant-based meat sections).
While Impossible Foods has picked up significant distribution there in recent months, he said, “I would say that this whole category has slowed down from the percentage growth that was happening last year.”
Plant-based chicken is a 'massive opportunity'
Despite a recent Bernstein report describing this subsegment of the plant-based meat category as a “two horse race” between Impossible Foods and Beyond Meat, meanwhile, Curtin insisted Lightlife was well-positioned to grow in all parts of the store, particularly with the launch of new fresh breaded chicken alternatives.
“Chicken is a massive opportunity because it represents about 42% of animal products, yet on the plant based side, its share is significantly less than that, so we see some big opportunities there.
"So we have frozen plant-based chicken nuggets and a breaded chicken product for the fresh meat case, and we see retailers testing different merchandising strategies. Do they put it next to chicken, or do they put it in the meat case with the plant based protein [subsegment]? I think retailers are still trying to determine where exactly these products should be placed.”
'Tremendous growth in tempeh'
Overall, he said, “We expect 30% growth [in plant-based] for the full year; we’ve got some new innovations, we've picked up some new distribution points at Walmart, Whole Foods and Raley’s, and we have a number of initiatives kicking in big time in the back half of the year, plus the foodservice market is opening up again.
“80% of all tempeh sold is sold under the Lightlife brand and one of our really great strengths in this market is that we self-manufacture.
“There's tremendous growth in tempeh," added Curtin, who said Maple Leaf Foods had recently acquired a 118,000 sq ft facility in Indianapolis to increase production capacity for its tempeh products.
"It’s probably the most versatile superfood product out there, whether you want to pan fry or stir fry or batter it. It’s been around for hundreds of years and only has three ingredients [cultured soybeans, water, and brown rice]. So yes, we are very, very bullish on tempeh.”
The Chao plant-based cheese business, meanwhile, is the “number one selling sliced plant-based cheese in the United States and is doing really, really well,” he said.
Pricing and economies of scale in plant-based meat
Asked about pricing in the plant-based meat segment, he said: “We have not seen that price has been a barrier, but all of us want to be as efficient as possible and as this category gets bigger, economies of scale will come.
"Automation is another big factor; all of the big [animal-based] meat companies are highly automated, and I think that will happen [in plant-based meat]. Then as demand continues to grow, the cost of key ingredients will also go down.”
As the category matures, he said, me-too products won't cut it: “We’ve brought out more innovation than anybody else in plant based foods in the last two years. So, I'm really proud of that.
"A lot of the big CPG companies see a category that's growing and jump in, but none of them so far have been very successful with it. But we're in it for the long haul.”