“We have given up on this segment entirely too fast,” and the recent negative headlines focused on slowing sales, product rationalization, company consolidation and industry layoffs tell only part of the story, Anne-Marie Roerink, president 210 Analytics, said yesterday during FoodNavigator-USA’s free webinar – Plant-based meat: Beyond the honeymoon period.
While she acknowledged year-over-year sales of refrigerated plant-based meat “is trending in the negative and has been for quite a while,” and the number of plant-based meat items per store dropped 11.1% in 2022 alongside a 22.6% decline in household penetration year-over-year, she said “there’s still a lot of interest among people and a lot of willingness to try [plant-based meat].”
According to her research, about a third of consumers are interested in reducing their meat and poultry consumption for their health, the environment, animal welfare and to save money. But, she added, many are disappointed by early early plant-based meat options’ taste, texture, smell, ingredient decks, and nutritional profiles. Many consumers also perceive them as over-processed or “fake.”
The worst is yet to come
The fallout from these shortcomings likely will become worse before it gets better, added Lisa Feria, CEO and managing partner at Stray Dog Capital.
She explained during the past two years “when money was flooding the space from every fund or angel or anybody who had money … we really lost track of not only what the consumer is looking for, but also who we’re designing products for, what price they are looking for,” and as a result the products were greeted with less “exuberance” than companies and investors hoped for – causing the latter to pull back.
As such, she predicts, many plant-based meat brands and companies will fold in the coming year, and those that remain will be forced to revaluate what consumers want and redesign their products to meet those needs.
Both Feria and Roerink say this is already happening.
“All of the 2.0 and 3.0 generations that I have seen coming out are addressing [these concerns] and, as long as the willingness of consumers is there, I believe we’re going to see continued innovation and continued strength, because after all, this is really a category [that has been] in its honeymoon,” and now “real life is starting,” added Roerink.
What does the real world look like for plant-based going forward?
According to Feria, plant-based meat companies that can survive “real life” need to master business fundamentals, including driving velocity in key accounts and shoring up consumer loyalty before expanding distribution.
Real life also requires companies to directly address what consumers want to eat and be hyper-conscious of the consumer experience and repeat rate.
Plant-based bacon manufacturer Hooray Foods is delivering on all of these factors. Company founder Sri Artham shared during the webinar how he is driving month-over-month gains and protecting his margins.
Plant-based chicken company Daring also is checking these boxes with a product that CEO Ross Mackay said delivers on the health benefits consumers want without compromising taste and texture.
Watch the webinar on demand
To learn more about how these companies are building their businesses for long-term success, check out the free one-hour webinar Plant-based meat: Beyond the honeymoon period, which is available on demand for the next three months.
Key takeaways from the webinar also include:
- Insights from Claire Conaghan, associate director of content at Datassential, about what consumers are looking for from plant-based offerings in restaurants and how to leverage foodservice for additional growth,
- Areas for innovation that balance consumer desire for meat analogues vs plant-based products that let plants shine as plants,
- Advice from Feria for raising additional funds in a more constrictive economic environment, and
- A deep dive into retail sales to understand how plant-based protein stacks up to its animal counterparts and other key segments of the store.