Despite recent sales declines, consumer tailwinds are strong. Consumer research indicates that many are interested in cutting back their meat consumption and/or increasing their consumption of plant-based foods. Research from Credit Suisse found that, among consumers aged 16-40 across 10 countries, 66% plan to spend more on plant-based meat and dairy alternatives in the future. Yet product development and enhancement opportunities remain, including to improve taste and lower prices in the plant-based meat category.
The primary barrier to consumption of plant-based foods is taste. According to Mintel, 53% of all consumers agree that plant-based protein products should taste indistinguishable from meat. Similarly, research from FMI shows that perception of taste is the top reason why consumers haven’t tried plant-based meat or dairy, as well as the top reason why consumers who have tried them once or twice haven’t continued purchasing. Cost is overall the second most important factor.
The sustained interest voiced by consumers combined with clear product needs make it crystal clear that plant-based meat is a growth opportunity. The plant-based meat market is characterized by a rush of next-generation products that are aligned with the public’s interest in eating more plant-based foods. It’s characterized by a bounty of emerging technical advances that are helping products grow closer to sensory parity with conventional products. And it’s characterized by an influx of investment that can support scale-up and improved affordability. These measures will help attract new consumers, particularly meat-eaters, to the category and encourage existing consumers to purchase more.
Furthermore, although dwarfed by taste and cost concerns, consumers also report “processedness” and too many ingredients as reasons why they haven’t tried or didn’t continue buying plant-based meat. Educating consumers on the health benefits of plant-based meat and maintaining or improving health perceptions will be important to its growth in market share, particularly given that health is a leading stated reason for switching in the first place.
The sustained interest voiced by consumers combined with clear product needs make it crystal clear that plant-based meat is a growth opportunity.
Product renovation & innovation
Continuing to invest in product renovation and innovation activity can help more and better products reach consumers who are looking for options that match the taste, texture, and appearance of animal-based meat.
Select examples of product renovation include:
- Reformulating products to achieve better flavor intensities and more authentic flavor profiles.
- Ensuring products have a low background flavor that does not distort subtler conventional meat or seafood flavors.
- Accurately representing product textures and ensuring they have the right balance of softness vs. hardness, mouthfeel, and authentic bite-down.
- Base protein ingredient research and experimentation. Currently, the vast majority of plant-based meat products leverage just a handful of plant protein bases such as soy and wheat. Additional research into other plant-protein bases could lead to better optimized ingredients and product outcomes.
- Alternative fats. Innovative plant-based fat ingredients or cultivated fats could help to advance the aroma, juiciness, tenderness, and overall mouthfeel of plant-based meat products.
- Health benefits. Some consumers could be interested in product renovations that—without sacrificing on taste—deliver cleaner ingredient labels and improved health benefits.
The potential of untapped categories
Plant-based meat has successfully earned significant shares of very specific meat categories—it had a 6% average dollar share of ground meat products from in 2018-2020, for example. However, conventional meat is a sizeable category with hundreds of product types. Notable white spaces with few plant-based options include:
- Whole cuts. These are often premium products with more complex structure than ground meat products, and may include plant-based chicken breasts and premium cuts of beef such as steak, which make up a significant share of the total meat market.
- A greater diversity of plant-based seafood products. There are some plant-based seafood products available in very specific formats such as fish sticks, crab cakes, tuna, and shellfish, but the wide variety of conventional seafood products available dwarfs the plant-based selection.
- More analogous plant-based products in underdeveloped types. There are many categories—like bacon, pulled pork, and chicken tenders—that have seen some activity but would benefit from high-fidelity product innovation and greater distribution.
Hybrid products and other alternative protein platforms
Increasingly, hybrid products are coming to market that combine ingredients from across alternative protein production platforms. An example of this is the Impossible Burger. Impossible Foods incorporates soy leghemoglobin produced via precision fermentation into their plant-based burger to give the finished product a meatier taste and appearance. Another example is Brave Robot ice cream, which contains both plant-based ingredients as well as animal-free whey protein produced via precision fermentation from Perfect Day.
Hybrid products have the potential to leverage the best components of plant-based, fermentation, and cultivated technologies to improve taste, texture, and cost. The relative affordability of plant-based products makes them particularly suitable to combine with the functionality of fermentation and cultivated technologies.
Another example on the horizon is using cultivated fat as an ingredient in otherwise plant-based products. Mission Barns, for example, mixes plant proteins with cultivated pork fat to produce meatballs, bacon, and sausages. While such products are not yet for sale in the U.S., given recent FDA green lights and more in the pipeline, there could be some soon.
Finally, some companies have already experienced success with blended animal-based and plant-based products, including Perdue, Hormel, and Tyson. Consumer groups this appeals to include parents who want to incorporate more vegetables into their children’s meals. GFI’s 2022 State of the Industry Report on plant-based meat, eggs, seafood, and dairy covers the development of the blended meat category.
Price parity and scaling
In the current economic environment, affordability looms large for consumers. 52% of consumers who are trying to reduce their meat consumption identified price as a key driver, up immensely compared to 16% in 2020, according to FMI’s The Power of Meat 2023. In order to compete with conventional products and lower barriers to entry and adoption, alternative proteins must achieve levels of affordability that unlock the largest market of consumers—meat-eaters. Today, consumers face significant price premiums.
Overcoming these premiums will require public and private investments to scale-up plant-based meat production, reduce the costs of goods and services, and, ultimately, reach consumers who cannot afford to sacrifice on value.
Marketing and positioning
No consumer-facing product can succeed in the food industry without effective marketing and positioning. Plant-based milk, with its 15% market share of the total U.S. retail milk market, is a shining precedent in plant-based food uptake. For plant-based meat to capture a similar share, products need to appeal to meat-eaters. Implementing marketing strategies (like those outlined in a recent BCG report) that appeal to meat-eating consumers, not just vegans and vegetarians, can dramatically increase household penetration and drive sales of plant-based products across categories.
To do so, companies need to:
- Understand consumer attitudes and usage
- Understand who their target consumers are
- Emphasize taste and other important plant-based food attributes
- Leverage the benefits of plant-forward category language versus terms like “vegan” and “vegetarian”
- Deploy best practices in shopper marketing
It’s notable that, recently, consumer views on the healthiness of plant-based foods may have weakened. A Deloitte survey found that the percent of consumers who said that plant-based food is generally healthier for them than eating fresh meat declined by 8 points (68% → 60%) from 2021 to 2022. This weakening parallels declines in views that plant-based foods are more sustainable than conventional meat and that consumers are willing to pay a premium for plant-based food. This decline in the strength of plant-based motivators, combined with known consumer concerns around the critical barrier of taste, present two clear opportunities: 1) increased marketing and consumer education, and 2) product innovation to meet consumer desires across taste, price, health, and sustainability.
