Recently there has been a lot of negative press about plant-based meat alternatives. Eye-catching headlines such as “is plant-based meat a failure?” or “was plant-based just a fad?” all predict the seemingly terminal decline of the plant-based category.
The reason why I’m not concerned by these headlines is that I have seen it all before. Plant-based is following the trend of any exciting, high-growth nascent category.
As per my experience with smoothies or craft beer, all ‘hot’ new categories follow the same cycle. They go from niche (craft beer was just for real beer enthusiasts, plant-based was solely for vegans) to explosion (too many brands and SKUs, leading to a huge tail of underperforming products), then to consolidation around a few high-performing, high-quality brands. Eventually that evolves to normalisation (craft beer is in mainstream beer, smoothies in juice and, in time, meat alternatives may end up going into the meat aisle).
Plant-based is clearly in the consolidation phase. However, what is undeniably different from other categories is that its ‘explosion phase’ has been far more extreme and pronounced. The huge valuations for meat alternative brands have inflated expectations, leading to huge numbers of brands coming to the market, and unfortunately leading to a lot of poor-quality products: no retailer needs 16 plant-based burgers, it just causes consumer confusion.
This has meant the inevitable and necessary consolidation phase for plant-based is more striking, and more brands and SKUs have exited the market than is the norm – resulting in many of these negative headlines.
If you step back and look at the plant-based category through a normal lens, the growth has been huge: 47% since 2020, compared to meat, fish and poultry growing by 8% over the same period [Kantar]. More importantly, the trend of people wanting to consume less meat for environmental, health, and animal welfare reasons shows plant-based is clearly not a fad, with a huge 76% of consumers likely or extremely likely to try meat-free again in the future [This & Directions Research].
Tesco has been rightly lauded for its ambition to increase plant-based ranges by 300% by 2025. I feel this ambition is right and holds true. The consumer trends are clear: vegan and flexitarian consumers still want meat alternatives, which is why it is predicted plant-based will take some 30% to 60% of meat consumption share by 2050 [Synthesis Capital].
The plant-based category is now in a better place as it consolidates. Expectations are normalising, while stronger brands and better-tasting products are driving repeat purchase. As with smoothies, craft beer, and other categories that have gone through this phase, plant-based is here to stay – unlike the headlines predicting its early demise.