Plant-Based Food: Trending for Success
Unsurprisingly, the plant-based food market has become one of the food & beverage industry’s fastest-growing categories. In 2019, a few of the industry’s largest brands entered the foodservice space and increased their retail distribution. In 2020, both large and small plant-based food brands greatly increased their national distribution and entered new categories. As of early 2022, plant-based food brands are in almost every national and regional grocery chain, there’s competition in nearly every plant-based category, and all eyes are on the market as we look to the future of the industry.
Meanwhile, traditional protein markets have largely been disrupted due to supply chain issues and growing inflation rates. Although plant-based foods are also experiencing similar issues, their sales have continued to grow. There are quite a few reasons why we’ve seen such explosive growth in this category over the past few years (i.e. environmental impact, health-conscious shoppers, etc.), but what is extremely interesting is just how much the market has grown despite all of the industry complications and social issues that have greatly affected the entire food & beverage industry.
Where the market currently stands
According to a recent report by the Plant-Based Foods Association (PBFA), The Good Food Institute (GFI), and SPINS, “U.S. retail sales of plant-based foods grew 6.2% in 2021 over a record year of growth in 2020, bringing the total plant-based market value to an all-time high of $7.4 billion. Overall, plant-based food retail sales grew three times faster than total food retail sales, with most plant-based categories outpacing their conventional counterparts.” Furthermore, “[…] 2021 plant-based meat dollar sales remain strong, delivering a repeat year of $1.4 billion in sales, and growing 74% in the past three years, outpacing conventional meat by almost three times.” Despite current economic conditions, plant-based food has seen consistent growth.
As for shopping behaviors, “Sixty-two percent or 79 million U.S. households are now buying plant-based products. […] Increased repeat rates in plant-based foods across numerous record-breaking years illustrate strong consumer commitment and interest—the percentage of consumers purchasing multiple times within the plant-based category grew from 78% in 2020 to 79% in 2021.” In the past, there used to be only one or two options in any given plant-based category. However, now shoppers have options. As the access to plant-based foods has grown, shoppers are increasingly interested in trying new products – and once they find a product they enjoy, they repurchase it.
Increased Competition, Increased Opportunity
Recently on our podcast Beyond the Shelf, we spoke with the Co-Founder and CEO of Nowadays, Max Elder. In our conversation, Max gave us some valuable insights into the highly competitive plant-based meat segment. He explained how creating a plant-based nugget with only 7 ingredients is helping to fill a void in the market for clean label products, which is often a huge concern for many shoppers. Max also shared that it was important for them to create a product that was different than others currently on shelves, and how innovating in this space adds value for consumers.
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