Plant-Based Category To Be Worth £1bn Within Five Years
Pilgrim’s Food Masters, the former Kerry business that owns brands including Richmond and Fridge Raiders, is forecasting strong growth for the plant-based category, expecting it to be worth £998m by 2026 – a 74% increase over the next four years.
An explosion of growth in the plant-based category over the last few years means it is currently worth £572m. Research shows that demand is predominantly being driven by flexitarians: 43.7% of UK shoppers consider themselves to be following a flexitarian diet compared to 2% following a vegan diet and 5.2% a vegetarian diet. Pilgrim’s Food Masters is predicting that in the next two years even more consumers will opt to moderate their meat consumption.
Veganuary is a key selling occasion for the plant-based category. In 2021 more than half a million shoppers signed up to Veganuary. And the impact is long-term with only 10% who took part intending to return to their original diet. This presents a clear opportunity for retailers to recruit shoppers in January and retain them all year round.
“The plant-based category has been on an unbelievable growth trajectory over the last five years or so but it’s still a relatively small sector of overall FMCG sales. This means there is still vast headroom for further growth. Plant-based alternatives can no longer be an afterthought, so retailers need to ensure they are investing in a robust plant-based offering which stretches across different categories,” said Dawn Spencer, Marketing, Category, Innovation & Sustainability Director GB&I at Pilgrim’s Food Masters.
“As we look ahead to what’s in store for 2022, now is the perfect time for retailers to regroup and take stock of their plant-based offering to ensure they’re responding to what consumers really want. There are really clear areas within plant-based which are currently underserved by the products on the market which is something we’re excited to tackle as a business.”
Pilgrim’s Food Masters revealed three key growth areas for the plant-based category:
Appealing To Families
Encouraging more families to buy into the plant-based sector will be key to its continued success. Yet Pilgrim’s Food Masters has identified two key areas which need work to convince more families to buy into the category: its health credentials and trust in products to deliver on taste and texture.
Currently only 14% of parents believe plant-based foods are suitable for younger children, with health and taste concerns being two key barriers. This represents a huge demographic that retailers can tap into to drive sales.
Retailers can appeal to families by highlighting the health credentials of plant-based alternatives, especially given health is the number driver for choice when it comes to the plant-based category.
Trust is key when shopping in an unfamiliar category and it is here that brands can play a key role. Brands are growing their share of the plant-based category now equating to 83% of the category as a whole.
Tapping Into New Occasions
While the category has boomed it has done so with an uneven focus on meal components. Up until now innovation has been concentrated on this area of meat mimicry, with the plant-based sausage and burger category now over-saturated. Further growth within the category will be driven by catering to an array of untapped occasions including lunchtime and snacking options.
A third of lunchtime occasions are sandwiches but current consumer sentiment is that plant-based lunchtime options under-deliver on both taste and texture. With 31% of meat-free moments being outside of evening meals there’s an opportunity for brands and retailers to cater to these occasions and fuel further growth within the category.
Additionally, the meat-free snacking category grew 17.5% YOY, but meat-free snacks only account for 5.9% of meat-free spend. Snacking that is both enjoyable and healthy is becoming increasingly important to consumers as shoppers continue to evolve their taste preferences post-pandemic. A robust meat-free snacking portfolio will allow retailers to offer more diverse, healthier snacking options and stretch the plant-based category further.
Innovation
The final piece of the puzzle to continue driving growth will be from innovation. From new meat alternatives to proteins such as fish, as well as exploring new proteins altogether including sunflower, wheat and chickpea proteins, the future of the plant-based category will be contingent on offering a plant-based alternative for every meat occasion.
As the category grows, so too does consumer expectation. Plant-based innovation needs to taste just as good – if not better – than its meat counterpart in order to cater to all meat occasions. Consumer sentiment around plant-based bacon is that it underdelivers on taste and texture and as result whilst meat bacon makes up 8.1% of total meat sales, plant-based bacon accounts for only 4% of sales in the category. Plant-based alternatives that truly look and taste like their meat counterparts will be key to further growth of the plant-based category.
NAM Implications:
- i.e. ignore at your peril…
- Key hurdles: ‘its health credentials and trust in products to deliver on taste and texture’
- Paths forward:
- Family appeal
- New occasions
- Innovation
- Simples…!
