Plant-based meats are not making it

The plant-based meat sector is experiencing severe growing pains.

Fresh meat alternatives had volume sales of 36.9 million for the 52 weeks ending May 19, down 21% from the year-earlier period, reports Circana, a Chicago-based market research firm. The best-selling products — dinner sausage, ground, and patties — had volume declines of 22.6%, 13%, and 34.6%, respectively. Dollar sales totaled $310.5 million, down 18.6%.

Volume sales for frozen alternatives totaled 90.1 million, down 11.7%. The top items — patties, strip/cutlet, and nugget — had declines of 13.9%, 11.9%, and 17.5%, respectively. Dollar sales reached $725.8 million, a 6.6% drop.

The deteriorating activity is part of an ongoing trend in which such factors as high prices, unfamiliar and unsatisfactory tastes and textures, and ingredient concerns, are limiting sales, analysts said.

“Plant-based meat ingredients fall below the nutritional needs of most humans and also contain significant levels of salt, sugar, and saturated fat,” said Russell Zwanka, associate professor of food marketing and director of the food marketing program at Western Michigan University in Kalamazoo. “There is a realization that plant-based products are not considerably healthier, and often less healthy, than animal proteins.”

The elements are resulting in a dearth of repeat purchasers, said Chris DuBois, Circana executive vice president of the protein practice. “The ingredients are too complex and more highly processed than animal proteins, and very few people will pay a premium, especially with inflation and with meat prices, except for beef, coming down,” he said.

“Getting the pricing right” is vital for boosting category activity, DuBois said. Fresh meat alternatives had an average price per pound of $8.41 for the 52 weeks ending May 19, up 3.3% from the year-earlier period, Circana reports. Frozen alternatives had an average price of $8.06, up 5.8%.

Additionally, consumers still report a high level of confusion about the category, said Steve Markenson, vice president of research and insights for Arlington Va.-based FMI – The Food Industry Association. He said that most shoppers indicate that it can be somewhat or very difficult to determine if a product is plant-based, and while some potential buyers seek the presence of plants, others just want to avoid animal products.

Better days ahead?

Despite the ongoing sales decline and shopper uncertainty, the future of plant-based meats remains bright, DuBois said, noting that the sector “still is a billion-dollar category and it is not going away.”

In addition, “not all shoppers have decreased their purchases of plant-based meats over the past year,” said Shannon Weis, director of insights at 84.51°, a Cincinnati-based research and insights firm and a unit of The Kroger Co.

Activity is likely to improve as retailers revise their merchandising strategies and product formulations, analysts said. In a 2023 84.51°consumer survey, respondents indicated that reviews, samples, and in-store promotions would encourage trial.

Retailers and manufacturers also can generate greater product interest by promoting pre-seasoned plant-based meat options with flavors that are familiar and favorable to shoppers, such as steak seasoning and BBQ rubs, Weis said. Educating consumers on how plant-based products are made and effective ways to prepare items also could stimulate activity, she said. 

Merchandising more varieties of plant-based meats will drive interest too, Zwanka said, including pork, chicken, and even fish substitutes. “Because flexitarian diets are a super trend, retailers should ensure the consumers know that they are offering options while not making a statement against animal proteins,” he said. “Let customers know that they have options for whatever diet they choose.”

Offering deep discounts, coupons, different packaging and brands, and sampling of items with newer tastes and ingredients also can help return consumers to the category, DuBois said. “Give shoppers the incentive to try the products and create excitement to get their attention,” he said.

Attracting customers to the sector is particularly important as many regular consumers of plant-based alternatives are from the lucrative Gen Z and Millennial segments, Markenson said. Such shoppers tend to be younger; have larger households with children; are well educated; have higher household incomes; spend more on groceries; and frequently shop for groceries online, he said.

“Shoppers are seeking new and different types of foods as they continue to prepare their own meals and eat at home,” Markenson said. 

Those aged 65 and older tend to be newer to the category, Weis said. 

“There could be a large opportunity for the plant-based meat industry to help meet the needs of these more mature generations who are looking to make choices aligned to their health and well-being,” she said.

Location, location, location

Making it simple for consumers to find plant-based meats in stores also is important for sustaining and increasing sales, but many merchandisers are in a “quandary” over where to situate products, Markenson said. Varying shopper preferences include accessing a plant-based foods section and having selections in such locations as the frozen case, meat department, and even the produce section, Markenson said.

Studies indicate that customers can find plant-based meats more easily when products are located adjacent to traditional meats and better signage would also make consumers more aware of the products’ location, Weis said.

Future placements, however, will likely gravitate to the frozen case, DuBois said, noting that frozen is “the natural home” for plant-based meats. “It is difficult for a new item to stay in the fresh case because the competition is so strong,” he said.

The most effective placement will be a plant-based section in the frozen case in which the selections do not compete directly against frozen meats, DuBois said. “Getting the frozen space right is the most important part of it,” he said.