Meat-free 2024: Tofoo and This defy plant-based droop

Meat-free is in a rut. The latest casualty of the plant-based downturn – value sales fell 7.1% while volumes plunged 8.7% – was frozen ready meals brand Allplants, which collapsed into administration last month. But it’s not the first and it won’t be the last, as the long tail of startups and challenger brands, which have been such a feature of this market, struggle to make money.

And it’s not just small operators either: as more major players close down or sell off their plant-based operations, the category’s top three players – Quorn, Linda McCartney’s and Richmond – all suffered significant losses as shoppers tightened their belts.

In absolute terms, Quorn’s value loss was the biggest. It’s down £16.5m after shifting two million fewer kilos. However, Gill Riley, consumer director at Quorn Foods, remains optimistic. “Nobody is investing and engaging like us”, she says.

“We are still very confident that the meat alternatives sector will return to growth over the next couple of years and market predictions reinforce this,” she adds. “Sustainability and health influences will become even more prevalent in purchase decisions, and financial pressures will hopefully ease for many shoppers as Inflation decreases and people settle into new habits of spending.”

The irony is that cash-strapped flexitarians have switched to “traditional, more affordable meat options, perceived as better value for money”, says Chris Doe, marketing director of Richmond owner Pilgrim’s Europe.

“The recent economic climate has also impacted retailers’ ability to offer competitive promotions in the meat-free category. With less frequent deals, consumers may be hesitant to try new products or make the switch from traditional meat options.”

Another obstacle has been reports outlining how many meat alternatives are ultra-processed, says Carol Ratcliffe, senior insights analyst at NIQ. This has also benefited certain meat-free brands. “While some shoppers have turned away from meat substitutes for being highly processed, tofu is seen as more natural, giving the likes of The Tofoo Co an edge on rivals.”

Bucking the trend

It’s an edge The Tofoo Co is clearly taking advantage of: sales are up 18.7% with volumes growing 15.2%. Ratcliffe notes how it has “continued to innovate, despite the wider category downturn, with NPD such as seitan blocks launched in partnership with restaurant chain Temple of Seitan, and a new Tex Mex burger with tofu, beans and veg”.

The Tofoo Co also stands out for having received fresh investment, with German private equity firm Comitis Capital taking a sizeable majority stake. And David Knibbs, co-founder and MD, “finally feels [vindicated] that tofu, once shunned by so many for being bland, boring and tasteless, has been accepted into consumers’ fridges as a staple natural alternative protein”.

Better Nature Tempeh has enjoyed growth for similar reasons: sales and volumes are up 457.4% and 476.1% – albeit from a small base. Co-founder & co-CEO Elin Roberts says “we have a product that can genuinely challenge chicken as an everyday protein staple”. Tempeh is “supercharged” with benefits meat doesn’t provide, she adds. “It’s gut-friendly, 100% natural, high fibre and plant-based”.

Another brand pushing its clean label credentials is La Vie. All its alt-meat products have fewer than 10 ingredients. “Brands that prioritise transparency and clean ingredients are gaining loyalty, especially among flexitarians, who wish to reduce their meat consumption without eliminating it,” says CEO Nicolas Schweitzer.

As the clean ingredient trend drives sales for smaller brands, bigger players with longer ingredients lists are losing out. Take Birds Eye Green Cuisine, which features many meat alternative products. It’s declined 27.3% in value and 27.5% in volumes.

“We are seeing the market shift towards more whole food plant-based options, with a notable decline in meat substitutes,” admits Jim Shearer, marketing director at Birds Eye.

“However, products that really hero vegetable and have visible vegetable products or vegetable food components, like Veggie Fingers, Veggie Burgers and Veggies Bakes, are up 2.8% in value.”

Market saturation

A further obstacle for struggling brands is the crowded market. It’s saturated with products of varying quality and insufficient differentiation, says NIQ’s Ratcliffe, and only brands that can deliver taste through a unique product will stand out.

Vladimir Mickovic, co-founder & chief brand officer of buoyant startup Juicy Marbles, backs this view. “The initial plant-based meat hype has led to an explosion of companies churning out plant-based products just to lay a stake in the category,” he says. “Many of these products, if not most, were really, really bad.”

That’s now set to change. The overall category decline is a “necessary contraction” leaving behind only the “good players”, Mickovic adds.

Those “good players” clearly include This, which alongside The Tofoo Co is the standout performer in this challenging category. Sales are up 32.7% and volumes 39.3%. As well as increasing prices, it’s continued to innovate and win awards.

“We can now see a clear correlation between brands that are delivering for shoppers on taste and those that continue to grow sales,” says CEO Mark Cuddigan.

The importance of taste is echoed by Unilever, owner of The Vegetarian Butcher. “Over the past 12 months, the taste of new plant-based meat alternative products has improved across the board and with better tasting products comes increased sales and repeat purchase,” says marketing director for nutrition Georgina Bradford.

That’s why The Vegetarian Butcher reformulated its What The Cluck chicken chunks in September to “make sure it is even closer to the texture and taste of chicken”.

On the other hand, Unilever recently put The Vegetarian Butcher up for sale. Proof that patience with plant-based is still wearing thin.

Read more: Meat-free 2023: Plant-based feels brunt of tight budgets