Following the recent news of Ella Mills acquiring Allplants out of administration, discussions have emerged about the future of the plant-based category and whether meat mimics will continue to shape the sector’s performance.
It’s fair to say the plant-based category has faced strong headwinds in recent years, but the emerging all-natural plant-based subcategory is primed to help revitalise the sector. As is widely known, the plant-based market flourished between 2015 and 2021 as plant-based foods became a mainstream food option, driven by increased interest in healthier diets and sustainability.
But over the past three years, the overall market has been in decline, facing an array of category, consumer and retailer challenges. Most notably the cost of living crisis stifled sales, as around four in five vegan foods cost more than their meaty counterparts.
Taste perceptions, ultra-processed food concerns, a perceived lack of convenience and reduced retail space have also had a big impact on sales.
Recent Mintel data shows these challenges are still prevalent: only 16% of UK adults see plant-based food as tasty, only 18% of UK adults view plant-based products as convenient to cook with, and 68% of adults find highly processed meat substitutes offputting.
However, with the cost of living crisis easing, people are willing to spend more on better-for-you, great-tasting, natural and sustainably produced foods, and these products are beginning to gain shelf space following their outperformance over the last two years versus ‘meat mimics’. In addition, this price disparity between traditional meat and plant-based alternatives has been narrowing.
Suppliers have driven efficiencies and meat products have been more significantly impacted by inflation, with beef prices rising by 24.7% in the last year.
Plant-based hurdles
So, the tides are turning, and retailers are beginning to understand the role all-natural foods have to play in the wider plant-based category. But there are still hurdles for the category to overcome.
Firstly, the category needs to transform taste perceptions, reminding consumers of the fantastic taste, aromas and textures of plant-based food.
Secondly, it needs to inspire recipes and meal ideas, showcasing the versatility of plant-based food and reinforcing the many positive health benefits of a plant-rich diet. Last year, Gosh identified ‘reassuringly natural’ as a key growth driver, showing consumers that plant-based food can be crafted from real, simple, wholesome ingredients that are familiar and reassuring.
There is undeniably still a demand for plant-based foods, driven by the underlying macro trends of eating more healthily and more sustainably.
A recent Mintel report predicts the category will grow in 2025 (the first time since 2021), with mid and higher-end market growth projections between 2025 to 2029 recovering from the recent ‘reset’ in the market. This comes as consumers adopt more flexible eating habits and move away from rigid dietary labels like ‘vegan’ and ‘vegetarian’.
Flexitarian and plant-based diets are now more mainstream – nearly 50% of adults don’t eat meat or limit their consumption – and this rises to ovber 50% among 16 to 34-year-olds [Mintel]. It’s more important than ever for retailers to be championing the plant-based category, communicating that plant-based food isn’t just for vegans or vegetarians.
While 39% of buyers were encouraged to try a new product after browsing the plant-based aisle [Mintel], there’s still more work to be done in getting people to the fixture in the first place and truly exciting and inspiring them when they are there.
We believe the offer tomorrow can be so much better than the offer today, filled with a more natural range satisfying a wider range of meal solutions and eating occasions.
Jason Belmont is the MD at Gosh Food
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