Plant-Based Food Takes Root

The recent growth in plant-based specialty food stores and eateries like Vegan Fine Foods, the all-vegan grocery in Fort Lauderdale, Florida, or Besties Vegan Paradise, the Los Angeles c-store selling 100% vegan merchandise, would have been inconceivable a generation ago. Vegan dining has gone mainstream with the growth of vegan chains such as Veggie Grill on the West Coast and in the Midwest, Plant Power Fast Food in California, Copper Branch on the East Coast and Cinnaholic in the U.S. and Canada.

These retailers have gained a following by offering plant-based foods made primarily from fruits, vegetables, nuts, seeds, oils, whole grains, legumes and beans. Their customers aren’t necessarily vegan or vegetarian. Today, consumers may choose a primarily plant-based diet while still consuming meat or animal byproducts. The highly touted Mediterranean diet is an example of plant-based eating that also includes fish, poultry, eggs and milk products.

AlixPartners, a multi-industry consulting firm, conducted a global survey about COVID-19-era eating habits and found “that about 20% [of consumers] have increased plant-based product consumption since COVID began,” said Abigail Masory, a director at AlixPartners. “People are concerned about health in the middle of a pandemic. They want to ensure they’re as healthy as possible.”

The fact was echoed in a recent survey by research organization Mintel in which 56% of respondents said they eat plant-based meat “to be healthier.”

Meatless Meat

Plant-based meat has been a hot topic for the past few years, although the concept is nothing new. Tofu, a meat substitute made from soybeans, was consumed in China as early as 200 B.C. In 1896, a member of the vegetarian Seventh-Day Adventists created a peanut-butter-based “meatless meat,” and in the 1960s, Japan’s macrobiotic food trend inspired British hippies to invent the veggie burger.

But the idea didn’t captivate the American food culture until 2012 when Beyond Meat came on the scene with a hamburger patty that could pass the real beef taste test and even oozed beet juice to mimic blood. What followed were offerings from other new companies, such as Impossible Burger and unMEAT, plus plant-based meats from established brands like Conagra, Kellogg, Kraft Heinz, Kroger, Nestlé, SYSCO and Tyson.

About 20% [of consumers] have increased plant-based product consumption since COVID began.

Fast-casual chains—Dunkin’, Red Robin and Tim Hortons—were early adopters of faux meat, followed by QSRs, such as Burger King, Carl’s Jr., Hardee’s and White Castle. After Del Taco rolled out Beyond Meat tacos, management announced that the product was one of the best-selling introductions in the chain’s history.

McDonald’s tested the Nestlé meatless burger in Germany but eventually teamed with Beyond Meat, announcing that the two companies would co-develop plant-based menu items as substitutes for real chicken, pork and eggs under McDonald’s new McPlant brand. The chain recently began selling the McPlant burger in Denmark and Sweden to gauge customer interest before rolling it out to more locations. The patty is reportedly made of pea-based and rice proteins.

Beyond Meat and Yum! Brands have teamed up to develop new plant-based offerings for KFC, Pizza Hut and Taco Bell over the next several years to appeal to flexitarians, the companies said in February. KFC was already testing Beyond Fried Chicken in several U.S. cities, and Pizza Hut last year rolled out the Beyond Italian Sausage Pizza and the Great Beyond Pizza nationwide.

“We’re excited about the long-term potential plant-based protein menu items have to attract more customers to our brands, especially younger consumers,” said Chris Turner, Yum! Brands CFO, in a news release. Consumers are demanding “more diverse protein options,” he said.

Convenience retailers, meanwhile, are adding plant-based meats to their menus. In late 2019, Pennsylvania-based Sheetz with 600 stores became the first c-store chain to serve Beyond Burgers. Last year, 900-store Wawa, also based in Pennsylvania, launched a line of Sizzli Breakfast Sandwiches, including one featuring a Beyond Meat sausage made from peas and brown rice.

Milking It

The demand for plant-based milks, including oat milk, soy milk, coconut milk and almond milk, also has intensified, with many consumers pouring these options in their coffee or on their cereal every morning.

“The Plant Based Foods Association reports that milk has the largest growth of all plant-based alternatives, at $2 billion in 2019,” said Jayme Gough, research manager, NACS. “That’s probably because an estimated 30 million to 50 million Americans are lactose intolerant.”

TXB Stores, with 45 locations in Texas and Oklahoma, sells cartons of almond milk in markets “where the customer base is looking for this type of dairy alternative,” said Russia Abdelbary, senior category manager, TXB Stores. “We’re data driven and always use market and consumer insights, combined with our internal data, to make changes to our assortments.”

Rutter’s, the Altoona, Pennsylvania-chain with 78 outlets, keeps Silk Almond Creamer on store coffee bars because customers want it. “While last year was challenging, we are looking to continue to provide new and innovative items for our customers in 2021,” said Chad White, foodservice category manager, Rutter’s.

Early this year, 7-Eleven Hong Kong launched a range of ready-to-go, plant-based meals and dim sum in more than 700 stores, along with 30 plant-based snacks and drinks in 150 locations. In Tokyo, the chain sells a vegetarian version of niku man or “steamed meat bun.” The updated option replaces traditional diced pork inside the bun with a soybean-meat substitute. Since last summer, 7-Eleven Australia has carried sandwiches with fillings of plant-based eggs, beef, chicken or sausage.

Thanks to the increased interest in plant-based proteins, the category is predicted to grow nearly 35% on menus by the end of 2022, reports Technomic. Retailers should expect to see alternatives to all types of meats—even fish, lamb and possibly frog legs—available in the marketplace.

Plant-based meats gained more consumer acceptance during the pandemic. In August 2020, foodservice consultancy Revenue Management Solutions polled 800 U.S consumers and found that 39% of them like the taste of plant-based meat, up from 29% from a similar survey in January. In addition, 30% of respondents said they’d switch restaurant brands to satisfy their taste for plant-based meat alternatives, up 7% from the January survey.

According to NielsenIQ, the pandemic has been good for the plant-based meat category. Sales of meat alternatives were up 16.7% for the 52-week period ended December 26, 2020, compared with the previous year, and 40.1% for the fourth quarter of 2020.

“I truly believe that plant-based meat has reached a tipping point in terms of its cultural relevance,” Beyond Meat President and CEO Ethan Brown said in reporting full-year and fourth-quarter results in February.

More Than Meat

Plant-based snacks continue to be perceived as better-for-you options, and ingredients in the newest offerings go beyond traditional soy and nut proteins. Different types of plant protein—mung bean, pea, watermelon seed, hempseed—are expanding consumer options.

“Alternative salty snacks, such as veggie chips, are being made from materials like kale or chickpeas that have more health benefits than potatoes,” said Masory. “People are still interested in indulgence. They still want to have the hamburger and eat the ice cream. They still want snacks, and if you can provide a healthy option, they’re interested.”

There is one catch. Plant-based foods tend to be pricier than traditional versions of the same products. Masory admits that expense is the No. 1 barrier to consumers when it comes to purchasing plant-based products, but she predicts prices will decline as demand for the products grows. “As we’ve seen with almond milk, if consumers like it, they’ll buy it,” she said.