Last weekend saw us attend JD Event’s Plant-based World Conference and Expo in Angel’s Business Design Centre. This was the first exhibition in Europe for plant-based meat, fish and dairy alternative companies and attracted a huge amount of interest from both new and established brands keen to showcase their plant-based portfolios.
The event had everything you’d expect including awards, exhibitions, speeches, and, of course, more cooking demonstrations than you can shake a vegan fish finger at.
As leading strategy advisors to the plant-based foods sector we work in this sector day in day out – here is what we took away as some of the key themes from the event…
Mind the gap: The plant-based industry has overcome significant challenges in the past five years but one of the issues highlighted throughout was that of price and, more specifically, the gap to meat and dairy. The overwhelming consensus from those in attendance was that the plant-based industry will not reach its full potential until the category can get closer to parity with the traditional meat and dairy-based foods. An interesting theme that was explored here was where the problem lay – is it that plant-based food is just too expensive or is it just that meat is so darn cheap (incredibly, chicken today is 50% cheaper in real terms than it was 20 years ago!)? The challenge of price in the plant-based industry is all too familiar with those in the industry but is becoming increasingly relevant to consumers especially in these turbulent times. While we expect price to come down as scale in the sector builds, we expect movement on both fronts with meat likely to be impacted by higher costs of land, fewer subsidies and, in the medium-term, environmental taxes.
Location, location, location: A second challenge raised by several speakers was around fixture space in retailers. Shelf space is in high demand, particularly in chilled, but the view was that more space is needed to grow the category, no small challenge when you consider that, as the Head of Marketing & Trading at Booths so eloquently pointed out, “on paper the commercials do not warrant the additional space”. Ouch
In addition to amount of available space, the issue is also around the location of the fixture. Plant-based alternatives sell a lot better in the meat/dairy aisles; however, many retailers still locate plant-based foods in a separate fixture. This works when the consumer is either vegan or not; a misleading message when you consider that 15% of the population defines themselves as flexitarian but less than 1% are vegan (thanks Kantar).
Keep it clean: The topic of clean label was raised by Hannah Carter, founder of OGGS, as one of the largest issues facing the plant-based industry today. Plant-based products often contain a large number of additives in order to achieve the taste required to compete with meat / dairy products. As a result, in most cases, the products often look heavily processed when you compare with non-plant-based alternatives. The industry needs cleaner label products that do not compromise on taste but we are clearly some way from achieving this. Cleaner ingredients are out there, products such as potato proteins can for example replace ‘dirty’ ingredients like methyl cellulose, but there is a price differential and shortage of supply to contend with.
Innovation: The final theme to highlight was that while innovation will be key to sustained growth in the sector it is only useful if it is solving a problem – to put it bluntly no one is calling out for more plant-based burgers. Innovation needs to focus on small nudges that together will make a big change
The above topics only really start to scratch the surface of what’s happening in the sector and likely reflect the category’s still early stages of development. And while there are undoubtedly big hurdles to overcome, what’s clear is that momentum to narrow the gap to meat/dairy is building and is coming not just from the brands but from retailers, investors, public sector and, most importantly, consumers.
A lot will happen in the next five years (indeed many of those in attendance weren’t around in 2016) and there are some amazing technologies which are progressing, for example 3D printing, which delivers complex textures more reminiscent of meat; precision fermentation which, if it can crack the challenge of yield could make serious inroads into milk and cheese; and good old mycoprotein which Quorn has been pushing for decades but that is finally seeing a host of new players entering the field.
Having worked in the sector since before it was fashionable and having advised dozens of companies in the space, what we know is that the companies that survive and thrive will be those that can deliver a product that hits the sweet spot of taste, price, health, and environment. When we write our despatch five, ten years from now it will be interesting to see who that will be…
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Combining the knowledge of highly experienced industry executives with top-tier strategy consultants we are Europe’s leading strategy advisors to the food industry with particular expertise in plant-based food.
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