More than a quarter of consumers are eating less meat these days, according to a recent NBJ report. And innovation in alternative foods that are catering to this shifting dynamic is stemming from the natural channel, where plant-based food sales grew 10.7 percent in the year ending June 12—three times the rate of growth in the multi-outlet channel, according to SPINS.

"Brands with a high concentration of ethically focused consumers understand that these natural retailers are essential proving ground for product innovation and growth," said Jeff Crumpton of SPINS in a webinar presented by the retail data and insights agency on Wednesday. Plant Based Foods Association Executive Director Michele Simon joined Crumpton and Kora Lazarski from SPINS on the webinar to explore the state of the plant-based food industry.

They highlighted three sub-categories leading the way.

Non-dairy beverages

This is the leading category in plant-based foods, accounting for $4.2 billion worth of sales last year, according to SPINS. Growth is occurring especially in refrigerated products, Lazarski said, and innovation is happening in the form of new bases, such as walnuts, tigernuts and macadamia nuts. The high pressure pasteurization trend is also making its way outside of the juice category, with ready-to-drink milk alternative drinks popping up.

Meat alternatives

The natural channel saw sales of frozen meat alternatives rise more than 12 percent in the last year, according to SPINS. The arrival of mock seafoods, innovation in meatless jerkies and continual rise of jackfruit are contributing to growth, as are meatless nuggets, strips and cutlets and meatless grounds.

Cheese alternatives

This niche category is also benefiting from shifts in consumer habits and product innovation, growing at a clip of 30 percent in the natural channel, and just about as fast in the specialty channel, too. Nut-based cheeses are the fastest-growing kind in natural. Companies are even expanding out of the cheese aisle—like Kite Hill with its pasta entrees and The Honest Stand's sauces.

The Plant Based Foods Association, which formed earlier this year, is a group of more than 50 companies, including manufacturers and ingredient suppliers. To help grow this burgeoning industry, the group's mission is to educate consumers and support policy that enables a fair marketplace for the plant-based food industry.

Catch Michele Simon and Kora Lazarski at Natural Products Expo East.
What: The Plant-Based Foods Revolution: Sowing Seeds for Climate Friendly Eating
When: 1:30-2:45 p.m., Thursday, Sept. 22, 2016