Plant-based meat's wild ride needs R&D, savvy to stabilizePlant-based meat's wild ride needs R&D, savvy to stabilize

After a few years of dramatic tumult, the plant-based meat industry is regrouping. The question for all stakeholders: What factors will pivot plant-based from pioneering to permanence?

From new fungi-based steaks to AI-powered tools tasked with discovering novel ingredient combinations, brands are advancing product development to win over key consumers, including skeptics and meat eaters. Likewise, strategic partnerships such as the one between Beyond Meat and Panda Express are beginning to steady what has been a volatile market since 2022.

At the same time, retailers are exploring how to merchandise a category that until fairly recently remained relatively small. A decade ago, options didn’t veer far from frozen veggie burgers and OG offerings such as tofu and seitan. But now, shoppers can find alternative versions of everything from chicken nuggets to sushi to pepperoni throughout store aisles—freezer, refrigerator and pantry. And retailers are coming up with best practices for where alt-meat products belong within their grocery departments.

All of this is part of the industry’s effort to woo consumers who not only are seeking lower prices, but also better flavors and textures, as well as increased convenience—vital factors before shoppers begin pivoting meaningfully to the category.

Related:Plant-based food sales dip in 2023 as inflation cuts volume

“Right now, price and taste are limiting meat eaters. Consumers say they would be more willing to buy plant-based meat if it tasted better, and was more affordable,” says Emma Ignaszewski, senior director of industry intelligence for the Good Food Institute (GFI), a nonprofit that revolves around the alternative protein industry.

Companies in the space “know that’s the goal—to improve flavor, bring down costs and also make plant-based convenient,” says Julie Emmett, senior director of marketplace development for the Plant Based Foods Association (PBFA). “They’ve heard that feedback from consumers. They know it’s a mandate.”

Fungi to the alt-meat rescue?

Mushroom varieties Photo credit: Canva

To meet these demands, many brands are investing more than ever in R&D. On the innovation front, biomass fermentation—the technology used to create large amounts of protein out of fungi-like mushrooms—has emerged as a promising route forward, said Ignaszewski.

Companies including Meati and Chunk Foods are pushing the industry far beyond the wave of fake chicken nuggets that flooded the market during the height of the alt-meat frenzy. Industry leader Beyond Meat has also caught mycelium mania. The company is expected to introduce a mycelium-based steak soon. Yogurt, too: Nature’s Fynd’s fungus-based alternative yogurt arrived on Whole Foods Market shelves last year. Even tuna bellies. Aqua Culture Foods in Chicago is using mycoproteins to craft alternative seafood.

Related:MyForest Foods reinvents mushroom farming—and bacon

All these companies have received investments to build factories aimed at scaling production, and potentially ratcheting back prices for consumers. They’re also tackling taste and texture challenges.

The “rush of new facilities in that space is a good proof point in scaling up and getting some of these new products launched in the market,” Ignaszewski says.

Innovating, from duck weed to AI

Novel proteins, too—and for alt-meat, protein is foundational—are emerging. Duck weed, one of the smallest flowering plants in the world and one which reproduces quickly, is getting tapped by startups. Companies such as Plantible Foods turn to the plant, which yields protein content reaching up to 40% of its dry weight.

They’re also tapping AI. NotCo, for example, harnesses AI to find plant-based ingredients that can replicate the molecular structure of products made using animal ingredients. NotCo, which offers alternative chicken, beef and milk products, established a partnership with Kraft Heinz to manufacture plant-based versions of everything from the company’s iconic Mac & Cheese (launched last year) to sliced cheese, egg-free mayonnaise and even Oscar Mayer hot dogs and sausages.

Related:Jinka’s plant-based seafood is a family affair

Forging partnerships for prosperity

“Strategic partnerships are proving to be a lifeline for the industry,” says Emmet. So are moves such as Starbucks’ announcement in November that it was eliminating its surcharge for plant-based milks. Ignazewski described the announcement as “huge” for the plant-based industry. It bolsters one of the industry’s central mandates: to bring down costs.

Collaborations contributed toward Beyond Meat’s announcement last November that it achieved its first positive quarter in nearly three years. The company’s partnership with Panda Express—Beyond Meat supplies the protein in Panda’s Beyond Orange Chicken—played a role in the news. And during the same quarter, Beyond Meat extended its partnership with McDonald’s for the chain’s Veggie McPlant Nuggets. Currently available in 1,500 McDonald’s restaurants, the chain plans to make the nuggets permanent fixtures on menus, including in several European countries.

One caution on the third-quarter earnings for Beyond Meat: They also reflect the company’s decision to raise prices, while simultaneously cutting costs. The upped prices don’t align with one of the industry’s mandates for long-term durability.

Beyond the brands—savvy retailer merchandising essential

Retailers play an important role in plant-based sales. Photo credit: Canva

For the industry to truly blossom however, it will require more than tastier, more affordable products. It also demands retailer participation. Look at plant-based milk, says Emmett. That swath of plant-based is performing well, and she thinks that its success rests in part on how it’s merchandised in stores together with the regular dairy products. Meat, on the other hand, often gets sequestered in a plant-based meat section that isn’t always adjacent to the animal meat areas of the store.

“Plant-based cheeses placed in the dairy section achieved nearly seven times more turns compared to when they were in the produce section,” she says. “This underscores how strategic placement could help the industry address its visibility challenge.”

For too many retailers, she said, plant-based meat displays target vegetarians and people specifically seeking the products. The strategy, she says, loses meat eaters who might be willing to give a plant-based bratwurst a shot—because they don’t encounter it while wandering the aisles.

Natural Grocers, one of the largest retailers in the natural and organic products industry, does merchandise some of its plant-based meat products in a separate section. But alt-meats “get plenty of shouts-outs in recipes, Meal Deals and in our Health Hotline,” says Christie Z. Pettys, the retailer’s product standards manager for food. She also said that jettisoning alt-meat brands due to lack of consumer interest hasn’t been an issue for Natural Grocers. In part, because the company rejects so many applicants due to its GMO and glyphosate standards.

“Not all plant-based meats are created equal,” she says. “Our customers trust our standards. We believe that many of our meat products are raised with a better environmental footprint than some alternative plant-based options in the market, which can be full of GMOs and weird ingredients. Technically, these products are vegan but not necessarily healthy or nutritious.”

Either way, until products appealing to those traditional bacon-shopping consumers emerge, the industry will continue inching along in maverick, rather than roaring forward in mainstream. Nailing taste and texture, price and convenience stand as vital foundations for the industry’s endurance. So does smart merchandising.

People, and the planet, need meat alternatives

A thriving plant-based meat industry isn’t just a win for consumers—it could reshape our food system, reduce climate impacts and lower health care costs by persuading people to eat less meat. A November report by the Good Food Institute, for example, found that plant-based beef imposes 91% lower impacts on the environment than animal beef. The numbers are 88% for pork, and 71% for chicken. The report concluded that plant-based meat uses 79% less land, 95% less water and reduces water pollution by 93%.

I’m a meat eater—and rooting for traditional meat’s plant-based analogues to take big bites out of the conventional market.