Wed, Dec-13-23, 14:25
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Plan: Muscle Centric
Stats: 238/153/160
BF:
Progress: 109%
Location: UK
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How the multi-billion dollar vegan bubble finally burst
Consumer tastes are changing – but is this really the end for ‘fake meat’ substitutes?
The year began so optimistically. Veganuary was hailed a triumph with record numbers signing up all over the world – only the Vatican City and North Korea were missing from the list of countries where people committed to a meat-free start to the year.
Pope Francis famously loves a steak, so that was chalked up to a win. It was to be the year when our eating habits would shift, driven by a cost-of-living crisis that was sending meat and dairy prices soaring, coupled with a pressure to eat with one eye on the planet. By March, the plant-based picture was looking altogether less rosy.
First, Nestlé announced it was withdrawing its vegan ranges Garden Gourmet and Wunda from sale in the UK, saying the products were simply “not viable”. In May, it was the turn of British sausage company Heck, which announced it was reducing its range of meat-free products, citing a lack of consumer appetite.
Most of its vegan sausages and burgers were shelved, with co-founder Jamie Keeble declaring shoppers were just “not there yet” when it came to buying vegan. And Heck weren’t the only ones.
Analysis by The Grocer showed the number of meat-alternative lines on sale in Tesco, Sainsbury’s, Asda, Morrisons and Waitrose fell 10.9 per cent in the 26 weeks to March 20.
Further signs the meat-free boom was beginning to trail off came in June, when Meatless Farms stopped trading and let staff go (though they were later acquired by a plant-based company). Then came the big one: Beyond Meat.
Launched in 2012 with investment from Bill Gates and Kim Kardashian, Beyond Meat was the original meat-free fast food brand, providing the plant-based options for McDonald’s and KFC. It was on the Nasdaq exchange by 2019, by which point the meat-free market was beginning to grow.
Four years later, in August this year, the company announced sales had fallen by almost a third, blaming “softer demand in the plant-based meat category”.
The appetite for meat alternatives had, it seemed, slumped. News outlets, including this one, declared the vegan bubble officially burst.
According to Heather Mills, the “gaslighting” meat and dairy industries are to blame for the great fake meat flop. Mills, who once declared she was going to turn the North East into the “Silicon Valley of plant-based foods”, is the latest in a long line of meat-free casualties in 2023.
As the vegan business she founded in the ’90s, VBites, prepared to file for administration this week, she criticised the industries whose campaigns she accused of both “insulting lactose-intolerant people” and sowing “seeds of doubt in consumers who deserve to know the truth”.
One interpretation of “the truth” might simply be that the fake meat experiment has flopped.
Plant-based meats should be booming in Britain – government figures show we are eating less meat at home now than we have done since 1974. And yet, it seems that four years after the market swelled with meatless burger brands, our tastes never quite caught up.
When it came to it, many of us didn’t actually want to swap our sausages for vegan alternatives, our beef burgers for beetroot, our chicken nuggets for tempeh. In fact, the latest Kantar data shows the past year has seen a nine per cent drop in fake meat sales in Britain.
Why? It’s partly because consumers never quite got on board with the idea that fake meat was really going to be healthier for them than the real thing. This year’s annual Waitrose Food & Drink Report revealed how an increased understanding of the risks of ultra-processed foods (UPFs) has led some to “turn away” from mock meats and fish, “prompting manufacturers to ditch lines that aren’t selling”.
Rather than seeking out imitation chicken packed with flavourings to make it taste as close to the real thing as possible, consumers now want plants to look and taste like plants. “We’re noticing a shift towards more natural plant-based ranges,” says Catherine Shadlock, a vegan buyer at Waitrose.
Gabriela Peacock, a nutritionist who counts Princess Beatrice and Dame Joan Collins among her clients, says attitudes towards meat replacements are changing. Peacock is “generally quite negative” about fake meats.
“Generally, they are made from a lot of additives and some fake proteins – it’s very far from a natural vegan diet and from plant-based foods.”
A meat-free chicken nugget is no healthier than a regular one, she says. “It’s extremely processed. Also it can be quite bland. If you’re faking the chicken you need to get the flavour from somewhere. [...] There will be a lot of e-numbers and flavourings and sugars.”
A rise in the popularity of protein-rich diets has led to a change in how people feel about meat, says Peacock, who has seen a shift away from plant-based lifestyles and back towards meat eating among her clients.
“It’s completely turning around. It’s been very popular to be vegetarian or vegan – [now] I can see quite a big turn. People do understand that actually meat is really not that bad if it’s from good sources.
“Now, I see a lot of clients that were vegetarian are now going back to having a steak once a week, because it’s very hard to maintain the protein intake. You become tired. Protein is absolutely essential. If you’re a vegan and you don’t want to eat processed food, you have to eat a lot of lentils.”
For many consumers, cost has been a factor too. “Some vegan mimics can be more expensive than the real thing, which has deterred non-vegan shoppers who just want to eat less meat and a few more plants,” says Shadlock. For others, it’s a matter of taste.
Received wisdom in 2018 was that if you were going to give up burgers, you’d want your plant-based alternative to still bleed like a cow. For some, that was borne out; others realised they would really rather a chickpea looked like a chickpea, a soybean like a soybean, not a minced hunk of meat.
But for all the changes in consumer tastes, experts suggest this isn’t necessarily the end for fake meat (Waitrose say the bubble is “maturing” rather than burst) – in fact, some say a dip like this was on the cards all along.
Andy Shovel, founder of plant-based meat brand THIS, says this is par for the course with “any new and emerging category”. “It happened with craft beer when craft beer went crazy a few years ago. It happened with smoothies in the late ’00s. It happened with coconut water.
“What tends to happen is you get an over-proliferation of brands, where everyone is like ooh craft beer this is cool we’re going to pile into this. You tend to get consumer demand remaining relatively stable but then loads of brands drop out because the market consolidates around the best-quality brands and products, like Brewdog with craft beer, or Vita Coco with coconut water.”
Shovel says in his sector, when companies like Beyond Meat and Oatly achieved IPO, they had “very high valuations”. “Valuations that were completely detached from the fundamentals of the business. So it did set the bar pretty high for investors. And I think that’s been a challenge for the category to meet those expectations from investors.”
Sales at his own company are 50 per cent up year on year, though after four years they are not yet profitable (they hope to be by the end of next year). Does he see the conversation around UPFs as posing a risk to companies like his, which make processed meat alternatives like plant-based bacon (made out of soya protein, pea protein and vegetable extracts among other things)?
“Only as much as it does sliced bread companies,” says Shovel, who feels the UPF debate lacks nuance. “A consumer doesn’t know when they go to the supermarket whether their pasta is less or more bad than cupcakes or sliced bread.
“It’s completely insane to have a binary debate about that, it produces no guidance to the customer at all that they can practically use.” Instead, he argues, the UPF debate leaves consumers feeling they’re “not allowed anything apart from vegetables”, which isn’t really how anyone shops or eats.
But while there might be a fight to the death playing out between the UPF naysayers and the plant-based devotees, there is also a sense among experts that meat-free brands have missed the mark when it comes to branding.
Lindsay Gorton-Lee, a brand strategy consultant at Kantar, points out that only seven per cent of meat-free buyers identify as vegan. Rather than casting consumers who don’t buy fake meat as being vegan-avoidant, or suggesting people are just “not there yet” when it comes to meat-free alternatives, these companies should be aiming their branding at a broader church.
“Are enough brands really stepping up to the plate and delivering the right mix of value, health, taste and sustainability to match appetites?” she asks.
Very few meat-free brands are “meaningful” to consumers yet, says Gorton-Lee. “There was a boom in 2019 and there are now a number of players in the market and what we [can see] is there is a range of equity – not all of these new brands have built equity yet in consumers’ minds.”
Young brands are all “vying for share”, she says. Meanwhile, Kantar data reveals that when it comes to plant-based food, our tastes are pretty old-fashioned – three of the biggest meat-free brands in Britain are still Quorn, Linda McCartney and Birds Eye.
“The established brands are really strong. […] When you look at the power of those brands there is a really long tail in terms of the equity they have built.”
There are “opportunities still to be met” though, she says. Kantar’s research shows people want “health and convenience” from their meat-free products. “People are looking for those incremental benefits,” she says, urging alternative meat companies to focus on “what they are bringing as a brand”, rather than making assumptions about what people want.
Would a new meat-free brand launching next year have a chance? “Absolutely,” says Gorton-Lee. “If they can get it right before they are delisted.”
There’s a challenge to the fake meat founders for 2024.
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https://www.telegraph.co.uk/food-an...uary-processed/ |
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