Meat alternatives

Meat Alternatives: Cooking Up a Market Disruption

The meat substitutes market is gaining momentum, driven by lively debates in the media, and many big food companies want to take a bite. Analysing the media coverage, we found that the most widely discussed topics are ethics and animal rights, research, regulation and policy, health aspects, environmental issues, product development and business models. In addition, our analysis showed that the companies in the front line of the media discussion include not only large food corporations but also fresh start-ups.

 

The meat industry is experiencing an unprecedented disruption from a rapidly growing demand for plant-based alternatives. This is one of the main conclusions of an extensive report on the vegan market published by the leading food industry magazine The Grocer. The researchers remarked that this is in part because the meat industry is increasingly scrutinised for issues revolving around ethics, sustainability and health.

The conclusion is in line with a predicted average annual growth rate of around 6.1% for the meat alternatives market for the period 2018-2026. The figure comes at a time when the consumption of meat substitutes such as tofu, natto, tempeh and other products has increased steadily in recent years, with this trend set to continue, according to a recent market research report by Transparency Market Research. Frozen meat alternatives, in particular, are gaining importance, and the chilled meat substitutes are expected to become more popular: frozen tempeh, for instance, is expected to generate sales of over USD 45 billion by the end of 2026.

More and more food companies are investing in research and development to capitalise on the trend by expanding their product ranges and by entering into collaborations and partnerships with the intention to enrich their portfolio. Utilising the latest food technology, manufacturers aim to produce plant-based foods with meat-like texture and taste.

The popularity of substitutes such as tofu and tempeh is mainly due to their rich protein and calcium content. Protein, in particular, is important when it comes to shopping decisions: 81% of Millennials, 74% of Gen X, 66% of Boomers and 50% of Silents said protein content is extremely or very influential when making grocery store purchases, according to marketing agency Acosta’s 2018 Progressing Protein Palates report. Protein has a different image for different generations: older generations are more interested in the health benefits, while younger generations care about exercise recovery and feeling full.

“Our research shows that protein continues to be a mainstay in shopping baskets, but the kind of proteins shoppers are buying is evolving,” said Colin Stewart, Senior Vice President of Insights at Acosta. “Plant-based meat alternative sales are booming and popular with vegetarians and meat-eaters alike. Another trend we’re seeing with protein is that shoppers are paying more attention to labels and product claims, but are overwhelmed and confused about what they mean.”

The study notes that shoppers are becoming well aware that eating meat isn’t the only way to obtain protein: plant-based meat alternatives are growing 11% in units year over year. Consumers, especially Millennials, want to try alternative diets which don’t circle around meat (71% of meat consumers have begun to purchase plant-based meat alternatives) or don’t contain meat at all (26% of Millennials are either vegetarian or vegan). In addition, 34% of meat-eating Millennials eat four or more vegetarian dinners each week.

 

The meat sector needs better communication

 

In a survey by the Grocer and research specialists England Marketing, representatives of the meat industry asserted that although the long-term significance of the trend remains to be seen, the sector should be careful and take into consideration changing consumer behaviours and the fact that the public debate about plant-based alternatives is over-hyped.

Caroline Drummond, CEO of farming and environmental charity Linking Environment And Farming, commented: “The meat industry is doing a good job, but it’s not communicating it well. The younger generation is very interested in food. We need to get the facts to them, so they are well informed and stay engaged.”

Producers also stress the need for better communication from industry bodies, unions and companies. The problem is that there isn’t a single unified message on which everyone involved agrees. Manufacturers in Britain, for instance, are up for a buoyant campaign, but others would prefer a more nuanced approach. A national retailer participating in the survey said: “There is too much in the farming press about how great we are. They need to be crystal clear on why we are great and what it means. There is too much propaganda.”

Another issue is the need for more clarity and collaboration when it comes to communication efforts. Drummond thinks that the government should take a leadership role through its departments of  health, education and industry, but Jane King, CEO of Agriculture and Horticulture Development Board, said the sector has to concentrate on campaign marketing, advocacy and collaborations: “The industry needs to be less fragmented and join forces around common goals.”

 

Taste the debate

 

As with every communication campaign, the meat industry needs to know the state of the debate in order to convey its messages successfully in the face of a market disruption. This is also true for manufacturers who want to be part of that disruption by launching meat alternatives – entering a new market and promoting new products would require in-depth knowledge of the conversations in the media.

We analysed the recent meat alternatives coverage and found out that it spans these main topics:

Most of the articles in the debate involve the ethical aspects of meat consumption and animal rights in particular. This issue is often cited as the main cause for many consumers to go vegetarian or vegan, with the most popular arguments being that animals have consciousness and feelings, and that cruelty towards them is morally wrong. The line of reasoning usually includes the supposition that animals are inherently valuable and shouldn`t be treated merely as means: if we can survive and be healthy without eating meat, we shouldn`t harm them. These sentiments are often shared by producers of meat alternatives as a way of promoting their products, and messages like these tend to resonate across many consumers who are taking up vegetarianism or veganism for ethical reasons. Another ethical question which comes up often is whether vegetarians and vegans should eat meat alternatives: if they have stopped eating meat, why would they eat something that resembles meat in taste and texture?

Industry reports play a major part of the coverage mainly because the meat alternatives trend is gathering momentum and professionals in the food business would like to see some facts and figures. The results of such reports are often cited not only in trade articles but also in health and lifestyle pieces which strive to underline the growing popularity of meat alternatives. Often quoted findings include a study by market research company Nielsen, which investigated plant-based foods that directly replace animal products such as seafood, meat, eggs and dairy, and concluded that these segments undergo a rapid expansion: sales in US stores and restaurants grew 10 times faster than their animal-based counterparts last year. „The plant-based foods industry has gone from being a relatively niche market to fully mainstream,” Michele Simon, executive director of the Plant-Based Food Association (PBFA), said in a statement. „Plant-based meat and dairy alternatives are not just for vegetarians or vegans anymore.“

In the meantime, federal watchdogs are considering how to categorise such foods, and articles about these issues form the third largest category in the coverage. Regulators basically have to resolve the ontological question ‘what is meat’ – if it`s grown in a lab without slaughtering animals, should it be called meat?

Animal rights advocates have already begun a lively debate with cattle ranchers. Some suggest that the alternative products should be called “clean meat” to reflect that they are grown by replicating animal cells, but meat industry representatives strongly disagree. „It implies that traditional beef is dirty,” says Danielle Beck, director of government affairs for the National Cattlemen’s Beef Association. The debate highlights the power of branding as an emerging sector tries to gain ground. The top trending article on social media is in the policy and regulation category: „Missouri Becomes The First State To Ban Vegans From Calling Meat Alternatives ‘Meat’.“

Articles on health issues are usually concerned with the health consequences of the consumption of meat alternatives versus the regular consumption of meat. One of the most controversial subjects is red meat – some state that it’s very nutritious and a great source of protein, iron, B12, zinc and creatine, while others point out that there are observational studies showing a link between meat intake, diabetes and heart disease. There are also many articles discussing whether vegetarianism is healthier – this topic has always generated buzz in the media and will always be of interest to the general public.

This goes hand in hand with environmental issues. The biggest problem here is the negative impact of the meat industry on the planet, and brands selling alternatives often make the case for their products by underlining environmental concerns alongside ethical and health considerations. The most recent extensive study, published in the journal Science, demonstrates meat and dairy uses 83% of farmland and is responsible for 60% of agriculture’s greenhouse gas emissions. „A vegan diet is probably the single biggest way to reduce your impact on planet Earth, not just greenhouse gases, but global acidification, eutrophication, land use and water use,” said Joseph Poore, at the University of Oxford, UK, who led the research. „It is far bigger than cutting down on your flights or buying an electric car.”

Reports on research and development talk about the newest advances in the meat substitutes sector, for instance, plant-based burgers, lab-grown meatballs and insect protein. Writing about business models and strategies, some journalists noted that companies don’t have a clear strategy on protein diversification and still don’t know how to capitalise on the new trend. A study by investor network Farm Animal Investment Risk and Return found that only three of the 16 companies it surveyed (M&S, Nestlé and Unilever) have set goals to increase their portfolio of alternative proteins, while Tesco and Nestlé are helping to grow the alternatives market through better product development and innovation.

 

Brands on the plate

 

Our analytics tools also managed to find out which brands lead the coverage:

Los Angeles-based vegan start-up Beyond Meat is one of the key players in the sector ever since Mark Bittman, a food journalist with The New York Times, wrote that „you won’t know the difference between that [Beyond Meat] and chicken. I didn’t, at least, and this is the kind of thing I do for a living.“ The company is profiled in many market reports and got in the news recently for introducing its plant-based Beyond Burger to the UK, positioning it as a product replicating the texture of meat and providing additional nutritional benefits.

CNBC also reported that Beyond Meat has hired J.P. Morgan, Goldman Sachs and Credit Suisse for an initial public offering, which will be the first IPO for a start-up specialising in vegetarian meat products. The company`s current investors include Bill Gates, Leonardo DiCaprio Jack and Suzy Welch, Kleiner Perkins and Tyson Foods, the world’s second largest processor and marketer of chicken, beef, and pork after JBS S.A., which recently said it expects meat prices to face continued pressure over the next year.

Unlike some big meat businesses, Tyson Foods aims not to defend itself against the new trend, but to take a slice of the cake and drive development. it. In 2016, it launched its fund Tyson Ventures to ‘invest in companies developing breakthrough technologies, business models and products to sustainably feed the growing world population’.

Tyson also set up an internal innovation lab and is introducing a new brand: Green Street, a range of plant-based protein bowls under. Tom Hayes, President and CEO of Tyson, said: „A protein strategy inclusive of alternative forms is intuitive for Tyson Foods. It’s another step toward giving today’s consumers what they want…No one knows exactly what the future of food will look like. That’s why we’re exploring new approaches.“

The Good Food Institute, a nonprofit that promotes plant-based meat, dairy, and egg substitutes, is mentioned because of its active involvement in the meat branding debate. Initially, it was in favour of the label „clean meat“, which was seen as a better choice than the more clinical „lab-grown meat“, as Bruce Friedrich, co-founder and executive director of Good Food Institute, put it. But the Institute`s Policy Director Jessica Almy told Bloomberg her organisation has changed its position: “It feels like ‘clean meat’ doesn’t resonate with everybody right now.”

The US Cattlemen’s Association stated that vegetarian companies shouldn`t call their products meat at all. The group even issued a petition to the U.S. Department of Agriculture in  demanding official definitions for the labels “beef” and “meat.”

Cellular agriculture company Memphis Meats, which had secured investment by meat giants Cargill and Tyson, employed another more clinical label – “cell-based” – in a letter to the White House wanting a clarification of the regulatory framework for their market. The company was also mentioned for its business prognoses: „Eventually, we expect to be competitive with conventionally produced meat,“ said Maria Occarina Macedo, Director of Brand & Creative at Memphis Meat. „We’re confident we’ll get there—it’s a matter of ‘when’ not ‘if’.“

Silicon Valley company Impossible Foods, which develops plant-based substitutes for meat and dairy products, is bringing its Impossible Burger, a plant-based patty that bleeds and sizzles when it cooks, to the supermarkets. It has become extremely popular in restaurants since its introduction in 2016, and now the media analysed the news of its move to the stores as one of the leading signals that the meat alternatives industry is growing fast.

“By far the No. 1 message from fans on social media is, ‘When will I be able to buy and cook the Impossible Burger at home?’” Impossible Foods’ CEO and founder Patrick Brown said in a statement. “We can’t wait until home chefs experience the magic and delight of the first plant-based meat that actually cooks and tastes like meat from animals — without any compromise.”

Agriculture specialist Cargill, the largest privately held corporation in the United States in terms of revenue, was mentioned because of its plans to expand its plant-based proteins portfolio by investing in Memphis. It sold its last cattle feedlots in April, saying it aimed to allocate funds to invest in alternatives like insects and plant-based protein. Friedrich commented: “So the fact that Cargill has purchased a stake in Memphis Meats, and Tyson has purchased a stake in Beyond Meat, and Big Food sees plant-based meat and clean meat as moving into the mainstream, will actually move plant-based meat into the mainstream.”

Morningstar Farms, a division of the Kellogg Company that produces vegetarian food, is transitioning from a vegetarian into a more vegan-friendly company by updating three of its best-selling chicken alternative products which used to contain egg whites and milk fat.

Plant-based meat alternative and vegan cheese company VBites gets exposure mainly because of its CEO, Heather Mills, who is an established media personality ever since her marriage to  Paul McCartney. Recently, she gave a talk called Solving the Trillion-Dollar Healthcare Problem at the World CEO Forum in Dubai, where she spoke about the importance of education, experimentation and tasty treats in the transition to plant diet.

Both Garden Protein and Kraft Foods were mentioned in industry reports: Canada-based Garden Protein International, the manufacturer of the famous plant-based protein brand gardein, was acquired by Pinnacle Foods, while Kraft was profiled as a key player mainly because of its frozen veggie Boca Burger.

The conversation about meat alternatives is set to become livelier and livelier, especially among younger generations whose members tend to share their views on social media. The fact that ethics, health and environment are some of the most widely discussed topics in the coverage we analysed goes to show that consumers are making conscious choices, taking into account issues beyond their food`s taste and appearance. The best way to reach such an audience is through a clear idea about the values that define your brand – these consumers are not simply buying products, they are defending certain values with their choices.

Shoppers want to know why brands use the ingredients they do and what motivates the messages they send through their marketing strategies. This level of consciousness underlines the importance of leveraging social media, where many buyers of meat alternatives provide feedback and recommend products. But in order for them to voice their opinion on Facebook or Twitter, they first have to encounter brands and associate with their culture.

That’s why becoming a thought leader on the issues that influence consumer decisions would be the most effective way to capitalise on the new trend. And such a strategy starts with an in-depth analysis of the subject employing sophisticated media analytics tools.

 

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