Innova Market Insights reports that plant-based product claims increased by 62% globally (CAGR, 2013-2017) with growth occurring on platforms such as plant proteins, active botanicals, sweeteners, herbs and seasonings and coloring foodstuffs.
To be clear, rising interest in plant-based eating is not reflected in the numbers of consumers following a vegan diet. The truth is that many consumers don’t adhere to a strict vegan diet—yet they look for “vegan” package claims as evidence of a plant-based food formulation. At the end of the day, these shoppers believe plant-based foods and drinks carry more important connotations related to health, sustainability and even, perhaps, ethics.
Suitable products now are gaining a greater profile with vegan labeling and certification programs now increasingly common in the mainstream food and drinks market. Moreover, these new products now are much more widely available across a range of product sectors.
Innova Market Insights data indicate that food and drinks launches featuring the term “vegan” accounted for 7% of new US food and beverage product introductions during a 12-month period to the end of May 2018. Vegan new products also comprised 5% of total global new product introductions, a mark that’s up from just a 1.2% level in the same period in 2012.
Leading food categories for vegan claims in the US in the 12 months to the end of May 2018 were cereals, soft drinks, snacks, bakery and ready meals, as well as more specific subcategories such as plant-based waters, meat substitutes and dairy alternative drinks.
The cereals category lends itself relatively easily to the use of vegan positionings, primarily featuring different grains with added ingredients such as fruit and nuts. The category accounted for more than 11% of total vegan launches in the US in the 12 months to the end of May 2018, with a penetration of 22%, rising to nearly 27% in the cereal and energy bars sub-category.
The cereal bars market already has a healthy and natural image, despite concerns over sugar levels in some instances. Many products use multiple health claims, with gluten-free one of the most popular in recent years, alongside high fiber and wholegrain. Key growth areas for claims include those related to Non-GMO Product Verification and protein content. Vegan positionings have been added in many instances, although not always with front-of-pack prominence.
Many vegan friendly cereals launches have been confined to more specialist health brands and have yet to impact the mainstream. Kellogg, for example, has largely left activity in vegan breakfast cereals to its Kashi brand in the US, although in the UK it launched a range of plant-based cereals under the W K Kellogg brand in early 2018.
Claiming high taste credentials through wholesome grains and natural flavors, its new UK line of five items featured two no-added sugar granolas (Apricot & Pumpkin Seeds/Coconut Cashew & Almond), Organic Wholegrain Wheats in Original and Raisin variants and a SuperGrains Granola with cranberry, sultana and spelt.
Bottoms Up: Beverages
Innova Market Insights’ tracking data show soft drinks rank second in terms of vegan-friendly new product launches—falling behind cereals but just ahead of snacks. Although new juices and juice drinks tend to lead in terms of actual new product numbers, the plant-based water category has generated the most excitement. This segment has seen global launch numbers rise more than four-fold during the past five years.
Looking more closely, the number of actual plant-based water products remains relatively modest overall, and it is still one of the smallest soft drink subcategories in terms of new product development. Interestingly, however, this category’s global share of market rose from less than 1% to nearly 3% during the five year period to the end of October 2017. Plant-based waters overtook energy drinks in terms of activity levels. In the US, where the market is relatively well established with the strength of coconut water in particular, share reached an even higher 3.5% of all plant-based beverages introduced.
Interest in plant-based waters has risen in keeping with overall interest in plant-based diets. The drinks have a strong health image and more than 95% of launches recorded during the 12 months to the end of May 2018 carried a health positioning of some type. Launches tend to feature multiple health claims, many of which are based on the properties of dominant coconut water. Coconut water is known for its isotonic benefits and a natural, low-calorie profile. Many products also are positioned as naturally gluten-free, paleo and vegan-friendly. Increasing numbers of new entries also carry claims such as low or zero calorie, no additives/ preservatives, no sweeteners and GMO-free.
During the past several years, coconut water products drove high levels of new product development. More recently, however, new plant-based waters rely on other ingredients ranging including aloe and tree-based options (such as birch and maple). Still more options include drinks based on almonds as well as those featuring chlorophyll, ginger, cactus and nettle.
Turning back to the coconut water market for a moment, it’s clear that rising competition has resulted in an increase in value-added and flavored varieties. Some of the segment’s latest entries feature additional functional ingredients such as probiotics, fiber or protein; while new flavored varieties may showcase ingredients such as coffee, tea and cocoa. There also are new blends of coconut waters with fruit juices with additional references to those that are “cold pressed.”
Demonstrating ongoing interest in the category was Danone’s venture arm, Danone Manifesto Ventures, which announced in February 2018 that it purchased a stake in the premium coconut water brand Harmless Harvest, San Francisco.
Plant-Based Meats
Interest in plant-based eating also is clearly reflected in developments in the meat substitutes market, where global sales are set to grow to US$4.2 billion by 2022.
The range of ingredients used for meat substitutes includes vegetables and grains, as well as traditional sources such as soy, wheat and pea proteins. In Europe, specialist manufactured brands such as Quorn and Valess (FrieslandCampina), respectively, use mycoprotein, algae and dairy proteins.
Growing overall interest in plant-based diets—along with interest in vegan, vegetarian and flexitarian lifestyles and concerns over animal welfare—have all combined to increase interest. Not surprisingly, new product development involving plant-based meat alternatives has surged to a 11% CAGR from 2013 to 2017. Research also indicates that four in 10 US consumers increased their consumption of meat substitutes/alternatives during 2017.
Innova Market Insights data show that vegan was second leading positioning for meat substitutes in 2017, used for 47% of launches in the second half of the year, up from 35% in the same period in 2016. When it comes to package label claims—by the numbers—“vegan” overtook vegetarian but still ranked behind broader references to a product’s protein claim (high in / source of).
Rising interest in plant-based diets was most apparent in North America, where vegan was the leading claim during the 12 months to the end of June 2017. Meanwhile, vegetarian related claims led in Europe and Asia and while protein content itself was a primary package call-out in Australia, New Zealand and throughout Latin America.
The US market has seen stiff competition involving new meatless brands such as Impossible Foods, known for its Impossible Burger in restaurants; and Beyond Meat, which has a growing retail line of refrigerated packaged burgers, sausage, beef crumbles and chicken strips. Other well-known US meat-alternatives—available in both the freezercase and refrigerated case—include MorningStar Farms and Gardenburger (Kellogg), Boca Burger (Kraft Heinz), Gardein, Tofurky, Field Roast, Yvves Veggie Cuisine, Sweet Earth, Lightlife and Atlantic Natural Foods (Loma Linda). Even retailers such as Trader Joes and Target (Simply Balanced) have own meat alternative offerings.
There’s also a growing list of US alternative meatless seafood offerings from US companies such as Good Catch, Sophie’s Kitchen, Ocean Hugger and New Wave (in addition to line extensions from Gardein and Atlantic Natural’s Loma Linda brand).
Quorn, although an established vegetarian meat substitute made using mycoprotein, was originally made with egg white and hence not vegan. However, with rising interest in totally plant-based options, the UK company introduced its first vegan burger in 2011 and started work on substituting egg white with potato protein in its products to launch more vegan friendly options, including Chik’n patties, cutlets and tenders.
Quorn still has a much wider product range available in its UK home market. There, its chilled and frozen offerings include vegan burgers, pieces, strips, fillets, sausages and slices, as well as value added and flavored options such as Five Grain Fillets, Hot & Spicy Burgers, BBQ Strips and Fajita Strips.
Moo-ve Over: New Dairy Options
Media headlines aside, the US dairy products category still is dominated by products containing milk from cows. Even so, Innova Market Insights found that nearly 8% of new category launches used a vegan (plant based, dairy-free) positioning during a 12-month period to the end of May 2018. Moreover, new plant-based dairy options are proliferating across the category in every product segment—including beverages as well as yogurts, frozen desserts and ice creams, creamers and cheeses.
Beverages lead new product activity when it comes to dairy alternatives. In fact, Innova Market Insights found that dairy alternative drinks accounted for more than 7% of global dairy category launches during 2017.
Spoonable non-dairy yogurts also have seen rising levels of interest, although it’s been from a smaller base. Innova Market Insights found that non-dairy yogurt launches experienced a 48% CAGR during the 2013-2017 period. During the same time, this segment took its share of overall dairy launches from less than 0.5% in 2012 to 1.5% in 2017. According to Innova Market Insights’ consumer research, one in three US consumers have increased their consumption of plant-based milk/yogurt during the two years to the end of 2017.
In the move to offer something new, an increasing variety of non-soy plant-based ingredients are appearing, including cereals such as rice, oats and barley. Manufacturers also are increasingly formulating new alternatives with nuts, such as almonds, hazelnuts, cashews, walnuts and macadamias; as well as coconut and more unusual options such as lupin, hemp and flaxseed.
In an interesting twist, the nation’s largest dairy products company, Dean Foods, moved this July to take a majority share in Good Karma Foods, known for its market-leading range of flaxseed-based milk and yogurt alternatives. Dean Foods first entered the plant-based beverages market a year earlier, in 2017, with a minority investment and distribution deal with Good Karma.
Consumers are increasingly choosing plant-based options, which are often also vegan-friendly, for a range of reasons, but the overall effect has been a rise in the number of products and brands on the market and the variety of ingredients used to make them.
