Amid setbacks, signs of stability emerge around plant-based meat
While sales may have hit a growth ceiling, consumer sentiment toward plant-based meat points to a foundation of continued support
Justin Cook
Spencer Young
Brian Baker
Randy Jagt
James Cascone
Three years ago, plant-based alternative (PBA) meat sales were booming and expected to grow at double-digit rates. Then 2022 hit, and sales prospects changed. Our survey data from the time (see “About the survey”) suggested three reasons from a consumer perspective: a limited market of consumers open to repeat buying, decline in consumers’ health perception of the product, and fewer consumers willing to pay a premium in a high inflation environment.1
Many of the same dynamics appear to have played out in 2023’s performance as well. Unit volume fell by 17%, and dollar sales of PBA meat declined by 11%, despite an 8% increase in price.2 However, if sales can hit a ceiling, our most recent survey data suggests they can also land on a floor of support regarding consumer attitudes (figure 1).3
We see room for optimism when checking back in on the three consumer factors we saw hampering PBA meat sales in 2022, since it appears they are no longer eroding.
- Addressable market: The number of people surveyed who sometimes buy PBA meat remained stable at 46%, a statistical tie with the previous year. Why are they sticking with the product? In part, it could be because consumers who buy PBA meat believe its taste has improved dramatically in recent years (73%) and that it is more environmentally sustainable (65%). Animal welfare may also be a factor in the purchase decision for many of these consumers (61%).
- Health perceptions: After a significant decline in 2022, no one knew if the health perceptions of PBA meat would continue to deteriorate. However, belief appears to have stabilized. Six in 10 PBA meat buyers believe it is healthier than fresh meat, the same as the year prior. This could be partly due to the industry’s efforts to improve the health profile of their products.4
- Price premium: Inflation wasn’t kind to consumers at the grocery store nor to sales of a product that can cost twice as much per pound as the traditional option.5 However, food inflation has since eased, and consumer willingness to pay a premium for PBA meat has increased by five percentage points year over year. It is not quite back to 2021 levels, but 51% of PBA meat buyers in our survey now say they are willing to pay a premium. How much of a premium? Willing consumers in the survey say they will pay 37% more on average. Surveyed retailers are more skeptical, believing their consumers will only pay 10% more.
While our most recent data suggests that PBA meat has staying power and a strong foundation among a sizable population segment, a return to growth will probably require more. After all, even among surveyed consumers who sometimes buy it, only about half think PBA meat is a truly superior product. Innovation that continues to improve its health profile and quality, while ideally lowering cost to approach price parity and avoiding negative perceptions around “ultra-processed” may be necessary to break through the growth ceiling.
Grocers will likely need to see that growth before investing more. Estimates suggest PBA meat represents only about 2% of meat department sales.6 That puts it in the long tail of products in their assortment. Manufacturers may need a return to rapid growth to demonstrate that the value delivered from PBA meat can outpace the effort and associated costs of dedicating case space and all that comes with it.
About the survey
As part of its annual Fresh Food survey, five years running, in July 2023, Deloitte surveyed 2,000 US consumers and 100 US-based grocery retail executives. Explore our future of fresh collection, including the latest paper Fresh food at the intersection of trust and transparency, for more insights.