Better for your health. Better for the planet. Whatever the reason, more people are choosing plant-based foods at the grocery store, leading to an impressive year-over-year 27% increase in sales of plant-derived foods in 2020 to $7 billion, according to the Plant Based Foods Association (PBFA), the Good Food Institute (GFI) and SPINS. That’s double the growth rate of 2019 and significantly higher than the overall 15% growth in U.S. retail food sales.
Last year, 57% of households bought plant-based foods, up from 53% in 2019. That number is expected to climb in the coming years for a number of reasons, including health and environmental concerns. Also playing a role is the increased selection and quality of products derived from plants. In the plant-based milk category alone, there are a wide variety of milk substitutes to appeal to a wide range of tastes. Plant-based foods also are a part of many popular weight loss and dietary plans. They appeal to vegans, of course, but also flexitarians —the growing consumer segment that consumes mostly plant-based foods while allowing meat and other animal products. Climatarians (those concerned with climate change) are also trying to incorporate plant-based foods into their daily diets. And even among those consumers who still consume a wide variety of meat products, many are incorporating plant-based foods where they can.
Simply put, plant-based foods are products that provide a replacement for an animal product. For example, plant-based eggs are a direct substitute for regular eggs. Egg-free and vegan mayo is a direct substitute for regular mayonnaise, and oat and almond milk are substitutes for regular milk. Foods that are already plant-based (like mustard) are not categorized as a plant-based food.
“The data tells us unequivocally that we are experiencing a fundamental shift, as an ever-growing number of consumers are choosing foods that taste good and boost their health by incorporating plant-based foods into their diet,” Julie Emmett, Plant Based Foods Association senior director of retail partnerships, said in a statement about the 2020 results.
Which types of plant-based foods are most in-demand? Plant-based eggs (up 168% year-over-year) registered the largest increase in sales last year of all plant-based foods. Sales of plant-based meat increased 45% last year, followed by plant-based cheese (up 42.5%), tofu and tempeh (up 41%), plant-based meals (up 29%), plant-based dairy products like yogurt (up 28%) and plant-based condiments and dressings (up 23%). Plant-based milk sales increased by 20%.
Two categories of plant-based foods have reached — have already surpassed — the important $1 billion sales threshold. U.S. sales of plant-based milk last year reached $2.5 billion and plant-based meat reached $1.4 billion. Plant-based milk remains the largest plant-based food category. Overall, plant-based foods that are high in protein are expected to be particularly in demand in the years to come as manufacturers continue to refine the taste, texture and quality of these types of foods to meet consumer preferences.
The strong demand for plant-based foods presents a huge opportunity and challenge for grocers. If your store doesn’t stock the right mix of products, shoppers may go elsewhere looking for them, and take their weekly shopping trips with them. This also is not a trend that should be approached with a “wait and see” attitude. The time to act is now. While the trend toward plant-based foods is clear, executing a profitable plant-based food strategy in your store can be challenging and even seem overwhelming. Which products will resonate with your shoppers? How best to position them in your store? How do you identify up-and-coming plant-based products?
At UNFI professional services, we can help you stock and showcase the right selection of foods your customers are looking for. With more than 150 customizable solutions built for stores of all sizes, UNFI Professional Services gives businesses and retailers more time and more money to prioritize what matters most: your shoppers, your employees and your competition. Let’s talk! E-mail us at [email protected] to learn more about how we can help your store better serve its unique customer base and become more efficient and profitable.
