Coming off a year of rising inflation rates and continued supply network disruptions, plant-based foods have faced a rocky landscape. Consumers became more price-conscious and companies continued to adapt and innovate to bolster their ingredient sourcing or secure funding. 2022 also saw growing scrutiny for the plant-based foods industry and speculation around whether the future for our nascent industry was as strong as initially predicted.
With all of these dynamics and considerations in the backdrop, PBFA is heartened to share the results of our 2022 The Plant Based Foods State of the Marketplace report. Taking a multi-channel approach to assessing the plant-based foods marketplace, the report delves into 2022 plant-based foods retail and e-commerce sales, emerging foodservice trends, and consumer insights, providing valuable data and analysis to inform industry stakeholders and motivate the advancement of the plant-based foods industry. The top line takeaway from the report findings is: Consumer demand for plant-based food is strong and the sales performance of plant-based foods outpaced all speculation, demonstrating the utmost resiliency.
“The continued growth of plant-based foods amidst the challenging backdrop of the global pandemic and supply network disruptions—which have upended the entire food system—speaks to this industry’s ability to connect with consumers, engage their desire to eat in alignment with their values, and provide delicious options that meet expectations, for every eating occasion,” said PBFA CEO Rachel Dreskin.
Plant-Based Foods Stand Out Across Marketplace Channels
Our most recent data set, analyzed and categorized from SPINS data by the Plant Based Foods Association and The Good Food Institute, shows that plant-based food dollar sales grew 6.6% in 2022 to $8 billion, with unit sales mirroring the 3% decline also seen in total food and beverage, and animal-based foods—all of which demonstrate the strong resilience of plant-based foods during intense inflationary conditions.
As the e-commerce landscape exploded in response to the pandemic, plant-based foods captured 6.4% of total online sales, compared to a 4.5% share in grocery retail. Seeing the strong performance of plant-based foods on online platforms–where consumers can easily search for plant-based options and see the variety available at the click of a button–foretells the potential avenues for growth of plant-based foods in brick-and-mortar retail with optimized merchandising strategies.
In the foodservice channel, engaged consumers drove consistent demand for plant-based options in foodservice settings, and now 48% of restaurants across the U.S. feature plant-based foods on their menus. It is significant to note that this percentage has grown steadily without decline over the past decade, illustrating demand for plant-based foods in foodservice settings is more than a trend and increasingly, the consumers’ expectation.
“The plant-based foods industry’s momentum and resilience–built on robust consumer demand– is evident across 2022 retail and e-commerce sales and foodservice performance. PBFA is dedicated to working with retailers, foodservice providers, and brands to optimize their engagement with plant-based consumers and help shift food environments in favor of plant-based. We know consumer interest is strong, now it’s a matter of continuing to increase access and awareness for existing and future innovative plant-based options and furthering the exciting potential of this industry.” – Julie Emmett, Vice President of Marketplace Development
Consumers are Coming Back for Plant-Based Meat
After years of exponential growth, powered by substantial investment and brand innovation, the plant-based meat category is hitting a point of maturation across retail and foodservice channels.
Reaching a record 46% U.S. retail sales growth in 2020 over 2019, plant-based meat has held firm in dollar sales: In 2022, plant-based meat dollar sales remained remarkably stable at $1.4 billion, decreasing slightly by 1.2%.
Trends show that consumers are committed to incorporating plant-based meat into their diets, with 17.5% of households purchasing plant-based meat and a hefty 62.5% repeating their purchases. This indicates that consumers are responding to the growing availability and diversity of plant-based meat types entering the market and their loyalty speaks to the potential for consistent future growth.
A few trends to watch in plant-based meat:
- Frozen meats: Frozen plant-based meats now make up 63% of plant-based meat sales. Consumers looking for lower prices may be increasing their focus on frozen options, paired with their interest in convenience.
- Clean label: Plant-based consumers report health as their primary motivation for choosing plant-based meats. Brands are responding quickly with highly sought-after products like burgers with less saturated fat and clean-label steak.
- Diversification: The plant-based meat category is expanding to include growing variety in types such as plant-based chicken, nuggets and wings, deli slices, filets and whole cut meats, crumbles, and seafood (including plant-based fish options, shellfish, and more).
On the foodservice front, plant-based meats continue to be the go-to choice for foodservice operators looking to engage consumers interested in plant-based options. In response to growing consumer demand for plant-based foods, four times as many operators plan to add plant-based meat to their menus in 2023 than drop it from their menus. NPD data shows sales of plant-based meat grew 8% to $304 million in 2022. Similar to retail trends, plant-based meat categories in foodservice continue to diversify. Plant-based beef is the largest subcategory, hitting $33 percent of total plant-based meat sales by weight, followed by tofu, veggie-forward products, plant-based chicken, and then plant-based pork. Plant-based chicken and seafood are standouts with high year-over-year growth in pound sales, growing 39% and 40% respectively.
The data picture clearly illustrates that consumer appetite for plant-based meats has far from peaked, and savvy foodservice operators can capitalize on this category’s momentum by incorporating a wider variety of meat options, like plant-based chicken, sausage, crumbles, and more.
Plant-Based Milk: Growing Household Staple
Plant-based milk is a thriving example of what is possible when plant-based foods are merchandised next to their animal-based counterparts. Retailers leaning into the growing consumer interest are seeing the results of expanding shelf space to enable increased variety of plant-based milk options. Driven by tremendous innovation, plant-based milk represents 15.3% of all milk sold and represents the gold standard in merchandising, comprising approximately 25% of shelf space and physically placed next to animal-based milk in stores, often with overhead signage to help shoppers navigate the section.
The plant-based milk category grew 9% to $2.8 billion in 2022. Against a backdrop of heavy inflation, plant-based milk units declined by 2%: As consumers stretched their dollar across total food sales, the price gap between plant-based milk and animal-based milk impacted overall purchasing. Insights from the Plant Based Foods Institute’s Plant-Based Migration Analysis Report⁴, carried out in collaboration with Kroger and 84.51°, revealed that 43% of plant-based customers new to or increasing their purchases of plant-based products choose plant-based milks over conventional dairy milk.
In foodservice, plant-based milk and dairy options are gaining prominence on menus. Plant-based milks are being incorporated into entrées and appetizers, and are playing a starring role in creamy sauces. Midscale restaurants closely follow many global operators in the segment, incorporating plant-based dairy in savory menu offerings such as coconut milk-based curries–particularly on Thai and Indian menus–or soups. Oat milk is a new category standout, growing from virtually no menu penetration four years ago to over 400% growth today.
Plant-based milks are a common item on food service beverage menus, often featured alongside coffee or other warm drinks. Almond milk is the top-offered alternative milk, while oat, soy, and coconut continue to grow. It is important to note, however, despite strong consumer affinity for milk alternatives and one-third of consumers preferring them to traditional dairy, menu presence of milk alternatives is still lacking, which may create an opportunity area for operators to address this unmet demand. Understanding that foodservice trends often mirror retail, plant-based creamer performance in 2022 U.S. retail sales may indicate where foodservice operators may turn for growing their plant-based dairy options.
In retail, plant-based creamer is the third largest plant-based category after milk and meat, and in 2022 this category grew by 24% in dollars and 12% in units. In contrast, animal-based creamer units declined by 1.4%. Brands innovated like never before, providing indulgent flavors like crème brûlée, dark chocolate truffle, and toasted marshmallow, all of which can be found in the creamer section next to animal-based counterparts. We’re also seeing a growing variety of ingredients introduced to boost the functionality and nutrition of plant-based creamer options: Some of the most popular ingredients are oat, almond, soy, and coconut, with rising interest in blends.
“Plant-based foods are clearly the arm of innovation for many food service operators,” said PBFA’s Director of Marketplace, Foodservice Hannah Lopez. “Collaborating with brands to introduce exciting and delicious new offerings presents a key opportunity to not only try new menu items, but to implement them in the overall brand strategy of a food service establishment.”
Consumer Loyalty Showcased in Plant-Based Cheese
Plant-based cheese is now a $233 million category in retail and merchandising strategies that place plant-based options next to their animal-based counterparts have proven successful in netting new consumers who are interested in expanding their plant-based engagement.
Household penetration of plant-based cheese is 5%; however, the repeat buying rate is an exceptionally strong 49.9% – demonstrating the commitment of shoppers to purchasing plant-based cheeses for different occasions.
In foodservice, there is ample opportunity for expansion in plant-based cheese. The variety of plant-based cheese options has been demonstrated on restaurants menus in craveable items like bagels with plant-based cream cheese, mac and cheese, sandwiches featuring plant-based cheese, decadent sauces, and plant-based cheese options for burgers and more. Overall, plant-based cheeses show up on around 4.5% of foodservice menus, growing 110% in the past four years alone.
Plant-based cheese has ample room to grow based on consumer survey data: PBFA collaborated with 84.51° to analyze consumer sentiment amongst plant-based Kroger shoppers⁷, and 73% surveyed indicated they were interested in better-tasting plant-based cheese options. Plant-based food companies are responding by debuting new fermentation techniques to improve taste and utilizing novel ingredients like potato, chickpea, and fava bean proteins. As new plant-based cheeses come to market, brands should advertise the improvements in taste and texture to motivate consumers.
Plant-Based Eggs
Plant-based eggs have been tapped as a growing category for the past few years as the market for these innovative foods have steadily expanded, predicated on consumer interest in engaging with more healthful options. In 2022, plant-based eggs grew 14% in dollars and 21% in units. Comparatively, animal-based eggs grew 47% in dollars, yet declined by 1% in units.
Pricing increases for animal-based eggs fueled by Avian flu and subsequent shortages are reflected in the increase in dollar growth paired with declining unit sales. More and more consumers continue to discover plant-based eggs, either due to the unreliable supply of animal-based eggs or motivated by concern about diseases associated with animal-based foods.
According to the Plant Based Migration Analysis report, 33% of plant-based consumers cite they are concerned about the risks associated with animal-based foods, such as the presence of antibiotics or hormones, or their potential to be vectors of disease (e.g. salmonella, E. coli, viruses, etc.).⁹ In contrast, consumers are discovering the many health benefits of the nutrient-dense ingredients companies are using to make plant-based eggs, such as mung beans and fava beans
The foodservice opportunity is ripe for plant-based egg growth with many new companies coming onto the scene with ready-to-eat options. Plant-based food brands are diversifying beyond liquid egg products into patties, hard-boiled eggs, pre-made scramble, folded and sous vide-style products, runny yolks, and more.
Plant-Based Charts a Course for Future Growth
The plant-based consumer has spoken again and again with their avid support of a wide-variety of plant-based foods. While this post focused on the highlights from some of the most prominent categories, there is much more research on the growing movement toward plant-based options ahead. As we know from this data, there is no such thing as a singular plant-based consumer, and as brands continue to innovate and offer new and unique products, the strength of the plant-based foods industry grows. With the partnership of marketplace stakeholders such as retailers, brands, and foodservice operators, PBFA is dedicated to providing the most cutting edge information needed to champion, elevate, and strengthen our industry.
To see our full 2022 State of the Marketplace Summary Report, click here.
In upcoming reports, to be released in coming weeks, we will dig into:
- Foodservice Optimization: Considerations for implementing plant-based foods onto menus, a deeper look into the state of the plant-based menu trends, and consumer sentiments when dining out.
- Retail Category Insights: Key emerging plant-based categories that represent important entry points for families—including snacks, chocolate, baby food, and pet food—and explore U.S. region sales of plant-based foods to help the industry make informed choices for growth.
For more from PBFA, check out:
- Plant-based foodservice menu trends: “State Plant-Based in Food Service” report here.
- For more insights on opportunities for plant-based meat companies to align with consumer expectations, check out our Unmet Needs Study with 84.51.