Current Market Trends in Plant-Based

The plant-based market is experiencing a slowdown after years of rapid growth. Despite the slowdown, the plant-based market still has a strong foundation to build on. A diverse range of consumers continues to explore these products, and the sector has successfully maintained effective price premiums.

With that in mind, here are 3 key trends in plant-based:

1. Increased Plant-Based Product Attribution

Finding plant-based products has never been easier, and consumers are actively seeking them out. In fact, there were 451k online searches for “Plant-Based” in the last year.¹ This is facilitated by the increased use of plant-based product attributes that are searchable through online storefronts. By optimizing your listed attributes to match consumer preferences, you can get the biggest return from ecommerce shoppers.

Yet, up to 84% of brands fail to claim at least one of the top three most searched attributes that their products qualify for.² Meaning shoppers today are not able to discover the products suitable for them online. Research conducted by NIQ Brandbank shows that the more complete product content is, the higher search ranking on the digital shelf, making products more discoverable and improving the conversion rate.

2. Diversification of Plant-Based Products

One of the greatest strengths of plant-based products is the breadth of offerings for consumers. What began primarily with meat substitutes has now expanded into a diverse range of categories, including dairy alternatives, snacks, beverages, seafood substitutes, and even plant-based eggs. This diversification allows consumers to find plant-based options that suit their specific dietary preferences, whether they are seeking alternatives for health reasons, ethical considerations, or environmental concerns.

Most importantly, this is opening up new categories for plant-based brands to innovate and higher growth than the overall category. For example, Wraps and Tortilla Shells had an overall category growth of 5.3%, but Plant-Based products were up 7.4%.³ This shows that the sweet spot for brands to innovate within Plant-based is categories where the share of Plant-Based items is low, but the growth is high.

3. Growth of Flexitarianism

The continued success of plant-based products is bolstered by flexitarianism, particularly the focus on alternative protein consumption. Unlike strict vegans or vegetarians, flexitarians opt for a more flexible and balanced approach, and this shift has dramatically broadened the appeal of plant-based products. Flexitarians are particularly drawn to alternative protein sources, such as plant-based meats, dairy alternatives, and protein-enriched snacks, as they look for healthier and more sustainable ways to reduce their meat consumption without completely eliminating it.

For example, 15% of Meat buyers buy both meat and meat alternatives.⁴ Similarly, 39% of Milk buyers buy both milk products and dairy alternatives.⁴ This shows that flexitarianism is a crucial part of Plant-Based consumption. Plant-based brands should target consumers who buy the traditional category and encourage trial among this target group through displays, awareness campaigns, or trial packs.

Challenges Facing the Plant-Based Industry

The plant-based industry faces notable challenges, with price sensitivity being one of the most significant hurdles. While plant-based products offer health and sustainability benefits, they often come at a higher price compared to their traditional animal-based counterparts. For many consumers, especially in times of economic uncertainty and inflation, this price difference can be a barrier to regular purchases. With the Consumer Price Index (CPI) up 6.5% over the last 12 months, this is one of those times.⁵ As consumers prioritize affordability, plant-based brands need to find ways to offer competitive pricing without compromising quality.

Another key challenge is addressing consumer demand for transparency. The proportion of shoppers affirming the importance of transparent product information from brands and manufacturers has risen steadily in the past 5 years from 69% in 2018, to 72% in 2021, to 76% in 2023.⁶ Plant-based brands need to be as open and honest as possible with their products or they risk losing the confidence of their target consumers.

Supply chain and scalability are also pressing concerns for the plant-based sector. As demand for these products increases, brands must navigate the complexities of sourcing high-quality plant-based ingredients in large quantities while maintaining sustainability. Limited availability of key ingredients, logistical challenges, and the need to expand manufacturing capabilities can create bottlenecks in the supply chain, driving up costs and slowing market growth.

Future Outlook for Plant-Based

Above all else, it’s important to understand that plant-based isn’t a single product category but an attribute across the store. This means that the growth of plant-based will be possible across a diverse range of categories as long as brands are aware of and acting on evolving consumer preferences. Identifying how consumers feel about plant-based products, how they fit into larger market trends, and how to capitalize on them will be key to seeing success.

Sustainability has emerged as a key driver of growth in the plant-based industry, with more consumers recognizing the environmental benefits of shifting towards plant-based diets. As concerns about climate change and environmental degradation continue to rise, consumers are increasingly seeking out food options that align with their values of sustainability and responsible consumption. For many, choosing plant-based alternatives is not only a health-conscious decision but also a way to reduce their personal impact on the planet. Brands that effectively communicate their sustainability credentials are well-positioned to attract environmentally conscious shoppers and build lasting loyalty in the marketplace.

The plant-based industry also holds tremendous potential for innovation as brands continue to push the boundaries of product development to meet evolving consumer demands. As technology advances, there are exciting opportunities to improve both the taste and nutritional profile of plant-based products, making them more appealing to a broader audience. Beyond the products themselves, innovation in packaging, sustainability practices, and personalized nutrition are shaping the future of the plant-based sector. Brands that invest in R&D and embrace cutting-edge technologies will be well-positioned to lead the next wave of plant-based growth.