DJS Research Ltd

Despite the record number of signs ups to Veganuary this year¹ and 4.1million (14.3%) UK households following a vegan, vegetarian, pescatarian or flexitarian diet in 2023, recent data released by NIQ reveals the plant-based category in the UK is showing signs of a slowdown.

What’s going on? Was veganism just a passing fad, or have consumers just decided they are not ready to give up their bacon butties in 2023?

Our investigations indicate the cost-of-living crisis alongside a desire to eat less highly processed food are the more likely causes.

A recent poll by DJS Research revealed that 42% of consumers are putting fewer items in their shopping baskets and 53% are switching away from more expensive branded items for cheaper own label alternatives. Data from NIQ indicates this behaviour is even more pronounced amongst those who buy plant-based foods, with 73% of these consumers actively trying to make savings on their grocery bill. And according to the 2021 Good Food Institute report, the per-kilo price of plant-based alternatives is twice that of animal meats, so it’s perhaps no surprise that shoppers are becoming more price sensitive in the current economic climate.

Retailers are reporting a similar picture and plant-based ranges have shrunk by over 10% in the past six months across the big four supermarkets. The list of dairy-free and plant-based brands that have reduced the number of vegan products they produce is a long one … Innocent Drinks has discontinued its dairy-free coconut, almond and hazelnut flavoured smoothies, Heck is set to reduce its range of meat-free products from 10 to two², The Tofoo Co. has seen a 42.9% decrease in range volumes, while Unilever’s The Vegetarian Butcher contracted 31.6% of its lines in six months³, the vegan food company Meatless Farm, which was selling £11m worth of its plant-based mince, burgers and chicken breasts in 2021, has announced it will cease trading altogether⁴.

With so many new plant-based product launches and new meat-free brands entering the market in recent years, the plant-based category had become somewhat crowded, so perhaps some casualties are to be expected. However, Mintel reports that sales of meat alternatives are still forecast to “rise over the long term” and data from NIQ reveals that 38% of the UK population plans to replace meat-based meals with a vegan or vegetarian option at least once a week (generally described as flexitarians). This all suggests there is great potential in the category for brands delivering the products consumers want, at a price they are prepared to pay.

And what about the product; Mintel reports that many plant-based products fail to meet consumer expectations, only 31% of Americans who eat plant-based meat substitutes opt for these products because they enjoy the taste. In China, 36% of consumers say they’d eat more plant-based meat alternatives if they were less processed⁵. A scan of the meat-free fridges in the major supermarkets reveals many meat substitute products which are expensive, highly processed and with a low nutritional value; plant-based meat alternatives often contain more sodium than animal meats and some of them contain added sugars and bulking agents.

Brands in the plant-based food category need to ensure the needs and wants of consumers are baked into their product development, brand strategy, marketing communications and pricing strategy. And the brands which deliver healthy and nutritional product innovation, perhaps centred on whole plants rather that highly processed look-a-likes, might just find the answer to growth in this stagnating category.