The global food and beverage industry is currently experiencing an exemplary level of technological disruption, propelled by the profound growth of the trending plant-based food and beverage alternatives. Plant-based food and beverages products use the biomimicry approach to replicate the taste and texture of the animal-derived product. Health and wellness, food safety, environmental sustainability, animal welfare, adopting restrictive diets due to preferred lifestyle choices, and increasing population of flexitarian consumers are the key factors propelling the growth of plant-based food and beverage alternative products globally. According to the analysis by BIS Research, the plant-based food and beverages alternatives market is expected to grow at a noteworthy CAGR of 13.82% during the forecast period from 2019 to 2024.
Demand for plant-based food and beverage products is currently evolving in the form of plant-based dairy, plant-based meat, and others (plant-based eggs, egg replacers, creamers, and spreads). These products are derived from different sources of protein, such as soy, pea, almond, corn, wheat, flaxseeds, and others.
Following are the key factors leading to the growth of the plant-based food and beverages industry: -
Companies Attracting Huge Investments in the Plant-Based Food and Beverages Industry
The plant-based products industry is observing increased participation of disruptor companies that are launching innovative products into the market to meet the escalating consumers’ demand for healthy and sustainable food options. Food giants such as Tyson Foods, Perdue Farms, Smithfield Foods, DANONE, and Nestle, along with a different set of companies such as Walmart, IKEA, and Marks and Spencer, are investing significantly in the plant-based food and beverages alternatives market. These companies are actively partnering with retail chains to increase the global reach of their products.
Plant-based meat companies have received significant investment rounds from venture capital investors since 2017. For instance, in February 2020, Alpha foods received series A capital funding of $28 million. Additionally, in January 2020, the plant-based beverage company, Califia Farms received $225 million funding by the Qatar investment authority. These are some of the latest investments happening at a rapid pace in the plant-based food and beverages industry at a rapid pace. The overall investment scenario of plant-based food and beverages alternatives market is depicted in the following figure:
Source: Secondary Sources and BIS Research Analysis
Innovative Product Launches
The plant-based food and beverages alternatives market comprises major companies providing food types such as plant-based burgers, plant-based sausages, plant-based cheeses, plant-based dips, plant-based creams, plant-based yogurts, and plant-based scrambled eggs.
Major players operating in the plant-based food and beverages alternatives industry include companies such as Daiya Foods, Blue Diamond Growers, Impossible Foods, Beyond Meat, Inc., Quorn Foods, Tyson Foods, Conagra Brands, Inc., Amy’s Kitchen, and Blue Diamond Growers.
The emerging strategies and developments in the plant-based food and beverages market are surging in the form of product launches and developments. For instance, in February 2020, Ripple Foods launched its line of plant-based dairy-free ice cream. In January 2020, Impossible Foods, the brand behind the popular Impossible Burger 2.0, unveiled plant-based pork and sausage at the CES 2020, in Las Vegas. Additionally, in May 2019, Danone S.A. had launched low-calorie dairy-free vegan ice cream in three flavors. Major food companies such as Nestle SA and Conagra Brands Inc. are making their own plant-based burgers, too.
Starbucks and Erbert & Gerbert's are the latest companies set to join the plant-based food rage. In January 2020, they have introduced more products to their menu that recognizes the shift toward healthier food options. Additionally, America’s plant-based beverage brand, Silk, in January 2020, added DHA Omega-3 plant-based beverage to the list of its products. It is a unique blend of oat milk, almond milk, and pea protein.
Plant-based food and beverages alternatives market is growing over time, compelling companies to come up with collaborative strategies in order to sustain the intensely competitive market. For instance, in January 2020, Nestlé formed a partnership with two Canadian plant-based food companies Burcans NutraScience and Merit Functional Foods. This partnership is aimed to help Nestle to accelerate the development of the company’s line of meat and dairy alternatives, which are healthy and eco-friendly.
Popular Adopters of the Plant-Based Diet Further Forging Growth of the Industry
Several athletes have also realized the benefits derived from a plant-based diet. The tennis athlete Novak Djokovic who won the Wimbledon finals recently revealed that plant-based and gluten-free foods such as green-juices powered him through Wimbledon. The tennis legend herself, Serena Williams, also believes in eating a vegan diet. In December 2017, she invested in Daily Harvest, a U.S.-based frozen plant-based foods company. Also, in August 2017, Bill Gates and Li Ka-Shing invested in Impossible Foods, a U.S.-based start-up, for creating a “bleeding” plant-based burger (because of its signature blood-red color).
Comprehensive Regional Landscape
North America gained a major portion of the plant-based food and beverages market share in terms of the revenue generated in 2018, followed by the Europe region. The region has been experiencing a rapid growth rate in the particular industry the past few years, owing to the increasing environmental concerns, growing vegan population, growing preference for meat alternatives, increasing demand for healthy and nutritional products, and the health and wellness trend being followed in region.
Asia-Pacific is an emerging region in the plant-based food and beverages industry. The region is inclusive of one of the largest vegetarian populations in the world, which is expected to create several opportunities for companies in the plant-based food and beverages alternatives industry. The opportunity for growth for plant-based food and beverage products is increasing massively, as the demand for meat continues to increase. The companies that are entering the region are focusing on developing their brand capability to enhance their presence across the region.
Food of the Future
The plant-based food and beverages are in quite a primary stage of their life cycle currently; however, with the exponential level of new product developments and ongoing investments, the demand for plant-based food and beverages is likely to increase manifold. The massive benefits derived from the consumption of plant-based products promise rapid growth of the plant-based food and beverages alternatives market and opportunities for the market players thereon.