Plant-based Diets are Here to Stay! Understanding Consumer Motivations and Desires Driving Today’s Hottest Megatrend Greg Paul, PhD, MBA June 5, 2019 Why are plant-based diets here to stay? Firstly, consumer demand as over half US consumers are increasing plant and nearly 60% cite the change as permanent… 41% I know it’s permanent. 31% 29% 18% 11% I’m hoping it’s permanent but I’m not sure yet if I will keep it 26% up. Exclusive Animal Exclusive Both Reducing Neither Reducing Reducer/Avoider Plant Increaser Animal/Increasing Plant Animal/Increasing Plant I’m going to try it for a while and 28% No Change then see how I feel about it. Increasing Increasing in Plant No Change Plant Plant in Plant ------------- No Change Avoid Reduce No Change in Animal Animal Animal It may not last. I’m just in Animal 14% exploring. HealthFocus International, 2017 Why are plant-based diets here to stay? Secondly, follow the $$$ including incredibly strong retail sales growth and strong interest from the investment community. State of the Industry Report: Plant-based Meat, Eggs, and Dairy. The Good Food Institute, 2019. Plant-based Behaviors & Motivations: Online Anthropology MotiveQuest Online conversations in English (January 2016 – November 2018) Consumer Cohort Exploration: Interest in plant-based dietary philosophies and substitutions is primarily driven by a quest for wellness and fitness, with half of conversation coming from general wellness and lifestyle venues online. 40% CONTEXT PLANT-BASED INTEREST ACROSS CONVERSATION CONTEXTS During this 35 month period, consumers 1/1/2016-11/30/2018 generated approximately 21 million conversations 31% about meal planning and dietary decisions 30% overall. Just under 7% of these conversations specifically referenced plant-based dietary choices, brands, and products. 20% 17% BASED DIET DISCUSSION DIET BASED - 13% 10% 10% 8% 6% 5% 5% 3% SHARE OF SHARE PLANT 1% 0% Wellness & Lifestyle Health & Parenting & Hobbies & Style & Culture Cooking Causes & Budgeting & Reviews Fitness Medical Pregnancy Pursuits Politics Money N=2,151,515 Source: MotiveQuest, January 2019. Analysis of forums, blogs, message boards, review sites. The extreme gets people talking. But, more people self-identify as the “moderate middle,” gradually reducing meat and dairy consumption when convenient. This moderate middle is reluctant to adopt labels for their behavior. TOPICS OF DISCUSSION vs SELF-IDENTIFIED RELUCTANT TO PARTICIPANTS ACCEPT LABELS 1/1/2016-11/30/2018 Veganism 47,9% “I guess I could call myself a flexitarian. 10,9% I do eat meat weekly, but in very little amounts. This didn't happen as an Vegetarianism 23,6% 14,9% overnight choice, just gradually developed like this with the Dairy Reduction, Elimination 21,7% 41,8% development of my knowledge about environment, health and ethics issues. Meat Reduction 16,3% 27,2% There's still a lot of things I'm not sure about (mostly the lack of transparency Egg Reduction, Elimination 1,6% 4,8% about food frustrates me), but I feel good Share of discussion about these regimens about my diet and I end up buying mostly Flexitarianism 0,6% 0,3% Share of conversants who say they follow these regimens seasonal veggies and the little animal products I buy at least say they're 0% 10% 20% 30% 40% 50% 60% biological.” SHARE OF CONVERSATION/INDIVIDUALS N=2,151,515 conversations; 427,594 individuals who self-identify Source: MotiveQuest, January 2019. Analysis of forums, blogs, review sites, and message boards. Motivations: Overall, moderates’ motivations to reduce meat, eggs, and dairy are personal and wellness-focused. Animal welfare and the environment are distant secondary benefits. Vegans are the opposite, leading with political and institutional change. THEMES & DRIVERS OF BEHAVIOR ACROSS CATEGORIES 1/1/2016-11/30/2018 DAIRY 1,9% INTOLERANCES Allergies, Intolerance 19,2% 1,7% 7,5% “I have qualms about soy milk, but that's 2,6% provided by daycare and has more Wellness, Feeling Better 17,4% 12,1% calories. What have you all used as a Vegans 9,5% milk substitute [due to allergies]? WIC Dairy-Reducers 9,8% provided checks for goat's milk, but I Environmental Concerns 2,7% Meat-Reducers 4,1% read that the protein in that is very 3,4% Egg-Reducers similar to cow's milk and can cause a 20,9% similar reaction.” Animal Welfare 2,2% 2,9% 3,5% 0% 5% 10% 15% 20% 25% SHARE OF CONVERSATION N= 466,879 dairy-free, 350,697 meat-free, 34,424 egg-free Source: MotiveQuest, January 2019. Analysis of forums, blogs, review sites, and message boards. Meat Alternatives Flexitarianism close-up: Flexitarians resist labels. Red meat reduction tends to be the focus, and is motivated by increasing awareness of the health benefits of reduced meat consumption for general health and wellness, followed by secondary environmental benefits. WHAT IT MEANS: “My wife and I have Reducing meat OPTING decreased our meat intake (mostly red TOWARD: consumption from 2- meat). Reduction Plant-based 3 times per day to 2- may be significant or substitutes such as moderate, but is beans and tofu. 3 times per week usually measured by and it's been days per week. surprisingly easy MOTIVATIONS: [but we don’t call Motivated primarily by a desire to feel better and ourselves achieve better health, flexitarians]” environmental concerns are a secondary reason to reduce meat consumption. “Flexitarian? Dear NOT A FAN OF LABELS: me…. Youngsters Because flexitarianism is SOCIALLY nowadays. Always intentionally moderate and PRAGMATIC: need a label.” flexible, adherents are Reduction without reluctant to use labels to fanfare is socially define their changing habits. acceptable and practical. Source: MotiveQuest, January 2019. Meatless priorities: Meatless products have enjoyed recent hype generated by Impossible and Beyond brands. Consumer attention focuses on taste and enjoyment, with some acknowledgement of products’ processed nature. These products are not consumed daily, however. TASTE, EXPERIENCE: Heavy emphasis on taste. HEALTH: Mixed bag on health – good alternative source of protein, USAGE: but recognized as a Not used daily, but processed food with rather as an non-clean label occasional ingredients. replacement for meat, or to add variety to the rotation of non-meat Source: MotiveQuest, January 2019. dishes. Brand relevance: Meat reducers have strong interest in a number of meatless brands, particularly Beyond Meat, Gardein, and Tofurkey. 2,4% Beyond Meat 0,4% 2,4% Gardein 0,4% 2,2% Tofurkey 0,3% 1,6% Impossible Burger 0,2% 1,0% Silken 0,1% 0,9% Boca 0,1% 0,9% FieldRoast 0,2% 0,5% MorningStar 0,1% 0,3% Lightlife 0,0% 0,3% Yves Veggie 0,1% 0,2% Simply Balanced 0,0% 0,1% Frieda's (Soyrizo) 0,0% 0,1% Gardenburger 0,0% 0,1% Meat - Sweet Earth 0,0% 0% 1% 2% 3% Source: MotiveQuest, January 2019. Brand relevance: Consumers are sensitive to personal preference, and there is no single “best of” meatless product. Texture is a consistently-cited problem though. Many meatless products are too crumbly, too dry, and hard to cook with. MEATLESS BRAND PERCEPTIONS 1/1/2016-11/30/2018 “The problem with all meat substitutes, including those marketed as meat substitutes is they simply aren't. And that's okay. Nobody orders turkey and then complains that it's Perceptions not chicken. The texture is different. The taste is different. I Texture a bit too crumbly to approximate the meat enjoy a Boca burger. But I don't get upset that it has a different Beyond Meat experience, but taste is good. texture and taste than beef. It's a different product, a different protein.” Gardein Uncanny “just like chicken” taste. Tofurkey “Different” taste; not just like the real thing though. “Honestly though, it's the texture of the [Impossible] burger and the embedded pockets of oil that do a lot more Excellent, juicy texture (consumers note this is due to oil for it. What they're doing is fantastic, especially once they Impossible content – puddles of oil on the plate are not uncommon). figure out how to get this produced at scale. While this won't change someone from a die-hard meat eater to a vegetarian, it Well-known and widely available, but many complaints Silken will help people consume less meat.” that it is just too hard to cook with. Broad awareness and familiarity, but not a lot of love. A number of restaurants (Bennigans, Red Robin) have Boca “Tofurky Italian Sausage - so good for sausage and peppers. switched away from Boac to Morningstar and other Boca Chicken Patty - by far my favorite chicken patty so far. brands. Gardein Pulled Pork Pockets - soooooo good, it's really so Extremely positive sentiment among vegans. Praise for close to the real thing. They also have pepperoni pockets that Field Roast crunchiness, spiciness, and tenderness. Less well-known are good as well. Gardein Chicken Tenders - great texture, by flexitarian meat reducers. great coating, amazing” Source: MotiveQuest, January 2019. Methyl Cellulose and Xanthan Gum are the most popular binding agents used in Meat Substitutes Stabilizers appearing in 2018 US Meat Substitute Launches as a Percentage of Launches Containing Stabilizers Methyl Cellulose 40% Xanthan Gum 22% Konjac 11% Alginate 11% Gum Arabic 6% Cellulose Gum 6% Gellan Gum 5% Carrageenan 5% Source: Innova Market Insights, February 2019. Plant-based Beverages Priorities: Taste, Flavor is consistently consumers’ biggest non-dairy substitute priority, but there is less comparison with dairy/cow milk than there used to be. Thickness and creaminess discussion has grown by about 20% since 2016. MAJOR THEMES TASTE, FLAVOR: Still the most important selection criterion to consumers, people are less likely to make comparisons between the taste of PBBs and the taste of dairy milk than they were just three years ago.