According to a McKinsey report, the market for alternative protein is valued at approximately $2.2bn compared with a global meat market of approximately $1.7 trillion. Given that the market for meat has been around significantly longer than the market for alternative proteins, this shows impressive growth from a relatively new segment. The opportunities in the plant-based and alternative protein innovation space are endless. As the category makes the move towards becoming mainstream and looks beyond the traditional vegetarian and vegan consumer base.
The general consensus on the main drivers of demand for these new products is very dependent on your location but the top 3 drivers, at least in the US and European markets seem to be based on:
- Health Reasons
- Environmental Concerns
- Animal Welfare
With these drivers in mind, let’s consider some of the key areas for opportunity. And the challenges still facing the alternative protein innovation space as we move into 2021.
Are Alternative Proteins Really Healthy?
As mentioned above, one of the top purchase drivers for consumers in alternative proteins nowadays is health. You will often hear consumers say or read in consumer insight studies that they are looking to reduce their meat consumption or move away from processed foods for these health reasons.
Processed foods have received a bad reputation in recent years. But what people are often actually referring to when they talk about processed foods is ultra-processed products. The majority of our foods and beverages go through some sort of a process. Alternative proteins or plant-based products are no different but this doesn’t automatically mean they are ‘bad’ for us.
What we need to ensure is understood by consumers is that simply putting food or drink through a process does not make it inherently ‘unhealthy’. What contributes to an unhealthy diet is the over-consumption of foods and/or drinks that are lacking in nutritional value. This is true whether it is an “original” protein or an “alternative” protein product.
In a recent LinkedIn post, I asked if people thought that consumers wanted to eat more plants or eat more meat alternatives. One comment of note from respondents was related to removing the word ‘or’ from the question. It shouldn’t be ‘do people want to eat more plants or meat alternatives’. It should be more about finding the balance between both based on each individual’s preferences and nutritional needs.
Sensory Profile Of The Product
We, as food scientists and functional food brand owners, can work to ensure that the products we create in the alternative protein and plant-based space are highly nutritious. And contain as many valuable nutrients and ingredients as possible. A good example is discussed in this article about Enriching Milk with Nutritional and Multifunctional Fibres.
When recreating products in a plant-based format, there are many aspects to take into account. You first have to build the basic sensory profile (see image below) of the product including the size, shape, flavour, colour etc. and make sure that it is nutritionally sound with ingredients and nutrients that complement each other well.
Improving the nutritional profile of alternative protein products is not without its difficulties. Reformulating the recipe of a product or attempting to recreate an existing product in an alternative way can lead to a number of R&D challenges. These can include creating the right texture, mouthfeel, and possibly most importantly from a consumer purchasing and experience perspective, taste.
New Ingredients Enter The Market
Angel Yeast is an example of an ingredient that has been created to help with one of the main challenges that plant-based and alternative protein brands face when it comes to NPD. It aims to get rid of the typical off-notes that the majority of plant proteins are known for. The yeast extract is full of amino acids, nucleotides, and polypeptides as well as flavour peptides and other substances that help to neutralise the unpleasant off-notes of alternative proteins and balance the overall taste profile.
We will likely see more similar functional ingredients launching in the market as alternative protein innovation moves into the mainstream space. So keep an eye out or get in touch if you would like help sourcing the ideal ingredient(s) to make your alternative protein product perfect.
Innovation is what can set brands apart from their competitors. And it is something that challenger brands, in particular, can invest in so as to stand out from the crowd and eventually move into a top of mind position. From a retail perspective, it is also in their best interests to offer as much variety for their customers as possibles so as to ensure continued footfall in their stores by satisfying demand.
Alternative Protein Segments
Alternative protein brands in 2021 will be looking at new types of plant-based and lab-grown ingredients. The focus will be on creating alternative proteins which cover three key segments: meat, dairy, and seafood. The latter of which is on the list due to increasing consumer and industry concerns regarding overfishing and water pollution, as well as mercury consumption and micro-plastics.
When looking at which ingredients to include in your plant-based or alternative protein product, it is good to think functionally. By choosing ingredients that offer multiple benefits, you are maximising the offering that you give to your customers (as illustrated in the image below) and by doing so are likely giving them a better, more nutritionally-rewarding experience.
When customers feel better when consuming your product, it is more likely to lead to a repeat purchase.
Some popular and functional ingredients that are becoming popular in alternative protein innovations include:
- Chicory Root Fibre,
- Jackfruit, Hemp,
- or even Oats.
This is obviously a very selective list. And there are many, many more excellent ingredients to consider depending on your project and brand needs.
Alternative Protein Innovation Can Be Pricey But Worthwhile
The below graph from McKinsey illustrates an overview of comparative prices for popular alternative protein sources. Cultured meat is still the most expensive in comparison to whey and two of the most common plant-based protein options (soy and pea). With more research and development being carried out in this area, and more funding as consumer demand increases, cultured meat will likely become a more financially viable alternative protein source for more brands in the future.
The demand and expectations for a higher quality of alternative proteins is constantly increasing.
Competition in the sector is also on the rise. However there is still fierce room for growth from challenger brands who focus on innovation when developing their plant-based products. The SNO ice cream brand is a great example of a small challenger brand using innovation to try and outperform big food in a highly competitive market.
Innovation in alternative protein ingredients is further driving innovation in alternative protein consumer products across the globe. With the goal of satisfying consumer demand for improved products for health, the environment and the animals.
To accelerate your alternative protein innovation project and get your product to market in the most effective and affordable way for your brand, book a consultation to discuss what success looks like for you in this area and how I can help you get there.