Innovation in the food industry could be set to slow down in the coming years, according to research by Rabobank.
The firm says that while the past decade has seen unprecedented food disruption in the form of innovations such as meat alternatives and animal-free dairy, changing what consumers eat has proven to be more challenging than expected. With the current economic environment leading to limited profitability, fewer disruptive products are likely to be launched over the next few years.
However, innovation will not stop altogether — instead, it will become more incremental. While some disruptive foods will still make it onto shelves, they will be more heavily vetted beforehand, potentially leading to greater long-term success.
Trough of disillusionment
Rabobank has also released another report outlining how plant-based meat could progress from the “trough of disillusionment” — a phase of the Gartner Hype Cycle that sees a decline in the industry following a peak of unrealistic inflated expectations. The trough is typically followed by an upward trend as the technology matures, then an eventual plateau as it gains mainstream adoption and ultimately becomes the dominant technology. This pattern has previously been seen in industries such as solar panels and electric cars.
To move past the trough, Rabobank argues that plant-based producers need to go back to the drawing board, and highlights some key changes that are needed. First and foremost, meat alternatives have gained a reputation for being highly processed, containing few of the nutrients found in whole plant foods. Brands could therefore see success with less processed products that are rich in fiber and other nutrients.
Additionally, while plant-based meats are often marketed based on their sustainability credentials, other factors such as taste, price, clean labels, health, and versatility are also important to consumers and should be emphasized.
Consolidation
Rabobank notes that a consolidation of the alt meat industry now looks inevitable, with some brands likely to retreat. However, the firm predicts that the current headwinds will not last forever, and emphasizes that there is a strong foundation for the category — especially as consumers’ desire for sustainable, healthy, and animal-friendly products remains strong.
“In principle, the ‘task’ for PBMA producers hasn’t changed: offering consumers tasty products, made from ‘clean’ ingredients, that are convenient, flexible to use in different recipes, reasonably priced, and have the additional benefit of being good for the planet and animals,” says Rabobank. “This will require investments in innovation, new products, ingredients, and manufacturing processes. And it will take time and money. Changing consumer behavior takes a lot of effort.”
