Over the last decade, meat alternatives have evolved from a niche product to a billion-dollar industry. The initial rise of plant-based options promised a revolution in how we consume food, aligning with growing concerns about the environmental, health, and ethical implications of meat consumption. Yet, despite reaching $1.3 billion in sales in 2020, the meat alternatives category has faced significant challenges in recent years. The latest report by Circana highlights the struggles and opportunities that lie ahead for this sector. Let's look into the findings of that report, examining whether plant-based meats can still capture the hearts—and wallets—of the average consumer.
A Declining Market or a Maturing Industry?
At first glance, the Circana report offers a sobering snapshot of the plant-based meat market: after a meteoric rise in 2020, sales have steadily declined for three consecutive years, dropping to $1.1 billion in 2023, a nearly 11.4% reduction compared to 2022 . This downturn might seem alarming, but it’s essential to view it through a broader lens. Pre-pandemic sales were even lower, and despite recent declines, today’s sales figures still outpace those from 2019. What we’re witnessing could be seen as a market correction—a shift from novelty to normalization, as consumer expectations and market conditions realign.
The Price Problem
One of the most significant barriers to continued growth is the price gap between meat alternatives and traditional meat. On average, plant-based options cost $4.20 more per pound than their animal-based counterparts, a stark contrast that’s hard to ignore amid rising inflation and grocery prices. For budget-conscious shoppers, this premium can be a dealbreaker, particularly when traditional meat prices remain competitive and deeply ingrained in consumer shopping habits. While consumers might be willing to pay more for perceived ethical or environmental benefits, brands will need to work harder to justify this price disparity.
Innovation and Value: The Way Forward?
The Circana report stresses that “value” in the meat alternatives category must be clearly defined, and it cannot rely solely on being a sustainable or ethical choice. In today’s market, convenience, taste, and nutrition are just as vital, if not more so, for most consumers . Brands that deliver on these fronts could turn the tide. For instance, some brands like Beyond Meat and Meati have maintained momentum by introducing convenient, flavor-forward options that cater to changing consumer needs.
Innovation is already playing a crucial role. Meati, a company producing mycelium-based meat, has become one of the top-performing brands by offering alternatives that are not just meat substitutes but entirely new categories of food. This shift in positioning—from mimicry to culinary innovation—could be a critical strategy for revitalizing consumer interest.
The Shift from Frozen to Fresh
One particularly telling insight from the report is the strong preference for frozen meat alternatives, which account for 70% of the market . Yet, there’s significant crossover, with 29% of consumer buyers purchasing both frozen and fresh products. Fresh meat alternatives, however, are seeing declines, with buyers falling off faster than frozen counterparts. Retailers have begun paring back their fresh meat substitute options, focusing instead on more successful frozen products. But why?
One explanation could be the convenience and longer shelf life of frozen items, making them a more practical option for consumers who are still experimenting with plant-based products. Still, the decline in fresh alternatives may indicate that these products have not been able to compete with the taste or cooking experience that fresh meat offers. This is a crucial area where innovation must take hold if plant-based meats are to expand their reach in the future.
Who’s Buying?
The data shows that the typical buyer of plant-based meat is skewed toward millennial and Gen X households with higher incomes. These demographics are more likely to be environmentally conscious, health-focused, and experimental in the kitchen.
Millennials and Gen Z are often described as “more experimental in the kitchen,” but the reasons behind this are multifaceted. Unlike older generations, who may have more entrenched food habits, these younger consumers have grown up during a time of globalization and unprecedented access to diverse cuisines. Thanks to cooking shows, food blogs, and social media platforms like Instagram and TikTok, they have been exposed to a broader range of ingredients, techniques, and cooking styles. This cultural backdrop encourages them to try new things, including plant-based alternatives, even if they aren’t highly skilled cooks.
In many cases, millennials and Gen Z are still in the process of discovering their culinary identities. They may not yet have settled into a fixed cooking style, which makes them more open to experimenting with new products and recipes. Their willingness to engage with new trends, from vegan diets to meatless Mondays, reflects a generation eager to explore and redefine what they eat. This fluidity makes them particularly receptive to plant-based products, especially those marketed as convenient and easy to integrate into everyday meals.
Another factor is these generations’ comfort with technology and access to information. With a wealth of tutorials, reviews, and recipe inspiration available at their fingertips, they are empowered to experiment in the kitchen without feeling overwhelmed. This access to a community of fellow food experimenters and influencers makes trying new products less intimidating.
However, despite all the above, the frequency of purchases from this demographic has dropped. Heavy buyers, who represent 75% of dollar sales, are dwindling faster than lighter buyers. These are the customers who once made plant-based meat a routine part of their diets, but they’re now either scaling back or abandoning the category entirely.
The challenge, then, is clear: retention. If the industry is to regain its growth trajectory, it must keep go beyond convenience and exposure, millennials and Gen Z are deeply motivated by values like health and sustainability. This generation is more likely to seek out products that align with their ethical and environmental concerns, which often leads them to plant-based alternatives. Even if they haven’t fully developed their cooking skills, their commitment to healthier and more sustainable eating habits drives them to experiment with alternative proteins and meat substitutes.
By targeting these buyers with innovative, convenient, and value-driven products, brands can tap into this generation’s openness to experimentation and align with their broader lifestyle and ethical values.
Beyond Meat and the Rest: Winners and Losers
Interestingly, while many brands have suffered from the overall decline, a few players are bucking the trend. Beyond Meat, for example, continues to show growth, thanks to a mix of co-branding efforts, such as its partnerships with fast-food chains, and its constant push for innovation . Other brands, like Meati and Abbott’s, have similarly managed to increase their sales by focusing on specific niches, like clean ingredients or premium flavor experiences.
However, many smaller brands have not fared as well. Since 2020, the number of meat alternative brands in the U.S. market has fallen by 28%, dropping from 116 to 83 . This market consolidation suggests that the category is maturing, and only those that can differentiate themselves—through innovation, marketing, or partnerships—are likely to survive.
What Next? Challenges and Opportunities
The challenges facing the meat alternatives industry are significant, but they are not insurmountable. Retention, pricing, and innovation are the three key areas that brands must focus on. Here’s what the future could hold:
- Value-Based Marketing: Beyond justifying the higher price tag, brands need to focus on what value they bring to the table. For some consumers, this will be about taste and convenience. For others, it’s about aligning with their values—whether that’s health, sustainability, or animal welfare. Clear, transparent communication will be essential.
- Convenience Is King: Consumers are looking for products that make their lives easier. Innovations in packaging, preparation, and recipe inspiration will be crucial in keeping plant-based meat relevant in today’s fast-paced world.
- Moving Past Meat Analogs: As companies like Meati have demonstrated, the future of plant-based alternatives may lie not in trying to mimic meat but in offering something entirely new. Consumers are more open than ever to novel food experiences, and this could be a pivotal moment for plant-based brands to lead the charge in food innovation.
- Localized Strategies: Adoption of plant-based meat alternatives varies significantly across regions in the U.S., with cities like Portland, OR, and Atlanta, GA, showing higher engagement than regions like Mississippi. Brands can tailor their marketing and product offerings to suit local tastes and preferences.
Conclusion: Can Meat Alternatives Still Succeed?
In conclusion, the meat alternatives market is at a crossroads. It has moved past the initial hype and novelty that drove its early growth, and it now faces the reality of maturing within a highly competitive and price-sensitive marketplace. Yet, there’s still immense potential. While the market may be shrinking, those brands that innovate and redefine value for consumers can thrive. The question is no longer whether plant-based meat alternatives can win over consumers—they already have. The challenge now is keeping them.
For policymakers, retailers, and brands, the imperative is clear: they must collaborate to make plant-based alternatives more accessible, affordable, and attractive. If we are serious about addressing climate change, food insecurity, and public health, the success of this industry is not just desirable—it’s essential.
Read the report here.
