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As consumers become more health-conscious, the demand for plant-based diets has increased. Plant-based diets have become more popular due to their health benefits, sustainability, and animal welfare concerns.
This trend has presented an opportunity for Consumer Packaged Goods (CPG) companies to adapt their product offerings and cater to the growing demand for plant-based diets. However, there are also challenges that these companies face as they try to meet the needs of their customers.
This blog discusses the opportunities and challenges that CPG companies face in the context of plant-based diets.
Opportunities for CPG companies
The rise in demand for plant-based diets presents an opportunity for CPG companies to increase their market share. According to a report by Grand View Research, the global plant-based food market will reach $71.3 billion by 2030, growing at a CAGR of 12.7%. The report findings show an opportunity for CPG companies to expand their product offerings and capture a larger market share.
CPG companies can improve their brand image and appeal to a global audience by offering plant-based products. Consumers are increasingly concerned about the environmental impact of their food choices, and offering plant-based products can help companies demonstrate their commitment to sustainability and reducing their carbon footprint.
CPG companies can diversify their product offerings by introducing more plant-based options. Introducing plant-based options will appeal to a bigger audience and cater to consumers looking for healthier and more sustainable food options.
Diversification can also help companies reduce their reliance on traditional animal-based products, which tend to be subject to fluctuations in demand and supply.
Challenges for CPG companies
One of the biggest challenges that CPG companies face in the context of plant-based diets is product formulation. Formulating plant-based products that are both nutritious and appealing to consumers can be difficult.
Companies should invest in research and development to ensure their products meet consumers' nutritional needs while being flavorful and appealing.
Plant-based products can be more expensive to produce than traditional animal-based products. The primary cause of high production costs is the cost of raw materials and research and development.
As a result, some consumers may be reluctant to pay higher prices for plant-based products, making it difficult for CPG companies to achieve profitability.
Despite the growing popularity of plant-based diets, some consumers may still view plant-based products as inferior to traditional animal-based products. As a result, convincing consumers to try their plant-based products becomes challenging for CPG companies.
Companies need to invest in marketing and education to help consumers understand the benefits of plant-based diets and the quality of their products.
The rise in demand for plant-based diets presents an opportunity for CPG companies to expand their product offerings and capture a larger market share. However, there are also challenges that these companies face as they try to meet the needs of their customers.
Companies should invest in research and development, marketing, and education to overcome these challenges and succeed in the plant-based market. By doing so, they can improve their brand image, diversify their product offerings, and appeal to a larger audience.
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