Plant-based spending behaviors pivot as health motivations sway decisions

02 Dec 2022 --- Ninety-five percent of plant-based consumers have “increased or maintained their plant-based spend versus the prior year,” according to research conducted to understand plant-based shopper behavior and sentiment better.

Kroger collaborated with the Plant Based Foods Institute (PBFI), sister non-profit to the Plant Based Foods Association, to identify whether shoppers are shifting away from their animal-based foods spending and increasing plant-based foods spending and, if so, why. The findings are being presented in a new Plant-Based Foods Migration Analysis Report.

“The research was conducted as part of Kroger’s long-term strategy predicated on listening to their customers. Kroger is committed to learning from consumers and creating the optimal merchandizing strategy for plant-based foods to meet the needs of shoppers best,” says Holly Adrien, natural and organics strategy and innovation manager at Kroger.

Key findings: 

• Customers who buy plant-based foods are motivated by personal health concerns (such as cardiovascular or cancer concerns), and 49% state they believe plant-based alternatives are healthier than animal-based foods.
• In year two, plant-based consumers generally decrease or maintain their spending on animal-based foods, which shows a reversal from year one (COVID timeframe) spending.
• Forty-three percent of plant-based customers increasing or new to plant-based products choose plant-based milks over conventional dairy milk.

The Plant-Based Foods Migration Analysis, part one of the research, measured changes in plant-based customer spending on animal-based and plant-based foods across five categories – milk, refrigerated and frozen meats, frozen meals, cheese and yogurt, and revealed consumer shifts in engagement with each grocery segment. 

In part two, a comprehensive Plant-Based Foods Survey explored plant-based consumer motivations for these shifts. This collaboration between PBFI, Kroger, and 84.51° (a retail data science, insights and media company helping The Kroger Co.), demonstrates a shared commitment to better understand and serve customers looking for plant-based foods. 

These plant-based shopper segments are; New, Increasing, Maintaining, Decreasing and Leaving plant-based foods.Five plant-based categories
The research evaluated purchases by nearly eight million households over two years and categorized shoppers into five segments, ranging from those new to the plant-based category to those leaving the category. 

These segments are; New, Increasing, Maintaining, Decreasing and Leaving plant-based foods.

Year-over-year sales of plant-based foods at Kroger increased by 1.5% from 2020 to 2021, after a 24% increase from 2019 to 2020. 

Findings from the report indicate that plant-based engaged households that purchased plant-based foods from 2020 to 2021 typically decreased or maintained annual spending for animal-based foods. The average plant-based household that either maintained or increased their plant-based foods spending reduced their spending with animal-based foods by up to US$28.21. 

Getting into the shopper’s basket 
One of the ways the impact of plant-based foods can be measured is to understand the displacement of animal-based foods in favor of plant-based foods through comprehensive research, says Julie Emmett, senior director of marketplace development for PBFI. 

“We must remove barriers for consumers by understanding shopper dynamics and taking an evidence-based look to ensure shoppers can easily find their products of choice.”

The study also provides insights into plant-based category performance and offers a blueprint for understanding which plant-based foods are associated with high engagement within the overall category. 

For example, plant-based shoppers who increased their plant-based cheese purchases also had the highest total spending in the plant-based foods category while less engaged with animal-based foods. This means plant-based cheese shoppers are some of the most dedicated to the plant-based lifestyle.

In addition to the observed shift in spending, the research included a survey of plant-based shoppers to understand the motivations behind the changes better. 

Among the Plant-Based Increaser segment, 43% report choosing plant-based milk instead of animal-based milk and nearly 30% choose refrigerated plant-based meat and frozen meals instead of animal-based items in the same categories. 

Among Plant-Based Decreasers that were asked what would make them more likely to consume plant-based, 64% said lower pricing and/or more frequent sales and coupons, and 58% said better taste and/or texture. 

For Plant-Based Increasers, when asked how shopping could be made more accessible, 61% stated price promotions and 29% said that recipes would be helpful.

Notably, Innova Market Insights crowned “Plant-Based: Unlocking a New Narrative,” as a Top Trend for 2023. The rapid rise of the plant-based sector has, almost inevitably, hit some roadblocks, necessitating a refocus on consumer demands for high-quality, flavorful products. No longer merely mimic, green gastronomy will blossom as a standalone sector in 2023, giving brands significant opportunities to diversify and expand. 

Edited by Elizabeth Green