Beyond Meat Reports 31% Drop in Revenue as Demand for Plant-Based Products Declines
The vegan food company, Beyond Meat, has announced a significant decline in revenue, with a drop of nearly 31% in the three months leading up to the end of June compared to the previous year. This decrease in revenue comes despite price cuts on its plant-based burgers, sausages, and other products. The company’s shares also fell by 10% on Monday.
One of the main factors contributing to this decline is the ongoing cost of living crisis, which has led consumers to opt for lower-priced animal protein over plant-based alternatives. Additionally, there is ambiguity surrounding the benefits of plant-based alternatives, which is impacting the growth of companies like Beyond Meat. CEO Ethan Brown addressed this issue in a call to investors, stating that interest groups have successfully created doubt and fear around the ingredients and process used to create plant-based meats.
Beyond Meat is facing challenges in appealing to new customers due to perceptions that its products are unhealthy and overly processed. To address this, the company has launched an advertising campaign to better explain its “clear and simple” manufacturing process and highlight the health credentials of its products. Brown emphasized the importance of education and stated that the facts regarding the health benefits of their products are strong.
In an effort to change perceptions about plant-based food, Beyond Meat has reached out to some competitors to discuss potential collaborations on advertising. The company is determined to be more aggressive in its marketing strategies to overcome the negative perceptions surrounding its products.
Price Cuts and Revenue Forecast
Beyond Meat has been “testing” price cuts to attract customers by offering its core products at a price point that is equal to or below their animal protein equivalents. As a result, the company has adjusted its revenue forecast for 2023 to be between $360 million and $380 million, compared to previous expectations of up to $415 million.
In Europe and the UK, Beyond Meat has partnered with McDonald’s to produce plant-based burgers and nuggets. However, these products are not currently available in the US. Brown expressed his expectation that US fast food restaurants will soon add plant-based options to their menus.
Last year, Beyond Meat announced job cuts in an effort to save approximately $39 million in costs.
Despite the challenges faced by Beyond Meat, the company remains committed to promoting the benefits of plant-based alternatives and is determined to regain its market share through strategic marketing and education initiatives.