As consumers feel the pinch, could the cost-of-living crisis put a stop to the vegan drink movement? Rachel Badham reports
After years of veganism and socially conscious beverages being the next big thing, the force of inflation could be about to tip the scales. As the rising cost of living puts pressure on Britons, affordability is becoming a deal breaker for concerned consumers.
In April 2022, FMCG Levercliff Data Analyst found that the majority of consumers (71%) prioritize value over sustainability when shopping for food and beverages. As energy prices rise and interest rates rise, 36% of consumers said their purchasing choices were driven by the need to have a budget, rather than a desire to choose ethically produced and energy-conscious items. environment.
With Adrian Hirst, CEO of vegan lager at Skinny Brands, saying it’s “inevitable” that the cost-of-living crisis will affect purchasing behavior as consumers look for more affordable options, should vegan beverage producers and the retailers that sell them are concerned. ?
Paul Crawford, founder and CEO of Panther M*lk, a vegan-friendly alcoholic RTD made with oat milk, is confident that those on an entirely plant-based diet will continue to engage with vegan beverages for their environmental benefits, saying: “Vegans will not compromise their integrity as the current climate emergency is not going to go away.”
However, he raised concerns about the cost-of-living crisis and its implications for both the vegan beverage industry and the environment, as consumers who might otherwise be tempted to venture into veganism begin to adjust their accounts.
“If people start choosing less sustainable products because they can’t afford to do otherwise, we really are in a scary downward spiral.”
THE PRICE POINT DEBATE
Skinny Brands’ Hirst says, “When consumers transition to veganism due to a number of factors, they are often willing to pay more for products that align with their beliefs.”
While it seems that vegan consumers are unwilling to compromise regardless of price, the rise of value-focused consumers begs the question: is it true that vegan beverages are more likely to break shoppers out of pocket? And if so, will this deter curious vegan consumers?
When it comes to why vegan drinks can be more expensive, Hirst points out that sometimes making them requires a more intensive production process.
“If vegan drinks are priced higher, it is often due to the extra steps taken to ensure that the process of creating the drink involves more inclusive dietary requirements and sustainable practices,” he says. And beyond production, the lack of government support can contribute to the expense of vegan beverages, as producers must undergo a certification process in order to classify their products as vegan.
“It’s important to remember that many animal by-products are subsidized and vegan products don’t benefit from the same financial support, so you may see an overall price increase in the market for vegan products,” says Hirst.
However, James Halliday, BWS buyer at South Downs Cellars in Sussex, points out that vegan drinks are only likely to command a higher price if they are substitutes for traditionally non-vegan products.
“Most of the vegan products on the market produced as substitutes for non-vegan products tend to be more expensive,” he says. “However, with wine it’s just part of the production process, so the fact that the product is vegan doesn’t tend to affect the price.”
While obtaining vegan certification can be a time-consuming process for producers, vegan beverages can still be labeled vegan-friendly. And as production methods develop, it could be easier than ever to create vegan-friendly beverages without the added expense.
Labid Al Ameri, president and co-founder of Argentine winery Domaine Bousquet, highlights advances in wine production that have eliminated the need for animal products like egg whites.
“Our products are vegan because we don’t need to use any animal waste or animal content in the filtering process. It is no longer necessary.
It also points out that while there may be additional expense with some vegan products, the category is becoming more accessible to general consumers as more brands are able to produce beverages without the need for non-vegan additives.
“Maybe 20 years ago, a lot of people had a bad perception of vegan and organic products. But this perception has changed over the years because there are so many big producers who now have the ability to produce wines that are just as good as what non-vegan drinkers are used to at no extra cost,” says Al Ameri.
After Spar became the first UK grocer to launch a range of own-brand vegan wines earlier this year, Spar UK business manager Matthew Fowkes discovered that vegan doesn’t always equate to a most expensive drink
“From our perspective, price remains extremely important and we have not seen an increase in costs related to the transition to vegan-friendly.”
And for Spar, Fowkes says it’s about balancing “sustainability in our wine range” alongside “great value” to appeal to a wider consumer audience.
“The purpose of making our wine range vegan was not just a focus on vegans, our aim was to make the wine range as inclusive as possible for all older drinking adults,” he adds.
MARKETING OF VEGAN DRINKS
As intermediaries between producers of vegan beverages and consumers wondering whether or not vegan beverages are out of their price range, retailers must consider how to promote these beverages without setting off alarm bells among concerned shoppers.
When value-driven consumers have negative connotations of vegan products, South Downs Cellars’ Halliday says integrating them into an existing range can encourage non-vegan shoppers to experiment with their choices without feeling like they’re straying from their comfort zone. .
“We want customers to be able to browse the full range without feeling like they have to buy products from a dedicated vegan area in the store,” he says. However, the importance of educating shoppers about vegan beverages remains.
Halliday advises retailers to get creative with how they distinguish between vegan and non-vegan beverages so that vegan beverages remain visible without separating themselves from the overall range.
“Not all producers stand out if their wine is vegan, so we do the hard work for our customers. If it’s vegan, the price tag has a yellow tag, if it’s organic, it’s a green tag, etc. It’s simple but effective.”
Domaine Bousquet’s Al Ameri emphasizes that the educational process involves engaging consumers outside of the retail environment: “We always try to collaborate with publications and participate in as many challenges and competitions as possible; those qualifications help give us credibility for the people who They’re not used to it.” to vegan organic wines.”
Fowkes says that Spar made sure to maximize its promotional activity for its new range, while also highlighting the affordability of the wines on offer.
“We supported the launch with digital communications, in-store and online POS, consumer PR including advertorials, influencer activity, media and celebrity outreach to drive customers into Spar stores. We had a selection of wines available for promotion during the first four weeks of the launch, including wines that cost £4.99.”
While it’s not yet clear how the cost-of-living crisis will affect the vegan beverage industry, Halliday says that South Downs Cellars has continued to see a “huge increase in demand for vegan products.”
And despite speculation that value for money may become the final decision for shoppers feeling the financial crunch, Skinny Brands’ Hirst believes vegan drinks are here to stay.
“It is inevitable that the cost of living will alter the way people shop as concerns about finances increase,” he says. “However, with almost 600,000 vegans in the UK as of 2019 according to the Vegan Society, it is clear that veganism is more than just a common shopping option – it is a lifestyle that people commit to.”