Dive Brief:
- Kroger announced a new private label collection, Simple Truth Plant Based. The line will include fresh meatless burger patties and grinds along with plant-based cookie dough, pasta sauces, sausages, deli slices and more, Gil Phipps, Kroger's vice president of Our Brands, said at the Good Food Conference in San Francisco.
- New product introductions will roll out to 1,800 of Kroger's roughly 2,800 stores this fall. The company notes Simple Truth Plant Based will feature an easy-to-identify icon that will show up on packages and on Kroger.com. A team of nutritionists, food scientists and chefs collaborated to create the recipes.
- Simple Truth currently brings in more than $2.3 billion annually and includes 1,550 organic and natural products.
Dive Insight:
Numerous retailers have added plant-based foods to their shelves, but very few have invested in private label products in the booming field. With this move, Kroger hopes to cash in on the meatless trend and boost its overall standing among health-minded consumers.
Simple Truth Plant Based covers a range of core categories across perimeter and center-store aisles. This includes a meatless burger patty made from pea protein that will go head to head with the Beyond Burger, made by Beyond Meat, which has taken flight following its IPO this spring. Kroger plans to price its patties below the Beyond Burger but won't say how much, according to The Wall Street Journal.
A report from UBS predicts plant-based sales will grow by 25% annually, reaching $85 billion by 2030. According to a study by OnePoll, one in three U.S. consumers is adding more plant-based alternatives to their diets and reducing their intake of dairy and meat.
During the presentation at the Good Food Conference, Phipps noted that these "flexitarians" are the target audience for Simple Truth Plant Based.
"Our customers are really open right now to exploring plant-based alternatives, and we're responding with our new collection," Phipps said.
The launch adds another dimension to Kroger's Simple Truth line, building on the trust it has gained with consumers since its launch in January 2013. In addition to expanding the line throughout the store, Kroger has begun offering Simple Truth products to other retailers like Walgreens, Lucky's Market and China's Alibaba. The store brand is quickly becoming a name to rival the Kroger brand itself.
The ultimate payoff for Kroger here would be increased loyalty from affluent consumers who value plant-based products. But that will depend on the flavor and value consumers find with the products. It'll also hinge on the competition, which has been ruthless to Kroger lately. Aldi offers a line of meatless foods under its Earth Grown brand, including a variety of veggie burgers.
As the plant-based trend advances, other retailers will likely jump aboard with private label lines, meaning Kroger will need to heavily promote the line in order to carve out a leading position in the red-hot space.
