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Go-to-market strategy: What do alt protein industry experts say?

Understanding a new market or introducing a new product is challenging and involves a plethora of considerations. That’s especially true for the alternative protein sector, which is still in its early stages of development. We spoke to leading industry experts to learn from their experiences successfully executing go-to-market strategies in a category that is just getting started.

Understand your target market, leverage existing relationships

Have a good product before you make a splash

Dr. Aparna Venkatesh, regional innovation lead at Bühler, says that one of the biggest mistakes many startups make is making too much noise too soon. While drumming up a lot of publicity is important for investors, before companies spend a lot of time and resources marketing their products and businesses, they should first make sure they have developed a good product that has been validated through internal R&D trials, consumer testing, and feedback.

Size isn’t everything: Know what resources you have to leverage in your target market

Maarten Geraets, former managing director of alternative proteins at Thai Union, notes that each country is very different from a go-to-market perspective. “For any country, your consumers are different, your route to market is different, your channels are different. Do you speak their language? Do you have resources on the ground? Do you know distributors that you can partner with successfully?  A big market doesn’t automatically mean that all the companies there are going to succeed. You need to understand the other side really well.”

Crispy mushroom tacos from Fable Food Co

Market similarities can help entering a new one

“The reason for our focus markets of Australia, the U.S., and the UK is the reasonably similar cuisine, and English as the language of communication, which means the packaging doesn’t need significant changes. They are all also big markets,” says Michael Fox, co-founder of mushroom-meat startup Fable Food. He adds that they have also done quite well in Singapore and credits this to the government’s strategic focus on the food sector.

Retail and foodservice channels behave very differently, choose your playground

Choose one service channel to focus on – retail or foodservice

Fox shared that one of the big mistakes they made with their go-to-market strategy was going too wide, too quickly, by trying to do both retail and foodservice channels at the same time. “We pretty quickly realised that the use cases for the product and how it resonates with the end consumers are different in retail and foodservice.” In the foodservice channel, you sell a bulk product to a restaurant chain’s culinary team. The consumer is making the decision of selecting that restaurant chain and selecting what they want to eat from the menu board. However, in retail, as opposed to a restaurant where the consumer is ordering a finished product, they might be starting with a recipe of what they’re going to cook. They are looking for items to go into their recipe. The consumer mindsets of purchasing in retail and foodservice are very different.”

He added that “Fable has slow-cooked, pulled-meat formats. However, in retail, the pulled-meat format is not as commonly purchased by consumers as sausages, patties, minced meat, and nuggets. We realised that consumers didn’t really know how to cook our product. We either had to change the format of the product, or there was a need for deep consumer education. The second path would require huge investments of time and research to understand and educate the customer. Since the product was selling really well in foodservice, we decided to focus our efforts on that channel, and we’ll come back to retail.” Additionally, both channels require different levels of investment in terms of finance, marketing, and team expertise.

Prepare yourself for the struggle of finding a distribution partner in a new territory

Getting the distribution right is challenging and time-consuming

“You’ve got to have customers in order to get a distributor, but it can be difficult to get customers until you’ve got a distributor. It’s a chicken and egg situation,” said Fox. For Geraets, this was one of the challenges they faced in the U.S. “Big distributors want big volumes. But if you don’t have big volumes, they are not going to list you and sell your products. As a result, you end up going to the consumer [retailer] to connect them to the distributor. You are now making two sales efforts, one for the distributor, the other for the customer.”

Try partnering with brands instead of OEMs

Geraets shared that getting your foot in the door may be relatively easier when working with a brand than an unbranded solution or an original equipment manufacturer (OEM). “Brands build a new category, not private labels. The alternative protein category is not ready for OEM solutions yet, in most cases.”

Better Bite Ventures founding partner Simon Newstead suggested doing proper homework before making such decisions. It is worthwhile to explore whether the potential distribution partner has worked with new emerging players in a different category and how it went. “You can reach out to a non-competitive brand and enquire about their experience of working with a particular partner that you are interested in.”

Want to take a deeper dive into GFI APAC’s business insights? Check out our latest report on Southeast Asian consumer perceptions, or reach out to our team of experts at APAC@gfi.org.

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