Consumer Interest in Novel Proteins: A McKinsey Study on Market Potential and Adoption

A recent report by McKinsey & Company highlights the growing interest and investment in novel food ingredients, particularly those developed through biotechnology. The report, authored by Kimberly Stover, Kate Toews, and Roberto Uchoa, focuses on consumer attitudes towards these novel ingredients and their potential impact on the food industry.

Over the past five years, $4 billion has been invested in the development of novel ingredients, including mycelium proteins and animal-free eggs, created through fermentation processes. These ingredients aim to mimic the functionality of traditional animal-based proteins while offering a more sustainable alternative. They are positioned to play a critical role in decarbonizing the food system, enhancing food security, and meeting the demands of increasingly flexitarian consumers.

Consumer Perception and Market Potential

The report is based on a survey of 1,551 U.S. consumers, revealing that a majority are open to trying novel ingredients. The survey indicated that between 49% and 67% of respondents expressed willingness to try foods and beverages containing these new ingredients, driven by perceptions of improved health benefits, taste, and sustainability.

Interestingly, the willingness to try these novel ingredients varied by age group. Younger consumers, particularly Gen Z, placed a higher importance on health benefits, while older generations prioritized taste. The survey also identified key barriers to adoption, including lack of awareness and concerns about production methods.

Novel Ingredients Classification

The study classified novel ingredients into three categories:

1. Animal-Free Bioidentical Products: These include dairy proteins, collagen, and eggs produced via precision fermentation.
2. Biomass Proteins: Derived from microorganisms, these include prebiotic, cultured, postbiotic, fermented, microbial, and gas-fed proteins.
3. Fungi Proteins: These involve nutritional fungi protein, mycelium protein, and mycoprotein, sourced from organisms in the fungi kingdom.

Plant-based proteins, such as almond and soy, were also examined for benchmarking but were not the primary focus of the research.

Consumer Preferences and Willingness to Pay

The report found that consumers are more likely to try novel ingredients in lunch and snack products rather than at dinner. Over half of the respondents showed a willingness to pay a premium for products containing novel ingredients, with some willing to pay up to four times the price of conventional alternatives. This willingness to pay did not significantly vary across different types of novel ingredients but was influenced by the type of product and its intended use.

Implications for the Food Industry

For the food industry, the report suggests several strategies to increase consumer adoption of novel ingredients:

• Consumer Education: Addressing the largest barrier—lack of awareness—through educational initiatives about how these ingredients are made and their benefits.
• Health, Taste, and Sustainability: Emphasizing the health benefits, taste similarity to traditional products, and sustainability of novel ingredients.
• Innovation in Product Development: Focusing on product categories such as breakfast, lunch, and snacks where consumers show higher openness to trying new ingredients.
• Effective Labeling: Using familiar and compelling language on product labels to communicate the benefits and sustainability of novel ingredients.

You can read the report here.