Plant-based Bakery, a New Growth Vertical for the Industry
Plant-based baked goods have firmly established themselves in Europe’s bakery landscape, driven by a dynamic interplay between consumer demand for healthier, sustainable alternatives and industry innovations in product development. This evolution has reshaped traditional baking practices and compelled manufacturers to rethink ingredients, processes, and branding strategies.
Plant-based eating is no longer a fringe trend—it’s reshaping the mainstream grocery landscape. One of the clearest signs of this shift comes from Germany, where leading retailer REWE has made a bold move with the launch of its first fully plant-based supermarket, “REWE voll pflanzlich”, in Berlin’s Friedrichshain district.
Despite its modest size—just 212 square metres, roughly one-eighth the size of a typical REWE store—the vegan concept store packs an impressive punch. Each week, around 5,500 transactions take place across its five self-checkout stations, which replace traditional conveyor belt cashiers entirely. Shoppers can choose from more than 2,700 plant-based products representing some 300 brands, ranging from REWE’s own lines to niche favourites like Heimatgut, bettr, bedda and Koro.
Designed to meet everyday grocery needs, the store offers a full weekly shop with around 1,300 dry goods and 1,400 fresh items. It also features a strong convenience section, including a dedicated Backwelt with popular baked treats like vegan chocolate croissants and franzbrötchen (cinnamon rolls), plus a snack bar serving wraps and sandwiches, and even a soft-serve oat ice cream machine from Oatly.
REWE’s bet on plant-based is supported by the market data, ingredient makers and manufacturers, who continue to invest in products that are healthier and tastier and answer to the consumers’ desire to eat in a planet-friendly manner.
Rising Demand and Market Potential
Europe’s plant-based food sector is experiencing robust growth, with the baked goods segment being a prominent beneficiary. According to Euromonitor International, plant-based bakery products grew by approximately 15% year-over-year from 2022 to 2023, signaling a clear consumer shift toward healthier and environmentally friendly diets.
The appeal of plant-based baked goods stems not only from vegan and vegetarian consumer bases but also from flexitarians, who significantly drive market expansion. Consumer motivations vary from health concerns and ethical considerations around animal welfare to sustainability issues, notably the environmental impacts of conventional animal agriculture.
Product Development: A Complex but Rewarding Journey
The journey from concept to consumer for plant-based baked goods involves intensive research and iterative testing. Successful plant-based product development hinges on replicating taste, texture, and appearance traditionally achieved with animal-based ingredients, particularly eggs, milk, butter, and gelatin.
Ingredients: Innovations and Substitutions
Plant-based innovation primarily revolves around finding suitable substitutes that can perform similarly to traditional ingredients. European bakers and manufacturers increasingly use alternative flours such as chickpea, lentil, almond, and coconut flour to boost nutritional profiles while ensuring taste quality.
For example, the French bakery company Bridor recently expanded its plant-based croissant and pastry line by incorporating margarine derived from shea butter and coconut oil. This innovation achieved the flakiness and rich mouthfeel characteristic of butter-based pastries, meeting high consumer expectations.
Similarly, Puratos, the Belgian ingredient giant, has launched egg-free cake mixes under its “Plant Forward” initiative, using pea protein and fibers to maintain structure and softness without compromising texture or flavor.
Texture and Taste: Balancing Act
Texture poses a significant challenge, as eggs and dairy often provide structure and softness. European companies have addressed this through meticulous formulation and advanced ingredient blends. For instance, Oatly, the Swedish plant-based dairy brand, successfully entered the bakery segment by offering oat-based milk and cream that closely mimic dairy characteristics, enabling seamless integration into baking recipes.
Taste development also requires considerable experimentation. Finnish bakery Fazer introduced “Fazer Oat Choco Cookies,” entirely plant-based cookies featuring oats and dairy-free chocolate chips. Fazer spent over a year refining the formulation, balancing sweetness and crispness to match consumer expectations closely.
Sustainability as a Selling Point
Sustainability underpins much of the consumer appeal in plant-based products. European brands often highlight their reduced environmental footprint, using sustainably sourced ingredients and packaging. UK-based company OGGS emphasizes environmental responsibility, promoting their aquafaba-based egg substitutes not just as vegan-friendly but as significantly reducing CO₂ emissions compared to traditional egg production.