Vital Farms CEO applauds Beyond Meat, Oatley trends: 'So much industrial food to be disrupted'
Vital Farms (VITL) pledges to bring ethically produced eggs and butter to consumers, and is part of a growing movement to disrupt the food industry with more sustainable options.
The company prides itself on transparency within the food supply chain — an emerging macro trend as Americans seek healthier, more sustainable options.
“I think it’s a secular shift towards people being more conscious of food choices and wanting food to reflect their values,” Vital Farms CEO Russell Diez-Canseco told Yahoo Finance Live in an interview last week.
“It’s the entire reason we have the right to exist and succeed in the markets in which we play because we are a transparent brand...I think our consumers appreciate our approach to that,” he said.
The company works with over 200 small family farms, and is the leading U.S. brand of pasture-raised eggs and butter by retail dollar sales. Yet as more health-conscious consumers shift to a vegan and plant-based lifestyle, will alternative brands like Beyond Meat and Oatley threaten demand?
Diez-Canseco doesn’t see to think so. Instead, he’s encouraging other food giants to do the same, and challenge the current food supply chain status quo.
“There’s so much industrial food to be disrupted in this world. I welcome the day to feel like I’m going head-to-head with [alternative food brands] but I think there is a lot of room between now and then,” he said.
Alternative food companies “are all trying to solve similar problems with our industrial food system, especially in the United States,” the CEO added.
“We’re trying to find ways to reduce the environmental impact on food production, trying to find ways to improve the, frankly, unsatisfying animal welfare impact of the way we produce food in this country,” he explained.
“I have a ton of respect for the work that those companies are doing. We’re approaching it in a different way but I think we’re all trying to solve the same unmet needs in the marketplace,” Diez-Canseco said.
‘Doing things differently’
Ethically-sourced foods usually translate to huge price points (Vital Farms products are estimated to be among the most expensive options available for eggs) — and with millions of people unemployed and struggling economically, affordability remains top of mind.
“Doing things differently does come with a cost. What we found is that we are able to do things that really matter to our stakeholders, especially our consumers. They reward us by being willing to pay more for the product we bring them,” the CEO added.
Vital Farms benefitted from the pandemic stock-up period as the company remained one of the only egg brands on shelves amid March and April’s food rush.
According to Diez-Canseco, the brand attracted 440,000 households during that time period, with 20% of those households returning to buy the product multiple times in the 20 weeks that followed.
Overall, eggs sold briskly during 2020, although sales tailed off in the fourth quarter, he pointed out. Yet specialty egg brands outpaced their regular counterparts, “so I think that’s a great indication of a secular shift to more premium products,” Diez-Canseco added.
Editor’s Note: This article has been updated to reflect the correct price point for Vital Farms eggs as the brand’s products are estimated to be among the most expensive on shelves
Alexandra Canal is a producer & entertainment correspondent at Yahoo Finance. Follow her on Twitter @alliecanal8193.
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