Meat of the Matter: Alt-Meat Marketing

There is one pervasive theme that runs through the investor chatter about alt-meat, or if you prefer, “cultured meat,” or even better, “clean meat.”

Despite all the blather about saving the environment, freeing the world’s livestock and feeding nine billion people on Planet Earth with nothing more than a bunch of test tubes (tanks, actually), some growth media and what would apparently be a bunch of gigantic factories; the people pushing the potential of shamburgers and bogus meat are actually focused on a much more primal purpose: making money.

Oh sure, the positioning is all about eco-consciousness, animal suffering and the (alleged) ability of biotech to produce food products that look like beef and taste like beef but don’t require virtually any of the land, energy or water that “conventional” livestock require. How technology can surpass the free solar energy and natural rainfall that produce the world’s grasslands has yet to be explained, but the point here is that the alt-meat movement is all about something a lot more fundamental: cashing in on an emerging market niche.

Here’s what I mean.

A recent commentary by business mogul disguised as diehard progressive John Mackey, CEO of Whole Foods Market and writing as a member of The Motley Fool investment service’s board of directors, spent a couple paragraphs extolling the wonders of the coming wave of factory foods. But he quickly got to the point of the piece in assessing the marketing prospects of vegetarian foods manufacturer Hampton Creek:

“Cultured meat could play heavily into the battle for organic food sales dominance,” Mackey wrote. “Consumers can definitely expect Hampton Creek to exploit the environmental benefits of clean meat during future marketing campaigns, similar to organic food brands today.”

I find his word choice to be quite informative. Essentially, Mackey’s admitting that Whole Foods “exploits” the eco-benefits of organic foods, ostensibly to justify the premiums that customers have to pay at the checkout stand of his upscale supermarkets.

When you hand over your credit card at a Whole Foods store, you realize you’re getting ripped off, but you rationalize it by imagining that your high-priced purchases are somehow saving the planet.

Well, now you’ve heard the truth from the CEO himself: You just got suckered, and that’s the textbook definition of “exploitation.”

The Real Truth

But wait — there’s more.

After acknowledging that same-store sales at Whole Foods stores open at least one year have fallen for seven consecutive quarters — which explains why he chose to sell out to Amazon’s Jeff Bezos and stick a huge windfall in his pocket — Mackey made another interesting admission.

“It’s important to note that much of the talk surrounding cultured meat can be filed away as hype rather than reality,” he wrote. “There are many manufacturing hurdles that need to be overcome to make clean meat a reality and sell it at price consumers would be willing to pay. It should take many more years before any product in the field hits all of these checkpoints.”

Whole Foods' John Mackey is laughing all the way to the bank.
(credit: Wikipedia/Inc.)

Not to put myself on some pedestal, but that’s exactly what I’ve been saying for several years now, and virtually every veggie activist has disagreed vigorously, insisting that alt-meat is truly the savior of the planet.

They need to have a conversation with John Mackey.

Look, there’s nothing untoward about coming up with novel products, with building market positioning that resonates with consumer values and then charging people whatever price they’re willing to pay.

It’s called free enterprise, and it’s (partly) what makes America great.

But take it from one of the original moguls who learned early on to exploit people’s well-intentioned concerns for the environmental problems generated by the reality that billions of human beings require food, clothing and shelter by marketing a “better-for-you-and-for-the-planet” product line at premium prices: The fact that 99% of the world can’t afford to shop at Whole Foods, and won’t be able to afford the coming wave of alt-meat products, doesn’t concern the investors who stand to cash in on “cultured meat.”

As Mackey has clearly articulated, this new technology reflects the oldest maxim in commerce:

Create the perception of value, and market it to people who’re able to pay for it.

Nothing wrong with that, but let’s not pretend it’s anything other than business as usual.

Editor’s Note: The opinions in this commentary are those of Dan Murphy, a veteran journalist and commentator.