Mission: Impossible Foods

The California-based 'food tech' company has come to Canada. Can it displace incumbents by having celebrity chefs do the selling?

By JustinDallaire

September 15, 2020

There's a formula to Impossible Foods' rapid rise in the U.S., and it's not just the science and "food tech" behind the startup's plant-based, craveable "meat."

Back in 2016, celebrity chef David Chang anointed Impossible's faux beef as more-than-passable by meat-loving-chef standards - casting away doubt among the country's culinary elite that meat made from plants could ever resemble the real thing.

Soon after Chang's New York City restaurant, Momofuku Nishi, became the first to regularly feature the Impossible Burger on its menu, others took notice. Before the year's end, some 30 other top restaurants in the U.S. had followed suit.

Then, Impossible came knocking on the doors of the country's smaller burger chains - Bareburger in New York City and Umami Burger in California - before eventually infiltrating Burger King and White Castle. Today, the Impossible Burger can be found in around 30,000 restaurants and more than 10,000 grocery stores in the U.S.

Last week, the California-based startup took another step in fulfilling its mission to "satisfy global demand for meat at a fraction of the environmental impact" by tackling one of the top meat-loving markets: Canada.

Like most plant-based companies, Impossible's ultimate goal is to reach mass-market ubiquity - helping to avert an environmental catastrophe by transitioning the world away from more resource-intensive eating systems. In the words of Nick Halla, Impossible's Hong Kong-based SVP of international: "We need to be everywhere meat is consumed." That includes Canada, where half of consumers eat animal meat every day and consume an average of 25.4 kilograms of beef per year.

With the expansion, Canada becomes the company's first international market outside of Asia. And, once again, it's using its celebrity-chef-inspired strategy to enter the market before seeking rapid expansion.

For two weeks (starting Sept 8) Impossible Burgerwill beexclusively available at a dozen influential Canadian restaurants, including Food Network chef Mark McEwan's high-end Bymark restaurant in Toronto, and Top Chef Canada finalist Connie DeSousa's Charcut Roast House in Calgary, known for its farm-to-table meats.

Diners have access to the restaurant's specialty menu and are eligible to win an "Impossible Mystery Box" - a goodie bag containing Impossible merchandise - when ordering the option.

"The first thing we want to do when we enter a new market is build credibility, and culinary influencers are a great way to do that," says Halla. "They may or may not always be the best way - it depends on the market, what the culture is driven by- but in the U.S, in Canada, or in Hong Kong and Singapore, the culinary influencers or the top restaurants drive what people look for, what's new, what's interesting."

The nine-year-old company took the same approach when entering Hong Kong in 2017, partnering with chef May Chow, who was named the best female chef on the continent that year. Two years later, it entered Singapore with the help of seven leading restaurants, repeating a strategy it had refined.

It's a departure from the QSR-heavy approach of other plant-based protein companies in Canada. California-based rival Beyond Meat, for example, partnered with A&W, Tim Hortons, Quesada, Subway and othersto drive mass-awareness and higher marginsat retail. And Maple Leaf's Lightlife worked with Harvey's and Kelseys, and more recentlypartnered with KFCto go national with the QSR's plant-based chicken sandwich.

The idea behind Impossible's play is to get the country's top meal-makers to endorse and showcase the versatility of its signature product by utilizing the ingredient in their own creative dishes, says Halla. Sold to restaurants as both five-pound, ground-beef-like blocks and as burger patties, it can be easily incorporated into an array of dishes, including tacos, dumplings, pizzas and, yes, even burgers.

Halla says working with more prestigious eateries for its launch puts Impossible's value proposition into perspective: it may be here to save the planet from the environmental impacts of meat consumption, but it hopes you won't notice anything is missing from your carnivorous diet.

Seeking endorsements from top chefs is inherently challenging, admits Halla. "With every channel, every customer that we go with, there's always a lot of skepticism that if it comes from plants it's not going to taste as good."

Impossible has tried to reverse those perceptions, though, by claiming to be not plant-based, but rather "meat made from plants, made for meat-eaters." Its elevator pitch focuses on "heme," a molecule which its scientists have recreated in the lab that's identical to the heme humans have consumed for hundreds of thousands of years in meat. In short, it helps give Impossible Burger the resemblance of actual meat. "You can cook a well-done burger versus a medium-well burger and it's different, the texture is different," notes Halla. "It's the same with Impossible."

Naturally, the company also has retail ambitions. Once it has established itself in the culinary culture, Impossible will use the buzz it generated early on to propel itself forward.

In the U.S., it quickly scaled its retail partnerships during COVID, striking new deals with Kroger Co., Walmart, Publix and Sprouts Farmers Market. So far this year, its grocery store footprint has grown 66-fold, and in February, it became the "preferred plant-based burger" of Walt Disney's resort and cruise line properties. During the summer, it also began offering two-day home delivery to U.S. households through its own ecommerce site.

Halla says the company will be rolling out to additional Canadian restaurants in the not-so-distant future, though nothing has officially been announced. Eventually, it plans to move aggressively into retail, replicating its approach to other markets. There, it will face competition from Beyond Meat Maple Leaf's Lightlife and Field Roast brands, which have been here longer, and with whom it has recentlygot into a public feud overthe ingredients in faux meat products.

The companyhasnot yetlaid out the role ofmarketing in that endeavour. "That's all to be determined in how the market develops," Halla says. "We will definitely be putting investment into the market to grow it. Exactly how - [through] marketing and things like that - that's all to be determined as we go."

Case Questions

After reading the case study provided, answer the question.

Based on information in the case study, what type of diversification approach do Impossible Meats represent and should they pursue diversification more aggressively? What type of diversification should they pursue?

Use specific terms as a part of your response.