I think it does work to a point. There aren't enough veg*ns yet to make a significant difference, but in some markets we are. Look at the dairy industry and how much shelf space is now given to nondairy milk. You can tell they (dairy industry) are very worried about it; look at how their advertising has changed. Instead of promoting their own product, they are trying to discredit their competition.
Years ago, when the main choices for nondairy milk were soy or rice, I preferred the rice milk. It was constantly sold out (I guess others preferred it as well), and one day they stopped restocking it. I asked a friend who worked in the dairy department why they no longer stocked the rice milk. He said he had no idea, since it was one of their biggest sellers.
It would be interesting to hear what kind of logic is used in deciding what products to sell.