Friday, August 25, 2017

Milk and Dairy Beverage Flavor Trends

photo source: Midwest Dairy Association

Go ahead, grab yourself a cold one. Make it a nice chilled, flavored dairy beverage.

From milk to kefir to fruit smoothies, flavorful dairy beverages are growing in popularity and yes, selling in the marketplace.

On the same note, plant-based dairy alternatives are rolling out in droves. But here’s the deal, most are competing in white milk space, not the flavored dairy beverage sector.


I hear the frustration from milk processors. In a previous post on the topic of the premiumization of flavored milk, I received the comment: “Plant-based alternative beverages are the rage. Millenials are moving away from cows milk at an unprecedented rate.”

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This is the case because the dairy industry is allowing it. Get loud, wake up and make dairy exciting again. Those companies that are creative with flavors, forms and packaging are not complaining. It pays off.

Here’s a personal story on why I believe investing in milk and dairy beverages makes sense.

This summer I have been volunteering at Lincoln Park Zoo’s Farm in the Zoo. Lincoln Park Zoo in Chicago is one of three large urban zoos in the country that is free 365-days a year. That’s possible through volunteers, donations, fundraising, etc. I chose to work in the farm to gain inspiration for my writing and to “hear” what moms, dads, grandparents, teens and children of all ages and backgrounds think about the food they get from the farm. I give presentations on cow milking and help guests feed the cows afterward. There’s an interactive demonstration where I teach guests how cows have one stomach with four chambers. They always walk away knowing that the only milk that comes from the cow is white and packed with essential nutrients.

I also assist with goat petting, pony grooming and chicken chats. One of my favorite interactive demonstrations is called Backwards Shopping, where I have the young guests pick up a piece of play food and identify its source, either animal or plant. Never once has a guest picked up the glass of milk, the slice of cheese, the ice cream cone, the stick of butter or the cup of yogurt and pointed to the photo of the field. It’s always the dairy cow. Good news!

Retail sales data from IRI provided to Dairy Management Inc., and courtesy of the Midwest Dairy Association, for the second quarter of 2017, show that total milk sales were down 2.6% year-to-date through June vs. prior year. However, the decline in the second quarter moderated, with nearly all regions posting softer losses than in the first quarter. Good news, again!

It’s no surprise, the volume leader, white gallon milk, is the driver of the decline. This is where the plant-based alternatives are hitting the dairy industry the hardest. However, non-dairy alternative beverages continue to grow but at a more moderate pace (+1.7% year-to-date), according to the IRI data. Almond and coconut are the growth engines. I’ll take this as more good news!

There’s some really great news occurring in the milk category that’s worth talking about, according to Cindy Sorensen, senior vice president of business development at the Midwest Dairy Association.

All segments outside of the white gallon have seen volume growth. This includes: flavored milk (+4.2%), lactose free (+11.5%), omega 3 (+6.4%), glass bottle (+2.7), grass fed (+66%) and refuel (+21.9%).




Chart source: IRI provided to Dairy Management Inc., and courtesy of the Midwest Dairy Association
“We’re also seeing continued growth in whole-fat milk, which is in its fourth year of increases (+3.5% 2017 year-to-date),” says Sorensen. “In fact, whole milk is getting very close to surpassing reduced-fat milk as the leader in the category. The whole-fat trend links both to a growing body of research indicating that whole fat may be beneficial to health as well as consumers’ desire for more natural foods.”

There’s a great deal of opportunity to innovate in the flavored dairy beverage sector. This includes flavored milk, in particular flavored whole milk; flavored cultured beverages, including drinkable yogurt and kefir; and fruit and dairy smoothies.
Recently LaLa introduced a line of dessert-inspired yogurt smoothies called Craveables. The 6.7-ounce bottles are sold in packs of four and come in flavors such as Lemon Bar, Strawberry Cheesecake, Tres Leches and Vanilla Cupcake. A single bottle contains 140 calories, 4 grams of fat, 5 grams of protein, 17 grams of sugar and 2 grams of fiber.

Flavored milk once again shined at the Wisconsin State Fair. Supplied by Prairie Farms Dairy, a leading innovator in flavored milk, the Milwaukee Bucks Milk House at the State Fair annually serves more than 160,000 cups of milk during its 10-day stint. In addition to the mainstays of Chocolate, Root Beer and Strawberry, this year’s milk line-up included Chocolate Peanut Butter and Sea Salt Caramel. (There is no peanut component in the Peanut Butter Chocolate flavored milk. It is a flavor additive, not actual peanut derived extract.) Last year, the two special flavors were Banana Cream and Orange Creamsicle.

So what’s trending in dairy beverage flavors? Based on my global marketplace observations, all types of fruit flavors, but in particular citrus (orange, lemon and even lime—think key lime) and tropical (banana, coconut and mango), are being used, as they add to the healthful halo. It goes without saying that coffee, specifically cold-brew coffee is a “hot” flavor. The next-generation cold-brew coffee lattes will likely have a layer of flavor in them. Think flavors beyond caramel, chocolate and vanilla. Try maple and praline. Indulgent flavors are booming, too. Limited-edition products create excitement in the category and encourage purchase.

It’s time to sell the story of dairy and simply liven it up with flavor!
www.trilogyei.com

2 comments:

  1. Where would Fairlife White Milk Fit in above Category? I would think it has had a notable boost for white milk. There should be private label offerings of this type of high protein, reduced lactose product.

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  2. Hi Donna! Great article about the future of flavored milk! Thanks!

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