Summer Inspiration Series: Developing Dairy Foods for the Next Normal

The “Summer Inspiration Series” of Friday blogs is all about stepping out of our comfort zone in terms of innovation. Why not? We’re already operating in an unprecedented manner. Some blogs may explore new concepts in “other” food and beverage categories and discuss how they may apply to dairy, others may focus on new consumer behaviors and brainstorm on how dairy foods processors may respond in coming months. 

McKinsey & Company just published: What got us here won’t get us there: A new model for the consumer goods industry. The report explains how COVID-19 has amplified 12 trends that have been disrupting consumer packaged goods (CPG) for the past decade. You can access the report HERE.

The authors explain that CPG players need to rethink their portfolio priorities and “where to play” choices to increase their exposure to growing markets, channels and subcategories. They also need to better focus on the what’s important to today’s consumers. Price sensitivity, for example, is skyrocketing in importance in the wake of COVID-19. Younger consumers seek out brands they see as special, different and authentic. All age groups are prioritizing conscious eating and living, preferring purpose-driven brands that help them meet personal goals. Small brands are rushing in to deliver on these brand values, although execution challenges during the COVID-19 crisis have held them back, growing at only their fair share, instead of outgrowing large brands, according to the authors.

This market data is revealing. Large brands (more than $750 million in revenue) in the U.S. lost volume at the rate of 1.5% a year, from 2017 to 2019, while small brands grew 1.7% and private label grew 4.3%. Detailed analysis of the large CPGs (more than $2.5 billion in U.S. revenue) shows that all of their organic volume growth and almost 90% of their overall value growth came from their small and medium-sized brands (less than $750 million in revenue), even though those brands contributed only 42% of 2016 revenues. In recent years, the leading brands in each CPG category generated only 25% of value growth in U.S. Nielsen-covered channels, while small and medium-sized brands captured 45% of growth and private-label products 30%. 

The future is niche products that meet a need. 

McKinsey & Company explains that successful stand-alone small brands are very disciplined and very careful about spending. Small brands usually market efficiently with the core consumer in mind. As they grow, they leverage their community and loyalty to “export” the brand. They also tend to focus on a key channel to deliver and delight the core audience before expanding distribution points to increase purchase frequency.

Grocery shopping trends during COVID-19

Consistent with prior years, the Food Marketing Institute (FMI), in collaboration with Hartman Group, fielded research in February 2020 to support this year’s U.S. Grocery Shopper Trends. The research included a national survey (n=2,000) and qualitative interviews around the country. 

To capture the dynamic changes in the intervening months, FMI updated this data through several additional weeks of survey research in March and April 2020 (n=1,000 x 4 waves). These findings have been integrated into the initial research to provide a relevant view of shopper trends as they stand at this moment in time.

“Retail food saw eight years of spending growth in one month,” reports FMI. 

Here are some dairy volume sales highlights from IRI, courtesy of the Midwest Dairy Association. 

• Milk sales are up 3.9% in 2020 year-to-date (YTD) through July 12, compared to the same period in 2019. In the four weeks ending July 12, volume sales increased 0.1%. Four of the eight regions are posting declines in the latest four weeks. While grocery stores continue to see growth, the “all other channel,” largely Walmart, has turned negative in the last two four-week periods. eCommerce sales continue to skyrocket.
• Cheese continues to see strong growth in 2020 YTD with volume up 16.7% YTD and 13.2% in the most recent four-week period. Large increases have been maintained despite significant price upticks of 5%. Growth is observed across all regions, top varieties, forms and types. Italian cheeses are performing particularly strong, as well as forms associated with family meals, such as shreds and grated.
• Yogurt sales are gaining strength over the last 12 weeks. Year-to-date, volume is up 3.4% with a higher increase of 4.6% in the most recent four weeks. Within yogurt packaging formats, tubs and tubes have been key growth drivers. Cups, which account for the largest volume share (56%), have been soft (-0.4% YTD). 
• Butter (and butter blends) is up 31.5% YTD and up 23.4% during the most recent four-week period.
• Ice Cream/Sherbet is up 11% YTD and up 5.2% during the most recent four-week period. 
• Cottage cheese is up 4.3% YTD and up 5.5% during the most recent four-week period. 
• Sour cream is up 17.3% YTD and up 15.2% during the most recent four-week period. 

Claims shoppers want, before and after COVID-19.

The FMI research shows shoppers continue to scrutinize products to avoid negatives and minimize processing. A large majority of shoppers (82%) reported at the outset of 2020 that they examine food and beverage packaging for specific properties they seek, similar to 2019. Few shoppers in March or April indicated paying any more or less attention to labels now than prior to the pandemic.

Shoppers focus on wholesome foods with minimal processing that help them avoid negatives, especially sugar and sodium. They also pay close attention to the level of processing, looking for claims such as natural (27%), no artificial ingredients (28%) or having no preservatives (28%).

Online shoppers tend to examine package claims more carefully, looking for cues of ethical sourcing practices in both animal treatment and business relationships. They are also more likely to seek out products offering positive nutrition, such as vitamin-enriched or antioxidant-rich claims. Shoppers who do not shop online, on the other hand, focus more on avoiding specific ingredients. Sugar is the number-one food component that all consumers avoid. 

Less sugar is the new norm in the next normal.

“Sugar’s increasingly negative image due to its impact on rising diabetes rates and childhood obesity has hurt sales of sugary beverages, especially sodas, juices, and ready-to-drink sports drinks and teas,” according to the hot-off-the-press Packaged Facts report: U.S. Beverage Market Outlook 2020: Grocery Shopping & Personal Consumption in the Coronavirus Era. “People who want to reduce their sugar intake typically do not want sugar-free products but instead those with less sugar or those sweetened with natural, non-sugar ingredients. Public health recommendations and tax legislations are helping drive the move toward reduced or no/less added sugar claims. New product activity has surged for reduced-sugar varieties of beverages, with manufacturers using natural sweeteners like stevia and monk fruit, real fruit, honey and erythritol.”

It’s no wonder that less sugar was a priority for the start-up companies that were selected to participate in the 2020 Dairy Farmers of America (DFA) Accelerator program. This is how big brands become niche players. 

“We’re excited about the companies for this year’s class. Not only is this the biggest group that we’ve ever had, but a lot of these companies are developing cutting-edge products and solutions,” says Doug Dresslaer, director of innovation at DFA. “Plus, on both the ag tech and food sides of the program, we have companies doing really cool things with sustainability and dairy by-products, which is a strategic focus for our cooperative and the industry.” 

The DFA Accelerator is a 90-day immersive program, typically with a combination of on-site meetings and virtual programs to provide training, growth opportunities and mentorship. Most startups typically spend about four weeks in Kansas City, where DFA is headquartered. This year due to the COVID-19 pandemic, the program was managed remotely with virtual Demo Day presentations made yesterday, July 30. This is where each of the companies talked about what they’ve learned and provided their best pitches about their startups. 

I was fortunate enough to be in the audience. All nine companies were very impressive. I look forward to featuring the dairy products in the Daily Dose of Dairy. Here are some highlights:

Ag Tech Innovations

• Armenta (Ra’anana, Israel): a non-invasive technology for antibiotic-free treatment of bovine mastitis 
• Capro-X (Ithaca, N.Y.): a sustainable solution for whey waste from Greek yogurt production 
• Livestock Water Recycling (Calgary, Alberta, Canada): a manure treatment technology, which recycles 75% of manure into clean water while segregating manure nutrients for precision fertilizer application 
• Mi Terro (Los Angeles): a sustainable fashion brand that uses excess milk to make men’s and women’s t-shirts 

Dairy Food Products 

• Chank’s Grab-N-Go (Millville, N.J.): a handheld snack company featuring pizza cones, Philly cheesesteak cones and more (pictured) 
• GoodSport (Chicago): a sports drink made from upcycled liquid dairy by-products, which uses only natural ingredients and has naturally occurring electrolytes and vitamins 
• SuperFrau (Cambridge, Mass.): electrolyte drinks made from upcycling surplus whey, with real ingredients and no added sugars 
• Wheyward Spirit (Eugene, Ore.): premium spirit made from whey 
• Yaar Nordic Quark Bar (London, U.K.): Nordic chilled dairy snacks made with fresh quark, a mixture of cow’s milk and natural lactic acid 

Since its inception, the DFA Accelerator has worked with 25 companies and has continued to work with the majority of these companies in some capacity after the 90-day program. To date, 94% of the alumni companies are still in business today. For additional information, link HERE.

Summer Inspiration Series: Think Alphabet Soup (with a Slice of Pizza)

The “Summer Inspiration Series” of Friday blogs is all about stepping out of our comfort zone in terms of innovation. Why not? We’re already operating in an unprecedented manner. Some blogs may explore new concepts in “other” food and beverage categories and discuss how they may apply to dairy, others may focus on new consumer behaviors and brainstorm on how dairy foods processors may respond in coming months. 

Several new McKinsey research efforts analyze the changes taking place in the homes of consumers, on their phones and in stores. In the report “Reimagining marketing in the new normal,” the consulting firm identifies six of the biggest shifts emerging from COVID-19. One of the most interesting is localizing outreach. You can read the report HERE.

It’s time to reimagine dairy’s role for back-to-school meals and snacks at the kitchen table, along with dorm room dining and lots of pizzas delivery to college apartments. Trick or treating will be cancelled and parents should not expect to see their grade schoolers jingle belling on the auditorium stage. 

Localized outreach has long been part of many dairy processors’ marketing efforts. It’s time to rethink the playbook for the next normal. Think “alphabet soup.”  

Many of us are old enough to remember this childhood classic. I believe the original intent by Campbell’s was to get kids to eat their vegetables by delivering them through a bowl of soup loaded with alphabet-shaped pasta. The meal was both nutritional and educational. This is something parents need now. 

Dairy foods are already nutritional. Let’s make them educational and entertaining, maybe even collectable. Can a yogurt cup become a pencil holder? Can the string cheese wrapper have a code on it that gets entered on the interactive website where a kid wins prizes? 

Milk cartons might use a panel to showcase a craft, such as repurposing the carton as a planter. A panel might be a cut-out card that kids start collecting and trading. That’s another flashback. Think Wacky Package cards from the 70s.   

The fact is that COVID-19 has dramatically affected consumer habits and dairy supply chains when foodservice demand plummeted and grocery sales surged. Consumers struggling with job losses and economic uncertainty quickly returned to buying basic dairy products like fluid milk and commodity cheese. 

A new report from CoBank’s Knowledge Exchange indicates that consumer behavior will be different for the next 12 to 18 months than it was pre-pandemic. As that behavior takes root, dairy supply chains will need to adjust from farm to fork. You can read the report HERE.

“The dairy industry is coping with some new realities, largely driven by the decrease in foodservice demand and restaurant sales,” says Tanner Ehmke, manager of CoBank’s Knowledge Exchange. “The challenge for dairy supply chains will be adapting to focus on meeting demand trends based on evolving consumer behavior as we navigate through an uneven reopening.” 

As consumers heeded the stay-at-home advisories, they increased purchases of products that in recent years had fallen out of favor. Processed cheese sales increased by nearly 20% during the eight weeks ending May 31. White milk sales gained more than 10% during the same period. Cereal is also doing well with sales up almost 15%.

Even as restrictions have begun lifting, polling has shown widespread reluctance among consumers about immediately returning to normal activities like restaurant dining and business travel. In late April, a Business Insider poll found just 9% of Americans believed they would resume their routine exactly as it was before the lockdowns, with only 16% saying they would resume “almost all” of their activities.

At a minimum, it will take some time for sit-down restaurant traffic to look anything like it did before the pandemic. Forecasts from Open Table suggest that the U.S. could lose up to 25% of its restaurants. 

Any structural reduction in restaurant sales has potential product mix implications for dairy processors and converters. For instance, firms that specialize in making or packaging products for foodservice accounts will need to retool, making different types of cheese or filling different-sized sour cream containers for at-home consumption.

Much of the price volatility experienced over the past 90 days has more to do with massive supply chain disruptions than major changes to aggregate demand and supply. Perishability played a big role in the upheaval. As demand spun toward retail, foodservice operators disposed of fresh products that now have to be replenished for reopening.  

Some buyers are asking if suppliers can develop and provide extended shelflife alternatives. Movement in that direction would presumably help on the supply side, giving manufacturers and dairy farmers more supply cushion. 

A world with more extended shelflife manufacturing options might mean less dumping of milk than took place in April. Business models may also be readjusted from just in time inventory practices to having more inventory stored in warehouses.

Grocers are also cutting down on product selection to enhance operational efficiency. Published reports say that the popular Wegman’s supermarket chain, for example, has cut its offerings from about 52,000 products to 30,000 products. 

Data from Nielsen shows that for the four weeks ending June 13, supermarkets carried nearly 7% fewer dairy items than the year prior. For dairy companies and other food marketers, that could mean fewer line extensions, fewer opportunities to differentiate, fewer chances to test new concepts.  

As the economy reopens, potential changes in consumer habits, the level of social distancing that remains in place, and the level of disposable income will again reshape dairy supply chains long term.  

That brings me to pizza. Retail and foodservice pizza sales have outpaced pre-pandemic levels. Domino’s, for instance, said that its U.S. same-store sales increased by 21% year-over-year from April 20 through May 17. 

“That’s especially good for the dairy industry considering how much cheese pizza carries to the dining table,” wrote Phil Plourd, president, Blimling and Associates Inc., and author of the CoBank report. “Because pizza remains relatively inexpensive and convenient, it should continue to outperform in the months ahead.”  

Prior to COVID-19, about one in eight Americans ate pizza on a typical day, according to USDA data. That’s a lot of cheese! 

The U.S. pizza market generated an estimated $47 billion in revenue in 2019, according to IBIS World. With the average price per pizza being $11.23, that equates to about 4.1 billion pizzas. 

The global pizza market has annual sales estimated at nearly $145 billion, according to Pizza Magazine. Western Europe leads the way with $54.4 billion, followed by North America ($50.7 billion) then Latin and South America ($16.8 billion). 

I’m ordering pizza tonight for the family, with extra cheese! Photo source: Dairy Farmers of Wisconsin

Pasta filata mozzarella is characterized by its functionality, which when heated, e.g., on a pizza, can generate the authentic stretch and mouthfeel that consumers associate with a desirable pizza experience. Pasta filata is the largest, fastest-growing and most globally widespread cheese type, accounting for more than 20% of cheese produced globally and estimated to reach USD 88,853 million (EUR 78,570 million) by 2027 with a CAGR of 5.5% (2019-2027), according to Coherent Market Insights

Recognizing the global craving for pizza is outpacing per-capita cheese consumption, Chr. Hansen has launched a series of high-yielding cultures and enzymes. They are designed to offer pasta filata makers the ability to increase cheese volumes and maximize milk efficiency through natural solutions while keeping intense focus to protect downstream whey fractionation processes. Learn more HERE.

Summer Inspiration Series: Connect with Consumers Through Limited-Edition and Seasonal Offerings

The “Summer Inspiration Series” of Friday blogs is all about stepping out of our comfort zone in terms of innovation. Why not? We’re already operating in an unprecedented manner. Some blogs may explore new concepts in “other” food and beverage categories and discuss how they may apply to dairy, others may focus on new consumer behaviors and brainstorm on how dairy foods processors may respond in coming months. 

Today let’s talk about connecting with consumers through limited-edition and seasonal offerings. But first…Happy National Ice Cream Month! Make sure you enjoy a scoop or two on National Ice Cream Day, which is celebrated on the third Sunday of July in the U.S.

U.S. ice cream marketers are doing a great job with promotions and innovation this ice cream season. And it’s paying off. Consumers appreciate the comfort and enjoyment of ice cream during these uncertain times and marketers are keeping them entertained with new products, flavors and marketing.

(Scroll down for COVID-19 ice cream sales trend data.)

Ice cream and frozen novelty sales continue to boom, according to IRI. What’s important to note is the growing inflationary gap between dollar gains and volume gains. Consumers are starting to pay more for food, including ice cream, and it shows in the numbers. As we enter a recession, it will be interesting to see what luxuries consumers splurge on. Ice cream has historically been one.

In early April I wrote about taking quarantine time to reboot your brand and develop inspirational messaging for COVID-19 marketing efforts. Many of you listened! If you missed the blog, you can link to it HERE.

Limited-edition and seasonal offerings keep consumers interested and coming back for more. They are often willing to dip into their pockets for a product that may not be stocked the next time they shop. 

High Road Craft Ice Cream is embracing the limited-edition flavors concept during National Ice Cream month. The company is celebrating with limited-edition, hand-crafted in small batch pints, one flavor for every day in July. They are available on the company’s online store in limited quantities. 

Here’s a sampling of what they’ve produced:

July 10: Salt & Pepper – salty sweet cream base with salt and pepper caramel and pecans

July 11: Cannoli – ricotta ice cream with chocolate chunk and pie crust

July 12: Mint and Chocolate – mint ice cream with chocolate cookie dough and Stracciatella

July 13: Tres Leches – three milk ice cream with praline pound cake pieces

July 14: Cherry Pie – cherry ice cream with jammy cherries and pie crust

July 15: Salty Snacks – sweet cream with peanut brittle, chocolate covered pretzels and a peanut butter swirl

July 16: Coffee and Cacao – roasted coffee base with Stracciatella 

July 17: Georgia Peach Crisp – sweet cream with peach jam and oat crisp

July 18: Roasted Strawberry – roasted strawberry ice cream with strawberry jam

July 19: NATIONAL ICE CREAM DAY

Sundae – Vanilla ice cream, jammy cherries, fudge caramel and praline peanuts

Brownie Sundae – Milk chocolate chip ice cream, chocolate chunk and brownies 

During these uncertain times, Jeni’s Splendid Ice Creams has prioritized offering flavors that transport you to another time and place. The company’s new feel-good collection was inspired by state fairs, a slice of Americana that will take you back to the summers of your childhood. 

Because state fairs have been canceled due to COVID-19, Jeni’s created its own virtual state fair experience on Instagram (@jenisstatefair). Viewers may explore the fairgrounds by tapping the photo tags—from boozy drink recipes at the Frosé Float to your new favorite summer playlist at the Brambleberry Bandstand—and play midway-style games with prizes throughout the month, including the chance to win a year’s worth of ice cream.

With the virtual state fair comes a new limited-edition flavor every Thursday for the next five weeks. The pints may be purchased in Jeni’s shops and online. The first offering was Watermelon Taffy, a flavor that directors of actual state fairs across the country picked as their personal favorite. This past week Wildberry Lavender rolled out. After that comes Orange Blossom Chiffon (July 23), Atlantic Beach Pie (July 30) and Sun-Popped Corn (August 6).

“We love the energy, color and flavor of a great state fair,” says Founder Jeni Britton Bauer. “From a flavor, art and design standpoint, we asked ourselves, if we were to hold our own state fair, what would we want it to be? What would it look like? The answer is a Jeni’s-fied mix of our memories of summer, vibes from the midway, and our imagination, in a way that only we could do.”

Check out these flavor concepts:

Atlantic Beach Pie – There is an old Southern legend that warns diners not to eat dessert after a seafood meal. Atlantic Beach Pie was the lone exception with its salty cracker crust, lemon custard filling and whipped cream topping. Jeni recreated this Southern staple with sweet cream ice cream and tart lemon custard adorned with homemade saltine streusel.

Orange Blossom Chiffon – This variety is sweet yet tart with tangerine and orange flavors. It is extra creamy and aerated for a chiffon-like texture. 

Sun-Popped Corn – The popcorn in this flavor is popped using the power of sunshine. The folks at BjornQorn in New York’s Hudson Valley use solar power to heat kettles filled with kernels. Jeni’s adds this crisp, sun-popped corn directly into fresh dairy, infusing every inch with the flavor and aroma of addicting buttery popcorn. 

Watermelon Taffy – Meant to taste like watermelon sour candy, this one has a puckery fruit flavor from a little watermelon and plenty of citric acid. It has a unique flavor twist from the addition of fresh cultured buttermilk and yogurt, which is made for Jeni’s by a nearby fifth-generation Ohio dairy.

Wildberry Lavender – This variety combines the flavors of steam-distilled lavender buds, cold-pressed orange zest and blackcurrants. To some, it tastes like fruit cereal milk. To others, it’s the flavor of springtime. 

It’s time to get busy creating flavors that peak consumers’ curiosity. It’s going to be long winter for many. Limited-edition and seasonal flavors may help pass the time. 

Again, don’t forget to get yourself a scoop or two this Sunday. Happy National Ice Cream Day!

(Scroll down for COVID-19 ice cream sales trend data.)

Eating with Our Eyes at SHIFT, the 2020 Installment of IFT

Before we heard of COVID-19, the majority of ingredient companies planning to exhibit at the Institute of Food Technologists’ Annual Meeting and Food Expo were likely going to focus their efforts on plant-sourced ingredients and all types of protein, along with natural and clean label claims. These topics will still be prevalent this coming week--July 13 to 15—when the conference “SHIFT”s to a virtual format. 

It’s going to be a different type of event, as IFT is all about tasting prototypes. This year we will be eating with our eyes.

Learn more about SHIFT20 by linking HERE. There’s still time to register. The live and pre-recorded sessions will all be available to registered attendees for one year. The topics are timely and a great resource for innovation and food science discovery.

A key theme at SHIFT20 will be whether the food that sustains our world could also be the biggest threat to its survival. Topics will be divided into five areas: Health and nutrition, food safety and security, science and technology, sustainability and innovation. For live events, attendees will be able to ask questions in real time. For pre-recorded sessions, attendees will be able to reach out to presenters through their virtual profile and ask questions directly.
Link HERE to view the complete SHIFT20 program.

Here are five facts to consider:

1. Retailers are reducing the number of SKUs they carry. With some products, this is because of anticipated supply chain issues. With others, it’s to free up shelf space for fast-moving and in-demand products, per the shopping trends of the past few months.
2. Many K-12 schools will be fully or partly virtual when classes resume in a few weeks. Many meals will be served at home. 
3. Universities and institutions will focus on pre-packaged foods for off-site consumption. 
4. The uptick in COVID-19 out-of-home dining during the summer months will slow when the seasons change.  
5. Food prices have increased the past few months, along with the unemployment rate. We are entering a recession.

Here are the five topics that every dairy foods formulator and supplier to the industry should prioritize.

1. Clean-label cost savings. A growing number of shoppers will become more price conscious this autumn. Brands that communicate their simple, clean-label attributes while being lower in price may have an advantage. Now is the time to consider formulation tweaks. This might be sweetener blending or strategic use of flavors and enhancers to reduce amounts of more costly ingredients, such as cheese, chocolate, cream, coffee and vanilla. This is especially true for imported ingredients.

2. Restaurant-inspired convenience cooking. Many home cooks are tiring, and while they may be increasingly price conscious, many are willing to spend a little more on restaurant-quality convenience. Think cooking creams and sauces; flavored cheeses and authentic queso; even barista foam and flavored creamer.

3. Adventurous flavors and package graphics. International travel has been shuttered. Domestic flights are limited, and frankly, scary to many. It’s time to design products that take the consumer on an adventure. They can even be tried and true favorites, just now with an attribute that brings back a memory of a place once visited. 

General Mills is doing this with its Oui by Yoplait French-style yogurt. The glass pots containing the yogurt now come in French-inspired designs. French Chic features stripes that come from the nautical culture of Northern France and have since become a style icon around the world. French Countryside features a pattern from what you might find in a farmhouse kitchen somewhere in the lavender fields of Provence. French Modern is inspired by Art Deco, the world-renowned visual style that first appeared in France in the early 1900s.

This limited-time Heritage Selection should be welcome by the many people who enjoy crafting with the glass pots. This is an activity that’s been trending the past few months while spending more time at home. Can your package provide something extra?

4. Immunity. The importance of health and wellness is at an all-time high as consumers try to build immunity and fight off the virus. This is something I wrote about early on after stay-at-home orders were issued. Read more HERE. It’s time to add proven probiotics to your dairy foods and flag their inclusion.

The American Dairy Products Institute hosted a webinar on July 9, 2020, titled: “Dairy Ingredients, Immunity & Immune Health.” To view the recorded event, link HERE. The research is fascinating. 

5. Food safety. It’s on top of every consumers’ mind. It’s also something that most companies don’t boast about. Now’s the time to share your food safety program, including COVID-19 precautions. 

Summer Inspiration Series: Formulating and Marketing for the New Norm School Lunch Rooms and University Dining Halls

Photo source: General Mills/Yoplait

The “Summer Inspiration Series” of Friday blogs is all about stepping out of our comfort zone in terms of innovation. Why not? We’re already operating in an unprecedented manner. Some blogs may explore new concepts in “other” food and beverage categories and discuss how they may apply to dairy, others may focus on new consumer behaviors and brainstorm on how dairy foods processors may respond in coming months. 

Institutional foodservice is getting revamped. For some elementary schools not much will change, as many are supplied with packaged meals from contracted vendors. The story is different for most middle schools and high schools where larger appetites and diet-conscious students pick and choose from an array of featured and ala carte items.

For university dining halls, there will no longer be a taco bar, make a sandwich or create your own pasta. Pre-packaged foods will dominate, with minimal onsite assembly of hot entrees. Schools that had at all-you-can eat meal plan will likely switch to a mini-mart format for carryout consumption.

These institutions need assistance from food and beverage manufacturers, who in turn need their packaging suppliers to provide solutions. Now’s the time to get busy, as many universities have moved up their open date, with campuses opening up in less than 60 days. This is a huge opportunity for packaged goods companies.

The dairy industry does a great job of offering individually wrapped single-serve products. Now’s the time, however, to start thinking of different portion sizes, alternative packages and targeted marketing. Further, production of these products will need to increase.

Think single-serve cottage cheese cups, which have been gaining traction in retail. These now have a place in dining halls. The same for parfaits, dessert cups and overnight oats. Condiments will be portion packs. Think dressings, dips and cheese sauce for chips and fries. Some of these products may require tweaked formulas to better handle the rigor of distribution and handling.

Fountain drinks and milk dispensers will be replaced with packaged beverages. Might the paperboard milk carton become fashionable again? These young adults needs pints of white for breakfast and lower-sugar, fun flavors with their meals. Cartons can be adorned with school colors and trivia. Feature athletes and award winners. Cartons provide an economical canvas to communicate with students.

This may be the first freshman university class to not feel the threat of gaining the freshman 10, as there will be better portion control and readily available nutrition information. Dairy processors must market smart products. Keep sugar content low and protein high. Educate students about protein quality. Keep labels clean and simple because students will be reading them. This is an opportunity to provide young adults with dairy facts and make them customers for life.
Photo source: University of Wisconsin-Madison, Babcock Hall

USDA Announces Flexibilities in School Lunch Programs

U.S. Secretary of Agriculture Sonny Perdue announced on June 25, 2020, a range of nationwide flexibilities to ensure America’s children receive the nutritious food they need throughout the upcoming school year. These waivers give states, schools and childcare providers time to plan for how they will serve children in the fall, including allowing for new and innovative feeding options as the nation recovers from the coronavirus.  

“As the country re-opens and schools prepare for the fall, a one-size-fits-all approach to meal service simply won’t cut it,” says Perdue. “The flexibilities announced today give states, schools, and child care providers the certainty they need to operate the USDA child nutrition programs in ways that make sense given their local, on-the-ground situations and ensure America’s children can count on meal service throughout the school year.”

As fall nears, schools are considering many different learning models. This announcement empowers them to operate the School Breakfast Program (SBP) and National School Lunch Program (NSLP) to best serve their students throughout the 2020-2021 school year. It also allows providers in the Child and Adult Care Food Program (CACFP) to tailor operations to serve the children in their care. USDA is providing flexibilities around meal patterns, group-setting requirements, meal service times and parent/guardian pick-up of meals for kids across all three programs to address anticipated changes for the coming school year. 

USDA is also announcing a new flexibility that waives the requirement for high schools to provide students the option to select some of the foods offered in a meal. While this practice, known as “offer versus serve” is encouraged, social distancing or meals-in-the-classroom models would make this regulatory requirement difficult. Collectively, these waivers reduce barriers to meal service options that support a transition back to normal operations while simultaneously responding to evolving local conditions.

Summer Inspiration Series: Formulating for Empowerment

The “Summer Inspiration Series” of Friday blogs is all about stepping out of our comfort zone in terms of innovation. Why not? We’re already operating in an unprecedented manner. Some blogs may explore new concepts in “other” food and beverage categories and discuss how they may apply to dairy, others may focus on new consumer behaviors and brainstorm on how dairy foods processors may respond in coming months. 

There’s been a lot of self-help, professional help and reflection in my life this past month. I believe it’s important to share, so others know they are not alone. I learned about three weeks ago that I am grieving loss of control of planning the future and loss of relationships (at trade shows and conferences). I would do anything for a long TSA line at O’Hare and a crowded Natural Products exposition where I get bumped every few minutes. (It was very disappointing to learn that the East installment, which was scheduled for late September in Philadelphia, got cancelled this week.)

Most people are grieving loss of some type of control, even though many are not aware. This loss of control fuels the desire to control what can be controlled. And that my friends, is diet. It’s the “what we eat, when we eat and where we eat.” Right now, we still have that power. Savvy marketers will formulate and position foods and beverages to empower consumers to choose their product.

“To combat current feelings of powerlessness, consumers are focusing on things they can control,” says Laurie Demerrit, chief executive officer, The Hartman Group, Bellevue, Wash. “Consumers are not opting out of consumption but are acting more intentionally and seeking out ways to feel empowered in their purchasing behavior.

“The importance of personal empowerment is buoyed by new emphasis on the connectivity of communities in myriad ways, including concern about protecting essential workers, caring for vulnerable populations and supporting local businesses,” she says. “How the ‘me’ directly affects the ‘we’ is a concept consumers won’t quickly forget. However, consumers will increasingly demand visible action—not just lip service—around connecting and caring for communities.

“We are seeing consumers employ distinct strategies to balance their desire for fresh and the need for long-lasting, such as buying fresh and organic in specific categories and seeking quality cues that speak to fresh and less processed when purchasing frozen and shelf-stable formats. And while many companies are questioning whether they placed the right bet by focusing on issues related to sustainability, there is evidence that conscious consumption is actually up during this time.”

Photo source: California Milk Advisory Board

Here’s a great headline in the summer issue of Natural Products Insider: “Sustainable Sourcing: Not ‘Selfies with Farmers.’” The article’s author, Blake Ebersole, president, NaturPro Scientific, writes, “Sustainability means different things to different people, but there’s one thing it definitely is not: a photo-op. In evaluating and improving supply sustainability, real benefits come from real investment.” 

He also wrote: “Regenerative farming practices have arrived at the front of the sustainability discussion.”

Consumers are in control of how they spend their money. Empower them to invest in your sustainability story, not just your happy cows on a happy family farm.

“Consumers are not opting out of consumption but are acting more intentionally and seeking out ways to feel empowered in their purchasing behavior,” says Demerrit.

There’s a renewed focus on the role of individual action and conscientious, making it perfect timing for General Mills, the maker of Yoplait, Liberté and Mountain High yogurt products, to start a three-year regenerative dairy pilot in western Michigan, a key sourcing region for its fluid milk supply. General Mills has partnered with consultants Understanding Ag and dairy cooperative Foremost Farms to pilot regenerative practices and provide support to participating dairy farmers. 

Implementing regenerative practices on dairy farms requires a holistic approach to managing land, cows and manure. This is the third regenerative agriculture pilot that the company has launched--and the first for its dairy ingredient supply--since making a commitment in 2019 to advance regenerative agriculture practices on one million acres of farmland by 2030. 

“As an industry, dairy farms have been especially hard hit in recent months and their resiliency is being tested. We believe regenerative agriculture builds and strengthens farmer resilience so they can better withstand pressures, be it societal, financial or environmental,” says Doug Martin, president of the General Mills U.S. yogurt business. “Consumers increasingly want to support brands and companies they trust are acting as environmental stewards. This pilot with Yoplait is a great example of the role our brands can play in unleashing the scale of our supply chain--supporting farmers, promoting animal welfare, and improving the health of the planet, all while delivering a great-tasting product.” 

Photo source: California Milk Advisory Board

The three dairy farms in the pilot, which collectively manage more than 14,000 acres, were chosen for their proximity to General Mills’ dairy manufacturing facility in Reed City, Mich., which produces a variety of Yoplait products. As the pilot begins, Understanding Ag consultants will meet with each dairy farmer to co-develop and implement custom regenerative management plans for a portion of their operation. Throughout the pilot, partners will monitor data and measure impacts to soil, biodiversity, water, animal well-being and farm profitability. 

This effort is something consumers want to support. On a more personal level, consumers are taking control of their health. Products need to speak to their needs. These needs must be communicated to the shopper so they feel empowered to choose your product. 

In the past few weeks, upon carefully analyzing recent new product entries and supportive promotion efforts, there appears to be four product themes emerging as marketing call outs to shoppers during the COVID-19 pandemic. 

Calm/Soothe/Refresh. That’s what you find in new Dunkin’ Refreshers iced beverages. The rollout came with this messaging: After a long and challenging spring, people are looking for much-needed moments of mental and physical refresh. Dunkin’ has prepared the perfect way to give its guests that new glow and a boost of brightness, energy and excitement.

“Dunkin’ has been there to keep our guests running during these difficult months. Now, with the start of summer, it’s the perfect time for something fresh and exciting to energize and enliven people again,” says Jill Nelson, vice president, marketing strategy at Dunkin’, Canton, Mass. “With a combination of iced green tea, B vitamins and bright bursts of flavor, Dunkin’ Refreshers stand apart as the perfect, new choice to help anyone get their glow back.”

Strength/Power. Chobani demonstrates this theme with its new Chobani Complete. Described as “Advanced Nutrition Yogurt” on front labels, the product also boasts upfront that it delivers “20 amino acids” and is “complete protein.” (All dairy yogurt contains this, but it’s the first time, to my knowledge, being called out). Labels also state that the yogurt is lactose free, easy to digest, made with only real fruit, has no added sugars, contains soluble fiber and is prebiotic and probiotic. Key ingredients are: chicory root fiber, lactase, monk fruit extract, stevia and an impressive cocktail of lactic acid cultures.

Protect/Immunity. Danone North America is debuting Super Danimals, a low-fat yogurt created to help support the immune system of kids. While the product was under development for more than a year, its timing is impeccable. The company conducted extensive research, which revealed a priority for parents is to find products that can support children’s immune systems, and this was discovered before COVID-19. 

Super Danimals features probiotics and vitamins C and D, all of which are associated with boosting immunity. It’s also free of artificial preservative ingredients and contains no colors or flavors from artificial sources. One 4-ounce cup contains 80 calories, 1.5 grams of fat, 4 grams of protein and 9 grams of sugar (4 grams are added).

“Based on our research, we know children’s health is always on parents’ minds, and families are exploring new ways to help support their children’s immune systems with the snacks they buy,” says Kristie Leigh, senior manager of scientific affairs at Danone. “By regularly adding Super Danimals to a balanced diet and healthy lifestyle, parents can feel good about helping support their children’s immune systems with a tasty snack their kids love.”

Revive/Energy. All three of Trimona’s new organic whole milk Superfood Yogurts complement the four themes of “formulations that empower” consumers. Revive (Turmeric + Ginger) contains maca, lucuma, mesquite, turmeric, cinnamon, ginger and black pepper, and is described as a blend to revive your creativity and your spirit. The other two are: Protect (Acai + Beets), with acai, maca root, aronia, beetroot and lucuma, a blend to protect your body and your soul, and Refresh (Matcha + Maca), with matcha tea, maca, lucuma, spirulina and chlorella, a blend to refresh your memory and your day.

Each Trimona Superfood Yogurt cup contains billions of probiotic cultures and no added sugar. A 5-ounce cup contains 110 calories, 6 to 7 grams of fat, 5 grams of protein and 5 grams of inherent sugar. The yogurt is sweetened with monkfruit. 

“We have been working on these products for almost two years and are delighted with the result. Our products combine the healthy benefits of our non-strained, grass-fed organic yogurt and superfoods,” says Atanas Valev, founder. “We’d like to think of our new line as Yogurt 2.0. It is arguably the healthiest yogurt snack in the market. It is a truly innovative line of products that will bring incremental sales to the yogurt isle.”

These are all products with purpose. They empower consumers to mindfully eat, giving shoppers the ability to control what they use to fuel the body.  

Demerrit concludes, “Personal resilience—already gaining footing in health and wellness trends of proactive, holistic medicine and mindfulness—will have enhanced traction as consumers manage the effects of the pandemic on themselves and their communities and face fears about future crises. Specifically, holistic immunity and thrifting behaviors will expand to support physical and economic resilience while calls for systemic change address community resilience.”

Get Educated on Crisis Management.

There is one way to test out your crisis management program and that’s a global pandemic. Crisis management is a critical organizational function. It can be divided into three phases: 1) Pre-crisis; 2) Crisis response and 3) Post-crisis, according to Jane Dummer, consultant to the food industry.

Read more HERE and listen to her short podcast on the topic by linking HERE. 

Need Help Formulating High-Protein Dairy Foods? 

Thank you to today’s blog sponsor, Idaho Milk Products, which will be offering virtual tours of its Milk Innovation Center that includes a state-of-the-art processing area, an instrumental lab and a multi-purpose room for product evaluations and conferencing. The virtual tours will primarily focus on the process formulations for ready-to-drink (RTD) beverages, protein bars and ice cream. This addition provides customers the ability to work directly with the Idaho Milk Products research and innovation team to build custom applications and work on new product developments based on their individual needs.

“Idaho Milk Products’ fresh, highly functional milk ingredients are tailored to meet the desire to increase the protein load in RTD beverages, yogurts, RTMs (Ready-to-Mix), weight management, and sports and adult nutrition products,” says Dr. Chenchaiah Marella, vice president of research and product development. “With state-of-the-art equipment in our Milk Innovation Center, we assure our customers are receiving expert help in formulating their products with quality ingredients in a timely manner and with confidence.” For more information, link HERE. 

Federal Dietary Committee Recommends 3 Servings of Dairy Per Day, Puts Dairy in Healthy Foods Category with Fruits, Veggies, Legumes, Whole Grains

The International Dairy Foods Association (IDFA) released the following statement on June 17, 2020:

“Today, members of the Dietary Guidelines Advisory Committee (DGAC) confirmed dairy products should maintain a central, important role in federal nutrition recommendations for people beginning at a very early age. In addition to maintaining three servings of dairy per day, the committee found strong evidence pointing to positive health outcomes from dairy foods. In fact, a diet including low-fat and fat-free dairy, legumes, whole grains, fruits and vegetables is considered the ideal, healthy dietary pattern for all ages.

“In other key findings from their draft scientific report presented today, the DGAC highlighted new evidence strengthening dairy’s role in maintaining bone health for adults. For mothers, the committee dispelled misinformation about dairy’s link to asthma, saying there is no association between a mother’s consumption of dairy and the development of asthma in children. And a new topic introduced in these Dietary Guidelines lays the groundwork for clearer nutrition recommendations for children from birth through 24 months of age, with the experts recommending small amounts of some foods including dairy foods, alongside fruits and vegetables, nut and seed products, and whole grain products, beginning at 6-12 months and continuing thereafter. For toddlers, dairy foods are particularly important for the vitamins and nutrients they provide. This recommendation could not be clearer, demonstrating what the American Academy of Pediatrics has stressed for years, that dairy plays a critical role in the diet of children to bolster long-term health.

“Once again, the committee found no linkage between consumption of dairy foods and incidences of breast cancer, which should put an end to a longstanding disinformation campaign to alarm and confuse the public.

“IDFA is disappointed that the reported outcomes today did not include a mention of relevant scientific studies which show the benefits of dairy at each fat level. There is robust evidence to support the inclusion of dairy foods at all fat levels in recommended food patterns. With the DGAC’s role coming to an end, IDFA encourages USDA and HHS to remedy this oversight in the final guidelines to be released this year.

“The conclusions offered today by the Dietary Guidelines Advisory Committee firmly establish dairy as one of the most nutritionally beneficial foods in dietary patterns alongside fruits and vegetables, legumes and whole grains. IDFA is pleased to see federal nutrition guidance continue to affirm the important nutritional contributions made by dairy foods and remind Americans that a healthy diet includes three daily servings of dairy.”

Summer Inspiration Series: Formulating for the Class of 2020

Photo source: Krispy Kreme

The “Summer Inspiration Series” of Friday blogs is all about stepping out of our comfort zone in terms of innovation. Why not? We’re already operating in an unprecedented manner. Some blogs may explore new concepts in “other” food and beverage categories and discuss how they may apply to dairy, others may focus on new consumer behaviors and brainstorm on how dairy foods processors may respond in coming months.

Congratulations to the Class of 2020…the new norm generation. Their lives have been turned completely upside down and are forever changed. They are the customer to focus on.

My heart goes out to all parents who have been celebrating graduations through video streams and drive-by commencement ceremonies. That’s on my family’s plan this weekend when my youngest graduates from high school. Congratulations!

In the past few months during quarantine, curfew and boredom, these young adults had to grow up quickly. Their eating habits have changed. Marketers of all types of products have taken note and are adjusting their offerings and their business to better appeal to this demographic.

It’s no longer Millennials and Gen Z. They are the 2020ers.

Over the next few years while we entertain a recession, their discretionary spending money will be used carefully. It’s time to revisit your business’ learnings from the last recession and adjust accordingly. But, take note, as a society we have changed tremendously over the past decade in terms of our eating habits.

This week the International Food Information Council (IFIC) published its 2020 Food & Health Survey, which was conducted between April 8 and April 16, about one month into the COVID-19 mayhem. The survey showed that 85% of Americans have made at least some change in the foods they eat or how they prepare food.

Among the 85% who have made any change, 60% of Americans report cooking at home more. Respondents also said they are snacking more (32%) and thinking about food more than usual (27%). Consumers under age 35 are most likely to have made changes, both in terms of healthier and less healthy choices. These changes will likely continue as we move forward.

Hindsight is 2020 (as compared to 2010)
Taste and price remain the top factors for purchase decisions, and while there has been movement year to year in the degree to which purchase drivers impact consumers, the comparison of 2010 results to 2020 shows almost no change. Yet, Americans have a different view of themselves and their own evolving purchasing decisions: 54% of all consumers, and 63% of those over age 50 care more about the healthfulness of their choices than they did in 2010.

According to consumers reflecting on their own habits over the past year, 28% are eating more protein from plant sources, 24% are eating more plant-based dairy and 17% are eating more plant-based meat alternatives. Those following a specific diet or eating pattern are huge drivers of these numbers: 41% of dieters say they increased consumption of protein from plant sources (vs. 18% of those not following a diet) and 28% say they eat more plant-based meat alternatives (vs. just 9%).

MORE THAN 50% VIEW DAIRY AS HEALTHY! Also, the number of consumers who view animal protein as healthful has increased. These are important figures to act on. It is paramount that the industry sell the healthfulness of dairy foods.

Fewer Americans are avoiding sugars this year, although it is still a very common practice: 74% are trying to avoid or limit sugars, compared to 80% in 2019. The top ways they are doing so is by drinking water instead of caloric beverages (60%) and limiting consumption of certain foods and beverages (42%). The most popular reasons people avoid sugars include not wanting extra calories (46%), believing that sugar is unhealthy (42%) and thinking it helps them lose or maintain weight (40%).

A “natural” label is most influential both when shopping and when purchasing food prepared outside the home. The Class of 2020 is likely reading more about food and making purchase decisions on product claims.

In my opinion, this is one of the most interesting findings from this year’s survey: Consumers perceive health differences in products even if they have the same Nutrition Facts Panel. Telling them the product is “all natural” does matter. Short ingredient lists, no artificial ingredients and use of familiar, traditional manufacturing technologies are all associated with perceived healthfulness of foods.

The 2020 Food & Health Survey provided an opportunity to examine some of the more significant trends in food attitudes and behaviors since 2010. The factors with the most influence on food-purchasing decisions, tracked by the survey, have remained relatively stable over the past decade, with taste consistently dominating the list, followed by price, healthfulness, convenience and sustainability (specified as “environmental sustainability” since last year).

Nearly 6 in 10 consumers say it is important that the food products they purchase or consume are produced in an environmentally sustainable way (similar to the 54% who said the same in 2019). Four out of 10 (43%) consumers also say it is important that a food manufacturer “has a commitment” to sustainability and 40% say the same about knowing food was produced using farming technologies that seek to reduce the impact on natural resources.

America’s Dairy Farmers Celebrate 2020 Graduates
In case you missed what the U.S. dairy industry did to celebrate the Class of 2020, a few weeks ago on The Tonight Show Starring Jimmy Fallon, Fallon announced a pizza giveaway funded by America’s dairy farmers and executed by Pizza Hut. Together, they gave away half a million pizzas to graduates and their families. We enjoyed ours! Thank you.

“Our brand has a long history of celebrating moments that matter--like graduations--and Pizza Hut takes pride in being a part of our customers’ big days. So, it’s only natural that we’d be there for students and their families to help celebrate the accomplishments of the graduating class of 2020,” said George Felix, chief marketing officer, Pizza Hut. “We’re proud to partner with America’s hard-working dairy farmers to bring students who are missing out on their chance to cross the stage with their diploma, an opportunity to celebrate with their favorite Pizza Hut pizza.”

Marilyn Hershey, a Pennsylvania dairy farmer and chair of Dairy Management Inc., said, “America’s dairy farmers have great appreciation and respect for the hard work that graduating students have put in and nothing celebrates that better than cheese and pizza enjoyed with family and friends.”

And in closing…two great quotes for our graduates.

“Never show up late with a coffee in your hand. The message when you do that is, you are not as important to me as this iced vanilla latte.” Jimmy Kimmel

“It’s natural that you may be worried about the future, what’s on the other side of this pandemic, but know that your generation is equal to this moment, and to the unprecedented opportunity for change that is coming. Before any great creation, there will always be chaos. Now go find your new order in it.” Stephen Colbert