A Dairy Processor’s Guide to Whole Foods Market’s Top-10 Food and Beverage Trends for 2025

 

(photo source: Milky Mist) Milky Mist believes in the power of dairy. One of the company’s most recent innovations is shelf-stable Milkshakes in Coffee and Butterscotch flavors. They are marketed as “the ultimate pick-me-up for your day! Guaranteed to keep you refreshed all day, indulge in pure delight with every sip.” The company states its healthy beverages are not only rich in taste, they provide calcium, potassium and protein, among other nutrients.

The Global Dairy Food Market size is estimated to grow by $88.1 billion from 2024 to 2028, according to Technavio. The market is estimated to grow at a compound annual growth rate of more than 2% during the forecast period. 

Consumer interest in healthful, minimally processed, natural, whole foods is driving this growth. The report states that the dairy foods industry is thriving with trends like milk, yogurt, cheese, spreads and ice creams leading the way. Nutritional value is a key focus. 

Lactose-intolerant consumers are finally feeling the love from dairy processors thanks to the plethora of lactose-free offerings that rolled out this past year. Thank you! 

If you have not heard of Milky Mist, check them out HERE.

“Milky Mist is dedicated to spreading the daily dose of nutrition, all day, every day. From being the initial ingredient to delivering the finishing touch, we make sure our products add the nutritional value you deserve. With our range of 300+ products, we’re committed to making India, a healthy India.”

“Daily dose of nutrition,” hmm, wonder if they read my blog. 

Innovative fermented dairy products, with probiotics and prebiotics, along with added vitamins, minerals, bioactive peptides, specific proteins, conjugated linoleic acid, antioxidants, organic acids and more are being embraced by all consumers, according to the Technavio report. Consumers finally get probiotics and they are turning to dairy for their daily dose. 

Whole Foods Market recognizes the nutritional value of dairy done correctly. Look at the opportunities for dairy in the natural and organic foods retailer’s 10th annual trends report.

The Whole Foods Market Trends Council--a collective of more than 50 Whole Foods Market team members ranging from foragers and buyers to culinary experts--develop these trend predictions each year through a combination of deep industry experience, keen observation of consumer preferences, and collaborative sessions with emerging and established brands.

Here they are. Explore how dairy fits in. 

1. International Snacking
The snack aisle is a perfect place for disruption with brands taking on salty snacks and adding global flavors to create fusion foods that have mass appeal and entice consumers to try something new. This is so much more than yogurt-covered raisins. Think freeze-dried kulfi in flavors such as mango or pistachio. Baked cheese snacks need to push flavor boundaries. I welcome a hot honey 100% cheddar crisp. 

2. Ever-Adaptable Dumpling
Dumplings are dough pockets with a typically savory filling, usually cooked by boiling, steaming or pan frying. Also known as pocket foods, they’re showing up in multiple aisles including frozen and shelf-stable, single-serve formats. These products hit on a few trends. Many are authentic to a founder’s cultural roots and ripe for fusion and unexpected mash-ups, which have continued popularity both on TikTok and restaurant menus. Dumplings are long-standing staples in cuisines across the globe, making them a trend everyone can feel involved in and get excited about.

You know what goes great with pierogis, the Polish dumpling? It’s sour cream. (Being 100% Polish, I know.) There’s a lot of room for innovation in dumpling dipping sauces based on dairy. I hate to be repetitive, but why is no one doing a hot honey dairy dip? This sounds like an amazing accompaniment to Asian dumplings, heck, even potato cheese pierogies. (I make the best.)

3. Crunch: Texture of the Moment
It’s time for those dual compartments and dome cups of yogurt, pudding and dairy desserts to provide something more than cookie crumbles. Enough said.

This week, my friends at Maple Hill Creamery, America’s original 100% grass-fed organic dairy company, announced its partnership with Purely Elizabeth. With Maple Hill’s Grass-Fed Organic Greek Yogurt, consumers are enjoying yogurt as nature intended, packed with a 50% higher ratio of omega-3 to omega-6 fatty acids and 40% higher levels of conjugated linoleic acids, which contribute to potential health benefits, including a lower risk of heart disease. The yogurt is a great canvas for Purely Elizabeth’s Pumpkin Cinnamon Ancient Grain Granola, a gluten-free, non-GMO blend crafted with organic oats, coconut sugar and pumpkin seeds. 

4. Hydration Hype
The Whole Foods Market Trends Council reports that consumers want more from their water these days. They are seeking added electrolytes and hydration in more innovative forms. Think clear whey protein waters. There are not enough of these out there and they are limited to the health food aisle. Start selling hydration in the fluid milk case.  

5. Tea’s Time
There’s tea talk everywhere you turn, both as a beverage and in flavor popularity. The Whole Foods Market Trends Council identified a number of dairy players in this space. They are Heritage Kulfi Cardamom Chai Ice Cream, Kola Goodies Sri Lankan Milk Tea Latte, Van Leeuwen Blue Jasmine Tea Ice Cream Bars and Bubbies Milk Tea Mochi. This is a HUGE opportunity. Enough said. 

Oh, and in case you forgot, dairies can process ready-to-drink tea, too. 

6. Next-Level Compostable
Products that aren’t ditching packaging completely are going the compostable route, making some or all elements of their packaging compostable. Don’t be shy. Share your packaging story. 

7. More-Sustainable Sips
Well, OK, this trend focuses on forward-thinking boozy brands that are working to reduce their environmental footprints. Natural and organic wines may not be new, but brands are taking things a step further by embracing regenerative practices and lower-impact packaging. And guess what, so are dairies.

This week, Challenge Dairy announced its commitment to sustainability by integrating electric vehicles (EV) into its delivery fleet. As part of its dedication to reducing its carbon footprint and complying with California’s evolving emissions regulations, the company plans to deploy three EV trucks by the end of 2024, with the goal of achieving a 100% electric fleet by 2035. 

Transitioning to EV trucks will significantly reduce diesel consumption, with each truck expected to save approximately 3,000 gallons of diesel annually. This transition translates to a reduction of around 30 metric tons of carbon dioxide emissions per truck each year, directly supporting Challenge Dairy’s sustainability goals and contributing to improved air quality in the San Joaquin Valley.

8. Sourdough Stepped Up
During the pandemic, we saw a sourdough resurgence with at-home bakers trying their hand at the classic fermented bread. This trend is moving into grocery aisles in both traditional and innovative ways with customers looking for the benefits and flavor that sourdough offers without spending hours in the kitchen. 

There has to be a dairy opportunity here. Someone out there, please figure it out. Sourdough-flavored buttermilk? 

9. Plant-Based Aquatic Ingredients
With the continued popularity of seaweed and the increasing interest in harvesting readily available aquatic plants for more-sustainable sources of protein and nutrients, the tide is turning toward foods made with more sea and freshwater greens. Sea moss, in particular, has been making a splash as a buzzy wellness ingredient—especially touted for its iron, magnesium and iodine content—in formats such as beverages and gummies. Duckweed, or water lentils, is in the early stages of emerging on the scene and boasts a higher protein content than other leafy greens, and agar-agar (a plant-based gelatin alternative that comes from red algae) is primarily fiber based and promoted for digestive support. 

It is challenging for me to brainstorm on how delicious dairy can go with seaweed. (I am not a fan.) But, something makes me think that dried seaweed makes for an interesting inclusion. Think “Trend #1 International Snacking”  and “Trend #3 Crunch: Texture of the Moment.” Maybe it could be a mix-in for a sourdough-flavored dual compartment yogurt?  

10. Protein Power-Up
Consumers are looking to incorporate more protein in their diet beyond traditional powders and bars, with an emphasis on ramping up protein consumption at meal times and with “whole food” snacking. Recipes incorporating cottage cheese (still the “it girl” in dairy) may have kick-started customers’ desires to seek out protein in whole food sources, with consumers now prioritizing animal protein. Enough said! 

Dairy Wins Big in Vegas this Week

 

(photo left) Young shoppers are looking for experiences and are willing to spend on premium products. These mini donut milkshakes were served as a snack at GroceryShop. Real milk. Real ice cream. 

 

“The next five years are going to be phenomenal,” said Sherry Frey, vice president-product insights at NielsenIQ, when speaking at GroceryShop on Monday, October 7.

For starters, she showed that sales are up in the perimeter of the store. You know what’s in the perimeter? It’s dairy. (See chart below.)

She also showed that “Better For” is once again outpacing conventional. You know what’s Better For? It’s dairy. (See chart below.)

She showed how there will be critical shifts in generational spending over the next five years. (See chart below.)

She explained that while the conversation often refers to generations, it’s really about the life stage that the generation is in and how they are handling it. 

Boomers have been trying to defy aging for the past 20 years. They are starting to realize that maybe it’s not a good thing to have their bodies outlast their brains. Younger generations will likely address aging in a different way, and that starts now.

“Today’s consumer is more intentional than ever,” said Frey. “Keep your eyes on the Millenials and where they are in their life stages.”

Key takeaways from her presentation include:

• Spending is being directed to where it matters most in the great shift from cautious to intentional spending.
• The most valued products deliver in multiple ways to multiple consumers.
• Changing priorities will drive the innovation requirements in the future.

Ram Krishnan, CEO of North American Beverages for PepsiCo also spoke at GroceryShop. He discussed the challenges of building brand loyalty in an era of fickle shoppers. He described today’s shoppers as having “precision loyalty.” They are loyal to what works for them. 

 

(photo left) Shamrock Farms said its single-serve milks and protein-enhanced milks are rockin’ in retail and the c-store channel.

David Portalatin, senior vice president-food and foodservice industry adviser,  Circana, spoke at a MilkPEP webinar on Thursday, October 10. He shared highlights from the hot-off-the-presses “Eating Patterns in America” report. He explained that in-home beverage consumption continues to grow as away-from-home remains stable. Overall, annual beverage-drinkings-per-capita is 1,504, as compared to 1,482 in the 2023 report. This is not volume. This is the occasion of putting a beverage to the mouth and drinking. 

“Consumers are looking to beverages to satisfy various needs,” said Portalatin.

They are: Hydration, Energy, Source of Protein and Source of Treat or Reward.

 

(photo right) Spylt—the original caffeinated, protein-enhanced flavored milk—had a very strong and active presence at NACS. The product appeals to the growing e-sport sector. To read more about e-sports, link HERE.

 

Fluid milk is the ideal base ingredient to speak to what today’s consumers want from their beverages. Convenience channels and grab-and-go retail merchandising is a great place for milk-based beverages. 

Convenience stores saw record sales in 2023, according to the National Association of Convenience Stores (NACS), which hosted the 2024 NACS Show at the Las Vegas Convention Center from Oct. 7-10. Total convenience industry sales in 2023 were $859.8 billion, of which $327.6 were from in-store sales. The average basket—what customers spent per visit—increased 3.7% to $7.80.

(photo above) Chobani, and its recently acquired LaColombe business, make milk fun. Both brands have new dairy beverages rolling out soon.

This year’s theme—We Are Convenience—reminded c-store operators that they are selling a concept, and that is convenience. Historically, convenience meant stopping for a gallon of milk or a loaf of bread on the way home from work. Today, convenience equates to foodservice, beverages and snacks. Dairy plays in all three.

(photo right) Sargento is all about snacking cheese. The c-store channel represents a growth opportunity. 

To read more about “Redefining the c-store experience,” link HERE to an article I wrote on this topic for Food Business News.

Stopping at the c-store for a gallon of milk and a loaf of bread on the way home from work was something those who stayed at the Tropicana did, which I watched implode in the wee early hours of October 9. Get inspired by watching a 7-minute VIDEO of the Tropicana hotel imploding, taken by yours truly. There’s no going back. The time is now for the Future of Dairy. It's time to Rethink Dairy.

Dairy is Not a Trend. It’s the Future of Nutrition and Innovation.

 

Trends come and go, while taste always reigns. Nutrition is increasingly being prioritized by today’s consumers and is fueling the future of food innovation. 

Health-conscious consumers are driving a staggering $638 billion in food and beverage spending, with $363 billion allocated to retail and $275 billion to foodservice, according to Circana’s Complete Food & Beverage research released this week. This data highlights a growing trend in the wellness movement, with one-third of all food and beverage spending now driven by consumers prioritizing physical, mental and social well-being. 

“Consumers are looking for wellness across every aspect of their lives, and food and beverages are playing a critical role in this transformation,” said Sally Lyons Wyatt, global executive vice president and chief advisor at Circana. “Our Complete Food & Beverage research shows that while the retail sector is excelling at meeting these needs, there is significant opportunity for foodservice providers to innovate and offer wellness-centered dining experiences.”

Consumers are increasingly seeking fresh, nutrient-dense foods that promote physical health, according to the research. Retailers are responding by offering a variety of minimally processed products high in protein, fiber and natural ingredients. Think milk and all things dairy!

In contrast, wellness influences only 11% of foodservice meals, as dining out remains more focused on convenience and indulgence. This presents an amazing opportunity for dairy in the out-of-home channel.

Thirty-five percent of consumers view food as an important tool for managing stress and improving mood, driving increased interest in functional foods and beverages that support mental health, according to Circana. While retailers are capitalizing on this trend with expanded assortments of relaxation beverages and mood-enhancing snacks, both retail and foodservice are providing treat-based indulgences, such as bakery items, candy, and yes, ice cream, which are often go-to items for emotional well-being. 

(click on graph to enlarge)

The rising trend of “eatertainment” is changing the way consumers experience dining, blending food with social interaction. This is particularly strong in foodservice, where chains are adapting to meet consumer demand for experiential dining. Retailers are also supporting social wellness by hosting community-driven events, helping consumers integrate physical health with social engagement.

It’s no wonder Milk Bar is expanding into my hometown. Read about this below.

As consumer demand for wellness grows, dairy foods formulators have the opportunity to innovate by expanding their offerings to better align with physical, mental and social well-being. Listen to the on-demand Circana webinar on this topic by linking HERE.

Packed with 13 essential nutrients that we all need to thrive and live healthy lives, along with being absolutely delicious, milk and products made with milk and milk ingredients, are part of the solution to addressing hunger and food insecurity. Listen to how dairy industry leaders are tapping into milk’s nutritional potential to address nutritional challenges. Link HERE to this week’s episode of The Dairy Download. 

Milk Bar Is Coming to Chicago

Milk Bar, the rule-breaking dessert company with New York City origins, is finally expanding to Chicago, my hometown and the location of many dairy- and food-centric associations, businesses and conferences. The Chicago location will be in the Fulton Market District at The Hoxton hotel. The shop will feature its full dessert menu along with Chicago-specific treats. Milk Bar was founded in 2008 and has more than a dozen locations in cities outside of New York, including Los Angeles, Boston and Washington D.C. 

“I am a Midwesterner by birth and Chicago has long been one of my favorite cities to visit. Food, culture, sports and art, the city is teeming with real people doing real things their way: creatively, honestly and inspiringly,” said Christina Tosi, Milk Bar founder and award-winning chef. “We promise to show up with passion, enthusiasm and care, serving delicious cookies, cake, pie and ice cream early in the morning until late at night. Chicago, we can’t wait to show up for you. We can’t wait to call you home.”

Tosi spoke a number of years ago at the International Foods Association’s Ice Cream Tech Conference. She believes in the power of dairy. Even her baked goods rely on real butter. 

This summer, Milk Bar teamed up with Tropicana to make a limited-time-offering. The soft-serve, Orange Squeeze is a nostalgic cream-meets-citrus flavor. A cup sold for $7 and a pint for $13.

“I grew up racing to the ice cream truck to score my favorite creamy, orange and vanilla flavored bar,” said Tosi. “Orange Squeeze is our take on that childhood classic, transporting you back, Milk Bar style, to sweet summer memories of that bright, fresh-tasting combo.”

The pandemic required that Tosi pivot her café business into retail pints. She started with four of the café’s most popular ice creams flavors. Soon, three others followed as the brand gained national distribution. 

Like novelty cups, pints present a package size that readily accommodates lots of inclusions along with unique textures, as compared to larger multi-serve containers that may get too messy when overwhelmed with extras that impact the frozen state.   

The four original pints included Birthday Cake, a birthday cake-flavored ice cream with birthday cake crumbs and ribbons of birthday frosting. The Cereal Milk ice cream base tastes like the bottom of the cereal bowl with some extras in the form of a salty-sweet cornflake crunch. Cornflake Chocolate Chip Marshmallow is an ode to the Milk Bar’s bestselling cookie. It combines cornflake crunch, chocolate chunks and gooey marshmallow swirls throughout a cookie dough ice cream. Milk Bar Pie is vanilla ice cream with swirls of a gooey butter filling and toasted oat crumble.

The three additional flavors are Peanut Butter Chocolate Cookie Crush (peanut butter chocolate ice cream with peanut butter cookie crumbs and fudgy chocolate cookie batter); Chocolate Mint Cookies N’ Cream (chocolate mint ice cream, chocolate cookie batter, cookies n’ cream crunch and creamy mint swirl) and Vanilla Sugar Cookie (vanilla cookie swirled into an ultra-creamy pint of vanilla-flavored ice cream with sugar cookies and a frosting swirl).

“I have dreamed about bringing Milk Bar to the freezer section--the holy grail of the supermarket in my opinion--for nearly a decade. I knew coming in now, we’d need to do more than bend pieces of our finished treats into an ice cream pint. So we toiled and tinkered, taking our favorite flavor profiles and imagining them through ice cream bases, swirls, gobs, fudges, frostings, crumbs and crunches to create our proudest on-shelf creation yet,” said Tosi, when the line debuted in June 2021. “Our ice creams are meant for the unapologetically indulgent moments and mean serious business, no two are alike. Whether we already have a place in your heart or you’re looking for even more joy and spirit in your ice cream bowl, we got you!”

Idaho Milk Products is Becoming an Ice Cream Co-Packer

To help more ice cream creators turn their innovations into reality, Idaho Milk Products, today’s blog sponsor (thank you!), is constructing a $200 million dual ice cream and powder blending facility at its Jerome, Idaho, campus. The company’s entry into the ice cream business comes with a focus on premium indulgent and functional recipes in both bulk and novelty formats, while blending capabilities will support the ice cream business and create capabilities to provide custom formulations to both existing and new customers.

“Construction of the custom-designed 183,000-square-foot plant will commence within the next two months and be substantially complete by early 2026 with full commercial production by May 2026,” said John Murphy, vice president of operations at Idaho Milk Products. 

Commenting further on the company’s commercial strategy, Kevin Quinn, vice president of sales and marketing, said, “We have the freshest, best-quality cream in the market, and the project was initially born out of the conviction to add incremental value to a portion of that product stream. The inclusion of a blending facility in the new plant creates new ways to service our customers and add to the benefits of our vertically integrated model.”

The team at Idaho Milk Products believes that this project builds on the company’s purpose, is a natural extension of its existing model and has the potential to create one of the world’s most sustainable ice cream businesses. A groundbreaking event will take place October 11, 2024.

“We will be able to produce a variety of novelty products, including sandwiches and stick bars and have the capability of producing various carton sizes from less than pint to half a gallon,” said Louis Armstrong, ice cream business manager. “We intend to co-manufacture various ice cream products in partnership with brands’ or retailers’ needs. Our plant, at scale, will have the capacity to produce roughly 14 million gallons of ice cream mix per year into various frozen formats.”

Daragh Maccabee, CEO of Idaho Milk Products, said, “Our commitment to our core business remains. We work hard every day to maintain our position as a global leader in milk protein concentrates (MPC) and milk protein isolates (MPI). At the same time, we constantly seek out new ways to add value to our milk, always doing so in a way that is sustainable for the longer term. Our vision for this plant is to build on the strength of our existing business, leverage our Milk Innovation Center, the strength of our R&D team and the unique synergies that this business will create.”

The Many Reasons to Use a Co-Packer

The dairy foods industry is overflowing with entrepreneurs, which is a beautiful thing. Innovative product development and healthy competition keeps the dairy case exciting and consumers interested in all things dairy. 

Early in the process of innovation, startups must decide whether they want to invest in processing, packaging and warehousing (to have control over the operation as well as secure any proprietary technology) or to partner with a contract manufacturer, aka a co-packer. 

More times than not, entrepreneurs and smaller manufacturers choose to partner with an expert to manufacture their products. There are many reasons why this is the smarter option. 

The most obvious reason is that this option reduces capital investment and assists with cash flow, freeing up dollars for marketing efforts to build brand awareness. Co-packers are also experts at what they do. This frees up man power and brain time, reducing energy spent on learning the process and troubleshooting common production issues. 

Before you begin interviewing potential co-packer partners, it is paramount that you identify those criteria that are non-negotiable and those where there’s flexibility. Keep in mind, co-packers vary in capabilities. Decide if you want to source ingredients and packaging, or if you prefer the co-packer do this for possible bulk pricing benefits. 

Speaking of pricing, determine your cost structure. Discuss potential hidden expenses.

Set quality standards. Identify product and package specifications, including shelf life requirements, as well as certifications such as allergen-free lines, kosher, organic, etc.

Safety, quality and record keeping are not negotiable in this day and age. Do your homework. Evaluate the co-packer’s safety and sanitation procedures. Do they have a HACCP plan? Are they compliant with the Food Safety Modernization Act? Is the manufacturing facility regularly audited by an accredited firm? Is the co-packer prepared to properly handle a recall?

Ask for referrals. Find out how reliable the co-packer is for scheduling production. How far in advance do you need to confirm schedules?  

Then there’s that gut feel we all have when doing business. Do you feel that the co-packer will work with you when issues arise? Troubleshoot with you? Communicate in a timely manner? In general, the more transparent a co-packer is willing to be, the more trustworthy the partnership will be. This is even more important when proximity is an issue. 

Remember, if you are prepared and do your homework, it will be easier to identify the best co-packer for your innovation. Your chance of success increases. 

Dairy is not a trend. It’s the future of nutrition and innovation.