By Gwen Walsh, Corporate Account Manager – Food Ingredients, USA
As consumers we are accustomed to having options, especially when we do our grocery shopping. We have many decisions to make as we navigate through the aisles, and the dairy aisle is no exception. Traditional cow's milk is just one conventional product that now finds itself competing against many plant-based alternatives. Plant-based products are changing the food industry, and there are several factors driving this shift in consumer decision-making. This blog reviews many aspects of the plant-based trend and provides further insight into why consumers are shifting away from dairy.
The modern-day consumer has endless information readily available to them. They are researching the products they buy, and they want to ensure they are making the right decisions for their health and the health of our planet. This increase in conscious consumerism is negatively affecting the dairy markets, with milk being hit the hardest.
There are many types of alternative dairy products. Throughout the past decade, the source of plant-based milks has shifted in popularity as follows:
- 2012 and before: Soy
- 2013 - 2017: Almond, rice, and nuts
- 2018: Coconut
- 2019: Pea
- 2020: Oat and other niche plants
Consumers shift to plant-based milks
Plant-based milks are taking over supermarket dairy cases. They are expanding at a 10% growth rate versus dairy milk’s 3% growth rate. The plant-based trend started with the launch of soymilk in 1996, but the trend really started to take off in early 2010 and has continued to grow and evolve ever since. Ten percent of the overall milk market now comprises plant, grain and nut-based milks. Several factors are incentivizing consumers to make this shift:
- Health and wellness
- Lactose intolerance and milk allergies
- Sustainability and animal welfare
1- Health and Wellness
Modern-day consumers are focused on their long-term health, and they look for products to explicitly state their tangible health benefits. Calories and physical health are still important, but priorities have expanded to also include mental health. Consumers are looking for claims to help with sleep, stress, cognitive function, muscle growth and immunity. Consumers do not want to consume anything ultra-processed. They want clean labels with easily recognized ingredients, as these are perceived as healthier. When consumers understand the ingredient statement, they have greater confidence in the product and will be more likely to buy.
2- Lactose Intolerance and Milk Allergies
Consumers' decreased milk consumption is threatening the success of the U.S. milk category. This reduction is being driven by veganism and allergies – predominately lactose intolerance. Almost 70% of the world's population is lactose intolerant and the lactose-free dairy market is set to grow 56% from 2017-2022. This provides plant-based companies with excellent growth opportunities when they offer a lactose-free claim.
Consumers are shifting their diets to focus on their health, and they are willing to make compromises, except when it comes to taste. Everyone still wants to enjoy what they are eating or drinking. People are very interested in trying new things and experiencing new flavors, and plant-based milks offer their own unique, often earthy tastes. They come in different flavors such as chocolate or vanilla, but the most popular is plain/unflavored.
4- Environmental Focus
Consumers want to buy brands that put people and the planet first. They are looking at the bigger picture and want to invest in brands that have a positive impact on our environment. All product attributes are being scrutinized, from packaging, resources used in manufacturing and sourcing of raw materials. Plant-based milks need to convey a uniform, transparent story throughout the entire supply chain. Transitioning to plant-based products offers a sustainably sourced product with recyclable packaging. Plant-based milks have a much lower environmental impact in emissions, land use and water use when compared to dairy milk. Furthermore, they are typically packaged in sustainable carton packages, not plastic. Plant-based products must deliver on consumer expectations for brand transparency and naturalness. The claims on plant-based products are unlimited—the more, the better. Low/no-sugar, high-fiber, high-protein, non-GMO, lactose free, allergen free, organic, ethically sourced, etc. The claims are presented right in front of the consumers' eyes.
Oat milk – the latest and greatest!
Oat milk began to take off at the end of 2019 and has continued to grow ever since. It currently holds the title for the most popular plant-based milk! Its popularity is attributed to its pleasant taste and texture. It has a sweet, creamy taste, which is familiar and loved by consumers. Of all the plant-based milks, oat milk is most comparable to traditional dairy milk. This similarity to dairy milk appeals to consumers, particularly flexitarians. A flexitarian is a person who has a primarily vegetarian diet but occasionally eats meat or fish. A flexitarian lifestyle is more popular vs. strict veganism, as only 9% of U.S. consumers truly follow a dairy-free lifestyle. These factors allow flexitarians to be the ideal target audience for oat milk and other plant-based options. These consumers like that the product tastes like dairy milk but comes from plants.
It's no surprise that oat milk has acquired its popularly. It offers what the consumer wants: a product that is healthier, good for the environment, has great texture and tastes delicious. The only down-side to this almost perfect product, is its sugar content. Oat milk is high in sugar, but this hasn't quite deterred its fan base. Oat milk is still the most popular option among the vast array of plant-based milks.
Navigating the Trend
The options in plant-based milk keep expanding, and the next big trend is out there waiting to launch. It may be hemp, cashew or the newly introduced dairy/non-dairy hybrid products. Essentially, continuous innovation is key to success in the dynamic, constantly evolving food industry.
Univar Solutions is here to help you navigate these trends. Our team of internal food scientists and product managers are readily available to partner with your company on your plant-based initiatives. We will provide you with in-depth market overviews, ingredient recommendations and full formulary support. Contact us today to partner, streamline your R&D process and expedite the launch of your next plant-based product!