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Non-Dairy Milks: Just As Good At Doing The Body Good

April 23, 2015

We know a trend when we see it, and it’s become pretty apparent that non-dairy milk alternatives are here to stay. In fact, we’ve had these tasty alternatives on our radar for the past few years and even conducted a proprietary study on beverages that included non-dairy milk alternatives back in 2013. For a little refresher, we highlighted some of these findings last year in our Non-Dairy Milks: A Primer post.

However, inspired by the recent phenomenal growth in consumer demand for non-dairy milks, we felt it was time to dig even deeper into this market to see what is tipping the carton in favor of non-dairy alternatives and how the industry is responding.

GIVE THE PEOPLE WHAT THEY WANT

As 56% of consumers continued to be motivated by health and wellness goals and 42% sought sources of high protein to meet dietary needs, consumers emptied carton after carton, sending the total retail sales of dairy alternative beverages to $1.3 in 2011. And the explosive growth continued in 2014, with a sales increase 7% over 2013. It is pretty clear that consumers want non-dairy milk alternatives because they perceive them as healthier, with higher protein and reduced allergen risk. It’s also interesting but not surprising that Millennials are more open-minded when it comes to non-dairy alternatives, as many of them grew up with these in their childhood refrigerators. In addition, non-dairy alternatives appeal to consumers who are watching calories and fat, have vegan preferences or want to avoid hormones or antibiotic-containing beverages.

AND THEY WANT NON-DAIRY ANYWHERE THEY CAN GET IT

It’s no surprise that health and convenience are what consumers prioritize when making a beverage choice. Food service giants have risen to the challenge of making their already accessible and popular coffee menus loaded with healthy non-dairy offerings. Companies have diversified their beverage offerings with products containing almond milk, coconut milk and soy, along with other non-dairy ingredients. This aligns with the findings from our study, which indicated that consumers’ usage of milk alternatives increased 33% year over year. While the market seems to prefer almond, soy, coconut or rice milks (in that order), we expect to see some of the unexpected non-dairy alternatives made from hemp, oat or flax make their way into new product introductions and consumers’ coffee cups or RTD smoothies.

A LITTLE FLAVOR and EXPERIMENTATION ADDS A LOT OF EXCITEMENT

At the very least, consumers will not drink a beverage if it doesn’t taste good. While they continue to watch sugar intake, consumers gravitate toward flavored milk alternatives like vanilla or chocolate — but we know that they will be drawn to the new, unexpected flavors making their way into new product introductions. Upscale offerings like Tahitian Vanilla, Coccocino Lattes or Chocolate Fudge Brownie flavors are tempting consumers in dairy beverages, and it’s only a matter of time before they crossover to the non-dairy category.

DOES THE NEXT CARTON CONTAIN DAIRY?

So what’s next in the non-dairy beverage market besides interesting flavors? Surprisingly, it might be a return to dairy beverages that is in the next carton but with a little pucker thrown in. Kefir (pronounced kee-fur), a fermented dairy product whose grains are used to make a drinkable yogurt, could be the next darling of the dairy case. Slightly sour in taste and boasting loads of beneficial yeast and friendly probiotic bacteria, kefir is poised to be the next Greek yogurt with sole distributor Lifeway’s sales exceeding $130 million in 2014, up from $58 million in 2009. And we predict kits for DIY-loving consumers to produce their own kefir right in their own kitchens.

So, rest assured. The market is ripe for innovation and the possibilities are endless, with consumers more open-minded than ever to healthy milk alternatives … as long as they taste good and they can get them when and where they want them.

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