Within the dairy segment, the milk subcategory has shown a number of interesting trends recently. While many new milk product introductions have focused on health, there has also been an increased effort to compete with carbonates and juices. Alissa Ostrowski reports.
Milk products continue to focus on health, with a number of fortified and functional products catering to specific demographic groups including children and pregnant women. To add variety to an established market however, flavoured milk products continue to drive innovation and to persuade consumers to return to an “old favourite” rather than other beverage choices including juices or carbonates. To remain competitive, producers within the industry are also creating products with convenient and portable packages and innovative new concepts including features such as probiotic straws. In addition, flavour selections are growing increasingly unique and are no longer limited to the standard chocolate, strawberry and vanilla products traditionally found in many regions.
Go deeper with GlobalData
In terms of new product introductions in the dairy category, cheese led the way with more than 4000 product introductions from 2000 to 2003. In general, the milk sub-category is also active, accounting for 20% of all dairy product introductions over the period covered. In addition, launch activity increased substantially between 2001 and 2002; however, figures from the first quarter of 2003 predict less of a jump by the end of the year. Launch activity typically consists of new products, with more than 1400 introductions in the milk sub-category over the period covered. It appears that variety and range extension products are gaining ground when looking at figures from the first quarter of 2003, with more than 400 introductions expected for the year worldwide.
The European region leads the category, accounting for 35% of all launch activity with more than 800 product introductions over the period covered. The region also exhibited consistent growth over the three-year period, with launch activity increasing by 74% between 2000 and 2002. The Asia Pacific region also experienced significant growth with more than 700 product introductions over the period, a figure that can be partially attributed to increased GNPD coverage in that area.
Functional foods
Milk products are typically regarded as a healthy beverage choice, due to their natural calcium and protein content. Producers within the milk sub-category further solidify the association between milk and health by adding fortification ingredients such as added calcium, vitamin D, and B vitamins. In addition, certain products are fortified for consumer groups with specific health needs including children and pregnant women. It is well known that young children require an adequate supply of calcium to grow properly while pregnant women require a greater amount of folic acid, an important substance needed for essential cell growth and reproduction. In general, milk products for pregnant women are most common in Asia Pacific and European regions, but recent launch activity provides evidence that the trend may be expanding into other locations.
How well do you really know your competitors?
Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.
Thank you!
Your download email will arrive shortly
Not ready to buy yet? Download a free sample
We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form
By GlobalDataRecent media attention on the health benefits of functional products led to a flood of entrants with Omega-3 fatty acids, fibre and probiotic cultures to maintain proper digestive health. In general, products with functional ingredients are typically found in Asia Pacific and Europe, as the two regions are inundated with a number of functional products across many food categories. Consumers in other regions are taking notice however, and it is likely that similar variations will begin to surface in North America in the near future.
Organic milk follows mainstream trends
Both European and North American regions experienced activity from the organic sector. Many organic products consist of alternative soy- and rice-based products, but many others include standard milk. The Asia Pacific region also appears to be witnessing increased interest in organic products, evident from the 250% increase in activity expected by the end of 2003. In particular, quite a few products stem from Australia, including Parmalat Pure Organic Unhomogenised Full Cream Milk from Pauls and Hasting Co-operative’s Organic Milk, under the Hastings Valley Dairy label.
In general, organic milk products are moving in line with mainstream products, with recent developments including flavoured products and ready to drink single serving containers. For example, Classic Organic introduced a range of organic banana, chocolate and strawberry milk drinks in the UK in 250ml cartons, while Sunrich Valley introduced its Mu organic milk products in 500ml cartons in Canada.
Flavoured milk offers growth potential
Flavoured milk offers the highest potential for growth, and the opportunity to compete with carbonates and juice drinks. Recent developments are expanding beyond the typical chocolate, strawberry, and vanilla selections with tropical fruit and “dessert” flavours. In terms of targeting, most flavoured milks have a broad family positioning, or are predominantly geared at children. Those for adults have been inspired by coffee varieties, or offer indulgent and decadent chocolate flavours.
Banana-flavoured products have remained popular, appearing alongside the traditional chocolate and strawberry selections. Apple and mango flavours show substantial growth, while other interesting mixes include tea, lemon and coconut flavours. A few flavoured products stand alone, perhaps marking the beginning of the next trend. Examples include Clover’s Bubblegum-flavoured milkshake in South Africa, a cola flavoured milk product from Arla Foods in Sweden, and Campina’s Walnut milk drink in Germany.
The milk market has had to deal with shifts in consumer consumption, in particular of cold breakfast cereals, carbonates, and juices. For example, lower demand for hot beverages and cold breakfast cereals with milk (in favour of on-the-go cereal bars) has led to lower demand for milk. The response has been to add value through fortification, organic launches and convenience.
Meal replacement products are gaining in popularity in the dairy segment, evident from the introduction of Sumolis’ PessegoMix Quick in Portugal, a fruit juice beverage with milk and cereals claimed to be a complete meal. Time crunched consumers may desire to quickly grab a meal replacement for the morning commute rather than sitting down at a table with a bowl of cereal – making products such as the Quick Meal from Sumolis popular items.
Beating the competition
Competing with carbonates and juices has not been easy, mainly because milk is not generally positioned as a refreshing item. However, there have been some important developments to keep the competition at bay and give milk a more “refreshing” image, especially within the flavoured milk segment. For instance, in the US, Fuze Beverage introduced a line of milk-based products aptly named “Fuze Refresh” in Peach Mango and Banana Colada varieties.
In general, the lines between the milk, juice, yoghurt, and carbonated beverage categories are blurring, with a number of smoothie and other blended products surfacing that incorporate a number of different ingredients. Currently, however, milk/fruit juice blends are becoming common, including products from major players in the industry such as Snapple Beverages. The company introduced its dairy-based juice drinks under the Elements label in the US, including Turbulence Shredded Lemon, Spark Mandarin Carrot, Atomic Jacked Apple and Sun Strawberry Banana. The company claims that the products are produced with a blend of juices from concentrate and are infused with herbal extracts and natural flavours. Similar products are also appearing in other regions, including Europe where Compal introduced Duo Fruta y Leche Manzana, a preservative- and colorant-free drink made with apple fruit and milk.
Alissa Ostrowski works for Mintel. To view Mintel research reports, click here.
To find out more about Mintel’s Global New Product Database, click here.
