Wellness Benefits Of Dairy Need To Be Communicated To Keep Sales Strong

May 22, 2017

From natural and full-fat products to nut milks and digestive aids, consumer trends have taken over the dairy category, and retailers and their suppliers must keep up with the pace of change in order to maintain—or increase—traffic to the dairy case. That’s according to Carl Jorgensen, director of global consumer strategy and wellness at retail services provider Daymon Worldwide, who spoke with The Shelby Report in March to highlight some of the changes Daymon is observing in dairy and to offer some insights into how retailers can address them.

“Conventional milk sales are declining,” he said. “There’s no news there—everybody knows it. And I think the thing to do is to think about the reasons why they’re declining and offer products and propositions that answer the question.”

While there are a number of ways for retailers to address that decline, the first and most important is by moving away from dairy products being produced from cows raised with hormones or antibiotics.

“It’s almost as though being free of growth hormones and antibiotics is the cost of entry. That’s a baseline,” Jorgensen said. “Really go big for that, and really call it out. Because parents, in particular, really are objecting to the idea of their children getting these hormones and antibiotics in their milk. And they are looking for hormone- and antibiotic-free alternatives.”

Once that’s out of the way, retailers can move on to bringing more interest and variety to the dairy case by emphasizing trendy attributes, particularly those pertaining to health and wellness.

More education needed around full-fat dairy

Fat has made a dramatic turnaround when it comes to consumer perceptions about health, and retailers can use that to their advantage in promoting dairy, Jorgensen notes.

“What a revolution in consumer attitudes and understanding about fat we’ve just seen in the past couple of years; unbelievable. After all those years when everything had to be low-fat, non-fat, fat-free—now people are looking for good fats,” he said.

As the body of research surrounding fats in the diet grows, consumers are increasingly aware of the role they play in digestion and in overall health, and they are trying to educate themselves on good fats vs. bad fats. Plant-based fats, like those found in olive oil or avocados, for example, often seem to take the spotlight in conversations around healthy fats, but dairy marketers can claim their piece of that pie by working to educate consumers on the benefits of full-fat dairy.

“I think the case needs to be made by dairy marketers that dairy fat can be a good fat,” said Jorgensen. “And I think we’re going to see a lot more communication on-pack and in advertising and so forth about the beneficial properties of dairy fats.”

Shout ‘protein’ from the rooftops

Protein is another trending health attribute that retailers and dairy marketers can use to their advantage.

“Today, you put protein on the label and people will buy it. Everybody wants protein,” Jorgensen said, noting the current lack of protein callouts in the dairy aisle. “I think it’s an enormous opportunity. Greek yogurt and cottage cheese, which are two very high-protein dairy products—they actually, without any fortification, already contain enough protein that under FDA regulations they can be labeled a good source of protein. So I think right away, at the very least, that should be done.”

Beyond those offerings, dairy suppliers have plenty of room to fortify their products with additional protein from whey or plant-based ingredients in order to make stronger protein claims on the label.

“I think that’s just an enormous, underleveraged opportunity in dairy,” he added.

Don’t forget about digestive health

When it comes to digestive health, there are two trends to watch in the dairy space. One is the increasingly mainstream focus on beneficial bacteria found in cultured dairy products; the other is an emerging category of milk that contains only the A2 beta-casein protein, rather than A1 strain.

“You do see quite a lot of digestive health marketing around cultured dairy products, but I just think that more can be done—that the probiotic health benefits of cultured dairy products like kefir really is underleveraged,” Jorgensen said.

Digestive health has become one of the top purchase drivers for the wellness-engaged consumer, he notes, and strong communication and callouts from both retailers and suppliers about digestive benefits “really can help stimulate dairy sales.”

An up-and-coming trend that Jorgensen believes is going to gain significant traction in the coming years is that of A2 milk. When cows were initially domesticated, their milk contained only the A2 protein, but a widespread genetic mutation eventually introduced A1 protein into milk. That’s significant because most people who are sensitive to dairy products are having trouble digesting A1, not lactose as is commonly believed.

“Generally speaking, people are not allergic to sugars. Lactose is milk sugar. But what they’re really allergic to is the milk protein, the casein in the milk,” Jorgensen said. “And most people who are allergic to milk protein are in fact allergic to the A1 not the A2.”

That means that there’s a lot of growth potential for A2 milk, and some companies already are starting to take notice. Jorgensen pointed to the brand a2 Milk as one that is making strides in that area (see story below).

Increase variety of non-dairy alternatives

Beyond health attributes, retailers can increase traffic to the dairy case by offering a greater variety of products to entice shoppers, especially when it comes to dairy alternatives.

“For every trend, there’s always a counter trend. So for the growth in all these really interesting dairy products, there’s a countertrend of the non-dairy alternatives that are coming out. And we’re seeing some interesting things there,” Jorgensen said. “For example, in the non-dairy milks category, soy milk is declining a little bit. It’s still strong, but there’s a couple things that seem to be at work there.”

For one, he said, an increasing number of consumers are avoiding soy over concerns of estrogen mimicking. But the proliferation of other alternatives, such as nut milks or grain-based milks, may be just as much to blame for soymilk’s decline.

“Now you’re seeing all kinds of grains. Oat milk is huge now, and also you’re starting to see quinoa milk,” Jorgensen said. “That’s a great proposition because quinoa has balanced protein, complete protein. So you can really make great claims for a product like that…There are so many fascinating and really delicious non-dairy milks available out there. Get a little more variety in the assortment.”

Take ‘natural’ a step further with grass-fed

Finally, Jorgensen points to the grass-fed trend as one that has the potential to revitalize the dairy space.

“Grass-fed, I think, is a powerful proposition because it keys into a bigger consumer belief, which we like to call ‘nature knows best’—the idea that nature has already designed the best foods and wellness practices for us,” he said. “It’s just a matter of discovering them and creating food products or consuming food products that are as close to nature as possible.”

Consumers are increasingly aware that cows were designed to eat grass and that the quality of the milk is affected when a cow’s diet is made up of corn or soy meal. And while animal welfare hasn’t come into play in the dairy space as dramatically as it has with eggs, it may just be a matter of time before that feeds into the growing popularity of grass-fed milk as well.

“I think consumers still have a kind of romantic mental image of dairy—the happy cows out in the field grazing,” Jorgensen said. “They aren’t as aware of how much dairy comes out of confinement operations where the cows are never out. I think there is some lag on that. We might be a couple years away from really widespread awareness of the animal welfare implications of dairy, but it’s coming…There’s no fighting it. The thing to do is adjust your production practices and your marketing practices right now.”

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