Speaking last week at Beverage Innovation 2015 – a free to access online event organized by FoodNavigator-USA.com and BeverageDaily.com that you can still experience on demand – Jones (pictured below) told us why he was so confident Fair Life milk could help turn the tanker around, with the nation’s liquid milk consumption languishing at lows not seen since the early 1980s.
“That industry is somewhere around $22bn of measured sales, so still a very large category… still in 98% of households, so it’s not something that’s fallen off a cliff,” Jones said.
Why is milk struggling? 'A lack of innovation'
“I think it’s down because of lack of innovation. If you excite consumers with something new, where there’s a real benefit that they see as functionally important to their life, then they’ll come back and try,” he added.
Fairlife is confident it can contribute to this transformation by ushering in what Jones calls the “rebirth of milk” in the US, and will attempt to do so by harnessing Coke’s marketing and distribution muscle – the milk will pass through the Minute Maid system in the States.
Jones is pinning his hopes on what he says is Fairlife’s ‘great taste’, high protein (+50%) and calcium (+30%) levels, zero lactose and 50% less sugar than standard milk; there’s also a shelf life boon since Extended Shelf Life (ESL) processing means the company can declare 100 days, versus 14 for standard milk.
'Milk hasn't been well merchandized' - Steve Jones
The milk is filtered using a patented method, and no powders are added. So there’s no need for sweeteners, flavorings or stabilizers: Fairlife milk has a short ingredients list and a ‘clean’ taste.
“We’re just out of the blocks, trying to get everything on this launch right so it gets into every fridge in America. It’ll take us a while to do that…that’s really my focus right now,” Jones said.
“By bringing these features and benefits, I think people will get excited about milk again. It hasn’t been overly well merchandized, it’s been stuck at the back of the store in the dairy case,” he said, insisting that Fairlife’s protein levels would lend consumers strength, but also energy and vitality.
“We’re bringing new merchandising to it, with point of sale, with our packaging and the graphics. So I think we can bring interest and excitement to the whole category,” Jones said.
How important does Jones think concerns about the lactose content of milk have been, in terms of consumers leaving the category?
“Statistically I think 3-4% actually are lactose intolerant – a lot more perceive themselves to have an intolerance,” he said.
“The reality doesn’t matter – if people perceive it then it’s real. So you’ve got to accept that is a growing concern to a lot of people. But we don’t want to be pigeon-holed in the lactose-free category,” he added, while admitting that Fairlife’s lactose-free status was important for some.
Sales of Fairlife began in test markets in the States early last week, with reports of 52oz on sale at $4.59, compared with 64oz of ordinary milk for around $2.18. Although many would Fairlife’s mission to add value into liquid milk, are consumers willing to pay such a premium?
'We're trying very hard to give people real value'
“The pricing comes down to the fact that it is so value-added, it’s because there’s so much in there. You wouldn’t have thought 30 years ago that you would have paid $4 for a coffee, but today you’re really looking for that value-added,” Jones said.
“Look at how many juice drinks or products out there have really changed categories because they’ve really added such value. Within this sector we’re really comparing ourselves to the high-end quality juices – the Bolthouse Farms and so on (also with protein), or the organic milks or alternative plant-based protein beverages like the soy and almond milks,” he added.
“That’s really where we’re comparing ourselves. In all fairness, I think someone picked up a product that was $4.59, but what you’re really seeing is everything from $3.98 to $4.20,” Jones said.
“We’re just on the shelf – it’s just getting seated. We’ll be working with a lot of retailers to make sure that the price is very competitive within that value-added set. Even at $4 you’re looking at 40-50 cents per serving of really great protein, so we’re trying very hard to give people real value.”
As for how Fairlife milk tastes compares with standard milk, Jones describes it as “very fresh, very creamy, very crisp” and suitable for all ages, day parts and milk consumption occasions, as well as “’Pick me up – give me energy!’ moments”.
“You’ll find because it has that protein in it you’ll feel that creaminess come through – even a fat-free milk, your sensory is going to register more of a 1 or 2%, the latter will feel robust like a whole milk,” he said.
Watch all the sessions from the Beverage Innovation Summit on demand by clicking HERE.