All 10 trends in its new report, ‘10 Key Trends in the Business of Dairy Nutrition,’ are relevant to dairy companies of all sizes, Joana Maricato, senior market analyst at New Nutrition Business told DairyReporter.
“Key trends are relevant to both global players as well as smaller, local, companies,” she said.
“That is why we include case studies of both large companies and smaller ones from around the world, like Brazil and New Zealand.
“These examples show how smaller companies can successfully innovate and apply the key trends, by for example, translating messages from other markets to their local market.”
The top 10 trends:
- Snackification & convenience
- Up with fat, down with sugar
- Say cheese
- Digestive Wellness
- Permission to indulge
- Digital revolution
- Hello savory
Reinventing cheese is positioned as the biggest growth opportunity.
It points to Sargento Balanced Breaks, a snack that pairs cheese with fruit and nuts, which is one of the most successful products launched in the US, with first year sales hitting $67m.
And Sargento Balanced Breaks retail at a 150% premium compared to regular mass-market cheese.
Julian Mellentin, director of New Nutrition Business, said for profitable growth, premium niches are the highest-opportunity, least-risk targets in dairy.
Maricato told DairyReporter that non-dairy is also an opportunity – while being a threat as well.
She said that dairy companies must take note of the trend and know how to respond, which in many cases, means entering the market.
“There’s no reason why a dairy company can’t acquire a dairy alternative business or launch non-dairy products – some of them already did, like Lion in Australia, and they manage them both separately without any issues for consumers,” Maricato said.
Danone has turned non-dairy into an opportunity by acquiring WhiteWave, thus becoming both one of the world’s biggest dairy companies and the world’s biggest non-dairy company.
“The key is to understand that these are two strategically independent segments.”
Maricato said that some trends can be established in one region while still emerging in other regions.
Marketing and packaging is also important in achieving potential growth from these trends.
“Execution is key,” Maricato said.
“Companies need to connect to growth trends but to be successful, it’s crucial to invest in a strong marketing and communications strategy tailored to their target consumers. Failing to do so can be the difference between success or failure.
“Differentiation through packaging is key across categories and dairy is no exception.”
Connecting to the trends
Maricato said no products could successfully connect to all of the trends outlined in the report.
“The more a product connects to the key trends, the better. It’s not a question of numbers, it’s a question of what is logical for a product – no product could successfully connect to all 10 trends.
“Companies need to consider the trends and decide which ones are relevant to their products, their market and target consumers.”
The report includes 20 case studies on large and small companies around the world, including Chobani, Ben & Jerry’s, LALA, Annie’s and a2 Milk.