The Case for Dairy

These days, dairy seems to be on an upswing ? Nielsen figures for the 52 weeks ended Nov. 22, 2014, show sales dollars for the overall category at food stores with sales of $2 million or more up 3.8 percent, following two years of flat growth ? but how can the section, best known for its commodity products, keep its sales rising in the future? The answer may be innovation, and lots of it.

?According to the Innovation Center for U.S. Dairy, reinventing and repositioning the dairy [section] to meet emerging consumer needs has the potential to generate over $1 billion for the category,? notes Skip Shaw, president and CEO of the Harrisburg, Pa.-based National Frozen & Refrigerated Foods Association (NFRA). ?Currently, most dairy categories, especially fluid milk, address only the most basic of consumer needs. Dairy innovation will need to move beyond core messaging and benefit delivery to fusions of benefits that deliver more effectively on these evolving, multidimensional needs.?

In terms of product trends, Shaw lists ?bold flavors, nutrition labels and snacking occasions ? among the watchwords [for] 2015.?

Heeding the call for novel flavors is Vermont-based Cabot Creamery Cooperative. ?This past year, we introduced our Legacy Collection, new and exciting flavor profiles for the dairy case,? notes Director of Marketing Amy Levine. ?The Legacy line is designed to add interest and excitement to the selection of cheeses available in the dairy case.? The collection includes Alpine Cheddar, with notes of Swiss and Parmesan; White Oak, a British-style cheddar with a subtle caramel flavor; and Farmhouse Reserve, an artisanal-grade cheddar with Cabot?s distinctive East Coast bite.

Dairy All Day

?Busy lifestyles leave Americans snacking more than ever before ? and the concept of snacks has evolved beyond just chips, popcorn or pretzels,? says Shaw. ?With a variety of foods and beverages, the refrigerated dairy aisle is home to endless snacking possibilities.?

One dairy segment that?s been touting its snackability of late is yogurt. Shaw notes how ?Chobani is trying to grow snack consumption with Chobani Flips, which includes yogurt and ?mix-in? toppings like graham-cracker crumbles and white chocolate.? Meanwhile, he points out that the Norwich, N.Y.-based brand is also encouraging evening consumption of its ?indulgent? variety, a mix of yogurt and dark chocolate.

Dannon is likewise working to get consumers to consider yogurt as not just a breakfast item. The White Plains, N.Y.-based company ?has adapted our diverse range of yogurt offerings to include Greek varieties of Danimals, specifically for kids; Oikos Greek in both refrigerated and frozen varieties; Activia, with its digestive health benefit; and Light & Fit, with 80 calories in a huge variety of flavors,? observes Michael J. Neuwirth, senior director of public relations. ?We believe the next platforms will include more convenience as well as expanding the use and appeal of yogurt into more dessert options.? There?s already been some success on the latter front, he affirms: ?We?re seeing growth in dessert-style products as Americans realize the versatility of yogurt.?

?Protein Plus?

On the nutrition front, ?Protein continues to capture consumer excitement and interest,? says Cary Frye, VP of scientific and regulatory affairs at the Washington, D.C.-based International Dairy Foods Association (IDFA). ?It was a big driver in the popularity and growth of Greek yogurt, and now protein-fortified milks are gaining consumer attention,? including H-E-B MooTopia, with 50 percent more protein and 25 percent more calcium than ordinary milk.

?Protein-rich foods and beverages continue to be a growing trend,? concurs Julia Kadison, CEO of the Washington-based Milk Processor Education Program (MilkPEP). She notes, however, that since many Americans are unaware that milk ? fortified or not ? is itself a source of protein, MilkPEP is ?dedicated to bridging that gap with out-of-the-box thinking, disruptive marketing programs, and a commitment to shake things up, take risks and be bold.

?I think protein will continue to capture consumer interest ? and milk continues to deliver on ?protein plus,?? she asserts. ?We anticipate the demand for high-quality protein to continue, and we know that milk can deliver.?

The enduring popularity of milk is good news for ancillary products like Milk Splash, a new zero-calorie, kid-oriented milk flavoring from S&D Beverage Innovations LLC, a division of Concord, N.C.-based S&D Coffee Inc.

?One of the best things about the dairy case is that it?s a major driver of grocery store traffic,? says Daniel Pancotto, S&D Coffee?s director, brand promotion and communications. ?It absolutely brings people to the store. The challenge lies in getting people to see all that the dairy case has to offer, as opposed to it just being an obligatory stop.?

What will keep customers coming, he believes, is a high level of engagement with the section?s products. ?The successful campaigns are going to be the ones that make dairy cool again,? he notes. ?Kids need milk, but if you pitch it that way to a 7-year-old, it sounds about as exciting as a math test on Monday.?

?Dairy innovation will need to move beyond core messaging and benefit delivery to fusions of benefits that deliver more effectively on these evolving, multidimensional needs.?
?Skip Shaw, NFRA

?We anticipate the demand for high-quality protein to continue, and we know that milk can deliver.?
?Julia Kadison, MilkPEP