Dairy and Nondairy Milk: Category Insights

What You Need to Know

• Consumers find value in dairy and nondairy milks, which drives consumption of both. Both categories are on the rise, finding their way into applications beyond traditional uses. Personalization is key as dairy and nondairy milks gain popularity for their versatility and ability to cater to varying dietary preferences.
• Improved product attributes (other than low price) aren’t enough to increase usage for most. Opportunity lies in highlighting novel use cases to attract new consumers and expand reach. Developing formats for portability and highlighting milk use cases in skin care can add value to time- and money-strapped consumers.
• Consumers see milk as a staple, but are increasingly price sensitive and willing to trade down to cheaper brands. Rising prices from inflation, exacerbated by supply-side issues related to climate change and increased production costs, may not force consumers out of the category, but they affect their milk shopping habits.

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Consumer Trends: 

Key Takeaways

• As inflation puts constraints on grocery spending, there’s a heightened emphasis on value. Within this category, the simplicity of dairy milk aids in regaining share lost to nondairy products. With its familiar taste and trusted health image, consumers, especially younger audiences, are increasingly turning back to dairy.
• When consumers choose dairy or nondairy milks, the decision is an extension of their values. Brands on either side have the opportunity to partner with consumers on matters they care about. Whether it’s health or sustainability, consumers want clear communication about how milk can fill their needs and help them meet their goals.
• Consumers opt for dairy and nondairy milks for diverse reasons, valuing both for their unique attributes. These sought-after options cater to consumer demands for health, sustainability, taste and allergen-free benefits, driving increased purchases of both varieties rather than that they choose one over the other.

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Opportunities

• Consumers are familiar with the versatility of milk, yet there’s still potential to expand on its possibilities. From incorporating milk into a face mask to using oatmilk in savory recipes, showcasing new applications can alleviate concerns about shelf life and higher prices while encouraging exploration of new milk-based experiences.
• As consumers turn to dairy and nondairy milks for diverse reasons, it’s essential to shift marketing toward highlighting their unique qualities instead of promoting one as superior. By emphasizing their distinctive factors, both segments can thrive as separate high-value categories and cater to varying consumer preferences.
• Position dairy and nondairy milks as specialty beverages that can meet a variety of needs to open up new markets. Target parents with milks containing nutrients for development, reach athletes with performance-based formulations and portable packaging, and support at-home baristas with nondairy milks capable of frothing.

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