The growing popularity of the health and wellness trend, alongside the pervasive veganism and flexitarianism movements, have put the dairy alternatives market on the investment radar of many players in the food and drink industry.
Global demand for plant-based beverages is estimated to increase by leaps and bounds, surpassing $25.5 billion by the end of 2028, according to Persistence Market Research, as consumers continue to demonstrate strong preferences for dairy alternatives over any other source type.
Plant-based milk, such as almond or soya milk, is the biggest plant-based food category, growing faster than plant-based meat. Brands are capitalising on the trend with quirky campaigns, strong visual identities and compelling messages about health and the environment.
In the US, nearly half of consumers now buy alternative milk beverages, while in the UK, plant milk sales have grown by 30% since 2015. These developments have caused considerable disruption in the traditional milk industry – for instance, reduced demand for cow’s milk led to the closure of 1,000 dairy farms in the UK between 2013 and 2016.
The long-standing reputation of traditional milk as a healthy drink, established primarily by blanket marketing initiatives, has started to deteriorate due to rising concerns around lactose intolerance, bovine antibiotics, animal cruelty and the industry’s environmental impact. Many consumers now view cow’s milk as less healthy than its plant alternatives – a perception which some commentators have called “a demographic time bomb”.
An oft-employed branding exercise among alternative milk producers is to emphasise that their products are “
Brands are tapping into the consumers’ perception of the “naturalness” of food and drinks, which has evolved from a focus on sanitation to added ingredients like preservatives, flavours and sweeteners. The ever-increasing health awareness among consumers, coupled with the rise of the organic food industry, has put the notion of “naturalness” in the centre of many debates around the food and drink industry.
For example, many consumers perceive GMO food as “unnatural” because they perceive genetic engineering as meddling with naturally occurring biological processes. The line of argument is that if the food is “unnatural”, it must be bad for our health or at least not as healthy as “natural” food. In the US, this view has been reinforced by organisations such as the Organic Consumers Association, Greenpeace and Union of Concerned Scientists.
In the conversation around dairy, similar messages are conveyed by the advocates of milk alternatives: many of them point out that drinking cow’s milk is “unnatural” because the milk is intended for baby cows, not for humans.
In response, critics say that humans have evolved to drink milk and highlight the health benefits of dairy. Industry alliances such as the UK’s Milk Marketing Board launched campaigns to boost milk’s reputation, while in the US, the recent Got Milk?
Organic-centred marketing strategies have suffered by heavy criticisms in top-tier publications, which generally dismiss organic food as an effective form of premium branding. When commenting on such branding, many outlets cite a four-year Stanford University research which found that organic products “have no significant advantage over conventional foods, even though consumers pay more for them”.
the healthy life
The health arguments from both sides of the debate formed the largest part of the recent media discussion in the top-tier English-language publications:
Proponents of the relationship between plant milk and clean eating have blamed dairy for a range of ailments, including acne, eczema, lethargy, joint pain and a variety of digestive issues. Most articles concentrate on young consumers, highlighting that millennials take a more proactive approach to healthy eating, take the time to research before they shop, and are more willing to pay higher prices for what they perceive to be better food and drinks.
The ongoing debate around whether plant milk is actually a healthy substitute has been particularly fierce since 2017 when a Belgian couple was convicted of causing the death of their baby after feeding him a diet of vegetable milk. Another part of the debate within the ‘health and wellness‘ topic circles around whether dairy alternatives should be fortified with additional vitamins in order to be better substitutes of cow’s milk.
Articles within that topic often fall under the ‘industry trends‘ topic as well, with many outlets presenting the plant milk trend as a fundamental shift in consumer behaviour which affects big agriculture businesses and opens up the market for disruption from hip start-ups. The change has been recently notable in the UK, where a quarter of shoppers now drink dairy alternatives.
But brands don’t only include health concerns in their promotional efforts – many focus their messaging on compelling environmental factors. They position themselves as part of the solution to our “broken food system”, citing evidence that the dairy industry is bad for the environment, particularly because of the greenhouse gases produced by agricultural businesses.
Concerns about agricultural practices also feature within the ‘ethical aspects‘ topic: commentators are often noting that cows are separated from their newborn calves within just 24 hours of giving birth and forced to produce more than 20,000 pounds of milk each year.
As with the conversation around meat consumption, animal rights are cited as the main cause for many consumers to go vegetarian or vegan, with the most popular arguments being that animals have consciousness and feelings, and that cruelty towards them is morally wrong. The line of reasoning usually includes the supposition that animals are inherently valuable and shouldn’t be treated merely as means: if we can survive and be healthy without eating meat, we shouldn’t harm them.
These sentiments are often shared by producers of dairy alternatives as a way of promoting their products, and messages like these tend to resonate across many consumers who are taking up vegetarianism or veganism for ethical reasons.
For more on the meat alternatives trend, read our analysis “Meat Alternatives: Cooking Up a Market Disruption”.
Of the different alternatives, the recent media discussion focused mostly on almond, coconut and oat milk:
The popularity of almond milk aligns with the recent categorisation of almonds as a superfood and the praise the nuts receive in food and lifestyle outlets. This is in part thanks to the California almond industry, which grows 8 in 10 of the world’s almond crop – it engaged in a strong marketing push,
Almond makes up around two-thirds of all alternative milk sold, but it also experiences some reputational problems, particularly on the environmental front: critics point out that 4.5 litres of water are needed to grow a single almond, and it consumes an estimated 10% of California’s water supply.
The issue is especially contentious since the state often suffers from droughts, a controversial issue in a state often afflicted by drought, with some media voices saying that we’re sucking the planet dry with our almond obsession.
Other publications also point out that almond milk beverages frequently include less than 2% actual almonds and contain many additives, such as sugar, thickeners and emulsifiers, which discredits the product’s healthy and eco-friendly image. According to some analysts, almond drinks would eventually be outrivaled by coconut and oat ones.
Soy milk, the first alternative on the market, is seen as a particularly strong contender mainly because it has been concluded that it provides the best nutritional value in comparison with other plant drinks.
Making quite a splash
Oat milk’s rise to popularity has also put brands such as Starbucks and Oatly in the centre of the media discussion:
Starbucks made headlines for starting to serve oat milk at several locations around the US, having already started offering that dairy substitute in European locations in early 2018. In their reports, many outlets noted that the oat milk trend is accelerating and Starbucks’ entry into the market comes as Americans’appetites for milk alternatives keep growing.
However, some critics claimed that the fact that milk alternatives at coffee shops are more expensive than traditional milk is discriminatory. PETA even organised a protest at Starbucks headquarters in Seattle, demanding the chain drop its charges for vegan-friendly milk options
Oatly was often mentioned in the Starbucks reports as the company which started the oat milk craze in the US several years ago, as the Swedish firm
The company made headlines when the US recently suffered from a shortage of its products, which many journalists took as a sign that the oat milk trend is here to stay. And although Oatly is struggling to meet demand, it’s eyeing up China, where about 85% of the population is lactose intolerant. The campaign introduced a new Chinese character for plant-based milk.
The company’s recent communication strategy included
In order to stand out, Oatly has been focusing more on environmental issues rather than health and wellness. The brand strives to cut through the health noise and make ecological concerns its primary message, with its packaging congratulating buyers on being part of the “post-milk generation”.
Meanwhile, Nestlé was also seen as part of the movement for boosting its Coffee-Mate Natural Bliss range of creamers with three dairy alternative variants. The company is also experimenting with a liquid derived from walnuts and blueberries.
Other firms mentioned as jumping on the oat milk trend were food conglomerate Quaker Oats, owned by PepsiCo, and dairy substitutes company Silk, owned by Danone, which launched oat milk products this year. Danone, which also owns organic food and drink company Alpro, shared its plans to triple its worldwide plant-based sales to €5bn (£4.49bn) by 2025.
Some companies in the coverage were discussed with a predominantly negative sentiment. A woman had a fatal allergic reaction from a flatbread bought from Pret a Manger – the food contained yoghurt that was supposed to be dairy-free but was found to be contaminated with dairy. The sandwich chain blamed former supplier, coconut milk brand CoYo, which said that Pret is hampering its own investigation into the accident by failing to provide vital information.
A new age of consumerism
The rise of the health-conscious consumer has lead to brands trying to promote their product ranges as the healthiest in the market. Companies aim to distinguish themselves by highlighting their sourcing practices, with the idea that the best way to reach a health-conscious audience is through a clear idea about the values that define a certain brand – these consumers are not simply buying products, they are making lifestyle statements.
The conversation around dairy alternatives is set to become livelier and livelier, especially among younger generations whose members tend to share their views on social media. The fact that ethics and the environment are some of the most widely discussed topics in the coverage we analysed goes to show that consumers are making well
The best way to reach such an audience is through a clear idea about the values that define a brand – these consumers are not simply buying products, they are defending certain values with their choices. Shoppers want to know why brands use the ingredients they do and what motivates the messages they send through their marketing strategies.
This level of consumer consciousness underlines the importance of leveraging social media, where many buyers of milk alternatives provide feedback and recommend products. But in order for them to voice their opinion on Facebook or Twitter, they first have to trust the brands’ thought leadership and associate with their culture.