Rivalry between dairy and plant-based alternatives intensifying

DAIRY alternatives continue to eat into the market share of dairy beverages as consumers show eager appetite for plant-based protein drinks. The competition will intensify even further as almond, cashew, coconut and other sources are being introduced. Some producers of dairy alternative drinks in efforts to split from dairy beverages, are pushing retailers to give plant milks their own refrigeration cases, according to the new report Dairy and Dairy Alternative Beverage Trends in the U.S., 3rd Edition released by Research and Markets.   

Makers of dairy milk are defending the industry, airing their dissatisfaction with food and nutrition experts criticizing dairy foods and milk. The National Dairy Council, the Milk Process Education Program (MilkPEP), and the Dairy Management Institute (DMI), collaborating in the GetReal campaign, launched in January 2015 to counter what the dairy industry perceives as mistruths about dairy milk.

If competition is about protein levels and the addition of other ingredients such as “ancient grains”, the dairy industry stands to win, the dairy camp says.  To regain consumer interest, they will continue to develop new flavored milks and limited edition holiday and seasonal flavors. The report forecast organic milk products to gain prominence, and the industry to expand “in more exotic ways”.  

Dairy alternative marketers meanwhile are expected to launch new products and expand their marketing and advertising efforts to ensure the positive outlook for the segment. More marketing muscle is expected to enhance the alternatives competitiveness as the soft drink industry, which like dairy milk competes with dairy alternatives, gets in the game via the acquisition route. Food industry analysts are waiting to see whether Coca-Cola or PepsiCo will be the first to announce a major takeover of a top alternative brand.