Description

“The dairy and dairy alternative milk market is evolving at a rapid pace, with specialty dairy milks, plant-based offerings and pandemic-driven priorities in health, variety and ethics shaking up the aisle once characterized by generic commodity positioning.”

– Sydney Olson, Food and Drink Analyst

This report will look at the following areas:

  • The impact of the pandemic on consumer behavior and the dairy and dairy alternative milk market
  • The evolution of the market through base innovation, benefits and claims
  • Consumers’ anticipated future consumption and how the category can address the “next-normal”
  • Opportunities to reclaim lost audiences and appeal to emerging category drinkers

Table of Contents

  1. Overview

    • What you need to know
      • Key issues covered in this Report
        • Definition
          • Market context
            • Economic and other assumptions
              • COVID-19: US context
              • Executive Summary

                  • Top takeaways
                    • Market overview
                        • Figure 1: Total US sales and fan chart of dairy milk, at current prices, 2016-26
                        • Figure 2: Total US sales and fan chart forecast of dairy alternative milk, at current prices, 2016-26
                      • Impact of COVID-19 on dairy and dairy alternative milk
                        • Figure 3: Short-, medium- and long-term impact of COVID-19 on dairy and dairy alternative milk, 2021
                      • Opportunities and challenges
                        • Stakes are high in the race to identify, or create, the perfect base type
                          • Figure 4: Dairy or dairy alternative milk purchases, 2019-21
                        • Dairy milk needs to be refreshed and reframed, many avenues exist
                          • Figure 5: Opinion on dairy’s impact on health, 2021
                        • Digital dairy shopping barriers require attention
                          • Figure 6: Dairy category attitudes, 2021
                        • Use fundamental benefits as building blocks toward greater functionality
                          • Figure 7: Attributes important to purchase, 2021
                        • Win younger adult audience by relating to generational values
                          • Figure 8: Dairy and dairy alternative milk repertoire, by age, 2021
                      • The Market – Key Takeaways

                        • Pandemic brings split performance to dairy and dairy alternative milk in 2021
                          • Almond milk’s leadership position weakens as the base race continues
                            • Pandemic conditions fostered new ethical and wellness priorities and expectations
                              • Dairy alternatives have reached the mainstream consumer
                              • Market Size and Forecast

                                  • 2021 brings slight drop off from 2020 pandemic-driven performance
                                      • Figure 9: Total US sales and forecast of total dairy and dairy alternative milk, at current prices, 2016-21
                                      • Figure 10: Total US sales and forecast of total dairy and dairy alternative milk, at current prices, 2016-21
                                    • Dairy milk’s short-lived resurgence and impending challenge
                                      • Figure 11: Total US sales and fan chart of dairy milk, at current prices, 2016-26
                                      • Figure 12: Total US retail sales and forecast of dairy milk, at current prices, 2016-26
                                    • Dairy alternative milk to maintain momentum
                                      • Figure 13: Total US sales and fan chart forecast of dairy alternative milk, at current prices, 2016-26
                                      • Figure 14: Total US retail sales and forecast of dairy alternative milk, at current prices, 2016-26
                                    • Impact of COVID-19 on the milk market
                                    • Segment Performance

                                      • Dairy alternatives continue to earn share
                                        • Figure 15: Share of total milk market, by category, 2016-26
                                      • Refrigerated dairy milk drives dairy milk category
                                        • Figure 16: Total US retail sales and forecast of dairy milk, by segment, at current prices, 2016-26
                                      • Almond milk is the dominant force, but losing share to other base types
                                        • Oat milk propels the “other” segment
                                          • Figure 17: Total US retail sales and forecast of dairy alternative milk, by segment, at current prices, 2016-26
                                          • Figure 18: Total US retail share of dairy alternative milk, by segment, at current prices, 2019 and 2021
                                        • Private label brands must deliver value beyond price
                                          • Figure 19: Attitudes toward private label food and drink, 2020
                                        • Barriers to online dairy shopping need action
                                          • Figure 20: Total US retail sales of dairy milk, by channel, at current prices, 2016-21
                                          • Figure 21: Total US retail sales of dairy alternative milk, by channel, at current prices, 2016-21
                                          • Figure 22: Anticipated post-pandemic shopping location for dairy products, 2021
                                          • Figure 23: Dairy category attitudes, 2021
                                      • Market Factors

                                        • The impact of fluctuating pandemic lifestyles and priorities
                                          • Figure 24: COVID-19-driven priorities, 2021
                                        • Dairy alternatives have outgrown their name
                                          • Figure 25: Reasons for household use of dairy alternatives, 2021
                                          • Figure 26: Reasons for household use of dairy alternatives, 2020-21
                                        • Taste and price lead barriers among nonusers
                                            • Figure 27: Brands perceived as premium and ethical, 2021
                                            • Figure 28: Reasons household does not use dairy alternatives, 2021
                                            • Figure 29: Reasons household does not use dairy alternatives, 2020-21
                                          • Rise (and risk) of plant-based claims
                                            • Figure 30: Dairy and dairy alternative consumption, 2021
                                            • Figure 31: Presence of all-natural and plant-based claims among dairy and dairy alternative milk launches, 2017-21
                                          • Sustainability stakes are high
                                            • Figure 32: Percentage of dairy and dairy alternative milk new product launches that contain environmentally friendly claims, 2019-21
                                          • Support consumers’ “next normal” wellness need: burnout
                                            • Figure 33: Current, emerging and future health undefined implications, 2021
                                            • Figure 34: Activia burnout Instagram post, 2021
                                          • The emergence of lab-grown dairy
                                            • Figure 35: Interest in lab-grown dairy milk, by age, 2020
                                            • Figure 36: Graeter’s and Perfect Day, 2021
                                            • Figure 37: Perfect Day, animal-free dairy Instagram, 2021
                                        • Companies and Brands – Key Takeaways

                                          • Private label dominates dairy milk, but specialty brands are moving in
                                            • Leading dairy alternative milk brands give way to new players
                                              • Dairy and dairy alternative brands attempt to reframe the iconic milk beverage
                                                • Dairy milk can rise up with pandemic-driven coffee and snack behavior
                                                  • Win the critical Gen Z loyalty through on- and offscreen connections
                                                  • Market Share

                                                    • Private label dominates dollar sales of dairy milk at MULO
                                                        • Figure 38: US multi-outlet market share of dairy milk, by leading companies, 2021
                                                        • Figure 39: Multi-outlet sales of dairy milk, by leading companies, rolling 52 weeks 2020 and 2021
                                                      • Name brands with specialty health positioning on the rise
                                                        • HP Hood cracks the lactose-free code
                                                          • Coca-Cola wins with specialty health claims and permissible indulgence
                                                            • Danone builds upon organic roots
                                                              • Figure 40: Premium and specialty dairy milk brands, 2021
                                                              • Figure 41: Multi-outlet sales of dairy milk, by leading companies and brands, rolling 52 weeks 2020 and 2021
                                                            • Danone and Blue Diamond account for more than half of dairy alternative milk dollar sales at MULO
                                                              • Danone struggles with legacy products
                                                                • Blue Diamond continues to reap Almond Breeze success
                                                                  • Top two companies are losing category share to smaller players
                                                                    • Figure 42: US multi-outlet market share of dairy alternative milk, by leading companies, 2021
                                                                    • Figure 43: Multi-outlet sales of dairy alternative milk, by leading companies, rolling 52 weeks 2020 and 2021
                                                                    • Figure 44: Leading and emerging dairy alternative milk brands, 2021
                                                                  • Almond milk brands show modest growth as consumer interest fragments across brand types
                                                                    • Figure 45: Multi-outlet sales of almond milk, by leading companies and brands, rolling 52 weeks 2020 and 2021
                                                                  • Coconut using inherent flavor and taste to find relevance beyond cooking
                                                                    • Figure 46: Multi-outlet sales of coconut milk, by leading companies and brands, rolling 52 weeks 2020 and 2021
                                                                  • Soy slips further, and faster
                                                                    • Figure 47: Multi-outlet sales of soy milk, by leading companies and brands, rolling 52 weeks 2020 and 2021
                                                                  • Oat milk craze propels “other” segment
                                                                    • Figure 48: Multi-outlet sales of other non-dairy drinks, by leading companies and brands, rolling 52 weeks 2020 and 2021
                                                                • Competitive Strategies

                                                                  • Milk medals at the summer games, promoting role in sport nutrition
                                                                    • Figure 49: MilkPEP Olympics spot, 2021
                                                                    • Figure 50: Silk Ultra, Olympics athlete partnerships, 2021
                                                                    • Figure 51: Sports and performance drinks, important ingredient claims, 2021
                                                                    • Figure 52: Trumoo, athletic recovery positioning, 2021
                                                                  • Cows of Instagram help sell animal welfare claims
                                                                    • Figure 53: Dairy milk cow welfare hashtags, 2021
                                                                    • Figure 54: Organic Valley healthy cows promotion, 2021
                                                                    • Figure 55: Zeal creamery free-range cow promotion, 2021
                                                                  • Dairy and dairy alternative milk fight to be the choice of parents and kids
                                                                    • Figure 56: children-specific portfolio extensions, Horizon Growing Years, 2021
                                                                    • Figure 57: children-specific portfolio extensions, Ripple Kids, 2021
                                                                    • Figure 58: Parents’ COVID-19-driven attitudes, 2021
                                                                  • Environmental efforts require show, in addition to tell
                                                                    • Figure 59: Dairy and dairy alternative milk environmental commitment Instagram posts, 2021
                                                                  • Innovation calls for transparent and simple education
                                                                    • Figure 60: Silk Milk of the Land commercial, 2021
                                                                • Market Opportunities

                                                                  • Coffee with milk, hold the creamer
                                                                    • Figure 61: Coffee and tea additions, 2021
                                                                    • Figure 62: High performing creamer products, by purchase intent, 2020-21
                                                                  • Edge into the (late night) snack occasion via dynamic duos
                                                                    • Figure 63: Kellogg’s snack-inspired cereal launches
                                                                    • Figure 64: Cereal usage, 2021
                                                                  • Holiday your way
                                                                    • Influence Gen Z on- and offscreen
                                                                      • Figure 65: Step financial literacy partnerships
                                                                  • The Consumer – Key Takeaways

                                                                    • Milk is present in majority of US households
                                                                      • Increased category consumption will be credited to dairy alternatives
                                                                        • Young age groups lead the dairy alternative charge
                                                                          • Dairy prevails in nutrition/versatility, must shore up base of younger shoppers
                                                                            • Basic benefits remain a must-have, functionality is a nice-to-have – for now
                                                                            • Milk Types Purchased

                                                                              • US adults unified on milk, split on type
                                                                                • Almond milk is the second most popular milk type overall
                                                                                  • Figure 66: Milk types purchased, 2021
                                                                                • Pandemic implications and rapid innovation have significantly impacted behavior
                                                                                  • Figure 67: Milk types purchased, 2019-21
                                                                                • Most US adults have multiple milk products on their list
                                                                                  • Figure 68: Milk purchase repertoire, 2021
                                                                                  • Figure 69: Milk purchase repertoire, by household size and parental status, 2021
                                                                                • Young age groups lead the charge toward dairy milk alternatives; older consumers remain dairy loyal
                                                                                  • Figure 70: Milk types purchased – Nets, by age, 2021
                                                                                  • Figure 71: Milk types purchased – Consumers aged 18-24, 2021
                                                                              • Anticipated Change in Dairy and Dairy Alternative Milk Consumption

                                                                                • Household consumption will maintain or increase
                                                                                  • Increased consumption favors dairy alternatives
                                                                                    • Figure 72: Anticipated change in consumption of dairy and dairy alternative milk, 2021
                                                                                  • Families, especially those with young children, provide more potential for increased dairy milk consumption
                                                                                    • Figure 73: Anticipated change in consumption of dairy and dairy alternative milk, by parental status, 2021
                                                                                • Perception of Dairy and Dairy Alternative Milk Base Types

                                                                                  • Majority of US consumers believe dairy has a positive impact on health
                                                                                    • Figure 74: Dairy’s impact on health, 2021
                                                                                  • Generation that is most committed to health of dairy is aging, emerging audiences present threat
                                                                                    • Figure 75: Dairy’s impact on health – Positive impact, by generation, 2021
                                                                                  • Indulgence is a category white space
                                                                                    • Lactose-free requires education and reframing
                                                                                      • Sustainability is a sore subject
                                                                                        • Figure 76: Perception of dairy and dairy alternative milk base types – General, 2021
                                                                                      • Dairy milk prevails in versatility
                                                                                        • Almond milk shines in smoothies
                                                                                          • Figure 77: Perception of dairy and dairy alternative milk base types – Uses, 2021
                                                                                      • Attributes Important to Dairy and Dairy Alternative Milk Purchase

                                                                                        • Milk products of all kinds must check the box on the basics
                                                                                          • Figure 78: Attributes important to dairy and dairy alternative milk purchase – Net – Any rank, 2021
                                                                                        • The dairy alternative milk dilemma
                                                                                          • Figure 79: Attributes important to purchase – Net – Any rank, by purchasers of dairy milk and dairy alternative milk, 2021
                                                                                        • Men are more open to niche claims and added “good stuff”
                                                                                          • Figure 80: Attributes important to dairy and dairy alternative milk purchase – Net – Any rank, by gender, 2021
                                                                                      • Motivating Dairy and Dairy Alternative Milk Trial

                                                                                        • Consumers rely on the category to support healthy bones
                                                                                          • Figure 81: Benefits that would encourage trial of dairy or dairy alternative milk, by age and parental status, 2021
                                                                                        • Supporting immune health is not behind us
                                                                                          • Figure 82: Benefits that would encourage trial of dairy or dairy alternative milk, 2021
                                                                                        • Millennials poised for eager adoption of functionality
                                                                                          • Figure 83: Benefits that would encourage trial of dairy or dairy alternative milk, by generation, 2021
                                                                                      • Appendix – Data Sources and Abbreviations

                                                                                        • Data sources
                                                                                          • Sales data
                                                                                            • Forecast
                                                                                              • Consumer survey data
                                                                                                • Abbreviations and terms
                                                                                                  • Abbreviations
                                                                                                    • Terms
                                                                                                    • Appendix – The Market

                                                                                                        • Figure 84: Total US retail sales and forecast of dairy milk, at current prices, 2016-26
                                                                                                        • Figure 85: Total US retail sales and forecast of dairy milk, at inflation-adjusted prices, 2016-26
                                                                                                        • Figure 86: Total US retail sales and forecast of refrigerated dairy milk, current price, 2016-26
                                                                                                        • Figure 87: Total US retail sales and forecast of refrigerated dairy milk, at inflation-adjusted prices, 2016-26
                                                                                                        • Figure 88: Total US retail sales and forecast of shelf-stable dairy milk, at current prices, 2016-26
                                                                                                        • Figure 89: Total US retail sales and forecast of shelf-stable dairy milk, at inflation-adjusted prices, 2016-26
                                                                                                        • Figure 90: Total US retail sales and forecast of dairy alternative milk, at current prices, 2016-26
                                                                                                        • Figure 91: Total US retail sales and forecast of dairy alternative milk, at inflation-adjusted prices, 2016-26
                                                                                                        • Figure 92: Total US retail sales and forecast of almond milk, at current prices, 2016-26
                                                                                                        • Figure 93: Total US retail sales and forecast of almond milk, at inflation-adjusted prices, 2016-26
                                                                                                        • Figure 94: Total US retail sales and forecast of soy milk, at current prices, 2016-26
                                                                                                        • Figure 95: Total US retail sales and forecast of soy milk, at inflation-adjusted prices, 2016-26
                                                                                                        • Figure 96: Total US retail sales and forecast of coconut milk, at current prices, 2016-26
                                                                                                        • Figure 97: Total US retail sales and forecast of coconut milk, at inflation-adjusted prices, 2016-26
                                                                                                        • Figure 98: Total US retail sales and forecast of other non-dairy drinks, at current prices, 2016-26
                                                                                                        • Figure 99: Total US retail sales and forecast of other non-dairy drinks, at inflation-adjusted prices, 2016-26
                                                                                                    • Appendix – Companies and Brands

                                                                                                        • Figure 100: Multi-outlet sales of refrigerated dairy milk, by leading companies and brands, rolling 52 weeks 2020 and 2021
                                                                                                        • Figure 101: Multi-outlet sales of shelf-stable dairy milk, by leading companies and brands, rolling 52 weeks 2020 and 2021

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