Dairy processors rely on creativity to grow, stay strong

Food has inspired artists throughout the ages, and we were inspired by the artists as we sifted through hundreds of images to find just the right ones to illustrate our annual State of the Industry report.(See our reports on milk and cultured dairy products, for example.)

Cheese has changed quite a bit in the hundred or so years since Gascard put his brush to canvas. For example, the wheel has given way to slices, chunks and sticks sold in modified atmosphere packaging. Today’s consumer wants convenience. It’s far easier to arrange cheese cubes on a party platter than it is to cut them yourself. Cheese sticks and slices, packaged with crackers, fruits and nuts, make for a convenient snack to eat on the go.

Snacking is one of the dominant themes we uncovered in researching our 28-page State of the Industry feature, beginning on page 26. Besides cheese, yogurt is a snack. Ice cream is a snack, and so are flavored milks consumed after a hard physical workout.

Dairy processors must call on the arts and the sciences to grow and to stay relevant today and in the future. Food scientists at WhiteWave Foods blend milk with sweeteners and other ingredients to create the Sir Bananas flavored milk. But to generate excitement for the brand, it takes creative artists in the marketing and web developments to make a site as wacky as sirbananas.com.

Milk plus coffee

Flavoring milk is one way to increase sales in the category. Blending it with other beverages works, too.  Cream used to be an accent to coffee. Today, processors are making milk an equal partner with java. Dean Foods, Shamrock Farms and Smith Brothers Farms are some of the fluid milk processors with refrigerated dairy-based coffee beverages.

Ice cream has always been about flavors. Sea salt caramel, cookies and cream and cookie dough have elbowed their way into the freezer to sit alongside the stalwarts vanilla, chocolate and strawberry. Ice cream is a food central to dessert, birthday parties and celebrations (like Fourth of July picnics). These days, consumers also are eating ice cream as a snack. Single-serve packages (with a spoon conveniently placed beneath the lid) address that need. Smaller pack sizes also give shoppers variety, and therefore customization. Sis and Bud can enjoy their own flavors while Mom and Dad choose their favorites.

Is there a “plain” yogurt?

Variety rules in the cultured dairy category, too. Yogurts (conventional and Greek) and cottage cheese seemingly come in every flavor but “plain.” Fruits, vegetables, nuts and spices are blended into the white mass. Daypart segmentation continues. Yogurt and cottage cheese are foods for breakfast, snack time, lunch, dinner and dessert. They can be used as recipe ingredients, too.

Water is milk’s top competition. Those ubiquitous water bottles and the message to “stay hydrated” hurt milk sales. Fortunately, dairy processors are picking up on a new way to consume milk. Sales of drinkable yogurts are on the rise. These portable cultured dairy beverages are flavorful, deliver protein naturally and can be relatively low in sugars. When made with Greek yogurt, the protein content is even greater. Long popular with Hispanic shoppers, drinkable yogurts now are entering the dairy cases in mainstream supermarkets. This is an opportunity to grab.

Many fluid milk processors also process juices, fruit punches, iced teas and other nondairy beverages.  So it is instructive to see what is happening in this category. Refrigerated almond milk has drawn a lot of attention (and condemnation) as a milk competitor, but unit sales barely increased (up just 0.1%) in a year. By way of comparison, 10 other nondairy beverages posted greater sales, from the energy drinks (the leader) at $10.8 billion to cranberry cocktail at $1 billion. Unit sales in all but two of the segments increased. To find opportunities in nondairy beverages, check out the complete list on page 61.

It should be noted that dairy competition is coming from overseas, too. If not in the form of physical foods, then from European Union regulations regarding geographical indications. If the EU prevails, U.S. cheesemakers (to take one example) could no longer use the term Parmesan. Instead, they would have to label that product as “hard grated cheese” or in similar words. (More Here)

New Breakthrough Award honors dairy innovation

As our State of the Industry shows, dairy processors do not lack creativity. We feel innovation needs to be honored. This magazine has joined with the American Dairy Products Institute to develop a new award honoring dairy processors for innovative products, manufacturing processes, research and development efforts, or marketing programs. The Breakthrough Award for Dairy Ingredient Innovation will honor achievements by dairy processing members of the American Dairy Products Institute in four categories:

• Innovative milk-derived or whey-derived dairy ingredient products
• Innovative processing or packaging of dairy ingredients
• Innovative breakthroughs in R&D or quality assurance of dairy ingredients
• Innovative marketing of a dairy ingredient

To submit an entry, go to www.dairyfoods.com/ADPI-Breakthrough-Award