As Treasurer for the Northeast Dairy Foods Association, I help Bruce Krupke and Leanne Ziemba manage the finances and budget. The association has been a great opportunity to collaborate with other industry professionals. I’m very happy to be part of the executive board of directors, helping to set policy and direction for the association’s activities. I’m also pleased to be able to share some thoughts with you on the focus of this issue — consumer trends. This gave me the opportunity to consider a few different areas that Guida’s, and the dairy industry as a whole, is dealing with and focusing on currently.
One topic of dairy product trends and what consumers want is the concept or definition of the term “local” and a better understanding of where their food is sourced. Today’s consumers are looking for local foods that they can count on and know support their local economies. However, each state has its own definition of “local,” and this is creating a dilemma for our industry in terms of labeling and marketing our products to satisfy this need. In addition, the federal government also has a different definition of the term local. For example, the Connecticut Grown program requires that raw product come from no further than ten miles away from its border. Alternately, many federal government programs that support local foods generally define local as the total distance that the product is transported as being less than 400 miles from its origin. Obviously, these discrepancies need to be resolved so that our industry will be able to accurately reflect its local origins and ensure this labeling is consistent and fair for all parties.
Decades ago, dairy was one of the first major categories of food to provide low-fat alternatives. As nutritionists pushed low-fat foods, our industry complied, and these items soon became everyday staples. Lo and behold, now full-fat products are back. Medical professionals have shown that the body processes dairy fat well, and consumers have taken the opportunity to add higher fat content products into their diets.
"Low and behold, now full-fat products are back. Medical professionals have shown that the body processes dairy fat well, and consumers have taken the opportunity to add higher fat content products into their diets."
— MICHAEL YOUNG
They are rediscovering the reasons whole milk is good for you, as it contains very important nutrients, including protein and vitamins and minerals (such as calcium, vitamin D and potassium). We see this with higher sales of whole milk, up around 3% nationally. However, our low-fat products are paying the price with some segments down as much as 14%.
Other industry trends that have been noted are consumers gravitating towards products that are high in protein. Dairy items such as cottage cheese have come back into fashion due largely to its protein content. In addition, consumers want low sugar options in the products they buy today. Our industry’s message on chocolate milk as a replenisher after exercise has struck a chord among activity-minded consumers, and the result has been several years of strong growth in our chocolate milk retail sales. There are opportunities to sell more flavored milk, as well. Our sister plant, Oakhurst Dairy in Portland, Maine, has developed a new milk flavor, wild blueberry. Even with the added sugar due to flavoring, milk is still a quality product. For every 3 grams of carbohydrates, milk provides a gram of protein — a winner in consumers’ eyes and stomachs.
Another significant topic in our industry today is the use of the word “milk” in plant-based beverages. It is confusing to consumers to allow such terms as almond “milk” to be used when the product doesn’t contain any dairy. The FDA needs to decide soon whether non-dairy beverages can use the word milk, which will not only help our industry comply but will properly inform consumers what they are truly purchasing. Our company is developing some new hybrids made up of dairy milk and plant-based beverages under our Live Real Brand to meet consumer demands. These include milk and almonds, and milk and oats, both providing a unique taste experience. They are now being tested in Minnesota, hopefully to positive reviews.
Marketing to specific consumer segments is also challenging for the industry today. For example, our marketing and product development teams spend considerable time evaluating what products will be on trend for Millennials. This age group accesses information and makes decisions using technology on a larger scale than previous generations, so communicating our product category to Millennials is important and necessary. This market segment also values convenience, and buying over the internet is the norm. While this presents a challenge for our products, due to their perishable nature, at the very least we need to give Millennials access to our products’ nutritional makeup, sourcing information and product benefits.
The nutrition trend continues in our school milk programs. Milk is, without a doubt, the most nutritious beverage available for children and young adults and is supported by the National School Lunch nutrition standards. Our organization is a strong provider in the school milk market within our service territories, and we will continue to support efforts to educate school children about nutrition and the value of dairy products in a healthy, well balanced diet.
We have recently seen an increase in the sale of fluid milk and dairy products to food service providers both directly and through distributors. These channels of distribution provide for efficient sales and more economic choices of the specific products that restaurants and other food service institutions require. Our goal is to find the most cost-effective approach to serving these and all our customers and is an on-going evaluation process by our distribution team.
Finally, we are seeing continued brand loyalty. As a regional brand, Guida’s is proving that “fresh” and “local” really mean something to consumers in milk and cream. This has been the result of strong collaboration with key market retailers and the commitment of our consumers in supporting their local dairy. Locally branded milk like Guida’s provides consumers with confidence the product is of good consistent quality. They like seeing the milk they consumed in schools as children still available now that they are adults.
As an industry, are we positioned well for the future? Absolutely. We need to continue to meet consumers’ demands, adjust and find our selling point, which is quality and nutrition. We also need to remind consumers that they don’t need to look for substitutes — we are the real thing!