The U.S. Market for Flavored Dairy and Dairy Alternative Beverages, 4th Edition

Apr 1, 2004
192 Pages - Pub ID: LA940443
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Flavored dairy beverages, and flavored beverages made with soymilk or other dairy alternatives, are breathing new life into the previously flat U.S. dairy industry. Changes and innovations in distribution channels, packaging, product formulation, marketing, advertising, and consumer tastes and perceptions are converging to create a growing, complex and competitive marketplace. This report from Packaged Facts updates and expands on our 2002 study addressing this dynamic category, and provides current, up-to-the-minute analysis of trends, influences, new products and mergers and acquisitions among industry leaders. The inclusion of flavored dairy alternative beverages is new to this report, reflecting growing consumer interest in these products.

This report examines the U.S. flavored milk and flavored dairy beverage market and equivalent products made with dairy alternatives. While the data primarily reflects supermarket sales, the report will also analyze current opportunities in other distribution channels, including school vending machines and other foodservice outlets, convenience stores, drugstores, and mass merchandisers. The report reviews successes and obstacles in marketing, advertising and promotional efforts as the dairy industry reaches for new demographic segments and explores the use of contemporary technologies such as the Internet as promotional devices.

Report Methodology
The information in The U.S. Market for Flavored Dairy and Dairy Alternative Beverages is based on both primary and secondary research. Primary research involved on-site examination of the retail milieu, interviews with marketing, public relations and industry analysts within the beverage market and consultants to the industry. Secondary research entailed data-gathering from relevant trade, business, and government sources, including company literature. Packaged Facts has derived mass merchandiser sales figures from Information Resources, Inc. (IRI) InfoScan sales-tracking data. Figures provided on national consumer advertising expenditures are based primarily on data compiled by CMR/TNS Media Intelligence U.S., the leading provider of strategic advertising and marketing communications intelligence. The analysis of consumer demographics derives from Simmons Market Research Bureau survey data for fall 2003. New product information is gathered via literature research, personal interviews and data compiled by ProductScan, a service of Marketing Intelligence Service Ltd.

The report looks at every segment of the dairy beverage market, examining trends for growth and projecting sales of products through 2008. It analyzes consumer demographics and their current and projected impact on sales of flavored dairy and dairy alternative beverages. It provides up-to-date competitive profiles of marketers of dairy beverage products - including a look at smaller, up-and-coming companies - and discusses the influence of demographic trends as a driver of retail trends. The report also spotlights new products and current distribution trends, and offers readers trends and marketing opportunities within the food/beverage industry.

What You’ll Get in this Report
The U.S. Market for Flavored Dairy and Alternative Dairy Beverages makes important predictions and recommendations regarding the future of this market, and pinpoints ways current and prospective marketers can capitalize on current trends and spearhead new ones. No other market research report provides both the comprehensive analysis and extensive data that The U.S. Market for Flavored Dairy and Alternative Dairy Beverages offers. The report addresses the following segments:

  • The Market (including market size and composition, and projected market growth)
  • The Marketers( (including discussions of specific marketer brand and market shares)
  • Competitive Profiles (of the mainstream marketers, specialists and up-and-coming niche players, and analyses of the products they market)
  • Distribution Strategies (including retail, foodservice and c-stores)
  • The Consumer (who’s buying what, and where)
  • The Products
  • Trends and Opportunities

Plus, you’ll benefit from extensive data, presented in easy-to-read and practical charts, tables and graphs.

Scroll down to see a more detailed outline of the contents of this report.

How You Will Benefit from this Report
If your company is already competing in the flavored dairy/alternative dairy beverage market, or is considering making the leap, you will find this report invaluable, as it provides a comprehensive package of information and insight not offered in any other single source. You will gain a thorough understanding of the current market for flavored dairy/dairy alternative beverages, as well as projected sales and trends through 2008. Contributing to that understanding will be a complete analysis of sales data from IRI and other published and trade sources, a detailed discussion of the consumer for flavored dairy beverages based on Simmons data.

This report will help:

  • Marketing Managers identify market opportunities and develop targeted promotion plans for flavored dairy/alternative dairy drinks.
  • Research and development professionals stay on top of competitor initiatives and explore demand for dairy beverages.
  • Advertising agencies working with clients in the beverage industry understand the product buyer to develop messages and images that compel consumers to purchase these products.
  • Business development executives understand the dynamics of the market and identify possible partnerships.
  • Information and research center librarians provide market researchers, brand and product managers and other colleagues with the vital information they need to do their jobs more effectively.

Chapter 1: Executive Summary
    • Scope and Methodology
    • Report Methodology

  • The Products
    • Two Main Categories
    • Milk Battles Boring Image
    • Soy Beverages Mimic Milk
    • Targeting Diverse Consumer Interests
    • Formulation Variables and Value-Added Characteristics
    • Single-Serve Packaging
    • Extended Shelf Life
    • Refrigerated Dairy Alternatives Build Awareness

  • Size and Growth of Market
    • Total Market Reached $2.9 Billion in 2003
    • Table 1-1: U.S. Sales of Flavored Dairy Beverages and Flavorings, 1999-2001*
    • Table 1-2: U.S. Sales of Flavored Dairy and Flavored Dairy Alternative Beverages, 2002-2003*
    • Table 1-3: Projected U.S. Sales of Flavored Dairy/Dairy Alternative Beverages, 2003-2008
    • Flavored Milk Outlook: Competitive but Positive
    • Shelf-Stable Dairy Drinks Less Predictable
    • Ready-to-Drink Packaged Coffee Still Has Buzz
    • Drinkable Yogurt Takes Off
    • Total Flavored Dairy Alternative Drinks $818.2 million in 2003
    • Table 1-4: 2003 Sales by Flavored Dairy Segment, Percentage of Total Category Sales
    • Figure 1-1: 2003 Sales by Flavored Dairy Segment, Percentage of Total Category Sales
    • New Product Introductions

  • Packaging and Processing Trends and Innovations
    • Single-Serve Shakes Up Sales
    • Plastic Single-Serve Containers Proliferate
    • Single-Serve Universe
    • Single-Serve Packaging Improves Margins, Reduces Trial Risk
    • Multi-packs Boost Sales
    • Processing Trends Multiply Options
    • Dean Foods Wins Approval for Aseptic Innovation
    • Trade-Offs With Shelf Life Improvements
    • Dairy Alternatives Reverse Trend, Succeed With Refrigeration
    • Can Milk and Fizz Co-exist?
    • Flavor Trends and Innovations
    • Sweeteners: Sucralose Trumps Aspartame

  • Marketing Trends and Innovations
    • Branding Strategies Help Redefine, Sell Milk
    • “Milk With Attitude”
    • Beverages for “Healthy Lifestyles”

  • Consumer Trends
    • Adults Getting Heavier
    • Sounding the Alarm on Childhood Obesity
    • Shifting from Soft Drinks to Dairy
    • Can Flavored Dairy-Based Drinks Fill the Bill?
    • Low-Carb a Significant Trend
    • Flavored Soymilk in Low-Carb Diets
    • Health, Wellness, and Aging Boomers
    • The Diversifying American Population
    • $644 Billion Spending Power in 2003
    • Teen Consumption Goes Up
    • Kids Drinking More Milk, Too
    • Adults Find Convenience Convincing
    • Who Are the Soymilk Drinkers?

  • The Marketers
    • Top Dog: Dean Foods
    • National Dairy Holdings — Consolidation and Speculation
    • New Competitors from Carbonated Soft Drink Industry
    • Small Innovators Still Make Waves

  • Distribution
    • Supermarkets Primary Sales Channel
    • Promising Vending Results Inspire Processors
    • Convenience Store Channel — Beyond the Gallon
    • Flavored Milk Sales Projected to Grow in C-Stores
    • Single-Serve Milk Boosts Sales, Offers Fast-Food Options

  • Conclusion
    • Health Concerns Support Milk, Soy Intake
    • Proliferation of Choices

Chapter 2: The Products

  • Milk Drinks Battle Boring Image
  • Soy Beverages Mimic Milk
  • Targeting Diverse Consumer Interests
  • Market Segments
  • Flavored Milks
  • Flavored Milk Drinks - Blended
  • Flavored Milk Drinks - Carbonated
  • Flavored Milk/Coffee Blends
  • Flavored Dairy Alternatives — Soy
  • Flavored Dairy Alternatives — Other Than Soy
  • Shakes and Smoothies
  • Drinkable Yogurt
  • Ethnic-style Drinks
  • Formulation Variables and Value-Added Characteristics
  • Reduced-Fat, Low-Fat and Fat-Free
  • Low-Carb Craze
  • Lactose-free
  • The Organic Segment
  • Organic Dairy Grows Despite Flat Conventional Market
  • Organic Standards
  • Safety, Health Concerns Drive Organic Growth
  • Organic Adds Flavors, Convenience
  • Fortification
  • Packaging for a Modern World
  • Single-Serve Packaging
  • Multi-packs of Single-Serve Beverages
  • Extended Shelf Life
  • Refrigerated Dairy Alternatives Build Awareness

Chapter 3: Size and Growth of the Market

    • Market Reached $2.9 Billion in 2003
    • Table 3-1: U.S. Sales of Flavored Dairy Beverages and Flavorings, 1999-2001*
    • Table 3-2: U.S. Sales of Flavored Dairy and Flavored Dairy Alternative Beverages, 2002-2003*
    • Table 3-3: Projected U.S. Sales of Flavored Dairy/Dairy Alternative Beverages, 2003-2008
    • Figure 3-1: Projected U.S. Sales of Flavored Dairy/Dairy Alternative Beverages, 2003-2008
    • Table 3-4: 2003 Sales by Flavored Dairy Segments, Percentage of Total Category
    • Figure 3-2: 2003 Sales by Flavored Dairy Segment, Percentage of Total Category

  • Flavored Milk and Dairy-Based Beverages
    • Chocolate Milk Just the Beginning
    • Making Milk Hip and Exciting
    • New Distribution Outlets Build Market
    • Changing Market Influences Estimates of Size
    • Table 3-5: IRI-Tracked Retail Sales of Refrigerated Flavored Milk, 1999 - 2003 (includes eggnog and buttermilk)
    • Table 3-6: U.S. Sales of Milk (Overall), 1999 - 2003
    • Packaged Facts Historical Data: Flavored Milk and Dairy-Based Shelf-Stable Beverages, 1997 - 2001
    • Table 3-7: U.S. Sales of Flavored Milk 1997 - 2002
    • Table 3-8: U.S. Sales of Dairy-Based Shelf-Stable Beverages. 1997 - 2002
    • 2003 U.S. Sales for Flavored Milk Reach $1,337 Million
    • Table 3.9: U.S. Sales of Selected Leading Refrigerated Flavored Milk Marketers, 2002-2003
    • Outlook: Competitive but Positive
    • Table 3-10: Projected U.S. Sales of Flavored Milk, 2003-2008
    • Figure 3-3: Projected U.S. Sales of Flavored Milk, 2003-2008
    • Shelf-Stable Dairy-Based Drinks a Wild Card
    • Shelf Stable Dairy-Based Beverages Reach $135.7 Million in 2003
    • Table 3-12: U.S. Projected Sales of Shelf-Stable Dairy Beverages 2003 - 2008
    • Figure 3-4: U.S. Projected Sales of Shelf-Stable Dairy Beverages 2003 - 2008

  • Ready-to-Drink Packaged Coffee
    • Frappuccino Still Segment Leader
    • Table 3-13: Total U.S. Sales of Ready-to-Drink Coffee Beverages by Market, 1999-2003
    • RTD Coffee Beverages Projected to Reach $598.9 Million
    • Table 3-14: Projected Total U.S. Sales of Packaged Ready-to-Drink Coffee Beverages by Market, 2003 - 2008
    • Table 3-15: U.S. Sales of Leading RTD Packaged Coffee Beverage Brands, 2002-2003

  • Drinkable Yogurt and Cultured Dairy Beverages
    • Drinkable Yogurt Making the Spoon Obsolete
    • Growth Exceeds Projections
    • Table 3-16: U.S. Sales of Leading Refrigerated Cultured Dairy Beverages Brands, 2002 - 2003
    • Room for Expansion
    • Table 3-17: U.S. Sales of Cultured Dairy Beverages, 1999 - 2003
    • Table 3-18: Projected Sales of Cultured Dairy Beverages, 2003 - 2008
    • Figure 3-5: Projected Sales of Cultured Dairy Beverages, 2003 - 2008
    • Leading Marketers Sell Health, Fitness, Functionality

  • Flavored Dairy-Alternative Beverages
    • White Wave Transforms Category
    • Other Market Leaders
    • Organic Matters
    • Flavored Category
    • Calculating Size of Market for Dairy Alternative Beverages
    • Table 3-19: U.S. Sales of Shelf-Stable Non-Fruit Drinks*, 1999 - 2003
    • Table 3-20: U.S. Sales of Refrigerated Milk Substitutes, Soymilk, Kefir
    • Table 3-21: U.S. Sales of Refrigerated Milkshakes/Non-Dairy Drinks
    • Total Flavored Dairy Alternative Drinks $818.2 million in 2003
    • Table 3-22: Projected Sales of Flavored Dairy Alternatives 2003 - 2008
    • Figure 3-6: Projected Sales of Flavored Dairy Alternatives 2003 - 2008
    • Table 3-23: U.S. Sales of Selected Dairy-Alternative Beverage Marketers, 2002-2003
    • Number of New Product Introductions

Chapter 4: Market Drivers and Factors Affecting Growth

    • Packaging and Processing Trends and Innovations
    • Single-Serve Shakes Up Sales
    • Milk Chug Revolution
    • Plastic Single-Serve Containers Proliferate
    • Single-Serve Packaging Suits Convenience Store Market
    • Horizon Organic Opts for Tetra Prisma Aseptic Single-Serve
    • Single-Serve Universe
    • Single-Serve Packaging Improves Margins, Reduces Trial Risk
    • Multi-packs Boost Sales
    • Processing Trends Multiply Options
    • Glossary of Terms Related to Beverage Shelf Life
    • Dean Foods Wins Approval for Aseptic Innovation
    • Trade-Offs With Shelf Life Improvements
    • Dairy Alternatives Reverse Trend, Succeed With Refrigeration
    • Can Milk and Fizz Co-exist?

  • Flavor Trends and Innovations
    • Chocolate Rules
    • Table 4-1: Share of Flavored Milk Sales by Flavor
    • Bold Flavor Names for Teens, Young Adults
    • Fruit Flavors Smoothies, Drinkable Yogurt
    • Soy-Based Drinks Run the Gamut of Flavors
    • Ready-to-Drink Coffee, Tea Beverages Add Flavors Too
    • Non-Soy Dairy Alternatives Go Wild With Flavor
    • Ethnic Flavors
    • Sweeteners: Sucralose Trumps Aspartame

  • Marketing Trends and Innovations
    • Branding Strategies Help Redefine, Sell Milk
    • “Milk With Attitude”
    • Cartoons, Contours for Children
    • Moving Up to Superheroes
    • Amped-Up Adolescence: Swerve, Raging Cow, and More
    • Adventures in Internet Marketing
    • Beverages for “Healthy Lifestyles”
    • Generic Milk Marketing Campaigns
    • Advertising by Marketers
    • Table 4-2: The U.S. Flavored Dairy/Dairy Alternative Beverage Market: Selected New Product Introductions, 2002—2003

Chapter 5: Consumer Trends

  • Epidemic of Obesity
    • Adults Getting Heavier
    • Table 5-1: Age-Adjusted* Prevalence of Overweight and Obese U.S. Adults (age 20-74 years)
    • Sounding the Alarm on Childhood Obesity
    • Table 5-2: Prevalence of Overweight Among Children and Adolescents, Ages 6-19 Years (Selected Years 1963-65 through 1999-2000)
    • Risks and Costs of Obesity
    • Is Dairy a Part of the Solution?
    • Can Flavored Dairy-Based Drinks Fill the Bill?
    • Table 5-3: Recommended Daily Levels of Calcium for Children and Teens

  • The Carbohydrate Conundrum
    • Did Low-Fat Diets Make Us Fat?
    • Labeling Regulations On the Way?
    • Low-Carb a Significant Trend
    • Dairy in Low-Carb Diets
    • Table 5-4
    • Milk and Chocolate Milk Comparison of Calories, Carbohydrates, Protein and Saturated Fat
    • Flavored Soymilk in Low-Carb Diets
    • Table 5-5: Carbohydrate Counts of Popular Flavored Soymilk Brands
    • Healthy Weight With Dairy

  • Health, Wellness, and Aging Boomers
    • Boomers a Boon to Dairy Alternatives?
    • Calcium a Long-Term Investment in Bone Health
    • Table 5-6: Calcium Recommendations for Adults
    • Soy for Heart-Health, Lactose Intolerance, Risk Reduction
    • Organic Foods for Health and Values
    • Organic Dairy Sells in Supermarkets
    • Who is the Organic Consumer?
    • Table 5-7: Percentage of Consumers Who Use Organic Foods: Overall, Regularly, Occasionally, and Infrequently
    • Wellness Consumers Want Natural Ingredients

  • Flavored Dairy and Dairy-Alternative Consumers
    • Teen Consumption Goes Up
    • Table 5-8: Teen Milk Consumption/Milk Share of Teen Beverage Market, 2000-2001
    • Kids Drinking More Milk, Too
    • Table 5-9: Per Capita Milk Consumption, Children Ages 6 - 12, 2000-2001
    • Adults Find Convenience Convincing
    • Ready-To-Drink Coffee Skews Younger
    • Drinkable Yogurt Targeted to Toddlers, Kids, Moms
    • Who Are the Soymilk Drinkers?
    • Potential Among Hispanic Consumers

  • Consumer Demographic Data
    • The Simmons Survey System
    • Chocolate Milk Penetration Highest
    • Consumer Focus: Chocolate Milk
    • Table 5-11: Demographic Factors Favoring the Most Often Use of Chocolate Milk
    • Consumer Focus: Other Flavored Milk
    • Table 5-12: Demographic Factors Favoring the Most Often Use of Other Flavored Milk
    • Consumer Focus: Drinkable Yogurt
    • Consumer Focus: Soymilk
    • Table 5-13: Demographic Factors Favoring the Most Often Use of Drinkable Yogurt
    • Table 5-15: Demographic Factors Favoring the Most Often Use of Soymilk

Chapter 6: Distribution

    • Flavored Milk Supermarket Sales
    • Soymilk, Soy Drinks Mainstreaming
    • Table 6-1: 2001 Channel Breakdown for Soymilk Sales*
    • Table 6-2: 2001 Refrigerated Soymilk Sales vs. Shelf Stable, by Channel*
    • Supermarkets Primary Sales Channel
    • Drinkable Yogurts More Than 15% of Yogurt Category

  • The Milk Machine: Opportunities in Vending
    • Midwest Tests Dairy Vending
    • National Milk Vending Tests by MilkPEP
    • Second Test Branches Out
    • Promising Vending Results Inspire Processors


  • Convenience Store Channel— Beyond the Gallon
    • Flavored Milk Sales Projected to Grow in C-Stores
    • FMSTI Study Says Single-Serve Drives Convenience Store Milk Sales

  • Restaurants, Coffee Chains Boost Image with Milk
    • Single-Serve Milk Boosts Sales, Offers Fast-Food Options

Chapter 7: The Marketers

    • M&A Still the Trend, Though 2002 Slow
    • Table 6.1: Dairy Processor Mergers & Acquisitions 1998-2002 & First Half 2003
    • Top Dog: Dean Foods
    • National Dairy Holdings — Consolidation and Speculation
    • Group Danone Ups Share of Brown Cow Buyer Stonyfield Farm
    • New Competitors from Carbonated Soft Drink Industry
    • CSD Per Capita Consumption Down
    • Table 6.2: U.S. Carbonated Soft Drink Market Per Capita Consumption, 1997-2002
    • Top CSD Cos. Enter Market
    • Small Innovators Still Make Waves
    • Table 6-3: The U.S. Flavored Dairy and Flavored Dairy Alternatives Market: Selected Marketers by Brand Line and Product

    • Marketer Profiles
      • Marketer Profile: General Mills
      • Brands: Yoplait Nouriche yogurt smoothie, 8th Continent soymilk
      • Marketer Profile: Stonyfield Farm
      • Brands: Stonyfield Farm Yogurt Smoothies, YoBaby Drinkable Yogurt
      • Marketer Profile: Dannon
      • Brands: Dannon Danimals Drinkable yogurt, Light ‘n Fit yogurt smoothies, Frusion yogurt smoothies
      • Marketer Profile: Lifeway Foods
      • Brands: Lifeway Kefir, La Fruta cultured dairy beverage, Soy-Treat soy-based kefir
      • Marketer Profile: The Hain Celestial Group, Inc.
      • Brands: WestSoy soymilk, Soy Dream soymilk, Rice Dream rice milk
      • Marketer Profile: White Wave Inc.
      • Brands: Silk soymilk, Sun Soy soymilk
      • Marketer Profile: Eden Foods
      • Brands: Edensoy soymilk
      • Marketer Profile: Dean Foods
      • Brands: Dean Milk Chugs; Flavored Milks sold under Meadow Gold, Borden, other brands
      • Dean Branded Products Group: Hershey’s Milks and Milkshakes; Folger’s Jakada
      • Marketer Profile: Nestle USA
      • Brands: Nestle Nesquik
      • Marketer Profile: PepsiCo
      • Brands: Starbucks Frappuccino, Starbucks DoubleShot; new dairy-based product introductions likely
      • Marketer Profile: Starbucks
      • Marketer Profile: Bravo! Foods
      • Brands: Looney Tunes, Slammers, Slim Slammers, Moon Pie, Super Heroes
      • Marketer Profile: Snapple Beverage Group
      • Brands: Yoo-hoo
      • Marketer Profile: Horizon Organic
      • Brands: Horizon Organic
      • Marketer Profile: Organic Valley Family of Farms
      • Marketer Profile: Mac Farms Inc.
      • Marketer Profile: Oberweis Dairy
      • Marketer Profile: HP Hood
      • Marketer Profile: Marigold Foods
      • Brands: Kemp’s Yo-J, Kemp’s milk, Oak Grove milk

Chapter 8: Trends and Opportunities

    • Health Concerns Support Milk, Soy Intake
    • Schools On the Lookout for Better Beverages
    • Low-carb Formulations Will Increase in 2004
    • Dairy Alternatives Will Continue to Find New Users
    • Yogurt Drinks Have Growing Appeal
    • Coffee Drinks Benefit From Shelf-Stable Multi-packs
    • Organic Keeps Growing
    • 3-A-Day, Healthy Weight With Dairy Campaigns Support Growth
    • Proliferation of Choices

Appendix: Addresses of Selected Marketers

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