FREE-UK-Flavoured-Milk-Report-2016-2017
The backdrop to the UK flavoured milk market is one of relentless change. The removal of the EU milk quotas, the transition to a Western-type diet by emerging economies, the UK sugar debate and the booming sports nutrition industry are all aspects of change that create both challenges and opportunities for the UK flavoured milk market. HRA Food and Drink Marketing has developed this report as a map to guide industry stakeholders. Although volume growth in 2014 was slightly lower than in previous years, the flavoured milk market still has plenty of room for product innovation and development. Overall, we expect the UK flavoured milk market to continue to grow over the medium term, but not without improving its nutritional profile. The sugar debate reached new heights when, in October 2015, Public Health England released a document suggesting Government intervention in the form of a sugar tax (levy). As a consequence, product reformulation has become a priority for all serious players in the market.
The backdrop to the UK flavoured milk market is one of relentless change. The removal of the EU milk quotas, the transition to a Western-type diet by emerging economies, the UK sugar debate and the booming sports nutrition industry are all aspects of change that create both challenges and
opportunities for the UK flavoured milk market.
HRA Food and Drink Marketing has developed this report as a map to guide industry stakeholders. Although volume growth in 2014 was slightly lower than in previous years, the flavoured milk market still has plenty of room for product innovation and development.
Overall, we expect the UK flavoured milk market to continue to grow over the medium term, but not without improving its nutritional profile. The sugar debate reached new heights when, in October 2015, Public Health England released a document suggesting Government intervention in the form of a sugar tax (levy). As a consequence, product reformulation has become a priority for all serious players in the market.
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Food and Drink<br />
Marketing<br />
& Branding<br />
Commercial<br />
Consulting<br />
Market<br />
Research<br />
<strong>UK</strong> <strong>Flavoured</strong> <strong>Milk</strong><br />
Market <strong>2016</strong> - <strong>2017</strong><br />
<strong>FREE</strong><br />
REPORT
<strong>UK</strong>#FLAVOURED#MILK#<strong>2016</strong>217#<br />
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FOOD AND DRINK<br />
<strong>UK</strong>#FLAVOURED#MILK#<strong>2016</strong>2<strong>2017</strong>#<br />
COMMERCIAL#AND#CONSUMER#RISKS#AND#OPPORTUNITIES##<br />
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Table of Contents<br />
1.! <strong>Flavoured</strong>,<strong>Milk</strong>,Market,.................................................................................,10!<br />
1.1,The,Global,<strong>Flavoured</strong>,<strong>Milk</strong>,Market,..........................................................................,11!<br />
1.2,<strong>UK</strong>,Dairy,Trade:,Exports,&,Imports,.........................................................................,11!<br />
1.3,................................................................................................................................,14!<br />
Nutritional,Profile,........................................................................................................,14!<br />
1.4,The,Health,Benefits,of,Dairy,...................................................................................,17!<br />
1.5,Growth,and,Development,......................................................................................,18!<br />
Bone Health!..................................................................................................................!18!<br />
Oral Health!....................................................................................................................!18!<br />
Weight Control and Obesity!.......................................................................................!18!<br />
Metabolic Syndrome and Type 2 Diabetes!.............................................................!18!<br />
Cardiovascular Disease!..............................................................................................!18!<br />
Cancer!...........................................................................................................................!19!<br />
1.6,Summary,................................................................................................................,20!<br />
2.! Evolution,of,the,<strong>Flavoured</strong>,<strong>Milk</strong>,Category,.....................................................,21!<br />
2.2,<strong>Flavoured</strong>,<strong>Milk</strong>,Trends,............................................................................................,23!<br />
2.3,................................................................................................................................,23!<br />
White,<strong>Milk</strong>,...................................................................................................................,23!<br />
Market,Indicators,.........................................................................................................,23!<br />
2.4,................................................................................................................................,24!<br />
<strong>Flavoured</strong>,<strong>Milk</strong>,Market,Indicators,.................................................................................,24!<br />
White <strong>Milk</strong> Market!........................................................................................................!24!<br />
<strong>Flavoured</strong> <strong>Milk</strong> Market!.................................................................................................!24!<br />
Value sales trending downwards!..............................................................................!24!<br />
Value sales on the rise!................................................................................................!24!<br />
Volume sales seeing slight rise!..................................................................................!24!<br />
Volume sales rising!......................................................................................................!24!<br />
Difficult to increase sales as market penetration is so high!..................................!24!<br />
Considerable opportunity for market growth!..........................................................!24!<br />
Heavy long-term discounting!.....................................................................................!24!<br />
Regular promotional discounts!..................................................................................!24!<br />
2.5,<strong>Flavoured</strong>,<strong>Milk</strong>,Market,Segmentation,.....................................................................,24!<br />
2.6,Own,Label,..............................................................................................................,25!<br />
2.7,Retail,Own,Label,Ranges,.........................................................................................,26!<br />
2.8,Issues,Faced,by,Own,Label,......................................................................................,26!<br />
2.9,Own,Label,in,SubYCategories,..................................................................................,26!<br />
2.10,The,Future,of,Own,Label,.......................................................................................,27!<br />
2.11,..............................................................................................................................,27!<br />
Summary,......................................................................................................................,27!<br />
3.! NPD,Guidance,...............................................................................................,28!<br />
3.1,Occasion,and,Usage,................................................................................................,28!<br />
3.2,Core,Consumer,Segments,.......................................................................................,30!<br />
Key Demographic Segments: 0-14 Years!................................................................!32!<br />
Key Demographic Segments: 15-29 Years!.............................................................!34!<br />
Key Demographic Segments: 30-44 Years!.............................................................!36!<br />
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Key Demographic Segments: 45-59 Years!.............................................................!38!<br />
Key Demographic Segments: 60+!............................................................................!40!<br />
3.3,Adding,Value,to,<strong>Flavoured</strong>,<strong>Milk</strong>,..............................................................................,42!<br />
Macro Food and Drink Trends!...................................................................................!42!<br />
3.4,Organic,...................................................................................................................,42!<br />
3.5,Transparent,Labelling,&,Minimal,Processing,...........................................................,43!<br />
3.6,Free,From/,Lactose,Free,.........................................................................................,44!<br />
3.7,................................................................................................................................,45!<br />
Sugar,Reduction,...........................................................................................................,45!<br />
3.8,Additional,Nutritional,Benefits,...............................................................................,46!<br />
3.9,White,<strong>Milk</strong>,Trends,..................................................................................................,46!<br />
3.10,Supporting,British,Farmers,...................................................................................,46!<br />
3.11,Alternative,Sourcing,.............................................................................................,47!<br />
3.12,Consumer,Targeted,NPD,.......................................................................................,47!<br />
3.13,<strong>Flavoured</strong>,<strong>Milk</strong>,Trends,..........................................................................................,49!<br />
3.14,Functionality,Driven,NPD,......................................................................................,49!<br />
3.15,Flavour,Driven,NPD,..............................................................................................,50!<br />
3.16,Formula,Innovation,..............................................................................................,52!<br />
3.17,Packaging,.............................................................................................................,52!<br />
3.18,Attitudes,towards,packaging,in,the,<strong>UK</strong>,.................................................................,53!<br />
3.19,Packaging,Evaluation,............................................................................................,53!<br />
3.20,Sports,Caps,...........................................................................................................,54!<br />
3.21,..............................................................................................................................,56!<br />
Summary,......................................................................................................................,56!<br />
4.! The,Power,Categories,...................................................................................,57!<br />
Traditional,<strong>Flavoured</strong>,<strong>Milk</strong>,...........................................................................................,57!<br />
4.1,Frijj,.........................................................................................................................,59!<br />
4.2,Yazoo,(Friesland,Campina),......................................................................................,61!<br />
4.3,Functional,<strong>Milk</strong>,.......................................................................................................,63!<br />
4.4,Sports,Nutrition:,Key,Facts,.....................................................................................,64!<br />
4.5,The,Science,.............................................................................................................,66!<br />
4.6,The,OverYConsumption,Argument,..........................................................................,67!<br />
4.7,The,VAT,Issue,.........................................................................................................,69!<br />
4.9,Dunn’s,River,Nurishment,........................................................................................,72!<br />
4.10,Coffee,milk,...........................................................................................................,74!<br />
4.11,Starbucks,..............................................................................................................,76!<br />
4.12,Emmi,CAFFE,LATTE,...............................................................................................,79!<br />
4.13,Confectionary,and,Dessert,<strong>Flavoured</strong>,<strong>Milk</strong>,............................................................,81!<br />
4.15,Gü,........................................................................................................................,86!<br />
4.16,Breakfast,ReadyYToYDrink,<strong>Milk</strong>,.............................................................................,87!<br />
4.18,Fuel,10K,................................................................................................................,90!<br />
4.19,Alternative,<strong>Flavoured</strong>,<strong>Milk</strong>,...................................................................................,90!<br />
4.20,Dairy,Alternative,Comparison,...............................................................................,92!<br />
4.21,Alpro,....................................................................................................................,94!<br />
4.22,Blue,Diamond,.......................................................................................................,96!<br />
4.23,Summary,..............................................................................................................,99!<br />
5.! Merchandising,and,Pricing,..........................................................................,100!<br />
5.1,Tesco,....................................................................................................................,101!<br />
Tesco Chilled Dairy Aisle!..........................................................................................!101!<br />
Tesco Chilled Protein Aisle!.......................................................................................!102!<br />
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Tesco Chilled Alternative Aisle!................................................................................!103!<br />
Tesco Ambient Grocery – Cereals Aisle!.................................................................!104!<br />
Tesco – Traditional <strong>Flavoured</strong> <strong>Milk</strong> Prices 2015!...................................................!105!<br />
Tesco – Coffee and Breakfast <strong>Flavoured</strong> <strong>Milk</strong> Prices 2015!................................!106!<br />
Tesco – Functional/Protein <strong>Flavoured</strong> <strong>Milk</strong> Prices 2015!......................................!107!<br />
Tesco – Confectionary and Alternative <strong>Flavoured</strong> <strong>Milk</strong> Prices 2015!.................!108!<br />
5.2,Sainsbury’s,...........................................................................................................,109!<br />
Sainsbury’s Chilled Dairy Aisle!................................................................................!109!<br />
Sainsbury’s Ambient Grocery – Cereals Aisle!.......................................................!110!<br />
Sainsbury’s Ambient Grocery – Supplement Aisle!...............................................!111!<br />
Sainsbury’s Ambient Grocery – Alternative Aisle!..................................................!112!<br />
Sainsbury’s – Traditional <strong>Flavoured</strong> <strong>Milk</strong> Prices 2015!.........................................!113!<br />
Sainsbury’s – Coffee and Breakfast <strong>Flavoured</strong> <strong>Milk</strong> Prices 2015!......................!114!<br />
Sainsbury’s – Functional/Protein <strong>Flavoured</strong> <strong>Milk</strong> Prices 2015!............................!115!<br />
Sainsbury’s – Confectionary and Alternative <strong>Flavoured</strong> <strong>Milk</strong> Prices 2015!........!116!<br />
5.3,ASDA,....................................................................................................................,117!<br />
ASDA Chilled Dairy Aisle!..........................................................................................!117!<br />
ASDA Ambient Grocery – Cereals Aisle!.................................................................!118!<br />
ASDA Ambient Grocery – Standard/Alternative Aisle!..........................................!119!<br />
ASDA Ambient Grocery – Supplements Aisle!.......................................................!120!<br />
ASDA – Traditional <strong>Flavoured</strong> <strong>Milk</strong> Prices 2015!....................................................!121!<br />
ASDA – Coffee and Breakfast <strong>Flavoured</strong> <strong>Milk</strong> Prices 2015!.................................!122!<br />
ASDA – Functional/Protein <strong>Flavoured</strong> <strong>Milk</strong> Prices 2015!......................................!123!<br />
ASDA – Confectionary and Alternative <strong>Flavoured</strong> <strong>Milk</strong> Prices 2015!..................!124!<br />
5.4! Morrisons,......................................................................................................,125!<br />
Morrisons Chilled Dairy Aisle!...................................................................................!125!<br />
Morrisons!Ambient!Grocery!–!Cereals!Aisle!.................................................................!126!<br />
Morrisons Ambient Grocery – Alternative Aisle!.....................................................!127!<br />
Morrisons Ambient Grocery – Standard Aisle!.......................................................!128!<br />
Morrisons – Traditional <strong>Flavoured</strong> <strong>Milk</strong> Prices 2015!............................................!129!<br />
Morrisons – Coffee and Breakfast <strong>Flavoured</strong> <strong>Milk</strong> Prices 2015!.........................!130!<br />
Morrisons – Functional/Protein <strong>Flavoured</strong> <strong>Milk</strong> Prices 2015!...............................!131!<br />
Morrisons – Confectionary and Alternative <strong>Flavoured</strong> <strong>Milk</strong> Prices 2015!...........!132!<br />
5.5,Waitrose,...............................................................................................................,133!<br />
Waitrose Chilled Dairy Aisle!.....................................................................................!133!<br />
Waitrose!Ambient!Grocery!–!Cereals!Aisle!...................................................................!134!<br />
Waitrose Ambient Grocery Aisle!..............................................................................!135!<br />
Waitrose – Traditional <strong>Flavoured</strong> <strong>Milk</strong> Prices 2015!..............................................!136!<br />
Waitrose – Coffee and Breakfast <strong>Flavoured</strong> <strong>Milk</strong> Prices 2015!............................!137!<br />
Waitrose – Functional/Protein <strong>Flavoured</strong> <strong>Milk</strong> Prices 2015!.................................!138!<br />
Waitrose – Confectionary and Alternative <strong>Flavoured</strong> <strong>Milk</strong> Prices 2015!.............!139!<br />
5.6,CoYop,....................................................................................................................,140!<br />
Co-op Chilled Dairy Aisle!..........................................................................................!140!<br />
Co-op Ambient Grocery Aisle!..................................................................................!141!<br />
6.! The,Future,of,the,Market,............................................................................,142!<br />
6.1,PEST,Analysis,........................................................................................................,143!<br />
6.2,Political,.........................................................................,Error!!Bookmark!not!defined.!<br />
6.3,Introduction,to,the,Sugar,debate,..........................................................................,144!<br />
6.4,A,short,history,of,sugar,and,flavoured,milk,(1933Y<strong>2016</strong>),.......................................,145!<br />
6.5,The,Sugar,Debate,in,the,<strong>UK</strong>,..................................................................................,146!<br />
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6.6,The,Current,Situation,on,<strong>UK</strong>,Sugar,Consumption,..................................................,147!<br />
Non-<strong>Milk</strong> Extrinsic Sugar (NMES)!...........................................................................!147!<br />
a)! Historic,annual,per,capita,consumption,of,NMES,in,the,<strong>UK</strong>,(1704Y2012),............,147!<br />
b)! NonYmilk,extrinsic,sugars,(NMES),by,gender,and,age,group,...............................,148!<br />
c)! Sources,of,NMES,according,to,age,group,,National,Diet,and,Nutrition,Survey,,<br />
rolling,programme,2008Y2012,....................................................................................,149!<br />
d)! Comparative,sugar,content,of,sweetened,drinks,................................................,150!<br />
e)! <strong>Flavoured</strong>,milk,sugar,content,.............................................................................,151!<br />
6.7,..............................................................................................................................,153!<br />
Public,Health,Policies,.................................................................................................,153!<br />
a)! Suggested,Actions,On,Sugar,...............................................................................,153!<br />
6.8! Arguments,for,and,against,a,sugar,tax,...........................................................,154!<br />
6.9,..............................................................................................................................,155!<br />
Evaluating,a,sugar,tax,................................................................................................,155!<br />
6.10! What,measures,will,affect,flavoured,milk?,....................................................,156!<br />
a)! The,effect,of,a,sugar,tax,on,the,future,flavoured,milk,market,............................,156!<br />
b)! Modelling,the,introduction,of,a,sugar,tax,..........................................................,157!<br />
c)! Alternative,sweeteners,......................................................................................,158!<br />
d)! How,can,flavoured,milk,brands,adapt?,..............................................................,158!<br />
e)! Case,study:,SugarYreduced,Frijj,..........................................................................,159!<br />
6.11,Conclusion,..........................................................................................................,160!<br />
6.12,The,Removal,of,EU,<strong>Milk</strong>,Quotas,..........................................................................,161!<br />
6.13,Implications,for,<strong>Flavoured</strong>,<strong>Milk</strong>,Market,..............................................................,162!<br />
6.14,Abolition,of,China’s,OneYChild,Policy,..................................................................,163!<br />
6.15,Environmental,concerns,.....................................................................................,163!<br />
6.16,Tax,on,carbon,emissions,.....................................................................................,164!<br />
6.17,Potential,EU,Exit,.................................................................................................,165!<br />
6.18,............................................................................................................................,167!<br />
Social,.........................................................................................................................,167!<br />
6.19,............................................................................................................................,172!<br />
Technological,.............................................................................................................,172!<br />
Development of innovative sweeteners!..................................................................!172!<br />
6.20,Considerations,for,<strong>Flavoured</strong>,<strong>Milk</strong>,Brands,Looking,Forward,................................,175!<br />
6.21,Conclusion,..........................................................................................................,176!<br />
7.! Summary,....................................................................................................,179!<br />
8.! References,..................................................................................................,181!<br />
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Foreword<br />
The backdrop to the <strong>UK</strong> flavoured milk market is one of relentless change.<br />
The removal of the EU milk quotas, the transition to a Western-type diet by<br />
emerging economies, the <strong>UK</strong> sugar debate and the booming sports nutrition<br />
industry are all aspects of change that create both challenges and<br />
opportunities for the <strong>UK</strong> flavoured milk market.<br />
HRA Food and Drink Marketing has developed this report as a map to guide<br />
industry stakeholders. Although volume growth in 2014 was slightly lower<br />
than in previous years, the flavoured milk market still has plenty of room for<br />
product innovation and development.<br />
Overall, we expect the <strong>UK</strong> flavoured milk market to continue to grow over the<br />
medium term, but not without improving its nutritional profile. The sugar<br />
debate reached new heights when, in October 2015, Public Health England<br />
released a document suggesting Government intervention in the form of a<br />
sugar tax (levy). As a consequence, product reformulation has become a<br />
priority for all serious players in the market.<br />
It is also the time when many players are exploring new demographics and<br />
developing flavoured milk propositions for more mature audiences than the<br />
category traditionally served. The <strong>UK</strong> National Office for Statistics predicts<br />
the 30-44 years demographic to grow rapidly over the next decade. With<br />
flavoured milk mostly currently consumed by those under 45 years of age,<br />
the study of this older segment is fundamental: functional drinks with clear<br />
benefit differentiation are key.<br />
With age, health rises as a priority for consumers and so does purchasing<br />
power. Almost one in every five adults in the <strong>UK</strong> is 65 or over. High-protein<br />
flavoured milk, often priced at a premium, is set to continue its growth by<br />
developing propositions for this demographic.<br />
At HRA Food and Drink Marketing, we believe growth needs to be consumerdriven,<br />
rather than products being pushed at consumers by manufacturers<br />
and processors. <strong>Flavoured</strong> milk is most fundamentally an on-the-go drink;<br />
therefore, special attention should be paid to consumer lifestyles by brands<br />
in order to understand how to integrate a different range of milk products into<br />
shoppers’ daily routines, for example:<br />
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The everyday athlete running from work to the gym who stops by the<br />
nearest convenience store to pick up a flavoured milk sports drink to<br />
power a workout, or recover afterwards.<br />
The university student in search of a healthier alternative to energy drinks<br />
who reaches for a ready-to-drink coffee as fuel for the revision week.<br />
The active teen who carries a functional drink with a sports cap in his bag<br />
because it’s practical and spillage-proof.<br />
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The concerned mother who wants to feed her children palatable flavoured<br />
milk that isn’t full of with sugar and selects one of the new sugar-reduced<br />
traditional flavoured milk versions.<br />
Point of sale, flavouring, packaging, and nutritional profile are all important<br />
aspects of the category proposition that can be adapted and improved to<br />
fuel consumer-driven growth within <strong>UK</strong> flavoured milk.<br />
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Executive Summary<br />
The purpose of this report is to deliver up-to-date insights on the <strong>UK</strong><br />
flavoured milk market from a consumer-centric growth perspective. The<br />
insights generated throughout the report are directed towards existing<br />
players, new branded entrants, analysts and investors in the flavoured milk<br />
industry.<br />
This document will serve as a tool for strategic planning to help increase<br />
market share or to understand where market share is heading.<br />
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Chapter 1 – <strong>Flavoured</strong> <strong>Milk</strong> Market. This chapter provides an overview<br />
of the Global context of flavoured milk. It covers the health benefits of<br />
dairy, along with the list of the diseases cow’s milk may help to prevent.<br />
In addition to the complete nutritional profile, it will show that white liquid<br />
milk volume and value sales have been falling and, with the removal of EU<br />
milk quotas, could continue to decline in terms of value growth whist<br />
production increases. Value and volume flavoured milk growth has been<br />
high overall during the past 5 years despite volume growth being negative<br />
in the past year. Product launches have been proliferating and all<br />
categories seem to be moving towards high-protein, low-sugar variants.<br />
The biggest flavoured milk segment continues to be traditional flavoured<br />
milk, which has a real opportunity for low-sugar product reformulation.<br />
The chapter includes an analysis of the <strong>UK</strong> <strong>Flavoured</strong> <strong>Milk</strong> Trade,<br />
looking at <strong>UK</strong> imports, exports and trade with the European Community in<br />
the form of arrival and dispatch of milk and cream, sweetened (not solid)<br />
milk products – we use this information as proxy for flavoured milk trade.<br />
Chapter 2 – The Rise of <strong>Flavoured</strong> <strong>Milk</strong>. We explore the category,<br />
particularly focusing on ready-to-drink and single-serving formats, looking<br />
also at the major trends and challenges the category faces.<br />
Chapter 3 – NPD Guidance will introduce several archetypes of<br />
consumers and signal that the most interesting demographics are in the<br />
0-14, 30-44 and over 60 years segments and we set out the broad<br />
opportunity areas.<br />
This chapter includes looking at the category’s Packaging and<br />
acknowledges the importance of packaging within the EU, the continual<br />
preference for plastic packaging and the importance of creating formats<br />
that deliver convenience to the consumer whilst minimising both<br />
packaging and beverage wastage.<br />
Chapter 4 – Power Categories will provide information on the main<br />
flavoured milk producing companies, in tandem with key figures and<br />
market behaviour. We look at the historic advertising and pack designs of<br />
the major brands, charting how they have changed as the category has<br />
evolved.<br />
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The Protein Trend section looks at the specific circumstances<br />
surrounding the usage of milk within the sports drink category: retailers<br />
and their role in convenience, product reformulation and clear product<br />
segmentation.<br />
Chapter 5 – Merchandising and Pricing is a critical, yet often<br />
overlooked, aspect of the flavoured milk market and understanding it’s<br />
nuances is essential for growth. As flavoured milk can come in so many<br />
varieties (Chapter 6), often the product is ‘lost’ in the supermarket. This is<br />
particularly true for functional drinks which are placed in the chiller but<br />
they are often designed and launched with a shopper profile in mind that<br />
would often shop elsewhere in the store.<br />
Chapter 6 – The Future of the Market sets out our value and volume<br />
flavoured milk predictions in upcoming years. Adaptation to consumer<br />
lifestyles, sugar-content and specificity on local and international markets<br />
will examined and implications for long-term successful growth are set<br />
out. The Sugar Debate will assess the sugar content of flavoured milk<br />
drinks in light of the recent report on sugar consumption in the <strong>UK</strong><br />
released by Public Health <strong>UK</strong>. The introduction of a sugar levy is<br />
modelled with an assumed impact on volume growth.<br />
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1.! <strong>Flavoured</strong> <strong>Milk</strong> Market<br />
This chapter provides a global view of the flavoured milk market. Our<br />
definition of flavoured milk is:<br />
Products with liquid milk as the main ingredient which have been<br />
processed by adding other ingredients such as sugar, colouring and flavours.<br />
This differentiates flavoured milk from white liquid milk.<br />
By our definition, flavoured milk excludes dairy products that contain live<br />
bacterial cultures and yoghurts. Although most flavoured milk products<br />
included in this report are dairy based, there is a wide range of dairy free<br />
milks (e.g. almond, rice, soy, oat, coconut).<br />
<strong>Flavoured</strong> milk is available in two main formats:<br />
•#<br />
•#<br />
Chilled: Product which is usually fresh and is confined to the chiller<br />
fixture. It is typically placed in store above white milk and sold as a value<br />
added tier.<br />
Ambient: Product which is usually ESL or UHT. Depending on its<br />
category can be found in the ambient grocery, cereals or lunch deal areas<br />
(it can also be found in special sports nutrition fixture or even in chilled,<br />
despite being ambient).<br />
We have identified six power categories of flavoured milk: traditional,<br />
functional drinks, coffee, confectionary, breakfast and alternative. The<br />
chapter on Power Categories provides a complete description of each<br />
category, in addition to the main brands, product innovations and new<br />
flavours available.<br />
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1.1 The Global <strong>Flavoured</strong> <strong>Milk</strong> Market<br />
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Globally, between 2010 and 2015, on average, the value of flavoured milk<br />
grew every year.<br />
<strong>Flavoured</strong> milk is consumed in every continent of the World.<br />
Asia consumes the most flavoured milk, accounting for more than half of<br />
the world's flavoured milk consumption.<br />
The region which consumes the least flavoured milk is Eastern Europe.<br />
Emerging markets such as South America and Africa combined consume<br />
almost 10% of the global flavoured milk supply.<br />
Mature markets such as North America and Europe combined consume a<br />
fifth of global flavoured milk.<br />
<strong>Flavoured</strong> milk is the most consumed liquid dairy product after white milk.<br />
Asian markets are the core consumers and their preferred product<br />
presentation is ambient/UHT products.<br />
Consumers in the United States consume flavoured milk to white milk at a<br />
ratio of 1:10.<br />
Since 2009, ambient/UHT flavoured milk has been more popular than<br />
chilled. In 2015, ambient/UHT grew to occupy half of flavoured milk<br />
consumption globally.<br />
This strong preference for ambient/UHT flavoured milk is most dominant in<br />
China where flavoured milk is offered in on-the-go formats. There are<br />
various reasons for this but ambient products suit a longer supply chain, offer<br />
longer shelf life and also a different flavoured profile. This reflects the general<br />
white milk trend, where ambient is more popular than fresh in China.<br />
1.2 <strong>UK</strong> Dairy Trade: Exports & Imports<br />
Figure 1-1 shows the total dairy exports from the United Kingdom for 2015.<br />
As can be seen from these charts, To Gain the majority Access of <strong>UK</strong> dairy exports to both<br />
outside the EU and within it Purchase are milk and The cream. Full Exports of milk and cream<br />
are particularly high within the EU. Of total <strong>UK</strong> milk and cream exports, over<br />
90% is destined for within the EU.<br />
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In terms of dairy imports, the <strong>UK</strong> imports negligible volumes from outside of<br />
the EU with non-EU imports only accounting for around 0.7% of all <strong>UK</strong> dairy<br />
imports. Shipping costs for ready made flavoured milk products from outside<br />
of the EU make this option expensive in particular. <strong>Milk</strong> and cream imports<br />
from within the EU are considerably higher.<br />
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1.3 Nutritional Profile<br />
•# Cows’ milk has higher levels of protein, calcium and phosphorus than<br />
human milk. The protein quality of this milk is considered to be of high<br />
quality because it has a broad range of essential amino acids.<br />
•# <strong>Milk</strong> is mostly comprised of water (68%).<br />
•# The main source of carbohydrate is lactose, which plays a role in the<br />
assimilation of calcium, magnesium and phosphorus and the usage of<br />
Vitamin D.<br />
•# Cows’ milk naturally has between 4-5g of lactose, 3.5-4g of protein and<br />
between 3.75g-4g of fat per 100g (5).<br />
•# Cows’ milk has more saturated fat than human milk with 65-75g per<br />
100g. Oleic acid is the monounsaturated fatty acid most present. Linoleic<br />
acid content varies between 0.1g-2.2g per 100g (5).<br />
•#<br />
•#<br />
<strong>Milk</strong>#is#a#good#source#of#the#minerals#Calcium,#Magnesium,#<br />
Phosphorus,#Sodium,#Zinc#and#Copper.#<br />
<strong>Milk</strong>#is#a#good#source#of#Vitamin#A,#Niacin,#Folate#and#Vitamin#D.##<br />
For an adult between the ages of 18 to 70, the following tables show the<br />
mineral and vitamin content of cows’ milk per 100 grams.<br />
Minerals Range<br />
Daily<br />
requirement<br />
RDA<br />
Calcium (mg) 120 2500 5%<br />
Iron (mg) 0.2 45 0%<br />
Magnesium (mg) 11 350 3%<br />
Phosphorus (mg) 95 4000 2%<br />
Sodium (mg) 45 2300 2%<br />
Zinc (mg) 0.4 40 1%<br />
Copper (mg) 0 10000 0%<br />
Selenium (μg) 3.7 400 1%<br />
Manganese (μg) 10 2300 0%<br />
Figure 1-1: Mineral content of cow’s milk per 100 grams (5).<br />
Vitamins<br />
Range<br />
Daily<br />
requirement<br />
RDA<br />
Vitamin A (μg) 46 3000 2%<br />
Niacin (mg) 0.2 35 1%<br />
Vitamin B6 (mg) 0.06 100 0%<br />
Folate (μg) 8 1000 1%<br />
Vitamin C (mg) 2 2000 0%<br />
Vitamin D (μg) 0.3 50 1%<br />
Figure 1-2: Vitamin content of cow’s milk per 100 grams (5).<br />
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Nutritional Content per 100ml<br />
Semiskimmed<br />
milk<br />
<strong>Flavoured</strong><br />
<strong>Milk</strong><br />
<strong>Milk</strong>shake<br />
(thick,<br />
takeaway<br />
type)/100g<br />
Tropicana<br />
Original<br />
Orange<br />
Juice<br />
Figure 1-3: Source: The Dairy Council, The Nutritional Composition of<br />
Dairy Products<br />
While flavoured milk may be a high calorie option compared to alternative<br />
soft drinks, in comparison to full sugar carbonated drinks and orange juice, it<br />
is often the lower sugar option. It is also the option containing the highest<br />
level of protein and fat, meaning it is also the most satiating option.<br />
Cows’ milk frequently undergoes three kinds of heat treatment to extend its<br />
shelf life:<br />
a)# Sterilisation involves reaching a temperature above 100ºC that aims<br />
to eliminate nearly all micro-organisms present in a food.<br />
b)# Ultra High Temperature (UHT) is an uninterrupted process and the<br />
product is packed after sterilisation into sterile containers. Usual<br />
temperatures and times specified are to take product to between<br />
130ºC and 150ºC for 1-3 seconds.<br />
c)# Pasteurisation is a heat treatment sufficient to destroy a large<br />
number of micro-organisms present in milk. There are two types:<br />
batch and high temperature pasteurisation.<br />
Coca<br />
Cola<br />
Energy (kcal) 47 66 88 48 43<br />
Protein 3.6 3.7 3.7 0.8 0<br />
Carbohydrate 4.8 9.9 15.3 10 10.6<br />
Of which 4.8 9.2 11.1 10 10.6<br />
sugars<br />
Fat 1.8 1.5 1.8 0 0<br />
Dietary Fibre 0 0 Trace 0.7 0<br />
Vitamin C (mg) 2 Trace 1 59 0<br />
Folate (micro<br />
grams)<br />
9 2 4.0 36 0<br />
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Figure 1-4: Nutrient Loss and Heat Treatments, Source: (5)<br />
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•#<br />
The#heat#treatment#that#produces#the#biggest#loss#of#nutrients#is#<br />
Sterilisation#as#it#produces#an#almost#certain#degradation#of#all#<br />
vitamins#studied,#with#a#particular#elimination#of#Vitamin#B12.##<br />
The#second#heat#treatment#with#the#highest#loss#of#vitamins#is#Ultra!<br />
High!Temperature!(UHT)#producing#the#biggest#loss#of#vitamin#C.#<br />
The#heat#treatment#that#seems#to#retain#the#most#vitamins#is#<br />
Pasteurisation#since#it#produces#a#loss#of#0220%#of#vitamins#studied.#<br />
In recent years there has been growing interest in intermediate temperature<br />
regimes which offer more shelf life than fresh (which usually delivers product<br />
life of day of production + 7 days). This intermediate technology is called<br />
Extended Shelf Life (ESL) and can deliver shelf life of typically between 21<br />
and 56 days from the date of production.<br />
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1.4 The Health Benefits of Dairy<br />
Cows’ milk represented 83% of total global milk production in 2010 (5). As a<br />
global average, in 2009 milk contributed 34g of carbohydrates (14% RDA),<br />
6g of protein (10% RDA) and 7.3g of fat (15% RDA) to a person’s daily diet<br />
(5).<br />
Figure 1-5: Average dietary contribution of cows’ milk (FAO, 2013)<br />
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•#<br />
•#<br />
•#<br />
!<br />
<strong>Milk</strong>#is#an#important#protein#source#for#Europe,#Oceania#and#the#<br />
Americas,#contributing#around#8210%#of#protein#consumption#to#these#<br />
diets.##<br />
<strong>Milk</strong>#is#an#important#fat#source#for#Europe,#Oceania,#the#Americas#and#<br />
Africa,#contributing#between#8215%#of#fat#intake#in#these#diets.#<br />
<strong>Milk</strong>#is#a#dietary#staple#for#Europe,#Oceania#&#Americas.#<br />
Of#all#the#global#regions,#milk#contributes#the#most#nutritionally#to#the#<br />
European#diet#where#milk#consumption#is#particularly#high.#<br />
#<br />
In addition to being a source of macro and micro-nutrients, studies have<br />
suggested various additional health benefits associated with the<br />
consumption of dairy.<br />
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1.5 Growth and Development<br />
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Nutrition in the first years of life are fundamental to a young person’s life,<br />
with stunting linked to reduced child morbidity and impaired cognitive<br />
development (9).<br />
Stunting and low birth weight increases the risk of chronic disease in<br />
adults (11). <strong>Milk</strong> has been found to affect and improve the growth of<br />
undernourished children (10).<br />
In developed countries, milk is used in a great deal of programs intended<br />
to address malnutrition and underfed patients (16).<br />
Evidence suggests that a diet containing at least one glass of milk (250ml)<br />
can provide 25-33% of protein requirements in children from 1 to 5 years<br />
of age and have a positive impact on their weight gain and linear growth<br />
(15).<br />
Bone Health<br />
IGF-1 is a protein in milk that plays an important role in the body, one of<br />
which is the assimilation of amino acids. Amino acids contribute to the<br />
formation of protein and bone length (20).<br />
In addition, research suggests diets with low levels of dairy are linked to a<br />
higher risk of osteoporosis (14). Similarly, children with diets lacking in dairy<br />
products have been found to suffer from an increased risk of fracture (12).<br />
Oral Health<br />
Evidence suggests that the regular consumption of milk may prevent cavities<br />
and contribute to good oral health (7). Specifically, children and adults with<br />
high levels of calcium and phosphate covering their teeth enamel had lower<br />
rates of dental cavities (18).<br />
Weight Control and Obesity<br />
There is evidence suggesting that increasing protein intake with constant<br />
overall energy consumption could contribute towards weight control and<br />
body composition. This is thought to be derived from possible increased<br />
thermogenesis and satiety (6).<br />
Metabolic Syndrome and Type 2 Diabetes<br />
Metabolic Syndrome refers to a set of irregularities in the metabolism that<br />
include: obesity, hypertension, high glucose, and high triglycerides (HDL)<br />
(17). Diets with high dairy content have been associated with lower levels of<br />
some elements of Metabolic Syndrome (19).<br />
Cardiovascular Disease<br />
Although there is no clear single publication establishing the relationship<br />
between dairy intake and cardiovascular disease, current knowledge<br />
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suggests a negative relationship between fermented milk and a major risk<br />
factor for cardiovascular disease: hypertension (8).<br />
Cancer<br />
Colorectal cancer is the third most common cancer worldwide. Calcium,<br />
provided by milk, may contribute to reducing the risk of this type of cancer.<br />
In addition, consumption of milk has been linked to the reduction of the risk<br />
of bladder cancer (13).<br />
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1.6 Summary<br />
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<strong>Milk</strong> plays an important role in our global economy and diet.<br />
<strong>Milk</strong> has the nutritional potential to provide essential nutrients in our diet.<br />
<strong>Flavoured</strong> milk has the potential to make milk more accessible.<br />
Ambient/UHT flavoured milk is the most popular and widely traded type<br />
of flavoured milk.<br />
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2.! Evolution of the <strong>Flavoured</strong> <strong>Milk</strong> Category<br />
It is important to understand the historic behaviour of the <strong>UK</strong> flavoured milk<br />
market in order to put what is currently happening in the market into context.<br />
<strong>Flavoured</strong> milk value and volume sales have shown an overall positive<br />
compound annual growth rate since 2009 and the category is one of<br />
relatively few categories in the grocery market to exhibit positive and<br />
sustained value growth. This growth has come at a price with a pattern of<br />
heavily-discounted promotions being established which has weakened brand<br />
loyalty. The high growth has also attracted a variety of new entrants into the<br />
category, which has in turn, driven innovation and widened consumer choice.<br />
This contrasts with white milk where the market has declined in value<br />
recently despite volumes increasing as a result of the retailer milk price wars<br />
which are driving down unit prices and encouraging purchase of larger<br />
volumes. The fall in market value is due to a variety of factors but, as we will<br />
see later on, the removal of the EU milk quota system has had a significant<br />
effect on white milk production, with increased supply and global market<br />
over supply driving prices down. However, arguably the most significant<br />
factor in the category’s value issues is price competition between<br />
supermarkets.<br />
This chapter summarises pictorially recent flavoured milk product launches.<br />
In the past five years, every year has seen an increase in the variety of<br />
flavoured milk products launched into the market. NPD continues to be a<br />
strong driver of growth.<br />
This growth in NPD reflects increased consumer demand, the need for<br />
dairies to develop value-added milk products to make use of increased white<br />
milk production, an increase in brands needing to differentiate themselves<br />
from competitor products and technological advances as well as the need for<br />
brands to constantly innovate flavours, propositions and packaging to create<br />
points of difference.<br />
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Figure 2-1 shows the key category product launches made in the past<br />
five years.<br />
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2.1 Key Trends from Chart:<br />
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•#<br />
•#<br />
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•#<br />
•#<br />
Brands Broadening their Target Consumer Base: This diagram<br />
illustrates the increasing number of flavoured milk brands he and<br />
demonstrates that many leading companies are trying to deliver to all<br />
customer segments of flavoured milk consumers.<br />
For example, Arla has a product in almost every sub-category: traditional<br />
flavoured milk, functional drinks with the protein added, flavoured milk<br />
packaged with sports caps as well as coffee, lactose-free and sugarreduced<br />
variants.<br />
Coffee Flavours on the Rise: The diagram also highlights that coffee is<br />
an increasingly popular flavour. Starbucks by Arla, Caffé Latte by Emmi<br />
and even dairy-alternative milk producers like Blue Diamond, Alpro and<br />
VitaCoco, have developed coffee flavoured propositions.<br />
Functional Drinks Becoming To Mainstream: Gain Access Another notable trend is<br />
functional drinks, a category that once belonged to a relatively niche<br />
Purchase The Full<br />
group consumers made primarily of athletes and weight lifters, is now<br />
becoming increasingly mainstream. <strong>Report</strong> <strong>Flavoured</strong> Nowmilk<br />
products high in<br />
protein are becoming increasingly merchandised alongside traditional<br />
flavoured milks.<br />
Targeted Packaging: The diagram demonstrates visually that the<br />
creation of flavoured milk products is not only about developing new<br />
formulas in the laboratory, but it is also about creating attractive,<br />
functional, efficient, convenient packaging that adapts to the consumer's<br />
needs and appeals to their aspirations.<br />
Rapid Growth: As flavoured milk is a fast growing category, brands are<br />
able to launch into several distribution channels at once, thus bringing<br />
scale to what is initially a niche proposition. This dynamic explains how<br />
quickly propositions like coconut and protein milk have grown so rapidly.<br />
Limited Own Label Innovation: Although this chart does focus solely on<br />
brands, this is largely down to the lack of innovation in own-label<br />
products.<br />
2.2 <strong>Flavoured</strong> <strong>Milk</strong> Trends<br />
2.3 White <strong>Milk</strong> Market Indicators<br />
•#<br />
•#<br />
•#<br />
Since 2009, historic value sales of white milk have been showing an<br />
overall negative compound annual growth rate (CAGR), meaning that<br />
white milk value sales are trending downwards.<br />
In terms of volumes sales, white milk has presented almost no CAGR with<br />
sales remaining almost constant.<br />
In contrast, over the past five years, flavoured milk has shown a positive<br />
value and volume CAGR.<br />
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2.4 <strong>Flavoured</strong> <strong>Milk</strong> Market Indicators<br />
•#<br />
•#<br />
•#<br />
•#<br />
•#<br />
•#<br />
In contrast to white milk, over the past five years, flavoured milk has<br />
shown a positive value and volume CAGR.<br />
Volume sales been strong in the <strong>UK</strong>, having grown by around a quarter<br />
over the last five years.<br />
Over the past five years flavoured milk value sales have been growing at a<br />
faster rate than volume sales, implying growth in added value products.<br />
Despite growth in volume sales, consumers are seeming to opt for lower<br />
quantities of products priced at a premium.<br />
<strong>UK</strong> consumers seem to prefer a single serve product that is tailored to<br />
their needs instead of several units or a larger volume of a less-specific or<br />
lower-quality product.<br />
Not all products in the flavoured milk category should be considered the<br />
same way. In the standard flavoured milk segment for example,<br />
discounting has typically been more intensive than in other areas such as<br />
protein drinks.<br />
White <strong>Milk</strong> Market<br />
Value sales trending<br />
downwards<br />
Volume sales seeing slight rise<br />
Difficult to increase sales as<br />
market penetration is so high<br />
Heavy long-term discounting<br />
<strong>Flavoured</strong> <strong>Milk</strong> Market<br />
Value sales on the rise<br />
Volume sales rising<br />
Considerable opportunity for<br />
market growth<br />
Regular promotional discounts<br />
2.5 <strong>Flavoured</strong> <strong>Milk</strong> Market Segmentation<br />
We estimated the proportion that each of the six different flavoured milk<br />
categories represent of the entire flavoured milk market. The percentages<br />
next to each category show our model of how much each sub-segment<br />
accounts for of the whole flavoured milk category.<br />
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Figure 2-2: This chart does not specifically represent the brands<br />
featured. The selected brands are a visual guide as they are the most<br />
well known in each sub-category.<br />
Although the sub-categories are presented as mutually exclusive, they are<br />
not necessarily so. Increasingly, more products are converging and breaking<br />
out of their sub-category and some of the boundaries are blurring.<br />
•#<br />
•#<br />
•#<br />
•#<br />
•#<br />
Traditional flavoured milk occupies almost half of the entire flavoured<br />
milk offer and centres around the traditional flavours of vanilla, strawberry<br />
and chocolate.<br />
Functional drinks are the second largest category with an estimated<br />
quarter of the supply.<br />
Coffee is the third most popular To category Gain Access and almost all other categories<br />
are attempting to include coffee Purchase a flavour The in order Full to expand their<br />
range since the segment is seeing <strong>Report</strong> strong performance. Now<br />
Confectionary, defined as flavoured milk usually offered in an indulgent<br />
flavour because of its sweet, creamy and rich texture is an estimated 10%<br />
of the category.<br />
Breakfast and dairy-alternatives are still a small section of the flavoured<br />
milk market, but they are both fast growing.<br />
2.6 Own Label<br />
One of the brakes that has hampered own label development in the category<br />
is the availability of appropriate bottling capacity for own label propositions.<br />
Whilst the retailers have well-developed liquid milk pools so would be able to<br />
divert milk to flavoured milk production, the lack of <strong>UK</strong> bottling capacity has<br />
acted to restrain own label growth. This is a particular constraint on their<br />
ability to develop UHT products which are usually manufactured on the<br />
continent due to the lack of capability on the <strong>UK</strong> mainland.<br />
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As parts of the sub category mature the proliferation of own label is more<br />
likely. At the present evolution in the market, brands have a clear ‘breathing<br />
space’ before significant amounts of own label propositions emerge. Image<br />
and appeal is important to consumers in the category and brands appeal to<br />
this aesthetic more. There are clearly some sub-categories that are more<br />
impervious to own label e.g. added value, protein, functional milk. Other<br />
areas such as traditional flavoured milk are more open to own label<br />
propositions.<br />
2.7 Retail Own Label Ranges<br />
•#<br />
•#<br />
•#<br />
•#<br />
The <strong>UK</strong>'s main retailers (Tesco, Sainsbury's, ASDA, Morrisons, Waitrose &<br />
Co-op) all offer their own flavoured milk formulas at more competitive<br />
price point than branded offerings.<br />
Own-label flavoured milk shares broadly follow the share that retailers<br />
have of total grocery i.e. the Tesco own-label flavoured milk category is<br />
worth more than own-label in the other retailers. As the category<br />
matures, there is a tendency for this effect to become more pronounced.<br />
Sainsbury's flavoured milk offering has remained constant in the past<br />
three years and the same can be said for ASDA and Morrisons.<br />
Tesco has seen a slight increase in the volume of SKUs over the past<br />
three years.<br />
2.8 Issues Faced by Own Label<br />
•#<br />
•#<br />
In standard flavoured milk especially, brand discounting (e.g. multi buy<br />
offers, X for Y, two for one, BOGOF etc.) often means the brands sell at a<br />
price below own-label.<br />
The lack of <strong>UK</strong> based co packing capacity in the market is a significant<br />
issue preventing the proliferation of own label UHT products in particular.<br />
2.9 Own Label in Sub-Categories<br />
•#<br />
•#<br />
•#<br />
•#<br />
•#<br />
Own-label flavoured milk is mostly in the traditional flavoured milk subcategory,<br />
though there is growing own-label presence in confectionary<br />
and coffee flavoured milk.<br />
Sainsbury’s for example has ventured into the confectionary sub-category<br />
with their Belgian Double Chocolate own-label flavoured milk. All the<br />
main retailers have also developed their own coffee drink products.<br />
There is minimal own-label presence in the other sub-categories including<br />
breakfast drinks and sports nutrition.<br />
This allows brands to dominate in these sub-categories and carry<br />
relatively high price points.<br />
As breakfast drinks are a relatively new sub-category, supermarkets have<br />
not yet entered with their own products. If the sub-category continues to<br />
grow, it is likely we will see own-label products in the next few years.<br />
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#<br />
•#<br />
•#<br />
There is also a distinct absence of own-label in the functional drinks subcategory.<br />
For customers buying sports nutrition drinks, branding is<br />
important as these customers often consume these drinks in public (i.e. at<br />
the gym or other sporting venue) and it is often regarded as important by<br />
these consumers to be seen with products which have sport nutrition<br />
credentials.<br />
Due to these particularly image conscious consumers, supermarkets<br />
appear reluctant to develop an own-label product which may not appeal<br />
to their target market.<br />
2.10 The Future of Own Label<br />
•#<br />
•#<br />
Once sub categories have matured, own label is more likely. Initially, in<br />
categories such as breakfast drinks and sports nutrition, brands have a<br />
clear ‘breathing space’ before the own label volumes grow.<br />
Own label is currently best suited to traditional flavoured milk rather than<br />
the faster growing added value categories although this is likely to change<br />
as the category evolves.<br />
2.11 Summary<br />
•#<br />
•#<br />
•#<br />
<strong>Flavoured</strong> milk continues to grow in value and volume<br />
o# <strong>Flavoured</strong> milk growth surpassed white milk growth in value and<br />
volume.<br />
o# <strong>Flavoured</strong> milk value growth is stronger than flavoured milk volume<br />
growth.<br />
o# Discounting by brands is reducing loyalty and eroding value in the<br />
category.<br />
Product launches have been To on Gain the rise Access for the past 5 years<br />
o# Low-sugar is important Purchase to watch (i.e. The Emmi, Full Frijj and Arla’s<br />
flavoured milk).<br />
<strong>Report</strong> Now<br />
o# Most core categories are developing high-protein variants (i.e.<br />
Mars, Weetabix, Dunn’s River Nurishment, Arla).<br />
o# Coffee is an obvious area of focus.<br />
Traditional flavoured milk continues to dominate<br />
o# Own-label competes with brands primarily in the category of<br />
traditional flavoured milk and coffee.<br />
o# Brands have room to innovate in the other power categories:<br />
alternative confectionary, coffee, breakfast and functional<br />
drinks.<br />
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3.! NPD Guidance<br />
This chapter will look at the major global and local events that have an<br />
impact on <strong>UK</strong> dairy production and, consequently, on the flavoured milk<br />
market.<br />
We will consider factors such as occasion and usage, core consumer<br />
segments, <strong>UK</strong> consumer perception, product innovation, packaging and the<br />
other important factors that influence and frame NPD thinking, strategy and<br />
eventual product launches.<br />
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3.1 Occasion and Usage<br />
Figure 3-1: Chilled flavoured milk in Waitrose<br />
Figure 3-1 illustrates one take on how retailers position the different flavoured<br />
milk products - occasion usage and nutritional value being the dominant<br />
thinking of this very clear merchandising approach.<br />
Looking at how retailers position the various brands in the category, we have<br />
developed a model which allows us to isolate the primary positioning<br />
element of the various brands.<br />
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Figure 3-2: Flavour milk occasion usage<br />
•#<br />
•#<br />
•#<br />
•#<br />
Everyday Healthy: In the upper left quadrant of Figure 3-2 are the<br />
flavoured milk products positioning themselves as ‘healthy’ and which are<br />
affordable products intended To Gain for Access regular consumption. Purchase These include<br />
some breakfast drinks, meal The replacement Full <strong>Report</strong> shakes, Now wholesome drinks<br />
aimed at children and 1l dairy alternatives.<br />
Premium Healthy: In the upper right quadrant are flavoured milk<br />
products which are positioned as healthy but with some added benefits<br />
which make them more of a premium product. These include branded<br />
protein drinks which<br />
To<br />
can<br />
Gain<br />
be fairly<br />
Access<br />
expensive<br />
Purchase<br />
and premium traditional<br />
flavoured milk brands with The added Full benefits <strong>Report</strong> i.e. Now organic milk, natural<br />
ingredients etc.<br />
Affordable Treat: In the bottom left section, we show drinks that are<br />
intended for regular use, though have indulgent flavours or formulas. This<br />
To Gain Access Purchase<br />
category mainly consists of traditional flavoured milks with relatively high<br />
levels of sugar. The Full <strong>Report</strong> Now<br />
Premium Indulgence: In the bottom right corner, we highlight drinks of<br />
indulgent flavours that are positioned as premium products. This mainly<br />
consists of coffee drinks, To Gain confectionary Access flavours Purchase such as those produced<br />
by the Mars company and<br />
The<br />
indulgence<br />
Full <strong>Report</strong><br />
products<br />
Nowfrom<br />
Frijj and the Gü<br />
licence.<br />
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#<br />
3.2 Core Consumer Segments<br />
One of the best ways of understanding the future growth of the market is<br />
through awareness of life stage and specifically the growth of the various<br />
demographic segments. Understanding this enables flavoured milk brands<br />
to gauge how large their sales to these consumer segments have the<br />
potential to be over the medium term. This should drive strategic thinking on<br />
targeting specific population groups by understanding and addressing their<br />
unique needs.<br />
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Figure 3-3: Projected populations at mid-years by age i<br />
In June 2014, the <strong>UK</strong> population was estimated at 64,596,800. Based on the<br />
National Population Projections published in 2013 and the 2012 population<br />
statistics, by 2037 a number of predictions have been made:<br />
•#<br />
•#<br />
•#<br />
The number of people over 80 is expected to more than double.<br />
The number of people over 90 is projected to more than triple.<br />
The number of people reaching the age of 100 or more is expected to<br />
increase more than eightfold.<br />
We’ll analyse the population data graphically and for each demographic<br />
segment, we identify core consumer segments, which are then matched with<br />
the six power categories.<br />
The core consumer segments identified were:<br />
•#<br />
•#<br />
•#<br />
•#<br />
•#<br />
•#<br />
•#<br />
School children – primary/secondary<br />
Active children – participating in clubs/sports<br />
Endurance and strength athletes To Gain – gym Access goers and solo trainers<br />
Weight conscious consumers Purchase The Full<br />
On-the-go professionals<br />
<strong>Report</strong> Now<br />
Vegans<br />
Casual Gym Goers<br />
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#<br />
Each consumer segment is matched against the six HRA power categories.<br />
We show which power category appeals to which demographic segment.<br />
Understanding this should directly inform NPD strategy.<br />
The combinations with the darkest shades on the following charts indicate<br />
the highest consumer interest.<br />
Of course, the relative growth specific consumer segments also need to be<br />
considered. For instance, if a high growth consumer segment has a high<br />
interest in functional milk, then this is a significant piece of information to<br />
drive brands medium term NPD plans and strategy.<br />
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#<br />
Key Demographic Segments: 0-14 Years<br />
Figure 3-4: Projected populations at mid-years by age: 0-14 years of<br />
age ii<br />
The population of those between ages 0 and 14 is expected to rise by 8%<br />
between 2014-2023 in the <strong>UK</strong>.<br />
Table 1: Core consumer categories for the 0-14 years demographic<br />
Traditional<br />
Functional<br />
Coffee<br />
Confectionary<br />
Breakfast<br />
Alternative<br />
School<br />
Children<br />
Active<br />
Children<br />
Indicates low level of<br />
interest for the subcategory<br />
Indicates moderate<br />
interest for the subcategory<br />
Indicates high level of<br />
interest for the subcategory<br />
This expected growth has implications for flavoured milk since there are two<br />
main core consumer categories that stem from this demographic:<br />
-# School children (aged 4-14) who may consume flavoured milk in their<br />
lunchbox at school or at home as a treat.<br />
-# Active children (aged 4-14) with high-energy requirements through their<br />
regular sport or exercise/clubs.<br />
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#<br />
•#<br />
•#<br />
•#<br />
•#<br />
•#<br />
•#<br />
While pre-school children will clearly make up a proportion of this<br />
consumer demographic, we have not included them as they we do not<br />
consider them a significant target group for flavoured milk brands.<br />
Although parents and guardians tend to be the gatekeepers in this<br />
category, it is also children at school or in other environments where<br />
flavoured milk is offered who are in the position to make a decision. This<br />
is especially true for children aged 9 and above and for secondary school<br />
children.<br />
Ultimately it is traditional flavoured milk and confectionary flavoured milk<br />
which are the most relevant to these consumer segments. However, with<br />
parental concerns over high sugar content particularly pertinent to these<br />
sub-categories, it will be crucial for brands to alter their formulations to<br />
To Gain Access<br />
best appeal to this consumer segment.<br />
Confectionary brands have Purchase established The high rates Full of sale in shoulder<br />
categories like desserts and yoghurts and are doing the same in flavoured<br />
<strong>Report</strong> Now<br />
milk.<br />
Active children are a key sub-segment of consumers who are likely to<br />
have additional requirements for on-the-go drinks which are filling and<br />
rich in nutrients and protein. With these children typically involved in<br />
activities before and/or after school and with higher nutritional<br />
requirements than average children, they represent a particular<br />
opportunity for functional drinks and breakfast drinks.<br />
According#to#the#Health#and#Social#Care#Information#Centre,#around#27%#<br />
of#children#aged#5215#meet#the#government#recommendations#for#physical#<br />
activity#(60#minutes#a#day#every#day).#Clearly#this#is#a#significant#target#<br />
group#for#flavoured#milk#brands.#<br />
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Key Demographic Segments: 15-29 Years<br />
Figure 3-5: Projected populations at mid-years by age: 15-29 years of<br />
age<br />
The 15-29 years segment in the <strong>UK</strong> is projected to decrease by 2% between<br />
<strong>2016</strong> and 2022.<br />
Table 2: Core consumer categories for the 15-29 years demographic<br />
Traditional<br />
Functional<br />
Coffee<br />
Confectionary<br />
Breakfast<br />
Alternative<br />
Endurance<br />
Athletes<br />
Weight<br />
Conscious<br />
Consumers<br />
On-the-go<br />
Professionals<br />
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Strength<br />
Athletes<br />
Vegans<br />
Casual Gym<br />
Goers<br />
Indicates low interest for<br />
the sub-category<br />
Indicates moderate<br />
interest for the subcategory<br />
Indicates high interest for<br />
the sub-category<br />
Within this group, we have identified several core consumer groups for all the<br />
flavoured milk categories. These groups are not mutually exclusive but we<br />
regard them as separate groups:<br />
•#<br />
Endurance Athletes with a need for glucose and functional drinks,<br />
primarily as fuel for sport and recovery. According to a 2010 report by the<br />
Department for Culture, Media and Sport, of activities reported by adults<br />
To Gain Access<br />
doing sporting activities in the last 4 weeks, swimming/ diving accounts<br />
for 15%, cycling accounts for Purchase 11% while The outdoor Full football and jogging,<br />
cross-country and road-running <strong>Report</strong> accounting Now for 7%. Therefore, endurance<br />
sports account for a high proportion of exercise for the <strong>UK</strong> population.<br />
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#<br />
•#<br />
•#<br />
•#<br />
•#<br />
•#<br />
•#<br />
•#<br />
High sugar content is often not a significant deterrent for these<br />
consumers so traditional and confectionary milks can be of appeal.<br />
Breakfast drinks can also appeal to these busy consumers, whether on<br />
their own or as part of a larger breakfast, as can coffee drinks.<br />
Weight Conscious Consumers with a desire for high-protein drinks<br />
which keep them satiated to help them avoid snacking. These consumers<br />
typically look to their diet to manage their weight rather than relying solely<br />
on exercise. These consumers are also a core market for dairy<br />
alternatives as these products are often perceived as healthier than cow’s<br />
milk for being lower in saturated fat and high in certain vitamins,<br />
depending on the source.<br />
On-the-go Professionals with little time to spare for exercise but who<br />
are conscious about their health and what they eat. These consumers<br />
often look for drinks which provide them with energy and are clear targets<br />
for coffee and breakfast drinks. They are willing to treat themselves<br />
during/after a hard day of work and are also open to on-the-go breakfast<br />
propositions at the other end of the day. These consumers will often have<br />
high disposable incomes and are To frequently Gain Access located in multicultural,<br />
cosmopolitan areas.<br />
Purchase The Full<br />
Strength athletes who demand timed dosages of high-quality protein<br />
sources primarily as recovery products<br />
<strong>Report</strong><br />
as an<br />
Now<br />
alternative to powdered<br />
protein. While this group makes up a relatively small proportion of this<br />
demographic, they account for a large proportion of protein drink sales.<br />
These consumers are typically very aware of what they consume and will<br />
avoid products they perceive as unhealthy. They are willing to pay for<br />
quality products.<br />
Vegans who demand good tasting alternatives to dairy products which<br />
can provide them with the nutrients they may be missing out on through<br />
their diets. These consumers are open to products from a variety of<br />
natural sources. According to a 2006 survey by The Vegan Society, they<br />
estimate 150,000 vegans in the <strong>UK</strong>, though this is likely to have increased<br />
since then.<br />
Casual Gym Goers who like to look after themselves and enjoy some<br />
form of regular exercise. According to Sport England in 2015, 36% of <strong>UK</strong><br />
consumers play sport for at least 30 minutes a week. This rises to 55%<br />
for those aged 16-25. According to the Department for Culture, Media<br />
and Sport, health, fitness, gym or conditioning activities make up the<br />
largest proportion of activity with 15% of activity occasions.<br />
These consumers may use intermediate or high-protein versions of<br />
flavoured milk as recovery after exercise sessions. This is a fairly broad,<br />
heterogeneous group so the other types of milk including alternative and<br />
traditional will also likely to appeal to a sub-section of this group.<br />
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Key Demographic Segments: 30-44 Years<br />
Figure 3-6: Projected populations at mid-years by age: 30-44 years of<br />
age<br />
This consumer segment is growing very fast with particularly significant<br />
growth from 2018. The number of people in this demographic segment are<br />
projected to increase by 34% by 2023.<br />
Table 3: Core consumer categories for the 30-44 years demographic<br />
Traditional<br />
Functional<br />
Coffee<br />
Confectionary<br />
Breakfast<br />
Alternative<br />
Endurance<br />
athletes<br />
Weight<br />
Conscious<br />
Consumer<br />
s<br />
On-the-Go<br />
Profession<br />
als<br />
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Strength<br />
athletes<br />
Vegans<br />
Casual<br />
Gym<br />
Goers<br />
Indicates low interest for<br />
the sub-category<br />
Indicates moderate<br />
interest for the subcategory<br />
Indicates high interest<br />
for the sub-category<br />
•# This segment of the population is projected to rapidly increase from 2018-<br />
2023 by 34%, so there is a potentially lucrative opportunity here to target<br />
this growing consumer group To of Gain adults. Access<br />
•# Consumers in this segment are likely to be busy, will often have families<br />
and more senior level jobs,<br />
Purchase<br />
meaning more<br />
The<br />
purchasing<br />
Full<br />
power.<br />
•# This category is also known for <strong>Report</strong> being the Now upper age limit at which<br />
flavoured milk consumption currently occurs in a significant way.<br />
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#<br />
•#<br />
•#<br />
•#<br />
The age categories in the 15-29 consumer demographic continue to exist.<br />
Generally, there is less appeal amongst all groups for traditional and<br />
confectionary flavoured milk as tastes become more sophisticated and<br />
consumers with young families become more price conscious and more<br />
careful about spending their money To Gain on on-the-go Access treats.<br />
Although we have looked at Purchase this from the The perspective Full of purchasing<br />
drinks for the individual’s consumption,<br />
<strong>Report</strong><br />
this<br />
Now<br />
consumer group will contain<br />
a high proportion of gatekeepers and so will be an important target for<br />
traditional and confectionary flavoured milk brands aimed at children.<br />
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#<br />
Key Demographic Segments: 45-59 Years<br />
Figure 3-7: Projected populations at mid-years by age: 45-59 years of<br />
age<br />
This segment is expected to continue increasing, peaking around 2018<br />
and then declining in the subsequent years.<br />
Table 4: Core consumer categories for the 45-59 years demographic<br />
Traditional<br />
Functional<br />
Coffee<br />
Confectionary<br />
Breakfast<br />
Alternative<br />
Endurance<br />
Athletes<br />
Weight<br />
Conscious<br />
Consumers<br />
On-the-go<br />
Professionals<br />
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Vegans<br />
Casual<br />
Gym<br />
Goers<br />
Indicates low interest<br />
for the subcategory<br />
Indicates moderate<br />
interest for the subcategory<br />
Indicates high interest<br />
for the subcategory<br />
•#<br />
•#<br />
•#<br />
•#<br />
For this portion of the <strong>UK</strong> population we have used most of the same<br />
consumer segments with the strength athletes removed as this is likely to<br />
be a small proportion of consumers.<br />
The interest level of this group for the products available in the market is<br />
broadly limited, with none of the<br />
To<br />
consumer<br />
Gain Access<br />
sub-segments likely to have a<br />
high level of interest in any of the products.<br />
Traditional and confectionary Purchase drinks are unlikely The Full to appeal greatly to this<br />
age group as consumers in this segment <strong>Report</strong> will Now associate such drinks with<br />
younger consumers and will perceive them as inappropriate for them.<br />
Coffee drinks, functional drinks and alternative milks are likely to be the<br />
most appealing products to the majority of these consumers, though<br />
interest is likely to be lower than to younger consumer groups.<br />
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#<br />
•#<br />
•#<br />
•#<br />
As a segment it is significant in its size and purchasing power.<br />
There is a distinct lack of products targeting this consumer group at<br />
present. There is clearly a significant opportunity here for brands able to<br />
target this consumer segment successfully.<br />
Coffee and functional drinks offer To a Gain clear Access platform to target this<br />
demographic.<br />
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Key Demographic Segments: 60+<br />
The reasoning for aggregating core consumers in this demographic<br />
segment is that both segments (60-74 and 75 & over) share sufficient<br />
characteristics to be considered similarly.<br />
Figure 3-8: Projected populations at mid-years by age: 60 years of age<br />
and over<br />
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It is also important to remember that consumers in this target<br />
demographic are traditionally not typical flavoured milk consumers.<br />
Their purchasing power is typically high, making them a particular group<br />
of interest for high-protein and functional flavoured milk brands which are<br />
priced at a premium.<br />
Both segments of the population are at an age where preoccupation with<br />
their health surfaces as a priority. Bone density, sarcopenia and<br />
malabsorption of macronutrients are particular health concerns for this<br />
group.<br />
We identify this demographic as a particular opportunity because,<br />
besides its projected growth, specific nutritional needs of consumers in<br />
this segment (i.e. carbohydrates, fats, protein and calcium) can be met<br />
through the development of specific flavoured milk products.<br />
This consumer segment is not currently effectively targeted by flavoured<br />
milk brands. Although protein is clearly important to these consumers,<br />
brands should recognise they need to target this group in a different way.<br />
Older consumers typically want convenience and this is a potential issue<br />
for flavoured milk brands. Buying large flavoured milk packs is heavy and<br />
frequently buying smaller ready-to-drink packs is also often not of great<br />
appeal to older consumers who are less mobile. Powders are therefore<br />
the obvious way of targeting these consumers, or longer shelf life<br />
propositions into smaller bottles or cartons.<br />
Consumers in this segment can be reluctant to change their dietary<br />
habits. Therefore, any products aiming to target this segment will need to<br />
easily fit into their current routines rather than require any significant<br />
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changes to the diet. This is easier said than done and is one of the main<br />
reasons for the lack of brands currently targeting this segment.<br />
When current flavoured milk consumers begin to grow into this life stage,<br />
it is likely that this segment will become more adventurous in its tastes<br />
and become a more alternative market.<br />
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3.3 Adding Value to <strong>Flavoured</strong> <strong>Milk</strong><br />
Understanding the perception of <strong>UK</strong> consumers towards flavoured and white<br />
milk is essential because these perceptions shape the offer in terms of<br />
packaging, material sourcing, product formulation, branding and<br />
merchandising. Through understanding what is important to consumers in<br />
the food and drink in general, and more specifically in the white and<br />
flavoured milk categories, it is possible to determine what things consumers<br />
will pay more for and hence what is worth considering in NPD.<br />
We have highlighted a number of macro and micro trends which are<br />
important to consider when developing a new product in the <strong>UK</strong> food and<br />
drink market. There are a number of areas where customers’ needs are not<br />
fully being addressed and understanding these can help chart the direction<br />
for flavoured milk NPD.<br />
To Gain Access<br />
In part, these stem from the three meta-trends that sit across the entire<br />
category – health, premium and Purchase convenience, The but Full in part there are also<br />
category specific drivers for flavoured milk.<br />
<strong>Report</strong> Now<br />
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Purchase The Full<br />
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3.4 Organic<br />
Macro Food and Drink Trends<br />
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Organic milk is a growing segment of the dairy category with organic milk<br />
accounting for around 5% To of milk Gain sales. Access Although this seems a relatively<br />
small proportion, it is a growing Purchase segment. The With Full total organic food and<br />
drink sales increasing 4% in 2014 according to the Soil Association,<br />
<strong>Report</strong> Now<br />
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consumers perception of organic as a proposition and their willingness to<br />
pay more for it, is improving.<br />
Research supporting organic, continues to emerge with findings<br />
published in February <strong>2016</strong> showing that organic milk contains around<br />
50% more beneficial omega-3 fatty acids than conventional dairy<br />
products. The research also suggests that organic dairy contains 40%<br />
more conjugated linoleic acid (CLA) which has been linked to reduced risk<br />
of cardiovascular disease, various cancers and obesity. In addition, it<br />
found organic dairy to contain higher concentrations of iron, vitamin E<br />
and some carotenoids.<br />
To Gain Access<br />
The research also highlighted that organic milk does contain less iodine<br />
than non-organic milk, a particular Purchase consideration The Full for pregnant women.<br />
Despite this negative, the benefits <strong>Report</strong> are helping Now to persuade consumers to<br />
make the switch to organic. Other factors such as concerns over<br />
pesticides, the environment and animal welfare are also increasing the<br />
appeal of organic.<br />
The rise in disposable income is also contributing to the rise in organic as<br />
consumers become more willing to pay for quality products.<br />
Despite the rise in organic, only a select few brands, such as Daioni, use<br />
organic milk in flavoured milk.<br />
Implications: Organic dairy is category which is seeing good growth<br />
though currently there is a real absence of flavoured milk products which<br />
use organic milk. There is definitely more space for organic flavoured milk<br />
products in the <strong>UK</strong>.<br />
Country: Wales<br />
Brand: Daioni<br />
Flavours: Banana, Strawberry and<br />
Chocolate<br />
Launch date: 2015<br />
What’s special? It is made using<br />
organic milk with a clear provenance<br />
positioning<br />
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3.5 Transparent Labelling & Minimal Processing<br />
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A consumer desire for products which are minimally processed reflects<br />
the wider trend for organic food and drink which is being partly driven<br />
over a fear of chemicals and<br />
To<br />
their<br />
Gain<br />
effects<br />
Access<br />
on the body and the<br />
environment.<br />
This is exemplified by the large-scale Purchase opposition The Full to GMO foods in the<br />
USA.<br />
<strong>Report</strong> Now<br />
Many consumers judge the healthiness of a product by the ingredients it<br />
lists. A short list of recognisable ingredients is often looked upon<br />
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positively, particularly by parents seeking to keep their children safe and<br />
healthy.<br />
This is also the case for adults and this desire has been capitalised on by<br />
products such as Arla’s Cocio<br />
To<br />
which<br />
Gain<br />
simply<br />
Access<br />
contains milk, sugar and<br />
1.5% fat-reduced cocoa.<br />
Marketing emphasising words<br />
Purchase<br />
such as ‘fresh’<br />
The Full<br />
and ‘natural’ appeals<br />
directly to this consumer desire <strong>Report</strong> for clean Now products.<br />
Implications: Short ingredients lists with claims such as ‘natural’ and<br />
‘fresh’ are of appeal for products aimed at children and adults alike. This<br />
is particularly true for traditional products.<br />
3.6 Free From/ Lactose Free<br />
Country: USA<br />
Brand: Shamrock Farms<br />
Flavours: To Gain Vanilla, Access Chocolate and Strawberry<br />
Launch date: 2007<br />
What’s<br />
Purchase<br />
special?<br />
The<br />
The<br />
Full<br />
brand emphasises the<br />
words <strong>Report</strong> “Real. Fresh. Now Ideas.” highlighting the<br />
provenance trend but also the wholesomeness<br />
of the product<br />
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Lactose is unique by being the only sugar not available in plants and only<br />
found in milk. It is not very sweet but when is processed it becomes a<br />
main element of the carbohydrate-rich liquid in flavoured milk.<br />
Lactose intolerance occurs when the enzyme lactase, which breaks down<br />
lactose into glucose and galactose, is absent from the digestive system.<br />
This is usually a genetic trait and is more common in certain populations<br />
than others.<br />
A person that is lactose intolerant will often suffer from cramps and<br />
diarrhoea when they consume lactose-containing products.<br />
A substantial proportion of the world is lactose intolerant:<br />
To Gain Access<br />
!# 90% of Filipinos, Thais and Japanese<br />
!# 70% of the black Purchase population The Full<br />
Because more than half of the <strong>Report</strong> world’s flavoured Now milk demand comes from<br />
Asia, lactose-free options are an important consideration that is likely to<br />
drive the market in the coming years.<br />
Scientific research has revealed that the digestive discomfort associated<br />
with consuming dairy is not always down to lactose but can be due to<br />
intolerance to the A1 beta casein present in the milk. This has led to the<br />
development of A2 milk which comes from cows which do not produce<br />
the A1 protein.<br />
The desire for products free of lactose is also reflected in the rising<br />
popularity of dairy alternatives which are naturally free of lactose.<br />
Arla’s Lactofree product as been the main lactose-free flavoured product<br />
in the <strong>UK</strong> market with a chocolate flavour available.<br />
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In Summer 2015, Mars launched a lactose free Mars <strong>Milk</strong> product which<br />
is currently listed in Tesco.<br />
This highlights how<br />
Country: <strong>UK</strong><br />
popular lactose avoidance<br />
Brand: Mars<br />
is becoming.<br />
Implications: Demand for<br />
lactose free is rising<br />
among mainstream<br />
consumers and this is<br />
partly driving the<br />
popularity of dairy<br />
alternatives.<br />
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Flavours: Chocolate<br />
Launch date: 2015<br />
What’s <strong>Report</strong> special? Now This is the first foray for<br />
Mars into more specialised products in<br />
the flavoured milk category and<br />
highlights the rising demand for lactosefree<br />
products.<br />
3.7 Sugar Reduction<br />
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•# Following the Public Health England report<br />
published October 2015 which claimed that<br />
To Gain Access<br />
all population groups in the <strong>UK</strong> are consuming<br />
too Purchase much sugar The and Full that the recommended<br />
daily <strong>Report</strong> intake should Nowbe halved, consumer<br />
perception over sugar has changed.<br />
Consumers are less focused on avoiding fat and are increasingly looking<br />
to products with reduced sugar claims.<br />
Sugar sweetened drinks have been particularly highlighted as a leading<br />
cause of excess sugar consumption and as a result, flavoured milk<br />
brands need to act to prevent being associated alongside high-sugar<br />
carbonated drinks.<br />
Implications: Sugar reduction is one of the most important trends for<br />
<strong>2016</strong> and it will be crucial for flavoured milk manufacturers to find a way<br />
round using high levels of sugar in their products.<br />
Country: <strong>UK</strong><br />
Brand: Frijj<br />
Flavours: Choc-a-Chocolate and<br />
Seriously Strawberry<br />
Launch date: 2015<br />
What’s special? As the category leader,<br />
Frijj launching a reduced sugar variant is<br />
a response to significant public demand<br />
for flavoured milk without high levels of<br />
sugar.<br />
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3.8 Additional Nutritional Benefits<br />
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Considering that milk is a good source of protein and that a high intake of<br />
protein is becoming increasingly desirable for many consumers, product<br />
reformulations with added amino acids are likely be successful on the<br />
market in the medium term.<br />
Due to consumers having an<br />
To<br />
increasingly<br />
Gain Access<br />
hectic and on-the-go lifestyle,<br />
<strong>UK</strong> adults have acknowledged Purchase that they The do not Full have sufficient time to<br />
prepare a nutritious breakfast. <strong>Report</strong> At the same Nowtime,<br />
they recognise the<br />
importance of a well-balanced breakfast to fuel their day and are open to<br />
more flavoured milk breakfast propositions.<br />
This demand has led to the creation of a flavoured milk sub-category<br />
focused on delivering the micro and macronutrients needed, in<br />
convenient packaging.<br />
Country: United States of America<br />
Brand: Fair Life<br />
Flavour: Chocolate<br />
Launch date: 2015<br />
What’s special? This milk is proteinenriched<br />
without being specifically<br />
targeted at bodybuilders. It is a recent<br />
example of the functional category<br />
blending with other sub-categories.<br />
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3.9 White <strong>Milk</strong> Trends<br />
3.10 Supporting British Farmers<br />
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Many consumers are concerned about the responsible sourcing of<br />
flavoured milk’s main ingredient: white liquid milk. With “farmgate” milk<br />
prices unsustainably low throughout 2015 and the retailer price wars still<br />
resulting in the use of milk almost as a ‘loss leading’ product, many <strong>UK</strong><br />
farmers are struggling. With growing media attention, more consumers<br />
are demanding a fair price for farmers for their milk.<br />
<strong>UK</strong> consumers are increasingly concerned about the livelihoods of <strong>UK</strong><br />
farmers because dairies are an essential element of British life. This<br />
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interest in the origin and ethics of dairy farming has been a part of<br />
branded value propositions. Purchase The Full<br />
Morrison’s are paying attention <strong>Report</strong> to consumer Nowdemand for fair prices for<br />
farmers with their <strong>Milk</strong> for Farmers proposition. It remains to be seen how<br />
successful this will be and how consumer attitudes translate into<br />
behaviours. In time, this could perhaps apply to other dairy products but<br />
at the moment in flavoured milk this is a helpful but not essential part of<br />
the flavoured milk proposition.<br />
In time we expect to see consumers preferring flavoured milk that<br />
specifies the origin of its milk, fairness in pricing and social impact - this is<br />
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an opportunity for small dairies to innovate or enter the flavoured milk<br />
market.<br />
3.11 Alternative Sourcing<br />
Country: Dubai, United Emirates<br />
Brand: Camelicious<br />
Flavours: Plain, Strawberry, Dates,<br />
Saffron and Chocolate<br />
Launch date: 2010<br />
What’s special? It is a nutritious and<br />
innovative type of milk that has been<br />
enjoyed for centuries: camel’s milk.<br />
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To Gain Access<br />
As has been the case with alternative flavoured milk, we expect <strong>UK</strong><br />
consumers to be more open Purchase to trying flavoured The Full milk<br />
from origins other than cows. One example is Camel milk, recently<br />
<strong>Report</strong> Now<br />
launched in the <strong>UK</strong> under the Camel <strong>Milk</strong> brand.<br />
Its historic consumption can be traced to an Ethiopian valley where there<br />
is a group of nomads who eat camel meat and drink its milk. Camels are<br />
animals that do not require high levels of husbandry and yet produce vast<br />
quantities of milk.<br />
Camels’ milk is close in composition to human milk, has a more subtle<br />
flavour than goat and sheep milk and there is some research to say it can<br />
help treat a variety of diseases including diabetes, IBS and hepatitis. It<br />
contains just 2% fat and contains no beta-lactoglobulin and a different<br />
beta-casein to cows’ milk. As these are two components of cows’ milk<br />
which commonly cause allergic reactions, camels’ milk offers a viable<br />
alternative for some allergy sufferers.<br />
3.12 Consumer Targeted NPD<br />
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The white liquid milk category has traditionally been one with minimal<br />
innovation. Looking at cow’s milk in particular, the key innovation which<br />
has added some value into the category has been filtered milk. Arla’s<br />
Cravendale is the biggest brand in <strong>UK</strong> filtered milk and is also the largest<br />
brand in the <strong>UK</strong> milk market as a whole.<br />
Although filtered milk accounts for around 5% of the total milk market,<br />
there are virtually no flavoured To filtered Gain products Access available. This is likely<br />
down to the limited number<br />
Purchase<br />
of processors<br />
The<br />
with<br />
Full<br />
the appropriate kit.<br />
Arla launched their Big <strong>Milk</strong> product which is aimed at the specific<br />
nutritional needs of toddlers between <strong>Report</strong> one Now to five with added vitamins A<br />
and D, iron and calcium. It is marketed on being a follow-on from formula<br />
milk and on allowing children to enjoy the nutritional benefits and taste of<br />
fresh cow’s milk.<br />
Following this, in January <strong>2016</strong> Arla also launched their Best of Both milk<br />
which tastes like semi-skimmed milk while being fat free.<br />
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These recent launches illustrate how the regular white milk category<br />
seeing considerable innovation since value has been stripped from the<br />
category through the milk price war which has been devaluing product.<br />
Implications: <strong>Flavoured</strong> milk brands should take note of these recent<br />
product development examples in the wider milk category and consider<br />
how they can add value to product by considering the specific nutritional<br />
requirements of particular age groups.<br />
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Country: <strong>UK</strong><br />
Brand: Best of Both <strong>Milk</strong><br />
Flavours: -<br />
Launch date: <strong>2016</strong><br />
What’s special? Arla’s new Best of Both <strong>Milk</strong> is<br />
marketed on having the fat levels of skimmed<br />
milk with the taste of semi-skimmed milk. It is a<br />
key example of recent innovation in the regular<br />
white milk category which is adding value back<br />
into milk.<br />
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3.13 <strong>Flavoured</strong> <strong>Milk</strong> Trends<br />
3.14 Functionality Driven NPD<br />
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Country: <strong>UK</strong><br />
Brand: The Protein Drinks Co<br />
Flavours: Plain and Sweetened<br />
Launch date: 2014<br />
What’s special? This flavoured<br />
milk is enriched with collagen and<br />
vitamins, promoting well-being and<br />
beauty for women. It is a good<br />
example of a targeted adult<br />
flavoured milk proposition.<br />
Stripping milk of the components that make up cows’ milk results in<br />
flavoured milk products oriented to female consumers who want to derive<br />
health and beauty benefits from unmodified cows’ milk.<br />
An example of this is collagen milk that is currently sold in outlets such as<br />
Superdrug, Holland & Barrett, Tesco and Ocado. The value proposition is<br />
interesting:<br />
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“Collagen+ Beauty <strong>Milk</strong> is a truly unique collagen beauty drink rich in<br />
essential vitamins, potent antioxidants and hunger-fighting protein!<br />
Occasion usage is recommended at breakfast or in between meals as a<br />
convenient healthy snack.”<br />
This product is produced by The Protein Drinks Co. Collagen+ Beauty<br />
<strong>Milk</strong> is one of the first of its type in the <strong>UK</strong> and is expected to grow in<br />
popularity as it has in other emerging To Gain markets, Access such as Japan.<br />
A number of clinical studies Purchase have supported The the Full idea that ingesting<br />
collagen peptides can help reduce the appearance of skin wrinkles and<br />
<strong>Report</strong> Now<br />
can help with joint health. However, more research needs to be done to<br />
further support the effectiveness of collagen drinks on reducing the signs<br />
of wrinkles.<br />
Collagen has also been shown to have a higher satiating effect than other<br />
proteins such as soy and casein, making it a potentially useful ingredient<br />
in weight control drinks.<br />
In addition to collagen milk, there are various opportunities for functional<br />
drinks including milk-based energy drinks. With recent findings of milk<br />
To Gain Access<br />
coming from cows during the night containing elevated levels of<br />
tryptophan and melatonin, Purchase two substances The found Full to reduce anxiety and<br />
aid sleep, it seems only a matter <strong>Report</strong> of time Now before a brand looks to market<br />
this.
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3.15 Flavour Driven NPD<br />
Country: Australia<br />
Brand: Nippy’s To Gain Access<br />
Flavour: Iced Honeycomb<br />
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Launch date: 2012<br />
What’s special? <strong>Report</strong> This Now brand is a unique flavour, with both<br />
adult and child appeal.<br />
Country: United States of America<br />
Brand: Hershey’s<br />
Flavour: White To Chocolate Gain Access<br />
Launch date: 2013<br />
Purchase The Full<br />
What’s special? Although, within the <strong>UK</strong>, confectionary<br />
flavours are not new, <strong>Report</strong> white Now chocolate flavour is still not as<br />
established as milk chocolate and has been the focus of NPD<br />
in the dessert category<br />
#<br />
Country: Taiwan<br />
Brand: Greenmax<br />
Flavour: Boba <strong>Milk</strong> Tea Powder<br />
Launch date: To 2011 Gain Access<br />
What’s special? Purchase Although The this Full product is powdered<br />
excluding it from our flavoured milk definition, the ‘healthy’<br />
<strong>Report</strong> Now<br />
flavour is worth mentioning as it also aligns with the teakeen<br />
palates of <strong>UK</strong> adults and the continued growth of<br />
green tea as a healthy proposition.<br />
Country: United States of America<br />
Brand: Peeps<br />
Flavours: Chocolate Marshmallow,<br />
Marshmallow, Easter Egg Nog.<br />
Launch To Gain date: Access 2011<br />
What’s special? The seasonal flavours e.g.<br />
‘Easter’ portrayed here, are examples of how<br />
to take <strong>Report</strong> advantage Now of the different retail<br />
opportunities across the trading year (i.e.<br />
Christmas, Halloween, Summer) and<br />
incorporate them into the category<br />
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#<br />
Country: United States of America<br />
Brand: Arriba<br />
Flavour: Horchata (cinnamon) with rice milk<br />
Launch date: 2015<br />
What’s special? This flavour is taken from<br />
the traditional Mexican and Central American<br />
flavour<br />
<strong>Report</strong><br />
Horchata.<br />
Now<br />
This is a good example of<br />
taking tried and true adult flavours into the<br />
category.<br />
As we saw in previous chapters, pitching flavoured milk to the adult<br />
population is an under-developed route and holds out commercial promise<br />
for brands who can manage this To successfully. Gain Access This is why we are seeing<br />
more interest in translating flavours Purchase that are The already Full popular amongst adults<br />
into the flavoured milk market.<br />
Popular flavours include:<br />
To Gain Access<br />
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Sticky Toffee Pudding<br />
Carrot Cake<br />
Millionaire’s Shortbread<br />
Cherry bagel<br />
Cheesecake<br />
Lemon meringue pie<br />
Flapjacks<br />
Rocky road<br />
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Whether these new flavours will compete in the confectionary category or in<br />
the traditional flavoured category remains to be seen.<br />
•#<br />
#<br />
•#<br />
The on-the-go lifestyles of consumers have implications for flavoured milk<br />
packaging and branding, as the convenience trend continues to gather<br />
pace.<br />
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Innovation will most likely come Purchase from the The functional Full drink offer and<br />
flavoured milk being used as a convenient<br />
<strong>Report</strong> Now<br />
snack that surpasses energy<br />
drinks in terms of both the perceived health benefits and its natural<br />
attributes.<br />
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#<br />
3.16 Formula Innovation<br />
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Country: India<br />
Brand: Vio<br />
Flavours: Very Berry, Fresh Citrus,<br />
Tropical Colada, Exotic<br />
Launch date: 2015<br />
What’s special? This flavoured milk<br />
has a twist as it is carbonated. It<br />
remains to be seen whether<br />
carbonation and dairy are a<br />
sustainable commercial match.<br />
3.17 Packaging<br />
Premium flavoured milk depends on a unique value proposition and<br />
packaging that serves its consumers needs. The coffee sub-category has<br />
done this successfully by offering packaging that is convenient, stylish and<br />
confers status to whoever carries coffee flavoured milk. Brands have used<br />
packaging, shape, glass and branding cues to deliver a modern and<br />
sophisticated feel to the packaging.<br />
Packaging plays an important role in shaping consumer experience (including<br />
different formats and materials), particularly for flavoured milk. Packaging has<br />
a particularly strong influence on flavoured milk brand perception. This is<br />
true for form (size, sleeve, shape, branding) as well as function (protective<br />
barrier, technology, cap, size). Of course, the availability of capacity to<br />
process and pack flavoured milk To Gain has a bearing Access on packaging. For instance,<br />
the reason many brands have very similar bottle shapes and size is that there<br />
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are relatively few co-packers and this creates uniformity in the category.<br />
#<br />
<strong>Report</strong> Now<br />
Figure 3-9 – Although the flavoured milk brands featured all vary to<br />
some extent, their packaging is fairly similar, indicating an opportunity<br />
to innovate in this area<br />
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3.18 Attitudes towards packaging in the <strong>UK</strong><br />
<strong>UK</strong>#FLAVOURED#MILK#<strong>2016</strong>217#<br />
#<br />
Many <strong>UK</strong> adults dislike excessive packaging and desire ease in the handling<br />
of packaged goods. Most flavoured<br />
To Gain<br />
milk is<br />
Access<br />
presented in portioned sized onthe-go<br />
formats. Usage and occasion Purchase is a driver The of Full packaging but there is a<br />
long way to go in terms of flavoured milk innovation in packaging format.<br />
3.19 Packaging Evaluation<br />
<strong>Report</strong> Now<br />
We examine flavoured milk packaging under the following criteria: ecoimpact,<br />
cost-effectiveness from the perspective of the producer, safety,<br />
aesthetical quality and convenience.<br />
•#<br />
•#<br />
•#<br />
The scorecard shows HDPE and PET are similarly suitable for flavoured<br />
milk packaging. PET is more aesthetically pleasing but HDPE has the<br />
least eco-impact, that is, the least amount of energy must be expended in<br />
order to produce and recycle To HDPE Gain bottles. Access<br />
Cartons score consistently in Purchase all categories The but Full are not as simple to<br />
recycle as plastic alternatives since <strong>Report</strong> they Now are formed by several layers.<br />
In last place was glass, which is not appropriate for children and also has<br />
a high eco-impact.<br />
#<br />
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Figure 3-10: Packaging comparison<br />
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3.20 Sports Caps<br />
In line with our consumer-driven principle for growth, flavoured milk<br />
producers must design and innovate in order to successfully address<br />
consumers’ lifestyles and needs.<br />
To Gain<br />
With the<br />
Access<br />
exception of recent 500ml, 750ml<br />
and 1-litre formats, flavoured milk is mainly available for on-the-go<br />
consumption in plastic bottles Purchase or Tetra Pak The cartons. Full<br />
<strong>Report</strong> Now<br />
Mars Refuel have seen considerable commercial success with their sports<br />
cap format. This can be attributed to a range of consumer lifestyle factors:<br />
•#<br />
•#<br />
•#<br />
•#<br />
Actual convenience e.g. value added feature for consumers with active<br />
lifestyles who see Mars drinks as a quick recovery after exercise.<br />
The perceived status enjoyed<br />
To<br />
by<br />
Gain<br />
those<br />
Access<br />
consumers carrying a bottle with a<br />
sports cap. Purchase The Full<br />
Consumers’ willingness to pay <strong>Report</strong> a premium Nowfor<br />
enhanced packaging.<br />
The perceived potential to avoid spillage - important to parents.<br />
Advantages<br />
Convenient for consumption<br />
Avoids spillage<br />
Active lifestyle association – “sporty”<br />
Disadvantages<br />
Expensive for manufacturer<br />
Requires manufacturing to be<br />
drastically changed<br />
Potential child choke risk<br />
Seal integrity<br />
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#<br />
Figure 3-11 Mars saw good sales growth after the introduction of the<br />
sports cap<br />
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Figure 3-12 Other notable examples of packaging tailored to<br />
consumers’ needs is Kids on The Go by For Goodness Shakes (formerly<br />
<strong>Milk</strong> Shoot)<br />
#<br />
#<br />
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#<br />
3.21 Summary<br />
•#<br />
•#<br />
•#<br />
While white milk prices continue to fall in real terms, flavoured milk<br />
provides a valuable opportunity for dairy companies to drive value and<br />
volume.<br />
o# With the decline in white milk prices throughout 2015, flavoured<br />
milk is an attractive alternative to create value for dairies in a<br />
challenging trading environment.<br />
o# The ready availability of European co-packer capacity creates a<br />
manufacturing route for brands without milk pools or processing<br />
assets. However, as there is not a wide variety of co-packers, it<br />
also drives a degree of uniformity and similarity into the category<br />
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o# The <strong>UK</strong> is under served with dairy processing capacity.<br />
o# Consumers are increasingly Purchase interested The Full in the origin of the raw<br />
materials, especially the <strong>Report</strong> milk, but Now the case is not proven that this is<br />
a lasting trend or one that delivers true differentiation.<br />
<strong>Flavoured</strong> milk is mainly positioned as an on-the-go product<br />
o# Products are available in single serving formats with the exception<br />
of relatively few 500ml, 750ml or 1-litre cartons (i.e. Alpro, Yazoo,<br />
Blue Diamond, MOO).<br />
o# <strong>Flavoured</strong> milk is typically placed in the chilled milk, lunch<br />
promotions or cereal aisle (UHT).<br />
Asian countries, particularly China, are potential export opportunities<br />
o# The removal of the one-child policy and the current status of China<br />
as the largest flavoured milk market in the world make it an ideal<br />
target market.<br />
#<br />
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#<br />
4.! The Power Categories<br />
Our working segmentation sees the flavoured milk market divided into six<br />
‘power categories’. This chapter looks at each of these power categories in<br />
turn: traditional flavoured milk, functional drinks, coffee, confectionary,<br />
breakfast and alternative flavoured milk.<br />
The percentages beside the categories give an approximate indication of the<br />
relative weighting of the categories sales to the <strong>UK</strong> flavoured milk market as<br />
a whole.<br />
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Figure 4-1: The Power Categories<br />
For each category, we explore the two flagship brands featured in the<br />
pyramid above and examine products, advertising, marketing and financials.<br />
Traditional <strong>Flavoured</strong> <strong>Milk</strong><br />
#<br />
Traditional milk laid the foundations for the flavoured milk category and is the<br />
biggest sub-category in volume sales with our estimate being that it is just<br />
under half of the category. In To its most Gain simple Access form, it is milk with added<br />
sugar and natural or artificial Purchase flavours. Traditional The Full flavoured milk products<br />
have been available in <strong>UK</strong> supermarket aisles for over two decades in their<br />
<strong>Report</strong> Now<br />
present form and are usually found alongside white liquid milk with typical<br />
flavours including chocolate, strawberry, vanilla and banana.<br />
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Figure 4-2: Chocolate is the best selling flavour in the traditional milk<br />
category<br />
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#<br />
Figure 4-3: Strawberry is the second most popular flavour<br />
Retailers tend to develop own-label products in this category in the most<br />
common flavours. Tesco, Sainsbury’s, Morrisons and ASDA own-label are<br />
the leading own label players. The two main volume brands operating in this<br />
area are Frijj and Yazoo.<br />
Figure 4-4: The two market leading flavoured milk brands: Frijj and<br />
Yazoo<br />
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Figure 4-5 – Morrisons <strong>Flavoured</strong> <strong>Milk</strong> Chilled Fixture<br />
4.1 Frijj<br />
•# Brand Growth: 7% 2014/15<br />
•# Product Variants: Confectionary and traditional flavoured<br />
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milk<br />
•# New product Purchase developments: The Full Frijj 40% sugar-reduced and<br />
Frijj Supreme <strong>Report</strong> Now<br />
•# Target consumers: Children and teens<br />
Frijj is a flavoured milk brand created in 1993 and is now the <strong>UK</strong> market<br />
leader. Frijj was sold by Dairy Crest to Muller in December 2015 as part of<br />
the # wider sale of the Dairy Crest operation.<br />
Frijj is currently available in 5 flavours: Full of Fudge Brownie, Choc-a-<br />
Chocolate, Seriously Strawberry, Burst of Banana and Mucho Cookie Dough,<br />
though there are also some coffee flavours in addition to this core range. In<br />
terms of brand share, Frijj has consistently To Gain Access increased its market share each<br />
year, rising 1.9% in 2014 and Purchase 2% in 2015 The after a Full 0.1% setback in 2013.<br />
According to the Dairy Crest 2015 Annual <strong>Report</strong>, new areas of growth for<br />
Frijj can be traced to hospitality and<br />
<strong>Report</strong><br />
convenience<br />
Now<br />
channels. Frijj UHT was<br />
launched in 2012 with the intention of taking a share of the convenience<br />
sector where a longer shelf life and ambient storage is often key for retailers<br />
in terms of shelf life and for consumers the ability to consume the drink<br />
ambient allows for greater practicality. However, the UHT proposition has<br />
struggled to gain traction with either the trade or consumers due to price<br />
point and sizing.<br />
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Figure 4-6- Frijj Seriously Strawberry<br />
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#<br />
Figure 4-7: Frijj Packaging Evolution<br />
Since its launch in 1993 a number of small changes have been made to the<br />
Frijj packaging, but the distinctive shape and design style has been kept<br />
largely the same. The brand has used marketing campaigns featuring<br />
licenced characters from The Simpsons to appeal to their core consumer<br />
audience. More recently however, they have been making an effort to appeal<br />
to older consumers with their coffee range and the Supreme range which<br />
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uses premium branding cues to confer a more indulgent product.<br />
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In February 2015 they launched a 40% reduced sugar product, the first of its<br />
kind in the <strong>UK</strong> market which is listed in all the major retailers. The packaging<br />
is largely the same as the standard product, though uses light blue to make it<br />
distinct. The use of the light blue colouring to confer reduced sugar is<br />
becoming standard in the wider food and drink market with products such as<br />
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#<br />
Heinz Reduced Sugar & Salt Tomato Ketchup, Heinz Baked Beans, Nestle<br />
Oat Cheerios Low Sugar etc.<br />
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Figure 4-8: Frijj Advertising<br />
Frijj advertising has traditionally been fun and well-suited to their core<br />
demographic of older children and teenagers. Their sponsorship of Sky TV’s<br />
Soccer # FM show is an attempt to widen the appeal to active consumers and<br />
older adult males.<br />
4.2 Yazoo (Friesland Campina)<br />
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•# Friesland Campina Profit H1 2015: €192 million (up<br />
84.6%)<br />
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•# Product variants: Traditional flavoured milk<br />
•# NPD: Yazoo <strong>Report</strong> Smoothie Now<br />
•# Target consumers: Children and teens<br />
Friesland Campina is one of the top 6 dairy companies in the world and is the<br />
Belgian manufacturer of the milkshake brand, Yazoo. The cooperative is the<br />
result of the 2007 merger between Friesland Foods and Campina and uses<br />
milk that comes from farmers in the Netherlands, Germany and Belgium.<br />
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Yazoo, the second best selling flavoured milk brand in the <strong>UK</strong>, has slowly<br />
increased its market share over the course of the past 5 years to almost<br />
match Frijj. Market share growth was 1.6% in 2015 after stagnating in 2013<br />
(a year in which in main competitor Frijj also lost share).<br />
The traditional flavours are banana, chocolate and strawberry. The vanilla<br />
flavour was a limited edition product which became a permanent fixture in<br />
September 2014. The size formats sold include 200ml, 250ml, 300ml, 475ml<br />
and 1-litre in both plastic bottle and Tetra Pak carton.<br />
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Figure 4-9<br />
#<br />
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Figure 4-10: Yazoo Packaging Evolution<br />
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#<br />
In comparison to its rival, Frijj, Yazoo has remained largely the same since its<br />
launch, with the same flavours available and no real limited edition flavours or<br />
variants introduced, except for vanilla. The products are classic, traditional<br />
flavoured milk aimed at primarily at children, teenagers and young adults.<br />
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Figure 4-11: Yazoo Advertising<br />
These advertisements have been humorous and aimed at younger<br />
consumers with promotions such as music downloads and cinema tickets.<br />
The May 2014 campaign had a simple focus on the goodness of milk,<br />
appealing to gatekeeper parents as well as the direct consumers.<br />
4.3 # Functional <strong>Milk</strong><br />
Sports nutrition is a rapidly growing market in the <strong>UK</strong>. <strong>Milk</strong> is a rich source of<br />
nutrients that can be fractioned To Gain into a wide Access range of components (i.e. whey<br />
protein, casein etc.) and used as ingredients to boost the protein value of<br />
flavoured milk drinks.<br />
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In recent years, the public has become increasingly aware of the impact of<br />
protein in their diets, in particular that protein:<br />
•#<br />
Helps develop greater muscle mass, lean tissue and aids strength<br />
training. It does so by stimulating muscle synthesis and suppressing<br />
protein breakdown for several hours to obtain a higher proportion of lean<br />
tissue;<br />
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#<br />
•#<br />
•#<br />
Supports weight control because it has a satiating effect and increases<br />
the metabolism for a longer period of time than other macronutrients;<br />
Contributes to lower blood pressure and is therefore useful for individuals<br />
with hypertension.<br />
There is some controversy surrounding protein consumption in the Western<br />
diet as, although the consumption of protein is essential for the correct<br />
functioning of the human body, most adults and children in the <strong>UK</strong> are not at<br />
risk of consuming low-levels of protein. In fact, some evidence shows that<br />
the opposite is more likely.<br />
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#<br />
Figure 4-12: For Goodness Shakes, CNP (Sky License) and Arla Protein<br />
Drinks<br />
4.4 Sports Nutrition: Key Facts<br />
•#<br />
•#<br />
•#<br />
•#<br />
Development of portable, convenient bottle has been key to driving sales<br />
in this category.<br />
Clever promotions, smaller To formats Gain and Access product reformulation have<br />
pushed growth forward.<br />
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Consumer education is a key lever in increasing demand for protein<br />
products and greater consumer <strong>Report</strong> education Nowwill drive the category growth<br />
forward.<br />
There is evidence that consumers are confused by the array of sports<br />
nutrition products and the technical claims they make without making<br />
clear links to distinct benefits.<br />
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#<br />
•#<br />
•#<br />
Consumers are often unclear what the products do for them and what the<br />
To Gain Access<br />
differences are between them.<br />
Most sports nutrition shoppers Purchase identify The with the Full brand - their personality,<br />
values and lifestyle are all expressed through the brand.<br />
<strong>Report</strong> Now<br />
Such is the success of protein-rich flavoured milk products, that other<br />
categories have taken note and are launching variants to satiate the growing<br />
demand. For example, Starbucks To (coffee) Gain Access and Weetabix (breakfast) have<br />
developed protein-rich formulas to defend and extend their market share.<br />
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In addition to weight control, muscle recovery and repair benefits of protein<br />
intake, there are many other benefits associated with the consumption of<br />
protein:<br />
•#<br />
•#<br />
•#<br />
Increased bone density leading to decreased risk of osteoporosis;<br />
Protein also aids cardiac health To Gain - it has Access been found that shifting 1% of<br />
calories from carbohydrates to protein, could lead to a 21% reduction in<br />
the probability of developing<br />
Purchase<br />
cardiovascular<br />
The<br />
disease<br />
Full iii ;<br />
Overall, a higher protein intake <strong>Report</strong> is more associated Now with a greater sense of<br />
wellbeing than a lower protein intake.<br />
This research has become increasingly mainstream and has led to a growing<br />
demand for products that provide high doses of protein in a convenient<br />
format.<br />
Although the development of protein drinks will continue to prove successful<br />
in the near-term future, the public has been advised against excessive sugar<br />
intake. Most flavoured milk beverages with added protein are also sources<br />
of what some experts define as To excessive Gain Access levels of sugar. This combination<br />
may ultimately deter the consumer from buying protein drinks and existing<br />
players in the market need to<br />
Purchase<br />
be alive to this<br />
The<br />
risk.<br />
Full<br />
#<br />
<strong>Report</strong> Now<br />
Figure 4-13: Strength training<br />
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#<br />
Figure 4-14: Mainstream consumers<br />
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Figure 4-12: Image conscious females<br />
Figure 4-16: Endurance<br />
#<br />
Figure 4-13: Slimmers<br />
4.5 The Science<br />
Protein requirements are determined by the body’s nitrogen balance. That is<br />
the difference between the intake and output of nitrogen. A healthy adult<br />
with enough protein will roughly consume and excrete the same amount of<br />
nitrogen each day.<br />
In growing children, pregnant women or a person recovering from protein<br />
loss, there is typically a positive balance where the intake of nitrogen is<br />
greater than the output as the body is increasing total body protein. This<br />
means that growing children, pregnant women and a person recovering from<br />
an injury all require higher levels of protein intake. By contrast, in certain<br />
people responding to trauma or infection, the output of nitrogen will be<br />
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#<br />
greater than the input and therefore there will be a negative nitrogen balance<br />
that will lead to a reduction in body protein.<br />
4.6 The Over-Consumption Argument<br />
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Protein drink brands need to be aware that there is some evidence to<br />
suggest that exceedingly high Purchase levels of protein The intake Full are linked to the<br />
development of chronic diseases.<br />
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Arguments against Excessive<br />
Protein Consumption<br />
Foods rich in protein i.e. meat and<br />
dairy, are often high in saturated fat<br />
Kidneys can be harmed by too much<br />
protein.<br />
Filling up on protein means eating less<br />
healthy vegetables, fruits and<br />
wholegrains. This can put people at<br />
risk of nutrient deficiencies.<br />
Consuming high levels of protein<br />
means excreting more calcium from<br />
the body, increasing the need for<br />
dietary calcium.<br />
Excess protein is converted to fat in<br />
the body so can result in weight gain<br />
Excessive protein consumption of over<br />
200g # a day can raise the risk of<br />
hyperaminoacidemaia,<br />
hyperammonemia and<br />
hyperinsulinemia nausea.<br />
•#<br />
•#<br />
•#<br />
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The Defence for Protein Drinks<br />
There is growing evidence that<br />
saturated fat is not as bad for us as we<br />
once thought.<br />
Research suggests excessive protein<br />
consumption is unlikely to cause<br />
kidney problems, just exacerbate<br />
existing conditions.<br />
Protein drinks are not intended as longterm<br />
dietary meal replacements and<br />
are recommended to be consumed<br />
with a healthy diet.<br />
Protein from dairy sources contains<br />
calcium.<br />
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Consumption is recommended for<br />
active consumers and combined with<br />
exercise this should not be an issue.<br />
Protein drinks typically only offer a<br />
fraction of the daily limit and, as long<br />
as they are used responsibly in an<br />
otherwise balanced diet, are safe.<br />
In the Western hemisphere, there is a very low chance of an adult<br />
suffering from protein deficiency because the staple foods that are<br />
commonly considered sources of carbohydrates also provide some levels<br />
of protein. Although some children require more protein, in the West most<br />
children consume more protein To than Gain is Access needed.<br />
For adults, the average daily requirement is 0.66g of protein per kilogram<br />
of body weight.<br />
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An individual’s protein requirements <strong>Report</strong> vary Now but, on average, based on an<br />
adult weighing 70kg, requirements range from 56g and 70g of protein per<br />
day. That is, the maximum amount required is 1g of protein per kilogram<br />
of body weight.<br />
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#<br />
•#<br />
•#<br />
•#<br />
In developed countries, the daily intake of protein far exceeds the<br />
nutritional requirements in the range of 80-100g of protein per day.<br />
Protein requirements for senior citizens, however, have recently been<br />
found to be different than those of the middle-aged population, with one<br />
study claiming that elderly women To aged Gain 80-87 Access would benefit from<br />
consuming 29% more protein Purchase than current The guidelines Full would recommend<br />
(Tang, 2014). Thus, there is an opportunity<br />
<strong>Report</strong> Now<br />
for flavoured milk producers<br />
with this segment, as the previous NPD chapter highlighted.<br />
It is widely recommended that protein intake should be timed. This<br />
means that it should be consumed in small quantities throughout the day<br />
as opposed to large quantities once a day. This is the optimal way of<br />
absorbing protein as, if too much is consumed at any one time, it will<br />
become a waste product of the body.<br />
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Figure 4-14<br />
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Figure 4-15<br />
#<br />
Figure To Gain 4-20 Access<br />
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Figure 4-21<br />
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#<br />
Figure 4-16: Standing Committee on the Scientific Evaluation of Dietary<br />
Reference Intakes, Food and Nutrition Board, Institute of Medicine in<br />
Dietary Reference Intakes for Energy, Carbohydrate, Fibre, Fat, Fatty<br />
Acids, Cholesterol, Protein and Amino Acids, National Academy Press,<br />
Washington, DC, 2002.<br />
4.7 The VAT Issue<br />
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Figure 4-22<br />
In 2012, VAT was introduced for Sports nutrition drinks which are defined by<br />
HMRC as drinks that are:<br />
“marketed as supplying energy to enhance performance, accelerating<br />
recovery after exercise, providing energy, or building bulk and often contain<br />
creatine.”<br />
There is a particular provision, however, made for “milk and preparations and<br />
extracts thereof” and “meal replacement drinks for slimmers or invalids”, both<br />
of which remain exempt.<br />
To Gain Access<br />
“<strong>Milk</strong> will remain zero-rated even if promoted as benefiting consumers<br />
taking # part in sports activity. Although products such as meal replacements<br />
for dieters may be a similar product<br />
Purchase<br />
to a protein<br />
The<br />
supplement<br />
Full<br />
used by athletes,<br />
they are aimed at different markets.” <strong>Report</strong> Now<br />
VAT, summary of responses, 28 June 2012.<br />
<strong>Flavoured</strong> milk is therefore zero-rated and a market opportunity persists for<br />
products that are marketed as a slimming aid or as a meal replacement.<br />
4.8 For Goodness Shakes<br />
© <strong>2016</strong> Teepee Limited. All Rights Reserved.<br />
Aurivo Turnover 2014: €447m<br />
Growth CAGR Growth (2014/13): 13.5%<br />
Product variants: Functional drinks<br />
NPD: Sports Recovery New Formula and<br />
Protein Nutrition On-The-Go<br />
Target consumers: Active children,<br />
teens, slimmers, strength and endurance<br />
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#<br />
athletes, casual gym goers and healthconscious<br />
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For Goodness Shakes is a ready-to-drink shake brand that targets a variety<br />
<strong>Report</strong> Now<br />
of different types of athletes with its range of protein products. It was<br />
developed by the company My Goodness Ltd, founded in 2003. Aurivo, the<br />
Ireland-based agribusiness purchased My Goodness Ltd in 2015.<br />
For Goodness Shakes comes in several varieties:<br />
•#<br />
•#<br />
•#<br />
•#<br />
#<br />
•#<br />
For Goodness Shakes® Ultimate Protein (Chocolate and<br />
Strawberry) is their highest-protein product with 40g of protein<br />
per serving. This product is targeted at consumers who are<br />
interested in specific muscle definition and development and<br />
who are highly knowledgeable about their specific nutritional<br />
requirements.<br />
For Goodness Shakes® Protein (Chocolate and Strawberry) is a<br />
product containing 25g of protein and is targeted at active<br />
consumers who are entry level gym goers or at a similar level of<br />
fitness.<br />
For Goodness Shakes® Protein Nutrition (Chocolate, Strawberry<br />
and Café Latte) is an intermediate choice with 20g of lean milk<br />
protein with added vitamins and To minerals. Gain Access This product is their<br />
most mainstream product, aimed Purchase at those The consumers Full interested<br />
in weight management and general health and wellbeing.<br />
<strong>Report</strong> Now<br />
For Goodness Shakes® Recovery, is their main product and<br />
comes in four flavours: Chocolate, SuperBerry, Vanilla and<br />
Banana. Its ratio of carbohydrates to protein is 3:1, containing<br />
17g of protein. This product is aimed at those for whom<br />
hydration and endurance are important, i.e. endurance and<br />
cardio sports.<br />
For Goodness Shakes has also developed a line aimed at active<br />
children and teens called Kids on the Go (formerly <strong>Milk</strong> Shoot). It<br />
is a convergence between protein and traditional flavoured milk.<br />
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For Goodness Shakes Packaging Evolution<br />
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Figure 4 – 23: For Goodness Shakes Packaging Evolution<br />
Since launching in 2005, the For Goodness Shakes packaging has evolved to<br />
become more serious in order to appeal to its core audience of athletes and<br />
active consumers. Upon launch, the packaging design and the name of the<br />
brand made the products approachable for mainstream consumers deterred<br />
by the hard-core sports nutrition products. This helped increase their growth<br />
and made the brand appealing to retailers such as Tesco, the Co-op and<br />
Sainsbury’s. Over time, the brand has diversified with new sub-ranges aimed<br />
at specific consumer groups, using distinct packaging to match. With the<br />
launch of the Kids on the Go product in 2014, a more child appropriate<br />
design was created for the product which was still in keeping with the brand<br />
as a whole. The <strong>Milk</strong> Shoot product utilises a sports cap, ideally suited to<br />
active children.<br />
#<br />
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Figure 4-24: For Goodness Shakes Advertising<br />
For Goodness Shakes’ advertising has been targeted at an active, male<br />
audience, appealing across the spectrum from light ‘January exercisers’ to<br />
cyclists, runners and weight lifters. Their online video campaign in 2013 was<br />
banned by ASA, though was intended as a tongue-in-cheek advert to appeal<br />
to young, male adults.<br />
4.9 Dunn’s River Nurishment<br />
#<br />
Profit (H1 2014): $37.2 billion<br />
Growth (2014/13):<br />
To<br />
20.56%<br />
Gain Access<br />
Product variants: Functional drinks<br />
NPD: Nurishment<br />
Purchase<br />
Active (2013)<br />
The Full<br />
Target consumers: <strong>Report</strong> Active Now children, teens, slimmers,<br />
strength and endurance athletes, casual gym goers and the<br />
health-conscious<br />
•#<br />
•#<br />
•#<br />
•#<br />
Nurishment Original was one of the first functional milk drinks in the <strong>UK</strong><br />
market and has been present for more than 20 years.<br />
This “nutritionally enriched milk drink” is available in seven flavours in its<br />
400g ring-pull can format: Vanilla,<br />
To Gain<br />
Banana,<br />
Access<br />
Strawberry, Chocolate,<br />
Peanut, Raspberry and Mango.<br />
This ring-pull can format is Purchase unique in the The flavoured Full milk category as a<br />
seemingly incompatible format, <strong>Report</strong> though these Nowproducts have gained a<br />
loyal consumer following from the Afro Caribbean market in particular.<br />
In 2013, Nurishment launched an on-the-go variant to compete against<br />
the other sports ready-to-drink products in the market.<br />
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#<br />
•#<br />
Nurishment Active has 35g of protein per bottle, doubling the protein<br />
content of Nurishment Extra, but is also available in the same three<br />
flavours: Strawberry,<br />
Chocolate and Vanilla.<br />
Figure 4-17- Nurishment<br />
Extra (left) and Nurishment<br />
Original (right)<br />
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#<br />
Figure 4-26: Nurishment Packaging Evolution<br />
The Nurishment Active product was the brand’s attempt at targeting the<br />
sports nutrition category with a specific product, moving away from the can<br />
format and towards the on-the-go, bottle format that is common in the<br />
category. The Nurishment Extra product is more of a mainstream flavoured<br />
milk concept with the bright colours and unintimidating branding typical of<br />
traditional flavoured milk. This product has allowed Nurishment to target<br />
more mainstream consumers who may be deterred by the can format.<br />
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Figure 4-27: Nurishment Advertising<br />
Nurishment advertising in recent years has focused on appealing to its target<br />
audience of active consumers with a focus on pushing the limits to appeal to<br />
extreme sports players. The advertising push has centred around outdoor,<br />
print, on-pack and online activation.<br />
#<br />
4.10 Coffee milk<br />
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Coffee continues to go from strength to strength as British companies move<br />
away from tea, the traditional <strong>UK</strong> <strong>Report</strong> drink, to Now a greater taste for coffee.<br />
<strong>Flavoured</strong> milk is a good carrier for coffee as a flavour – it mixes well and<br />
brings out the qualities in the coffee and there has consequently been a high<br />
level of innovation in this segment. It is an area where own label struggles to<br />
cut through and where innovation in flavour and packaging format e.g. glass,<br />
cup shaped bottles, is key.<br />
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Figure 4-28: Cappuccino<br />
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Figure 4-29: “Skinny” coffee<br />
#<br />
Figure 4-30: Chocolate coffee<br />
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Figure 4-31: Caramel coffee<br />
Figure 4-32: Strong coffee<br />
4.11 # Starbucks<br />
Profit: €5.13 billion<br />
Growth Volume: To H1 Gain 2015 Access 2.4%<br />
Product variants: Purchase Alternative, The coffee, Full functional and<br />
traditional flavoured milk<br />
NPD: Gulp, Cocio,<br />
<strong>Report</strong><br />
Lactofree,<br />
Now<br />
Sugar-Reduced flavoured<br />
milk, high-protein flavoured milk<br />
Target consumers: On-the-go professionals<br />
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•# Starbucks, the High Street coffee shop, entered the <strong>UK</strong> in 1998.<br />
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#<br />
•#<br />
•#<br />
•#<br />
Their ready-to-drink coffee drink was launched in late 2010 through a<br />
partnership with Arla Foods, who licensed their brand to manufacture,<br />
distribute and market this coffee-flavoured To Gain Access milk drink.<br />
The first drinks launched were Purchase Starbucks The VIA® Full instant coffee, Starbucks<br />
Discoveries® chilled latte and Starbucks Doubleshot®. In 2011, it<br />
<strong>Report</strong> Now<br />
launched Starbucks Bottled Frappuccino®.<br />
The Starbucks license has grown to become one of the market leading<br />
chilled coffee drinks in the <strong>UK</strong>.<br />
Figure 4-33<br />
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#<br />
Figure 4-34: Starbucks Packaging Evolution<br />
The Starbucks packaging is designed to target those cosmopolitan, on-thego<br />
professionals who like to be seen with a Starbucks but who are not<br />
necessarily able to get to an outlet. With this in mind, the packs are designed<br />
in a cup, to mirror the store format. Re-closable packs are not particularly<br />
important to the target consumers as image clearly outweighs convenience<br />
and the product is single serve. The small sized packs of around 220ml<br />
make this feasible as a reasonable amount to consume in one serving for<br />
their core audience of females and busy commuters.<br />
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Figure 4 – 35: Starbucks Advertising<br />
As Starbucks is such a well-known brand in the <strong>UK</strong>, promotions and<br />
campaigns focus on introducing new products in the range rather than<br />
building brand awareness. Launches of new bottles drinks or new flavours<br />
typically focus on print advertising, radio advertising and events sponsorship.<br />
The Starbucks brand is extremely well-known, and until 2015 they had never<br />
done # any TV advertising for their range of bottled drinks. The Doubleshot<br />
2015 commercial targeted their core audience of busy professionals who<br />
would consume Doubleshot as a pick me up throughout the day.<br />
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4.12 Emmi CAFFE LATTE<br />
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Turnover H1 2014: CHF 1,626 million<br />
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Growth Sales: H1 2014: 3.7%<br />
Product variants: Coffee <strong>Report</strong> Now<br />
NPD: Expresso Zero, Flat White<br />
Target consumers: On-the-go Professionals<br />
•#<br />
•#<br />
•#<br />
•#<br />
Emmi is a Swiss dairy company that launched its coffee products in the<br />
<strong>UK</strong> in 2004 and has done much to pioneer the flavoured milk coffee<br />
market.<br />
Its line of ready-to-drink chilled coffees Emmi CAFFÉ LATTE come in four<br />
flavours: Cappuccino, Skinny, Espresso Zero, Vanilla and Caramel.<br />
This range of flavours aims to satisfy a variation of strengths (intense,<br />
medium and mild) and different tastes in coffee (less sugar, low calorie,<br />
flavoured and decaf).<br />
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Its Espresso Zero version, which positions itself as a ‘no sugar added’<br />
and ‘no lactose’ alternative to its already well established drinks, was<br />
launched in 2015.<br />
#<br />
Figure 4-36<br />
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Figure 4-37: Emmi Caffé Latte Packaging Evolution<br />
Emmi Caffe Latte has been available in the market since 2004. Like<br />
Starbucks, they utilise a cup format for their small portion sizes of around<br />
230ml – plastic has proved an attractive packaging material for their<br />
distinctive cup format. The packaging design hasn’t changed much from the<br />
original launch, but they did re-brand slightly once they had launched more<br />
flavours to give more standout to the brand name and colour differentiation.<br />
They recently launched a more convenient UHT bottle format, differentiating<br />
them from their rivals.<br />
#<br />
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Figure 4-38: Emmi Caffé Latte Advertising<br />
The advertising for Emmi is primarily aimed at young, cosmopolitan women<br />
and plays on the escapist ritual of indulging in coffee. The advertising<br />
focused primarily on print advertising in the early days but now utilises social<br />
media and filmography to increase brand awareness and encourage<br />
consumer engagement.<br />
4.13 Confectionary and Dessert <strong>Flavoured</strong> <strong>Milk</strong><br />
#<br />
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In essence, confectionery flavoured milk is traditional flavoured milk using<br />
flavour innovations and indulgent, often rich, textures. One of the key<br />
differences of this category is the occasion usage with confectionaryflavoured<br />
milk a creamy treat to be enjoyed every so often as opposed to<br />
being an everyday purchase. However, this definition is most likely limited<br />
and, as occurs with other categories, indulgence can be an everyday<br />
purchase. For example:<br />
•#<br />
•#<br />
Mars has launched their most popular confectionary products as<br />
flavoured milk: Starburst, Galaxy, Skittles, Mars Bar.<br />
Mars has also developed products that could easily be placed in the<br />
alternative or functional drink category: Mars Refuel with added protein<br />
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#<br />
and packaged with the sports for the functional category, or Mars<br />
flavoured milk without lactose in the alternative milk category.<br />
This segment holds many possibilities for innovation. As mentioned in<br />
Chapter 3, this is the most straightforward category in which to innovate<br />
because opportunity lies in translating popular confectionary, dessert or<br />
pudding flavours into flavoured milk, accompanied by a smooth, creamy and<br />
‘decadent’ texture:<br />
•#<br />
Sticky toffee pudding, white chocolate, rocky road, millionaire’s<br />
shortbread and carrot cake<br />
To<br />
are<br />
Gain<br />
just a<br />
Access<br />
few examples.<br />
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<strong>Report</strong> Now<br />
#<br />
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#<br />
4.14 Mars<br />
Product variants: Confectionary and functional drinks<br />
NPD: Mars <strong>Milk</strong> High-Protein and Mars Lactose-Free<br />
Target consumers: Endurance athletes, sports<br />
participants and active children<br />
Mars Chocolate Drinks and Treats Europe has launched a range of milk<br />
drinks that represent the leading confectionary brands they own: Mars, Mars<br />
Caramel, Galaxy, Bounty, <strong>Milk</strong>y Way, Starburst Snickers, Skittles, Maltesers,<br />
Galaxy Caramel, Galaxy Mocha Latte and M&M’s Peanuts.<br />
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In 2015 Mars launched a higher protein version of their Mars milk drink and,<br />
in June, they launched their lactose-free variant.<br />
#<br />
Figure 4-39<br />
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#<br />
Figure 4-40: Mars Packaging Evolution<br />
Mars milkshakes have been available for over 13 years. While the branding<br />
has remained largely the same since its launch, the range of formats has<br />
diversified to cater to a wide range of consumers. The rebranding to ‘Refuel’<br />
and the launch of the sports cap format in 2007 was a step towards<br />
appealing as an on-the-go product for active children and teenagers, rather<br />
than an indulgent treat for home. The addition of the milk splash in 2011 was<br />
another step towards appearing as more wholesome and natural.<br />
The launch of the lactose-free variant in 2015 was a move to capitalise on the<br />
growing market for free-from products in the <strong>UK</strong> and a way of boosting the<br />
health perception of the brand.<br />
#<br />
#<br />
#<br />
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Figure 4-41: Mars Advertising<br />
Mars unveiled their first TV advertisement for the Mars <strong>Milk</strong> brand in 2009<br />
with the focus on promoting the creamy quality of the drinks, since then they<br />
have gathered a loyal following on social media and now utilise these<br />
platforms as a way to engage and interact with consumers. They run<br />
competitions and giveaways and use the pages as a way of promoting new<br />
products such as Mars Caramel or Mars High Protein.<br />
#<br />
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#<br />
4.15 Gü<br />
Turnover: £63.03 million<br />
Growth Sales: 2014: 124.32%<br />
Product variants: Confectionary and traditional flavoured milk<br />
NPD: Salted Caramel Flavour Hot Chocolate<br />
Target consumers: More affluent, indulgence orientated<br />
consumer.<br />
Gu is a dessert brand which has expanded into the flavoured milk arena. The<br />
product is made under licence in Crediton dairy with fresh milk. It is a<br />
relatively innovative product - unlike other flavoured milks on the market, it is<br />
meant to be served warm rather than being an on-the-go proposition, which<br />
many other brands are focused To on. Gain There Access would appear to be a gap in the<br />
market for this but it is still Purchase very new to market, The Full so it is unclear how<br />
consumers will react to reheating a ready-made flavoured milk.<br />
<strong>Report</strong> Now<br />
With the <strong>UK</strong> hot chocolate category dominated by powders, there has been<br />
successful innovation with hot chocolate spoons which allow chocolate to be<br />
melted in hot water. This demonstrates the willingness of consumers to try<br />
new products in this category. The Gu product is clearly aimed at adults as<br />
an indulgent treat with the premium black packaging and the relatively high<br />
chocolate content in the formulation.<br />
#<br />
Figure 4-42<br />
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#<br />
4.16 Breakfast Ready-To-Drink <strong>Milk</strong><br />
With the increasingly hectic lifestyles of <strong>UK</strong> consumers, on-the-go breakfast<br />
propositions have been growing in popularity. This desire for convenience<br />
was exemplified by the breakfast biscuit category which saw rapid growth<br />
from 2010 when Belvita Breakfast was launched. As consumers began to<br />
realise that these breakfast biscuit products are not as healthy as they<br />
appear, sales started to decline and only a considerable amount of<br />
innovation has kept sales going. Protein drinks have since entered the <strong>UK</strong><br />
market as an on-the-go breakfast To Gain alternative Access which is both more satiating<br />
and nutritious than many other options available on the market.<br />
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This category is still in its infancy with Weetabix and Fuel the main brands<br />
available until the Australian brand, Up & Go, entered the market in 2015 with<br />
a large advertising and media spend.<br />
#<br />
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4.17 Weetabix<br />
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#<br />
Weetabix Turnover 2014: £352bn<br />
Sales growth: Purchase -3.91% The Full<br />
Product Variants: Breakfast<br />
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NPD: Weetabix On-The-Go Protein<br />
Target consumers: Slimmers, children, professionals<br />
and commuters<br />
•#<br />
•#<br />
•#<br />
•#<br />
•#<br />
The Weetabix Food Company, founded in 1932, became a subsidiary of<br />
Bright Food Group Co. Limited in 2003 and in 2015 also became partially<br />
owned by Baring Private Equity Asia.<br />
The company launched Weetabix on-the-go Breakfast Drink in 2013 - a<br />
ready-to-drink product that intends<br />
To Gain<br />
to replace<br />
Access<br />
breakfast with a<br />
combination of protein, carbohydrates Purchase and The fibre. Full<br />
The company emphasises the <strong>Report</strong> drink’s convenience: Now “chill it, drink it, bin it<br />
and get on with your day”.<br />
The product is available in four flavours: Chocolate, Strawberry, Vanilla<br />
and Banana.<br />
In response to the high-protein trend, Weetabix launched a high protein<br />
variant in July 2015. This comes in three flavours: Strawberry &<br />
Raspberry, Blueberry & Blackberry and Vanilla.<br />
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Figure 4-44: Weetabix Packaging Evolution<br />
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Since its launch in 2014, the packaging for the traditional product has<br />
remained the same. With its fairly generic, inoffensive branding which<br />
capitalises on its well known brand logo and style, it aims to appeal to all<br />
ages and, with a 250ml bottle size, it is suitable for most consumers. The<br />
protein product launched in 2015 uses the silver packaging as a functional<br />
drink category cue to stand out on shelf as being more premium, with added<br />
benefits.<br />
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Figure 4-45: Weetabix Advertising<br />
The launch of Weetabix Breakfast drink was accompanied by a £5m<br />
marketing push, focusing on outdoor, online and digital activation. The<br />
television advertising focuses on targeting the busy on-the-go professionals<br />
who are so busy they lack the time for a traditional breakfast meal occasion.<br />
The strapline reads “a proper breakfast. Bottled” which helps to push the<br />
drinks convenience credentials and health benefits.<br />
#<br />
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4.18 Fuel 10K<br />
Fuel 10K Liquid Breakfast is available in 5 flavours: Banana, Caffé Latte,<br />
Chocolate, Strawberry and Vanilla. Each Tetra Pak 330ml unit has<br />
approximately 241 calories with 5.3g of fibre and 20g of protein. The sugar<br />
level is 25g per unit.<br />
Turnover 2014: £352,064,000<br />
Growth Sales: -3.91%<br />
Product Variants: Breakfast<br />
NPD: Strawberry, Chocolate and Banana<br />
Target To Gain consumers: Access Males, on-the-go<br />
professionals, active consumers.<br />
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Figure 4-46: Fuel 10K Packaging Evolution<br />
The # Fuel branding is bold and masculine and has not changed since its<br />
launch. The use of black helps the bottles to stand out amongst competitors<br />
who typically use less bold colours. The brand name is clear and the image<br />
of the eye is attention grabbing and will capture consumers curiosity as it is a<br />
very different route to take for a breakfast drink brand. Fuel uses clear colour<br />
differentiation across the range. It has retained the single serve Tetra Prisma<br />
pack format which allows it to stand To Gain out from Access competition and fit in with the<br />
rest of the cereal aisle where it is placed.<br />
4.19 Alternative <strong>Flavoured</strong> <strong>Milk</strong><br />
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The lactose free market has seen significant growth in recent years as more<br />
consumers look to plant alternatives to cows milk for the health benefits and<br />
the taste. Dairy alternatives come in many varieties e.g. hazelnut, coconut,<br />
soy, hemp, oat, rice etc. and each has its own specific nutritional benefits.<br />
According to Alpro, over 4.7m households buy plant-based food and drink<br />
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regularly. Part of this growth has been down to plant-based foods moving<br />
away from a core audience of vegans and towards mainstream consumers<br />
looking for healthy, innovative products. Appeal to mainstream consumers<br />
has been helped by extensive innovation in the category with products<br />
moving on from soy milk offerings to various nut-based drinks and yogurts.<br />
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Figure 4-47: Alternative (coconut, oat, soy and almond)<br />
Figure 4-48: Lactose-free<br />
#<br />
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4.20 Dairy Alternative Comparison<br />
Dairy<br />
Alternative<br />
Soy<br />
Almond<br />
#<br />
Hazelnut<br />
Overview Benefits Drawbacks Key<br />
Brands<br />
Produced •# - Same •#<br />
Alpro,<br />
by soaking protein<br />
Vitasoy,<br />
dried content as<br />
Provamel<br />
soybeans cows milk.<br />
•#<br />
Sweet, nutty<br />
taste. In<br />
October<br />
2015,<br />
Waitrose<br />
announced<br />
Almond milk<br />
had<br />
overtaken<br />
soya as its<br />
customers<br />
preferred<br />
dairy<br />
alternative.<br />
Smooth an<br />
creamy with<br />
rich<br />
-Little<br />
saturated fat.<br />
- No lactose<br />
-Many are<br />
fortified to<br />
contain<br />
calcium and<br />
minerals<br />
-Contains<br />
isoflavones<br />
which may<br />
help prevent<br />
heart disease.<br />
•#<br />
-Nearly as<br />
much protein<br />
as dairy milk<br />
-Little/no<br />
saturated fat<br />
-Almonds are<br />
high in<br />
vitamins,<br />
minerals,<br />
protein,<br />
healthy fats<br />
and fibre.<br />
•#<br />
-Soy is high in<br />
phytoestrogen<br />
s which can<br />
activate the<br />
body’s<br />
estrogen<br />
receptors. -<br />
Studies have<br />
been varied<br />
with some<br />
showing soy<br />
consumption<br />
influencing<br />
serum<br />
estrogen<br />
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-Low in<br />
saturated fat.<br />
-Contains<br />
levels (Nagata<br />
et al., 2001).<br />
-Curdles in<br />
Coffee.<br />
-According to<br />
USDA, 94% of<br />
US soy crops<br />
are GM.<br />
-Production<br />
needs vast<br />
volumes of<br />
water.<br />
-Many almond<br />
milks contain<br />
around 2%<br />
almond with<br />
water and<br />
sugar the two<br />
main<br />
ingredients.<br />
-Protein<br />
content much<br />
lower than<br />
cows’ milk.<br />
-Around 2.5%<br />
hazelnut with<br />
water and<br />
Almond<br />
Breeze,<br />
Rude<br />
Health,<br />
Eco Mill,<br />
Alpro,<br />
Provamel<br />
Alpro<br />
<strong>Flavoured</strong><br />
Products<br />
Alpro Soya<br />
Chocolate/<br />
Vanilla/<br />
Strawberry<br />
Eco Mill<br />
almond<br />
milk<br />
sweetened<br />
with<br />
agave,<br />
cacoa or<br />
vanilla,<br />
Alpro<br />
Almond –<br />
Dark<br />
Chocolate<br />
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#<br />
Rice<br />
Coconut<br />
#<br />
Hemp<br />
hazelnut<br />
taste<br />
Watery<br />
consistency<br />
with sweet<br />
taste<br />
Light with<br />
delicate<br />
coconut<br />
flavour<br />
Mild, slightly<br />
sweet taste<br />
vitamin E.<br />
-Little natural<br />
fat<br />
-No<br />
cholesterol<br />
-Rich in<br />
antioxidants<br />
and nutrients<br />
including<br />
Vitamins B, C<br />
and E,<br />
magnesium,<br />
phosphorus,<br />
iron and<br />
potassium.<br />
-Around half<br />
of the fat is<br />
lauric acid<br />
which is a<br />
medium chain<br />
fatty acid<br />
(MCFA). Some<br />
studies have<br />
shown MCFAs<br />
promote<br />
weight loss. 1<br />
-Fortified with<br />
calcium and<br />
Vitamin D.<br />
-Good<br />
alternatives if<br />
allergic to<br />
sugar the two<br />
main<br />
ingredients.<br />
-According to<br />
the<br />
Environmental<br />
Working<br />
Group, arsenic<br />
levels in rice<br />
milk frequently<br />
surpass the<br />
maximum limit<br />
allowed in<br />
drinking water.<br />
-Minimal<br />
calcium or<br />
protein<br />
-More<br />
carbohydrates<br />
than animal<br />
milk<br />
-Higher in<br />
saturated fat<br />
and lower<br />
protein than<br />
other<br />
alternatives<br />
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-Separates in<br />
coffee<br />
-The<br />
hallucinogenic<br />
reputation of<br />
hemp<br />
Rice<br />
Dream,<br />
Rude<br />
Health<br />
Alpro,<br />
Koko Diary<br />
Free,<br />
Coconut<br />
Dream,<br />
Rebel<br />
Kitchen,<br />
Chi<br />
Good<br />
Hemp<br />
Provamel<br />
Organic<br />
Rice,<br />
Coconut &<br />
Pineapple/<br />
Chocolate<br />
Rebel<br />
Kitchen<br />
Chocolat/<br />
Chai Mylk,<br />
Alpro<br />
Almond<br />
Coconut<br />
<strong>Milk</strong><br />
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Oat<br />
Creamy,<br />
thin<br />
consistency<br />
and<br />
naturally<br />
sweet<br />
dairy and nuts<br />
-Rich in<br />
protein,<br />
magnesium<br />
and contains<br />
omega-3 and<br />
6.<br />
-Low in<br />
saturated fat,<br />
enriched with<br />
vitamins and<br />
calcium, high<br />
in fibre and<br />
iron.<br />
-Good<br />
alternatives if<br />
allergic to<br />
dairy and nuts<br />
distracts from<br />
the health<br />
benefits.<br />
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-Contains<br />
more sugar<br />
and is higher<br />
in calories<br />
than some of<br />
the other<br />
milks.<br />
Oatly,<br />
Alpro, Oat<br />
Dream,<br />
Provitamil<br />
Oatly<br />
Chocolate<br />
With the rapid growth of the dairy alternative market, flavoured products<br />
have naturally followed on from this. While only really chocolate flavoured<br />
products have reached the mainstream market with Alpro’s almond, soya<br />
and hazelnut offerings, there are a small number of products with innovative<br />
flavour combinations such as coconut & pineapple. There is clearly room for<br />
more flavour NPD, though the difficulty lies in combining dairy alternatives<br />
with their own distinct flavour profiles with other flavours which may not<br />
blend together well.<br />
4.21 Alpro<br />
#<br />
Alpro Turnover 2014: €385m<br />
Employees in 2014/2015: 910/1150<br />
EU Dairy Market To Gain Share Access 2014: 3.5%<br />
Plant-based Purchase Market Share The 2015: Full 43.3%<br />
Target consumers: Vegans, weight conscious, health<br />
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aware<br />
Product Variants: Soy, Almond, Hazelnut, Coconut, Rice<br />
Alpro is a company founded in 1973. Based on the premise that cows<br />
consume feed that includes soy, they aimed to shorten the production<br />
process by creating a type of ‘milk’ directly based on soy. When soy milk<br />
was developed, other ingredients were added to the product, thus allowing<br />
the production of vanilla flavoured soy milk, vanilla custard and cherry<br />
yoghurt ‘kirsche’.<br />
Alpro is a company known for its sustainability. They were able to reduce<br />
their carbon footprint by 50% between 2008 and 2013 thanks to increased<br />
energy efficiency in their factories.<br />
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Alpro have also succeeded commercially by being in the right place in the<br />
category at the right time with sales growth of 70% since 2012 and broad<br />
expansion in the plant based foods segment. In 2014 they were listed in The<br />
Grocer’s list of Britain’s 100 Biggest Grocery Brands at number 100 and by<br />
2015 they were the second-largest brand in the <strong>UK</strong> milk category.<br />
In 2013, Alpro launched its first flavoured nut drink – Alpro Almond Dark<br />
Chocolate drink. It has since launched a coconut chocolate drink.<br />
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Figure 4-49: Alpro Packaging Evolution<br />
Alpro launched their alternative brand in 1980 focusing on the soya<br />
credentials, with a soya bean incorporated into their logo. In recent years,<br />
alternative drinks have become increasingly popular with a variety of flavour<br />
#<br />
variants. Alpro has kept up with these new trends and launched their<br />
competing flavour variants i.e. hzlenut, coconut and chocolate. The emphasis<br />
moving away from soya and becoming more about the goodness of ‘plant<br />
power’. Alpro therefore rebranded their logo and packaging and removed the<br />
references to soya and the soya To bean Gain and Access replaced it with the image of a sun<br />
and the strapline “enjoy plant Purchase power” to reposition The Full the brand as a plant<br />
based dairy-free brand with an abundance of flavours.<br />
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Key consumer groups for Alpro are those looking to manage their weight with<br />
lower calorie alternatives to cows milk, those looking to avoid lactose for<br />
digestive issues and individuals concerned about the environmental or<br />
animal welfare implications of dairy farming as well as general health aware<br />
consumers wanting to try something new. Their repositioning from a soya<br />
milk brand to a general dairy alternative brand has helped them appeal to a<br />
wider range of consumers with their other products in their range. They were<br />
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able to capitalise on growing consumer awareness of almonds and coconuts<br />
as superfoods and this has certainly helped them grow. With their clean,<br />
neutral packaging they are conferring a naturally healthy product and are<br />
appealing to a broad range of consumers.<br />
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Figure 4 – 50: Alpro Advertising<br />
Alpro’s advertising is heavily skewed towards females with a broad age<br />
spread as this is their primary audience. The recent collaboration with<br />
London Fashion Week and Women’s To Gain Health Access in particular has focused on<br />
appealing to younger women<br />
Purchase<br />
conscious of<br />
The<br />
their<br />
Full<br />
health and appearance.<br />
Through this they have aligned the brand with healthiness and beauty, in line<br />
with their core health and wellbeing <strong>Report</strong> message. NowAlpro focus on TV advertising<br />
campaigns, blogger campaigns, social media and print advertising to<br />
promote # the goodness of their products.<br />
4.22 Blue Diamond<br />
Turnover 2014: £75 million<br />
Number of people in the cooperative: 3,000 +<br />
Company age: 105<br />
Target consumers: To Gain Access Vegans, weight conscious, health<br />
aware<br />
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Most popular product: Almond milk<br />
Profit growth:<br />
<strong>Report</strong><br />
37%<br />
Now<br />
This almond-based company grows its raw material in California, where it is<br />
located. In the <strong>UK</strong>, the Blue Diamond stockists are Tesco, Sainsbury’s,<br />
Asda, Morrisons, Waitrose and Ocado.<br />
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Figure 4-51: Blue Diamond product developments<br />
Blue Diamond offered the <strong>UK</strong>’s first reduced sugar almond milk drink, further<br />
improving their health credentials To and Gain appealing Access to health aware consumers.<br />
While in the US they have expanded Purchase with a The Hint Full of Honey flavour, this is yet<br />
to make it to the <strong>UK</strong> market. In the<br />
<strong>Report</strong><br />
<strong>UK</strong> they<br />
Now<br />
launched a vanilla flavoured<br />
product, though this is their only flavoured product in the main retailers.<br />
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Figure 4 – 52: Blue Diamond Packaging Evolution<br />
The Almond Breeze range launched in 2012 with three flavour variants. The<br />
packaging is clear and clean and stands out on-shelf. The vibrant Americanstyle<br />
colours differentiate the range well and the focus of the ‘pouring’ image<br />
appeals to <strong>UK</strong> consumers. The brand and the packaging has remained<br />
unchanged since its launch in the <strong>UK</strong>.<br />
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Figure 4 – 53: Blue Diamond Advertising<br />
Blue Diamond focused their original marketing push on a TV advertising<br />
campaign that aired during a Coronation Street break. The campaign<br />
highlights the health credentials of Blue Diamond Almond Breeze with the<br />
strapline “Goodness is now gorgeous”. The TV advertising in 2014 also<br />
focused solely on the low calorie content of their products, attempting to<br />
appeal to a mainstream consumer audience of weight conscious consumers.<br />
#<br />
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#<br />
4.23 Summary<br />
•#<br />
•#<br />
•#<br />
•#<br />
•#<br />
•#<br />
•#<br />
•#<br />
•#<br />
Categories#are#transitioning#towards#the#low2sugar#or#high2protein#trend#<br />
Frijj#has#created#an#effective#sugar2reduced#version#with#40%#less#sugar#<br />
content.##<br />
Coffee,#confectionary#and#traditional#flavoured#milk#are#blurring#the#<br />
‘functional#drink’#category#line#with#added2protein.#<br />
Products#are#becoming#more#tailored#to#the#customers’#needs.#<br />
To Gain Access<br />
Lactose2free#variants#from#Mars.#<br />
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Variation#in#protein#content#from#For#Goodness#Shakes#to#target#specific#<br />
consumer#needs.#<br />
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Private2label#competition#is#strong#for#traditional#flavoured#milk#and#coffee#<br />
categories#<br />
Brands#have#more#non#own#label#market#space#in#the#alternative,#<br />
confectionary,#functional#and#breakfast#categories.##<br />
Retailers#have#created#competitive#variations#in#the#traditional#and#coffee#<br />
flavour#categories.##<br />
#<br />
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#<br />
5.! Merchandising and Pricing<br />
Currently, flavoured milk can be found in several locations in <strong>UK</strong><br />
supermarkets:<br />
•#<br />
•#<br />
•#<br />
•#<br />
•#<br />
•#<br />
•#<br />
•#<br />
#<br />
•#<br />
The Chilled Dairy Aisle: Traditional flavoured milk drinks, functional<br />
dairy drinks, confectionary drinks, coffee drinks and some dairy<br />
alternatives are often placed above white milk.<br />
The Cereal Aisle: Breakfast drinks are placed in the the on-the-go<br />
breakfast cereals section in the cereals aisle, near the on-the-go<br />
alternatives (i.e. pots of porridge). These are UHT shelf-stable products.<br />
Lunch Meal Deals: <strong>Flavoured</strong> milk is placed next to the lunch deals<br />
section at the front of the store. Coffee flavoured milk is the most popular<br />
alternative in this aisle.<br />
Promotional Areas: <strong>Flavoured</strong> milk, particularly coffee and traditional<br />
flavoured milk is placed in the promotions sections of supermarkets on<br />
aisle or gondola end. These can To be Gain themed Access around convenience (e.g.<br />
lunch deals) and occasion usage<br />
Purchase<br />
(breakfast<br />
The<br />
options).<br />
Full<br />
Specialised Dairy Fixture: <strong>Flavoured</strong> milk can, in some circumstances,<br />
also be placed in the dairy aisle near <strong>Report</strong> yoghurt, Now another dairy derivative<br />
preferred for high-protein content. In Tesco this is the ‘Active Health<br />
Fixture’.<br />
Health & Beauty: In some instances, sports nutrition and slimming drinks<br />
can be placed next to energy drinks in the ambient health & beauty<br />
section of the store.<br />
Ambient Drinks: It is also possible for some drinks, particularly sports<br />
nutrition drinks, to be placed alongside energy drinks in the ambient<br />
section.<br />
Ambient UHT Aisle: UHT dairy alternatives are often placed in their own<br />
section in the ambient aisles, typically in the tea & coffee aisle. Some<br />
ambient flavoured dairy milk can also be found in this aisle.<br />
Ethnic Foods: Nurishment Original cans can often be found in the<br />
ambient aisles alongside ethnic foods.<br />
The following schematics show where the various retailers place their<br />
products.<br />
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100
5.1 Tesco<br />
Tesco Chilled Dairy Aisle<br />
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Tesco Chilled Protein Aisle<br />
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#
Tesco Chilled Alternative Aisle<br />
#<br />
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#
Tesco Ambient Grocery – Cereals Aisle<br />
#<br />
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#
Tesco – Traditional <strong>Flavoured</strong> <strong>Milk</strong> Prices 2015<br />
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#<br />
105<br />
<strong>UK</strong>#FLAVOURED#MILK#<strong>2016</strong>217#<br />
#
Tesco – Coffee and Breakfast <strong>Flavoured</strong> <strong>Milk</strong> Prices 2015<br />
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#<br />
106<br />
<strong>UK</strong>#FLAVOURED#MILK#<strong>2016</strong>217#<br />
#
Tesco – Functional/Protein <strong>Flavoured</strong> <strong>Milk</strong> Prices 2015<br />
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#<br />
107<br />
<strong>UK</strong>#FLAVOURED#MILK#<strong>2016</strong>217#<br />
#
Tesco – Confectionary and Alternative <strong>Flavoured</strong> <strong>Milk</strong> Prices 2015<br />
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#
5.2 Sainsbury’s<br />
Sainsbury’s Chilled Dairy Aisle<br />
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ASDA Chilled Dairy Aisle<br />
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5.4! Morrisons<br />
Morrisons Chilled Dairy Aisle<br />
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5.5 Waitrose<br />
Waitrose Chilled Dairy Aisle<br />
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5.6 Co-op<br />
Co-op Chilled Dairy Aisle<br />
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6.! The Future of the Market<br />
There are various political, technological, social and environmental factors<br />
set to impact the global flavoured milk market.<br />
In terms of political factors, the removal of EU milk quotas has already had<br />
an impact on milk production and is restraining dairy commodity prices as a<br />
consequence of global oversupply. The performance of the wider dairy<br />
market clearly has a significant impact on the flavoured milk market and<br />
currently means flavoured milk is a particularly attractive opportunity to add<br />
value back into dairy. The abolition of the one child policy is another factor<br />
likely to have an impact on the global flavoured milk market. With an<br />
impending rise in the number of children in China, this represents a<br />
significant opportunity for the dairy market as a whole but in the flavoured<br />
milk market in particular. Other political factors more relevant to the <strong>UK</strong><br />
specifically are a potential exit from the EU and the possibility of a sugar tax.<br />
In terms of technological impacts, the development of alternative sweeteners<br />
without the negative associations To Gain of some Access artificial ingredients also signifies<br />
an important development for Purchase the flavoured The milk Full market. Looking at the <strong>UK</strong><br />
specifically, another factor which<br />
<strong>Report</strong><br />
has a substantial<br />
Now<br />
impact on the market is<br />
the facilities available in the country. Currently there is a lack of contract<br />
manufacturers able to produce flavoured milk in UHT plastic bottles, hence<br />
the majority of UHT products being produced on the continent.<br />
There are various social factors likely to impact on the demand for flavoured<br />
milk in general and which will also determine how additional value can be<br />
added to flavoured milk products. Growing support for British farmers has<br />
already impacted how consumers purchase within the white milk market with<br />
the <strong>Milk</strong> for Farmers brand performing well. An ageing population is another<br />
important factor to be considered by all food and drink brands as consumer<br />
needs change. An increase in hectic lifestyles and a growing interest in plant<br />
based diets are both factors which have already impacted the food and drink<br />
market with on-the-go propositions and dairy alternatives both seeing good<br />
growth.<br />
In terms of environmental considerations, a tax on carbon emissions<br />
associated with animal derived products is another factor likely to have an<br />
impact on the flavoured milk market.
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6.1 PEST Analysis<br />
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6.2 Potential Sugar Tax<br />
Of all the future challenges, sugar is the most significant issue that the<br />
flavoured milk industry will have to deal with over the next decade:<br />
•#<br />
•#<br />
•#<br />
•#<br />
•#<br />
•#<br />
•#<br />
•#<br />
#<br />
As#flavoured#milk#is#essentially#a#beverage#comprised#of#milk,#sugar#and#<br />
flavourings,#sugar#is#an#integral#part#of#the#flavoured#milk#product.###<br />
Simon#Steven#the#boss#of#NHS#England#suggested#in#January#<strong>2016</strong>#that#a#<br />
sugar#tax#of#10%#to#20%#could#be#effective#in#saving#lives.#<br />
##<br />
Boris#Johnson#proposed#a#tax#on#“fizzy#drinks’#in#London#in#Autumn#2015.#<br />
Downing#Street#has#sent#mixed#messages#about#the#introduction#of#a#tax#so#it#<br />
is#unclear#if#this#will#become#a#reality,#but#other#measures#seem#likely#to#come#<br />
into#effect.##It#would#seem#to#be#a#matter#of#time#before#the#flavoured#milk#<br />
market#needs#to#come#to#terms#with#the#imposition#of#a#“tax”#of#some#<br />
description.##<br />
A#British#Medical#Journal#Study#shows#that#a#sugary#drink#tax#in#Mexico#led#to#<br />
a#12%#increase#in#sales#of#untaxed#(no#sugar)#drinks#after#one#year.##<br />
Over#the#past#30#to#40#years,#food#has#become#more#readily#available,#more#<br />
marketed,#promoted/advertised#and,#in#real#terms,#is#much#cheaper.##<br />
Obesity2related#health#issues#are#costing#the#NHS#approximately#£5.1#billion#<br />
each#year#and#sugar#is#a#prime#concern#for#this#epidemic.##In#2015,#in#<br />
England,#25%#of#adults,#10%#of#4#to#5#year#olds#and#19%#of#10#to#11#year#olds#<br />
were#obese.#<br />
Cancer#Research#warned#in#January#<strong>2016</strong>#that#700,000#more#people#could#<br />
develop#cancer#in#the#next#20#years#due#to#obesity.##<br />
•# The#sugar#debate#has#been#on2going#for#the#past#decade#but#a#report#<br />
published#in#October#2015#by#Public#Health#<strong>UK</strong>#sparked#further#controversy#<br />
amongst:##the#Government,#consumers,#the#food#and#drink#industry,#charities#<br />
and#political#parties.###<br />
#<br />
•# This#paper#will#explore#the#history,#issues#and#possible#solutions#to#this#<br />
problem#and#pull#out#the#implications#for#flavoured#milk#brands.###<br />
“We$need$to$look$at$(sugar)$in$the$same$<br />
#<br />
way$that$in$the$past$we$looked$at$the$<br />
dangers$of$smoking.”$<br />
$<br />
Rt#Honorable#David#Cameron,#Prime#Minister#<br />
of#the#United#Kingdom.#7 th #January#<strong>2016</strong>.#<br />
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6.3 A short history of sugar and flavoured milk (1933-<strong>2016</strong>)<br />
Figure 6-1: <strong>Milk</strong> and sweeteners. Key events 1993 - <strong>2016</strong><br />
•#<br />
•#<br />
#<br />
•#<br />
•#<br />
<strong>Flavoured</strong> <strong>Milk</strong> in the <strong>UK</strong> has a history that dates back to the first half of<br />
the Twentieth Century.<br />
Sweeteners with low glycemic index values have been on the market for<br />
over half a century, however they have not been adopted by the flavoured<br />
milk industry in any meaningful way.<br />
The questioning of the role of sugar can be traced back to John Yudkin’s<br />
seminal 1972 book, “Pure, Whole and Deadly.”<br />
The earliest diet drink was Diet Rite in 1962, but flavoured milk has been<br />
slow to embrace the lower sugar theme, in contrast to soft carbonated<br />
drinks.<br />
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6.4 The Sugar Debate in the <strong>UK</strong><br />
#<br />
Figure 6-2: Understanding the <strong>2016</strong> sugar debate in the <strong>UK</strong><br />
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6.5 The Current Situation on <strong>UK</strong> Sugar Consumption<br />
Non-<strong>Milk</strong> Extrinsic Sugar (NMES)<br />
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Figure 6-3: Understanding the difference between intrinsic and extrinsic<br />
sugars<br />
Most of the debate focuses on the effects of what is called "extrinsic” sugars<br />
(NMES) with some analysts making a distinction between ‘good’ sugars and<br />
‘bad’ sugars in the same way there are ‘good’ and ‘bad’ fats described.<br />
a)! Historic annual per capita consumption of NMES in the <strong>UK</strong> (1704-<br />
2012)<br />
#<br />
Figure 6-4: Historic annual per capita consumption of NMES sugars in<br />
the <strong>UK</strong> (kgs) – 1704 to 2012<br />
•#<br />
•#<br />
Since the Victorian era, annual per capita consumption of NMES<br />
sugars in the <strong>UK</strong> has been rising, reaching a peak in the 1970s.<br />
Since 1996, efforts in product reformulation have led to a decrease of<br />
annual per capita consumption of NMES.<br />
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•#<br />
Still, annual per capita consumption of NMES continues to be higher<br />
than the recommended daily average for most <strong>UK</strong> adults and children.<br />
b)! Non-milk extrinsic sugars (NMES) by gender and age group<br />
Figure 6-5: Non-milk extrinsic sugar annual per capita consumption<br />
(kgs), National Diet and Nutrition Survey, rolling programme 2008-2012<br />
Figure 6-6: Children 1.5-3 years of<br />
#<br />
age<br />
Figure 6-7: Children 4-10 years of<br />
age<br />
Figure 6-8: Teenagers 11-18 years<br />
of age<br />
Figure 6-9: Adults 19-64 years of<br />
age<br />
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Figure 6-10: Adults over 65 years of<br />
age<br />
•# The age group that consumes the most sugar is teenagers (11 to 18<br />
years of age).<br />
•# In this category, teenage boys generally consume significantly more<br />
than teenage girls. This difference is also reflected in adults where<br />
men consume more sugar than women.<br />
c)! Sources of NMES according to age group, National Diet and Nutrition<br />
Survey, rolling programme 2008-2012<br />
•#<br />
•#<br />
•#<br />
The age group that consumes the most sugar derived from milk<br />
products (including flavoured milk) is children between the ages of 1 to<br />
3 with 19% of sugar from this source.<br />
The second group that consumes the most sugar from these products<br />
is children between the ages of 4 to 10 where 14% of sugar comes<br />
from dairy sources.<br />
The group that consumes the least amount of sugar from milk<br />
products is adults with 8% of NMES coming from milk products.<br />
#<br />
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d)! Comparative sugar content of sweetened drinks<br />
#<br />
Figure 6-11: The comparative sugar content of soft drinks, flavoured milk<br />
and cordials<br />
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•#<br />
•#<br />
There is a wide variation of sugar levels within flavoured milk.<br />
Whilst carbonates contain the highest levels of sugar, it is obvious why<br />
flavoured milk brands have become targets for sugar campaigners<br />
with sugar volumes closely behind.<br />
e)! <strong>Flavoured</strong> milk sugar content<br />
We have selected the market’s bestsellers and profiled the sugar content for<br />
the whole bottle (as it is usually the amount consumed in one sitting).<br />
Items are organized in descending order with the items on the left containing<br />
the highest amounts of sugar.<br />
HRA Power<br />
Categories<br />
#<br />
Figure 6-11: The sugar content of flavoured milk<br />
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Coffee milk has the lowest sugar level the reflecting the smaller<br />
serving sizes and the strength of coffee as a flavour in an adult<br />
indulgence drink.<br />
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6.6 Public Health Policies<br />
Government and health bodies in the <strong>UK</strong> are looking at a variety of<br />
statutory and voluntary interventions, all of which could impact on<br />
the flavoured milk market.<br />
a)! Suggested Actions On Sugar<br />
#<br />
Figure 6-12: Public Health <strong>UK</strong><br />
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6.7 Arguments for and against a sugar tax<br />
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Figure 6-13: Arguments for and against a sugar tax<br />
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6.8 Evaluating a sugar tax<br />
The introduction of a food tax can change the consumer’s behaviour. As is<br />
intuitive, the rise in the price of a product predicts a fall in demand. Even if<br />
the change in behaviour is small, it is significant in terms of health. There<br />
have been, however, multiple responses to the introduction of sugar levies in<br />
different parts of the world:<br />
#<br />
Figure 6-14: Sugar tax experiences from other countries<br />
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6.9!What measures will affect flavoured milk?<br />
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There is some debate as to whether flavoured milk could escape a tax.<br />
Recently, Boris Johnson’s focus on taxing “fizzy drinks’ seemed to focus on<br />
carbonated soft drinks (CSD’s), rather than flavoured milk.<br />
In addition, Tam Fry of the National Health Obesity forum provides a helpful<br />
clarification. Speaking in January <strong>2016</strong> he said “The suggestion of a sugar<br />
tax was incorrect. We are talking about a tax on sugary drinks which are<br />
without nutrition and injurious. It would be wrong to tax sugar in foodstuffs as<br />
that would hit the poor hardest”. However, if flavoured milk is included,<br />
these are likely actions:<br />
•#<br />
•#<br />
•#<br />
•#<br />
Reduction of promotions in all retail outlets including supermarkets and<br />
convenience stores and the out of home sector (including restaurants,<br />
cafes and takeaways).<br />
Introduction of a price increase of a minimum 10-20% on high sugar<br />
products.<br />
Transitioning to a lower sugar content profile in everyday food and drink<br />
products.<br />
Decrease in marketing and advertisement of high sugar food and drink<br />
products to children and adults across all media including digital<br />
platforms and through sponsorship.<br />
a)! The effect of a sugar tax on the future flavoured milk market<br />
Although there is general consent agreement that the taxation of sugar<br />
sweetened beverages will lead to a decline in consumption, a substitution<br />
effect must also be considered. That is, the consumer preference for a<br />
similar unhealthy product over the “levied” (taxed) product, e.g. flavoured<br />
milk drinks. Simply, customers could go elsewhere in the store for their sugar<br />
“fix” # rather than flavoured milk.<br />
We have projected the <strong>UK</strong> flavoured milk market growth until 2022 under<br />
current conditions. We expect steady growth. For this modelling we assume<br />
a 20% tax on sugary drinks will be introduced in 2019, having been<br />
announced in <strong>2017</strong>.<br />
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)! Modelling the introduction of a sugar tax<br />
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#<br />
•#<br />
#<br />
•#<br />
•#<br />
The graph shows a peak in volume sales leading up to the imposition of<br />
the tax. This is because retailers are likely to try and sell as many units as<br />
possible of sugar-sweetened flavoured milk drinks before the tax arrives.<br />
Then, there will be a general decrease in volume sales as the price is<br />
higher.<br />
Due to product innovation, population growth and rising milk production,<br />
we expect both consumers and producers to adapt and the flavoured<br />
milk market to continue to rise.<br />
Our belief is that the flavoured milk market will respond to the threat of a<br />
tax with significant “low” and “no” sugar product innovation. However,<br />
any tax will have a short/medium term impact on sales, before in the<br />
longer term the market resumes its upward growth curve.<br />
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c)! Alternative sweeteners<br />
Figure 6-15: Comparing different types of sweeteners<br />
d)! How can flavoured milk brands adapt?<br />
#<br />
#<br />
Figure 6-16: Brand Responses<br />
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#<br />
e)! Case study: Sugar-reduced Frijj<br />
Figure 6-16: Sugar-reduced Frijj is an example of successful<br />
reformulation<br />
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#<br />
6.10 Conclusion<br />
The sugar issue is not going away and with the Government sure to intervene<br />
in some way regarding sugar, brands need to engage with the issue now.<br />
The most flexible and proactive flavoured milk brands are taking action now<br />
and planning for the “new world”.<br />
Brands need to consider a variety of scenarios and chart the impact on the<br />
products, business model and strategy.<br />
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6.11 The Removal of EU <strong>Milk</strong> Quotas<br />
Figure 6-17: EU 28 <strong>Milk</strong> Production (million litres). Source: Dairy Co<br />
On 1 st April 2015, the long-standing EU milk quota system was lifted. In the<br />
long-term, predictions were made about redistribution of milk products in the<br />
<strong>UK</strong>, though no major changes were predicted for EU milk production.<br />
Total increase in production was forecasted at 1% for 2015/16. Since the<br />
quotas were removed, production levels have been higher than forecast and<br />
profits have declined for milk producers as milk prices have reached levels<br />
not observed since 2009 due to the weak demand and strong supply seen in<br />
the global commodity markets.<br />
As<br />
#<br />
observed in figure 6-19, EU production has generally been increasing<br />
year-on-year. This, combined with several factors that include the 2014<br />
Russian embargo on agricultural imports and subdued demand from China,<br />
has led to a decline in global demand and thus, on incomes for EU farmers.<br />
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#<br />
Figure 6-19: EU Total Dairy Exports (tonnes). Figures include WMP, SMP,<br />
condensed milk, butter & butteroil, cheese and whey. Source: Eurostat.<br />
As the global population continues to grow and incomes in Asia and Africa<br />
grow and demand for Western diets that include large amounts of dairy rise,<br />
the long-term prospects for dairy production remains positive. As seen in<br />
Figure 6-20, EU exports of dairy products are generally increasing. This is<br />
despite the Russian embargo in 2014 which restricted exports and in doing<br />
so helped the EU establish and grow trade relationships with other countries.<br />
6.12 Implications for <strong>Flavoured</strong> <strong>Milk</strong> Market<br />
According to the EU Commission, the low milk prices are expected to<br />
improve in <strong>2016</strong>, with the strengthening of the economy and a rise in internal<br />
demand for dairy. Here, lies an opportunity for flavoured milk.<br />
<strong>Flavoured</strong> milk is the ideal outlet for surplus milk as it is a high value product<br />
and # global demand is increasing, particularly in developing countries where<br />
milk imports are expected to grow. <strong>Flavoured</strong> milk producers should<br />
therefore focus on developing products targeted at these fast-growing<br />
economies where EU trade relationships are strong.<br />
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#<br />
6.13 Abolition of China’s One-Child Policy<br />
On October 29 th 2015, the abolition of China’s long withstanding one-child<br />
policy was announced. It is now possible for a family to have two-children if<br />
they wish.<br />
Initially, a rise in China’s birth rate is expected but according to several<br />
projections by demographers, the Chinese birth rate will not dramatically<br />
peak because Chinese women are more career-oriented today.<br />
The removal of the one-child policy in China does not necessarily translate<br />
into a higher birth rate, since birth rates in China had been declining before<br />
the abolition of that law and, in rural provinces, the policy was not strictly<br />
enforced.<br />
This is not to say that China will not remain as the world’s largest flavoured<br />
milk consumer and therefore will continue to be crucial to the development of<br />
the global category.<br />
For the <strong>UK</strong> flavoured milk market, this represents a key opportunity for<br />
export.<br />
#<br />
Figure 6-18: Examples of lactose-free alternatives in both the traditional<br />
and confectionary categories.<br />
The above products are examples of lactose-free products that fit with the<br />
Chinese lactose-free demand and offer an export ready UHT format.<br />
6.14 Environmental concerns<br />
The dairy and meat industry are known for being a source of relatively high<br />
carbon emissions.<br />
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#<br />
6.15 Tax on carbon emissions<br />
Figure 6-19<br />
According to the National Office of Statistics, total <strong>UK</strong> Greenhouse gas<br />
(GHG) emissions have been decreasing year-on-year. Despite this overall<br />
declining trend, emissions for the agricultural sector present a slightly more<br />
static pattern and in 2013 accounted for approximately 10% of GHG<br />
emissions. As Figure 1 shows, carbon dioxide emissions have remained<br />
almost constant while both nitrogen dioxide and methane have only<br />
marginally decreased.<br />
#<br />
Figure 6-20<br />
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#<br />
It is also important to consider that GHG emissions allocated to agriculture<br />
do not account for transport or other associated emissions. As the <strong>UK</strong><br />
Government website states:<br />
“end-user emissions do not take account of the emissions ’embedded’ within<br />
the manufactured goods and services which the <strong>UK</strong> imports and exports.”<br />
That is, the agricultural sector emissions figure does not entirely reflect its<br />
true GHG emissions and is estimated to be higher than shown, including<br />
additional CO 2 emissions produced by trade and transport.<br />
The production on animal derived foods typically is associated with higher<br />
GHG emissions than plant based foods. A study by Scarborough et al. (2014)<br />
examined the differences in dietary GHG emissions between meat-eaters,<br />
fish-eaters, vegetarians and vegans in the <strong>UK</strong>. They found that GHG<br />
emissions of meat-eaters were around twice as high as those for vegans.<br />
With the Climate Change Act 2008 committing to at least at least an 80% cut<br />
in GHG emissions by 2050 compared to a 1990 baseline, it is important for<br />
the agricultural industry to address high GHG emissions. While there is a<br />
voluntary initiative for the industry (GHGAP) which focuses on the uptake of<br />
more resource efficient practices to lower emissions, there has been talk of a<br />
carbon tax for agriculture. This will add additional costs to production for<br />
flavoured milk brands and is something producers should be aware of.<br />
6.16 Potential EU Exit<br />
In order to leave the EU, the <strong>UK</strong> will have to negotiate an agreement with the<br />
EU defining conditions of withdrawal and its future relationship. As these<br />
conditions have not yet been set out, it is difficult to fairly weigh up the<br />
benefits and drawbacks of staying in the EU. However, we have done so<br />
based on what we do know.<br />
#<br />
With the upcoming EU referendum To Gain expected Access to happen by the end of <strong>2017</strong>,<br />
the question of how an exit from Purchase the EU will The affect Full their industry in particular<br />
is a question many want answered. According to the FDF, the EU is the main<br />
<strong>Report</strong> Now<br />
trade partner for the <strong>UK</strong> with 73% of the <strong>UK</strong>’s agri-food exports going to<br />
other EU states. However, for dairy products in particular, the EU is even<br />
more important with 90% of <strong>UK</strong> dairy exports in 2015 destined for within the<br />
EU and 8 of the top 10 dairy destinations within the EU. In addition, dairy<br />
imports into the <strong>UK</strong> are almost exclusively from the EU which accounts for<br />
99.4% of dairy imports. Therefore, the EU is a crucial trade partner for the<br />
<strong>UK</strong>, but this is particularly the case for dairy.<br />
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#<br />
To Gain Access<br />
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Figure 6-23 Top 10 Destinations for <strong>UK</strong> Dairy Exports in 2015. Source:<br />
HMRC<br />
Arguments for Staying<br />
Arguments for Leaving<br />
Free movement of goods means the<br />
elimination of tariffs, border controls and<br />
established rules mean ease of trade<br />
between member states. With the EU the<br />
destination for 73% of the <strong>UK</strong>’s agri-food<br />
exports, minimal administrative burden is<br />
very helpful.<br />
The CAP provides support for farmers<br />
through helping them through periods of<br />
market # volatility where returns cannot be<br />
made from the market. Defra figures show<br />
55% of <strong>UK</strong> farming income comes from<br />
CAP support payments.<br />
The <strong>UK</strong> is entitled to a rebate which<br />
amounts to 66% of the difference between<br />
what it pays into the budget and what it<br />
gets back.<br />
To Gain Access<br />
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<strong>Report</strong> Now<br />
EU regulations can lead to high<br />
requirements for environmental<br />
legislation, labour rights and some animal<br />
welfare requirements. These requirements<br />
cannot be enforced on imported products<br />
so can lead to reduced EU global<br />
competitiveness.<br />
Switzerland and Norway’s versions of the<br />
CAP provide more support for farmers<br />
than the EU CAP does. Leaving could<br />
allow the <strong>UK</strong> to offer better support<br />
farmers.<br />
The <strong>UK</strong> pays in more money than it<br />
directly receives from the EU. In 2014 it<br />
contributed a net of £9.8bn, around 1.5%<br />
of total <strong>UK</strong> public expenditure.<br />
States in the EEA have to comply with EU<br />
environmental, food safety and veterinary<br />
legislation anyway to have the right to<br />
trade with the EU. Despite not being a<br />
member, Norway still contributes £106 per<br />
person to the EU compared to £153 by the<br />
If the <strong>UK</strong> were to contribute to the EU<br />
budget in a similar way to Norway, HM<br />
Treasury estimates <strong>UK</strong> contribution<br />
would fall by 30%.<br />
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#<br />
<strong>UK</strong>.<br />
Easy access to European labour market.<br />
The Framework Programme 7 (now<br />
Horizon 2020) is the EU’s research<br />
programme which provides funds for<br />
research into key technologies. The <strong>UK</strong><br />
has the second largest budget share of<br />
this after Germany.<br />
Leaving the EU and being in EFTA or EEA<br />
instead often means having to abide by<br />
many of the same rules and having to pay<br />
contributions without the power to shape<br />
them.<br />
If the <strong>UK</strong> does leave, relaxing high EU food<br />
standards to lower production costs will be<br />
difficult as exports to the EU will still need<br />
to meet these standards.<br />
EU trade agreements with the rest of the<br />
world increase the <strong>UK</strong>’s market access.<br />
This has certainly been influential in<br />
increasing the <strong>UK</strong>’s agri-food exports to<br />
international countries.<br />
6.17 Social<br />
Supporting British farmers<br />
#<br />
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The <strong>UK</strong> did trade successfully with<br />
Europe in the post-war period before<br />
entering the EU.<br />
Leaving the EU will likely result in a<br />
devaluation of Sterling for a sustained<br />
period. This would be overall good for <strong>UK</strong><br />
food and drink exports (though not<br />
imports).<br />
In recent years, the supermarket price wars using milk as a loss leading<br />
product has had a significant impact on farmers’ profitability through the<br />
devaluation of dairy. This has led to concerns for farmers welfare within<br />
sections of the <strong>UK</strong> population and this has been mostly clearly exemplified<br />
by Morrissons’ <strong>Milk</strong> for Farmers brand which allows customers to voluntarily<br />
pay a premium to pass back to dairy To Gain farmers. Access The following public outcry<br />
upon the realisation that this Purchase premium is The actually Full shared among Arla’s<br />
continental farmers as well rather than just their <strong>UK</strong> farmers as the packaging<br />
implies illustrates the public desire to<br />
<strong>Report</strong><br />
support ‘local’.<br />
Now<br />
This desire to support <strong>UK</strong> dairy farmers is closely linked to the growing trend<br />
for buying locally produced products. This trend has led to growth in<br />
popularity of farm shops and farmer’s markets. This rising popularity is<br />
perfectly illustrated by advertising from shops such as Lidl with their Lidl<br />
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#<br />
Surprises campaign which tries to align their low prices with farmer’s market<br />
quality.<br />
The driving factors behind local sourcing are often environmental and ethical<br />
considerations, including a desire for sustainable sourcing, reduced carbon<br />
emissions, supporting local communities, shorter supply chains with greater<br />
integrity and higher animal welfare standards.<br />
There is an opportunity for flavoured milk brands to capitalise on their British<br />
milk provenance. Daioni, with its Welsh organic milk, is a brand which does<br />
this effectively and is able To to Gain charge Access a premium for their provenance<br />
positioning. However, this opportunity Purchase is The limited Full mainly to fresh products due<br />
to the lack of <strong>UK</strong> contract manufacturing capability for UHT milk bottled<br />
<strong>Report</strong> Now<br />
drinks.<br />
In terms of whether there is a more specific opportunity for a flavoured milk<br />
product similar to the <strong>Milk</strong> for Farmers brand which promises better returns<br />
for farmers, this could be possible. In November 2015, Ash Amirahmadi, vice<br />
president of milk and member services at Arla <strong>UK</strong>, claimed that the brand is<br />
set to return £5m back to the farmers within its first year of sales. By<br />
February <strong>2016</strong>, Morrison’s claimed that the brand was surpassing its target<br />
sales. This demonstrates a clear willingness from consumers to voluntarily<br />
pay more for ethical reasons. There is little reason this could not also apply to<br />
flavoured milk. However, when milk prices start to rise again this concept will<br />
become fairly redundant. Furthermore, it has faced some criticism from those<br />
saying it is the retailers and processors responsibility to ensure their farmers<br />
are paid fairly.<br />
Ageing population<br />
With healthcare advances and consequent improvements in mortality rates,<br />
the <strong>UK</strong> population is ageing and is expected to continue to do so. Almost<br />
one in every six adults in the <strong>UK</strong> is 65 or over but by 2050 one in four will be.<br />
#<br />
The public’s perception of milk as a good supplement for the elderly<br />
population makes flavoured milk a prime opportunity to satisfy requirements<br />
for products which target their To specific Gain requirements. Access Specific relevant claims<br />
for elderly consumers include Purchase to help The maintain Full muscle mass, prevent<br />
cardiovascular disease, cognitive decline and bone and joint health.<br />
<strong>Report</strong> Now<br />
Elderly consumers have specific needs for vitamin D, vitamin K and calcium.<br />
Omega-3 is also of particular importance to older consumers as it can be<br />
protective against heart disease and can help prevent cognitive decline an<br />
improve immune function. Fortification of products with these nutrients could<br />
therefore help flavoured milk brands appeal to older consumers. Specific<br />
ingredients such as chia seeds, flaxseeds and walnuts which contain high<br />
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Hectic lifestyles<br />
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#<br />
levels of omega-3 could be used in formulations to satisfy these<br />
requirements in a natural way.<br />
With age, there is a notable decline in muscle and an increase in fat tissue,<br />
thereby leading to a decrease in basal metabolic rate. It is therefore<br />
important for elderly consumers, especially those suffering an illness, to<br />
consume adequate levels of protein. Whey is a high quality protein containing<br />
the amino acids essential for humans in the required proportions. One<br />
particular study by Dangin et al. (2002) found whey protein to be especially<br />
effective in preserving muscle To mass Gain older Access adults. Therefore, flavoured milk<br />
products with whey protein would also be well suited for elderly consumers.<br />
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While it may be relatively straightforward to develop a product ideally suited<br />
for elderly consumers in terms of its formulation, the real difficulty is in<br />
marketing this product to this group of consumers. With elderly consumers<br />
often set in their dietary habits, it would be difficult to persuade this<br />
demographic group to completely change their eating habits to consume<br />
milkshakes instead of eating meals or snacking. They key is to fit the product<br />
around their existing habits and offer a feasible alternative to something they<br />
already use. Another difficulty likely to be faced is the ingrained association<br />
between flavoured milk and children among this demographic.<br />
For elderly consumers with limited mobility, the idea of buying large volumes<br />
of flavoured milk is unlikely to be of appeal. Furthermore, on-the-go<br />
propositions are also unlikely to be appealing to these consumers. Finding a<br />
format suited to these consumers is therefore also a major struggle for<br />
product developers.<br />
In order to appeal to these consumers, it is important to make specific health<br />
claims where possible. For example, rather than just claiming ‘added Vitamin<br />
D’, claims can and should be made about helping to reduce bone factures.<br />
<strong>UK</strong> urban populations are continuing to rise, employment has risen to 73%<br />
and the number of people aged 18-24 on unemployment benefits is at the<br />
lowest since the 70s. In 2015, the AGCAS What Do Graduates Do? report<br />
revealed 68% of working new graduates were in professional level jobs, a<br />
2% increase on the year before. With this group of busy professionals<br />
growing, they represent a significant<br />
To Gain Access<br />
target market for flavoured milk<br />
producers.<br />
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Breakfast drinks, coffee drinks and functional drinks are particularly<br />
appealing to these consumers who are looking for satiating, nutritious<br />
products or drinks which can provide them with energy or indulgence. While<br />
there are various brands targeting these consumers, there is still scope for<br />
product development.<br />
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In terms of increasing appeal to this group, sugar reduction is particularly<br />
important. The growing trend towards health and wellness among young<br />
people and the growing media attention warning against sugar are likely to<br />
deter consumers from purchasing flavoured milk products with high levels of<br />
sugar.<br />
Nutrition is important to these consumers who often do not have the time to<br />
cook wholesome, nutritious meals <strong>Report</strong> and look Now for healthy, convenient products.<br />
To maximise appeal to these consumers therefore it is important to make<br />
explicit claims on pack where possible. If ingredients are used where a health<br />
claim can be made, this should be done.<br />
There is also an opportunity here for innovation with flavoured milk products<br />
with superfood ingredients such as coconut and flaxseeds to confer<br />
nutritional benefits.<br />
Desire for Adult Flavours<br />
As the flavoured milk category has matured, there has been significant<br />
development in terms of flavours. Using new flavours aside from traditional<br />
chocolate, strawberry and banana are an effective means of drawing new<br />
consumers into the category. Examples are flavours that allude to indulgent<br />
desserts such as chocolate fudge cake, strawberry cheesecake and<br />
millionaire shortbread. These flavours reflect the innovation seen in the wider<br />
dairy category, particularly yogurt where similar flavours are also seeing<br />
success.<br />
This purpose of this flavour innovation is to draw in older consumers to the<br />
flavoured milk category. The Frijj<br />
To<br />
Supreme<br />
Gain Access<br />
range is a particular example of<br />
this with their indulgent dessert flavours such as Honeycomb Swirl. Products<br />
in the range are presented in Purchase premium, black The packaging Full to appeal to adults<br />
as an indulgent treat. The Gu hot chocolate <strong>Report</strong> Now range uses a similar strategy with<br />
#<br />
their Salted Caramel flavour product presented in a premium, black package.<br />
While existing products certainly cover the desire for indulgence in adults,<br />
there is clearly an opportunity here for products capitalising on the growing<br />
taste for superfood ingredients such as ancient grains, blueberry,<br />
pomegranate, chia seeds and perhaps even vegetables such as kale and<br />
spinach.<br />
While major reformulation will likely require investment in terms of processing<br />
equipment, the returns to be made from being the first brand offering<br />
premium, healthy flavoured milks aimed at adults are likely to make<br />
significant returns on investment.<br />
Vegan Attitudes<br />
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Temporary Veganism: There are a growing number of people are trying out<br />
a vegan diet for 7 or 30 days according to the Vegan Society. They reported<br />
a 40% increase in people signing up to its temporary menu at the start of<br />
2013 compared to 2012. The media and celebrities have played a big part in<br />
this with stars such as Beyonce To claiming Gain Access to have tried a vegan diet for 22<br />
days for a ‘spiritual and physical cleanse’.<br />
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These consumers who are flexible in their consumption of animal-derived<br />
products are part of a growing group of ‘flexitarians’. These people do not<br />
commit to a full vegetarian or vegan diet but try to reduce their consumption<br />
of animal products. The Meat Free Monday campaign launched by Paul,<br />
Mary and Stella McCartney is one example of how small steps towards<br />
vegetarianism are being taken by mainstream consumers.<br />
Health Concerns: The rise in avoiding meat products is largely down to<br />
health concerns, particularly following the World Health Organisation’s<br />
International Agency for Research on Cancer’s October 2015 report claiming<br />
50g of processed meat a day increases the risk of colorectal cancer by 18%.<br />
The resulting decline in red meat and processed meat sales illustrates the<br />
impact negative media attention can have on consumers’ views. While red<br />
and processed meat is currently the focus of health organisations, there is a<br />
danger for dairy products if it is the next target.<br />
To Gain Access<br />
There is a section of consumers who avoid dairy for health concerns. The<br />
paleo diet for example forbids Purchase the consumption The Full of dairy products. With<br />
humans the only species that consumes <strong>Report</strong> Now milk in adulthood and the only<br />
species that consumes milk from another animal, paleo advocates say dairy<br />
is not necessary for optimal health and consumption in adults in unnatural.<br />
Some findings that countries with low dairy consumption have low rates of<br />
osteoporosis and vice versa have also called into question age-old<br />
assumption about dairy being good for bone health. Despite several studies<br />
supporting # the association between dairy consumption and improved bone<br />
health, evidence suggesting otherwise be damaging for the industry when<br />
quoted as fact by the media.<br />
Animal Welfare: Another factor which is leading more people to adopt vegan<br />
attitudes is concerns over animal welfare. With the internet making<br />
information more accessible, various videos and documentaries criticising<br />
the meat and dairy industries for poor animal welfare standards have<br />
emerged. Hidden camera footage showing To Gain abuse Access or sub-standard conditions<br />
can be extremely damaging to the Purchase industry. Take The the Full example of the video<br />
showing bobby calves suffering abuse in New Zealand which saw significant<br />
media attention in December 2015.<br />
<strong>Report</strong> Now<br />
Environmental Concerns: While health and animal welfare concerns tend to<br />
be the major reasons for adopting vegan attitudes, environmental concerns<br />
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over dairy farming can also be a driving force. The relatively mainstream<br />
documentary Cowspiracy: The Sustainable Secret which was released on<br />
online streaming site Netflix in To 2015 Gain has been Access credited with informing a large<br />
audience about the negative Purchase impact The of dairy Full farming on the global<br />
environment. With Leonardo di Caprio acting as executive producer on the<br />
<strong>Report</strong> Now<br />
film and the dramatic narrative and footage used, the documentary has reach<br />
a substantial audience of younger consumers. The impact of media attention<br />
like this on consumer attitudes should not be underestimated.<br />
6.18 Technological<br />
Development of innovative sweeteners<br />
As mentioned previously, one of the main factors restraining growth of the<br />
flavoured milk market is the high sugar content of many products. At this<br />
point, sugar is an issue which is likely to deter consumers from making<br />
purchases. Looking further ahead to a potential sugar tax being implemented<br />
this is likely to be an even bigger issue.<br />
The protein and fat content in milk can supress the perception of sweetness<br />
in flavoured milk, thereby leading to large volumes of sugar being used.<br />
There have already been some efforts to reduce sugar content in flavoured<br />
milk. Generally there are two main options when it comes to reducing sugar<br />
content in flavoured milk: reducing lactose and using sweeteners to replace<br />
sugar. Of course, there is also a third option of simply reducing sugar to a<br />
point of still maintaining an acceptable To Gain Access taste. While this has worked for<br />
almond milk, this is more difficult Purchase for flavoured The milk Full which is consumed on its<br />
own so needs to taste appealing for consumers.<br />
<strong>Report</strong> Now<br />
#<br />
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#<br />
Figure 6 - 25 Examples of Sugar Reduction Strategies in <strong>Milk</strong> Drinks<br />
Modifying/ reducing lactose<br />
To Gain Access<br />
Purchase The Full<br />
Reducing/ eliminating lactose is a relatively common way of reducing the<br />
<strong>Report</strong> Now<br />
inherent sugar content of milk drinks. Coca Cola’s US Fairlife product and<br />
both of Arla’s <strong>UK</strong> reduced sugar flavoured milk products utilise lactase<br />
enzymes to help reduce the sugar content in their milk. This technique is<br />
often paired with some sort of sweetening agent.<br />
Reformulating flavoured milk with sugar substitutes<br />
There are various artificial sweeteners including aspartame and sucralose<br />
which are widely used in the beverage To Gain industry Access as well as various sweeteners<br />
which are being developed by Purchase ingredients The companies. Full However, due to<br />
common negative associations with artificial sweeteners, the use of natural<br />
sweeteners is often preferred by flavoured<br />
<strong>Report</strong><br />
milk<br />
Nowmanufacturers.<br />
Natural Sweeteners Frequently Used<br />
Inulin/ chicory root fibre: In terms of natural sweeteners, chicory root fibre<br />
is an ingredient which can help with both fat and sugar reduction. It is a clean<br />
label ingredient and can help mask the flavours associated with some highintensity<br />
sweeteners. It is the inulin compound within it which is key to its<br />
sweetening properties. Arla’s <strong>Flavoured</strong> <strong>Milk</strong> products use inulin from chicory<br />
to reduce the sugar content in their formulation by 50%.<br />
Stevia is a commonly used natural sweetener which can be used as a<br />
replacement for sugar. While it is often associated with a liquorice-like<br />
aftertaste, # recent developments have led to compounds with less of the<br />
aftertaste. This has been used successfully To Gain Access in Coca Cola Life as well as the<br />
Skinnygirl Protein product shown in the table above.<br />
Purchase The Full<br />
<strong>Report</strong> Now<br />
Allulose is another natural sweetener which has about 70% of the sweetness<br />
of table sugar with 10% of the calories. Although it has been granted GRAS<br />
(Generally Regarded as Safe) status to Tatle & Lyle’s Dolcia Prima brand of<br />
allulose, it has not yet been approved by Europe.<br />
Monk Fruit Extract is a no calorie sweetener which is 150-200 times<br />
sweeter than sugar. It is a relatively expensive ingredient and although it has<br />
been granted approval in the US, it has not yet by the EU.<br />
Of course, there are a wide range of sweeteners available. Here we have just<br />
highlighted some of the common ones used in dairy. The question of which<br />
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#<br />
sweetener to use is often not an easy one to answer and will depend on<br />
product properties, flavour and desired properties. Often there is no easy<br />
solution and frequently a blend of sweeteners is used.<br />
Solely reducing sugar content.<br />
A study by Oliveira at el. (2015) tested the effects of sugar reduction on<br />
consumers’ liking of probiotic chocolate To Gain Access flavoured milk. They found that<br />
although consumers could taste Purchase when drinks The were Full 40% lower in sugar, their<br />
enjoyment of the drink was not affected significantly by sugar reduction. This<br />
<strong>Report</strong> Now<br />
suggests in some cases, a minor decrease in sugar content without any need<br />
for replacement sweeteners could be feasible.<br />
Lack of <strong>UK</strong> Co-packers<br />
Interesting and convenient formats for flavoured milk present an opportunity<br />
not only for flavoured milk producers but also for packaging manufacturers.<br />
As illustrated by the addition of the sports cap for the Mars flavoured milk<br />
product, a small alteration to packaging to make it more practical for target<br />
consumers can mean a big difference to product sales.<br />
With many flavoured milk products on the market positioned as convenient<br />
on-the-go drinks, storage at ambient temperatures if often desired and this<br />
means UHT drinks dominate. This is particularly the case for sports nutrition<br />
drinks, meal replacement shakes and breakfast drinks. The traditional milk<br />
category however does have a leaning To Gain towards Access fresh/ ESL product with the<br />
market leader, Frijj, predominantly ESL lines.<br />
Purchase The Full<br />
UHT drinks are frequently in HDPE bottles as this resilient, resealable format<br />
is suited to on-the-go products. The <strong>Report</strong> longer Now shelf life of these products also<br />
makes exports feasible, allowing <strong>UK</strong> brands to take advantage of growing<br />
global demand for flavoured milk.<br />
However, # for brands without proprietary processing capabilities in the <strong>UK</strong>,<br />
manufacturing UHT HDPE products is not possible due to a lack of contract<br />
manufacturers. While fresh milk in bottles and UHT milk in tetrapak are both<br />
feasible options considering the accessible facilities in the <strong>UK</strong>, this constraint<br />
is important to bear in mind for those considering entering the market.<br />
For brands wanting to produce UHT HDPE products, facilities most often<br />
used are located in Austria, Belgium and Germany.<br />
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6.19 Considerations for <strong>Flavoured</strong> <strong>Milk</strong> Brands Looking Forward<br />
To Gain Access<br />
Purchase The Full<br />
<strong>Report</strong> Now<br />
#<br />
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#<br />
6.20 Conclusion<br />
HRA Predictions for the Future of the <strong>UK</strong> <strong>Flavoured</strong> <strong>Milk</strong> Market.<br />
Globally, we expect the flavoured milk market to continue to flourish as the<br />
demand for dairy in developing countries increases. With the abolishment of<br />
the one-child policy, China is a particularly attractive market for flavoured<br />
milk brands and is one which more international brands are likely to focus on.<br />
While the issue of the lack of <strong>UK</strong> co-packers persists, this is likely to hinder<br />
the potential for <strong>UK</strong> flavoured milk exports.<br />
Assuming that flavoured milk producers will do all they can to improve their<br />
product offering and marketing approach, we would expect the <strong>UK</strong> market to<br />
see strong, sustained growth over the next five years. In particular, we would<br />
expect stronger value growth than volume growth as more added value<br />
products are introduced to the category.<br />
Consumer Segments…<br />
#<br />
•#<br />
•#<br />
•#<br />
There is a significant opportunity globally for products which are<br />
targeted to specific consumer groups. <strong>Flavoured</strong> milk brands should<br />
focus on developing and marketing their products for adults in<br />
particular.<br />
Adults consumers aged 65+ and To Gain 30-44 Access are both growing consumer<br />
groups which is currently not being targeted successfully by any<br />
flavoured milk brands in the<br />
Purchase<br />
<strong>UK</strong>. Although<br />
The<br />
a difficult<br />
Full<br />
audience to target<br />
with flavoured milk, the brands <strong>Report</strong> which can Now do this well are likely to see<br />
success.<br />
In targeting adults, it will be vital for brands to reduce sugar content<br />
and make clear any health benefits in order to maximise appeal to<br />
health conscious consumers which make up such a large proportion<br />
of the population.<br />
Product Formulation…<br />
•#<br />
•#<br />
Innovation with vitamin/ mineral supplementation, superfood<br />
ingredients and sugar reduction is a growing trend expected to<br />
continue. This reformulation will help add appeal to adults.<br />
To Gain Access<br />
Purchase The Full<br />
There are various options for sugar reduction including simply<br />
reducing sugar by a small enough quantity<br />
<strong>Report</strong><br />
to<br />
Now<br />
maintain taste, using<br />
enzymes to remove lactose and substitute sugar with sweeteners.<br />
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#<br />
•#<br />
A broad range of natural sweeteners is becoming available including<br />
stevia and inulin and these are becoming increasingly used in<br />
flavoured milk products.<br />
Merchandising…<br />
•#<br />
•#<br />
Due to the breadth of the flavoured milk category and the various<br />
temperature requirements (fresh, ESL, UHT), product positioning in the<br />
grocery retailers can be confusing for consumers. There is often no<br />
clear destination where products To can Gain be found Access and this can lead to<br />
consumers missing products. This is particularly the case for sports<br />
Purchase The Full<br />
nutrition products which can be virtually anywhere in store (lunch<br />
deals, chillers, health & beauty aisle, <strong>Report</strong> alongside Nowenergy<br />
drinks etc.).<br />
Retailers are likely to continue to alter their merchandising approach<br />
until they can optimise the positioning of flavoured milk.<br />
Packaging & Positioning…<br />
#<br />
•#<br />
•#<br />
•#<br />
•#<br />
In terms of advertising and positioning of flavoured milk brands it is<br />
important to highlight the health credentials of dairy over dairy<br />
alternatives.<br />
There is considerable opportunity in the sector to use packaging<br />
formats to target specific consumer segments. This has been done<br />
well by coffee brands and sports<br />
To Gain<br />
nutrition<br />
Access<br />
brands in particular.<br />
Purchase The Full<br />
<strong>Report</strong> Now<br />
In targeting the growing group of 65+ consumers, packaging and<br />
positioning will be crucial in determining success.<br />
The positioning of the brand is particularly important to sports nutrition<br />
customers who value the credentials and status associated with some<br />
brands.<br />
Own Label…<br />
•#<br />
•#<br />
The relative infancy of the category and the brand loyalty in the sports<br />
nutrition segment has deterred own label from entering this category.<br />
While own label could be expected to eventually the enter the sports<br />
nutrition market, it will be to target To Gain the more Access mainstream consumers.<br />
Purchase The Full<br />
The infancy of the breakfast drink category has prevented own label<br />
<strong>Report</strong> Now<br />
from entering the category, though if growth continues this could be<br />
expected to happen within 1-2 years.<br />
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#<br />
To Gain Access<br />
Purchase The Full<br />
<strong>Report</strong> Now<br />
SWOT Analysis<br />
#<br />
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#<br />
7! Summary<br />
The backdrop to <strong>UK</strong> flavoured milk is one of relentless change. The removal<br />
of the EU milk quotas, the transition to a Western-type diet by emerging<br />
economies, the <strong>UK</strong> sugar debate, the booming sports nutrition industry are<br />
all aspects that create both challenges and opportunities for the <strong>UK</strong><br />
flavoured milk market.<br />
Overall, we expect the <strong>UK</strong> flavoured milk market to continue to grow over the<br />
medium term, but not without improving its nutritional profile. The sugar<br />
debate reached new heights when, in October 2015, Public Health England<br />
released a document suggesting Government intervention in the form of a<br />
sugar tax (levy). Product reformulation has become a priority.<br />
To Gain Access<br />
It is also the time when many players are exploring new demographics and<br />
developing flavoured milk propositions Purchase for mature The Full audiences. The <strong>UK</strong><br />
National Office for Statistics shows <strong>Report</strong> that the 30-44 Now years demographic is<br />
predicted to quickly grow over the next decade.<br />
With flavoured milk mostly consumed by those under 45 years of age, the<br />
study of this segment is fundamental: functional drinks with clear benefit<br />
differentiation are key.<br />
With one in five adults now over 65 and the segment living longer, brands<br />
that are able to successfully unlock the aspirations of this segment will<br />
prosper commercially.<br />
Point of sale, flavouring, packaging and nutritional profile are all important<br />
aspects that can be adapted to fuel consumer-driven growth within <strong>UK</strong><br />
flavoured milk.<br />
#<br />
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www.Food-and-Drink.Marketing<br />
HRA Food and Drink Marketing<br />
Rockwood House, Parkhill Road,<br />
Torquay, Devon, TQ1 2DU<br />
Telephone: +44(0) 1803 203387<br />
#<br />
Registered as a Limited Company number<br />
7654941 in England & Wales<br />
VAT registration number<br />
GB 113 8468 16<br />
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8! References<br />
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Abou-Samra, R., Keersmaekers, L., Brienza, D., Mukherjee, R., & Macé,<br />
K. (2011). Effect of different protein sources on satiation and short-term<br />
satiety when consumed as a starter. Nutrition Journal, 10, 139.<br />
doi:10.1186/1475-2891-10-139<br />
Aimutis, W. R. (2004). Bioactive properties of milk proteins with particular<br />
focus on anticariogenesis. The Journal of Nutrition, 134(4), 989S–95S.<br />
Retrieved from http://www.ncbi.nlm.nih.gov/pubmed/15051859<br />
Bilsborough, S., Mann, N. (2006). A review of issues of dietary protein<br />
intake in humans. International Journal of Nutrition and Exercise<br />
Metabolism. 16(2): 129-52.<br />
Dalmeijer, G. W., Struijk, E. A., van der Schouw, Y. T., Soedamah-Muthu,<br />
S. S., Verschuren, W. M. M., Boer, J. M. A., … Beulens, J. W. J. (2013).<br />
Dairy intake and coronary heart disease or stroke--a population-based<br />
cohort study. International Journal of Cardiology, 167(3), 925–9.<br />
doi:10.1016/j.ijcard.2012.03.094<br />
Dangin M, Boirie Y, Guillet C, Beaufrere B. Influence of the protein<br />
digestion rate on protein turnover in young and elderly subjects. J Nutr.<br />
2002 Oct;132(10):3228S-33S.<br />
dela Peña Irene Joy I., Hong Eunyoung, de la Peña June Bryan, Kim Hee<br />
Jin, Botanas Chrislean Jun, Hong Ye Seul, Hwang Ye Seul, Moon Byoung<br />
Seok, and Cheong Jae Hoon. Journal of Medicinal Food. October 2015,<br />
18(11): 1255-1261. doi:10.1089/jmf.2015.3448.<br />
Department for Culture, Media and Sport (2010). Taking Part: The<br />
National Survey of Culture, Leisure and Sport Adult and Child <strong>Report</strong><br />
2009/10. Available at: www.culture.gov.uk/publications/7386.aspx<br />
•# Grillenberger, M., Neumann, C. G., Murphy, S. P., Bwibo, N. O., Weiss, R.<br />
E., Jiang, L., … West, C. E. (2006). Intake of micronutrients high in animalsource<br />
foods is associated with better growth in rural Kenyan school<br />
children. The British Journal of Nutrition, 95(2), 379–90. Retrieved from<br />
http://www.ncbi.nlm.nih.gov/pubmed/16469157<br />
•# Han, J., Hamilton, J, A., Kirkland, J, L., Corkey, B, E., Guo, W. (2003).<br />
Medium-chain oil reduces fat mass and down-regulates expression of<br />
adipogenic genes in rates. Obes Res. Jun; 11 (6): 734-744<br />
•#<br />
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He, M., Yang, Y.-X., Han, H., Men, J.-H., Bian, L.-H., & Wang, G.-D.<br />
(2005). Effects of yogurt supplementation on the growth of preschool<br />
children in Beijing suburbs. Biomedical and Environmental Sciences :<br />
BES, 18(3), 192–7. Retrieved from<br />
http://www.ncbi.nlm.nih.gov/pubmed/16131023<br />
Hoppe, C., Mølgaard, C., & Michaelsen, K. F. (2006). Cow’s milk and<br />
linear growth in industrialized and developing countries. Annual Review of<br />
Nutrition, 26, 131–73. doi:10.1146/annurev.nutr.26.010506.103757<br />
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•#<br />
•#<br />
•#<br />
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Konstantynowicz, J., Nguyen, T. V, Kaczmarski, M., Jamiolkowski, J.,<br />
Piotrowska-Jastrzebska, J., & Seeman, E. (2007). Fractures during<br />
growth: potential role of a milk-free diet. Osteoporosis International : A<br />
Journal Established as Result of Cooperation between the European<br />
Foundation for Osteoporosis and the National Osteoporosis Foundation of<br />
the USA, 18(12), 1601–7. doi:10.1007/s00198-007-0397-x<br />
Li, F., An, S., Zhou, Y., Liang, Z., Jiao, Z., Jing, Y., … Tan, W. (2011). <strong>Milk</strong><br />
and dairy consumption and risk of bladder cancer: a meta-analysis.<br />
Urology, 78(6), 1298–305. doi:10.1016/j.urology.2011.09.002<br />
Merrill, R. M., & Aldana, S. G. (2009). Consequences of a plant-based diet<br />
with low dairy consumption on intake of bone-relevant nutrients. Journal<br />
of Women’s Health (2002), 18(5), 691–8. doi:10.1089/jwh.2008.1020<br />
Michaelsen, K. F., Hoppe, C., Roos, N., Kaestel, P., Stougaard, M.,<br />
Lauritzen, L., … Friis, H. (2009). Choice of foods and ingredients for<br />
moderately malnourished children 6 months to 5 years of age. Food and<br />
Nutrition Bulletin, 30(3 Suppl), S343–404. Retrieved from<br />
http://www.ncbi.nlm.nih.gov/pubmed/19998864<br />
•# Michaelsen, K. F., Nielsen, A.-L. H., Roos, N., Friis, H., & Mølgaard, C.<br />
(2011). Cow’s milk in treatment of moderate and severe undernutrition in<br />
low-income countries. Nestlé Nutrition Workshop Series. Paediatric<br />
Programme, 67, 99–111. doi:10.1159/000325578<br />
•#<br />
Mokdad, A. H., Bowman, B. A., Ford, E. S., Vinicor, F., Marks, J. S., &<br />
Koplan, J. P. (2001). The continuing epidemics of obesity and diabetes in<br />
the United States. JAMA, 286(10), 1195–200. Retrieved from<br />
http://www.ncbi.nlm.nih.gov/pubmed/11559264<br />
•# Nagata, C., Takatsika, N., Shimizu, H., Hayashi, H., Akamatsu, T., Murase,<br />
K. (2001) Effect of soymilk consumption on serum estrogren and<br />
androgen concentrations in Japanese men. Cancer Epedimiol<br />
Biomarkers. 10(3): 179-184.<br />
•# Oliviera, D., Antúnez, L., Giménez, A., Castura, J. C., Deliza, R., Ares, G.<br />
(2015). Food Research International, 75, 148–156.<br />
Scarborough, P., Appleby, P.N., Mizdrak, A., Briggs, A.D.M., Travix, R.C.,<br />
Bradbury, K.E., Key, T.J. (2014). Dietary greenhouse gas emissions of<br />
meat-eaters, fish-eaters, vegetarians and vegans in the <strong>UK</strong>. Climatic<br />
Change. 125(2): 179-192.<br />
•# Schamschula, R. G., Bunzel, M., Agus, H. M., Adkins, B. L., Barmes, D.<br />
E., & Charlton, G. (1978). Plaque minerals and caries experience:<br />
associations and interrelationships. Journal of Dental Research, 57(3),<br />
427–32. Retrieved from http://www.ncbi.nlm.nih.gov/pubmed/277544<br />
•#<br />
Srednicka-Tober, D., Baranski, M., Seal, D.J., Sanderson, R., Benbrook,<br />
C., Steinshamn, H, Gromadska-Ostrowska, J., Rembialkowska, E.,<br />
Skwarlo-Sonta, K., Eyre, M., Cozzi, G, Larsen M.K., Jordon, T., Niggli, U.,<br />
Sakowski, T., Calder, P.C., Burdge, G.C, Sotiraki, S., Stefanakis, A.,<br />
Stergiadis, S., Yolcu, H., Chatzidimitriuo, E., Butler, G., Stewart, G.,<br />
Leifert, C. (<strong>2016</strong>). Higher PUFA and n-3 PUFA, conjugated linoleic acid, α-<br />
tocopherol and iron, but lower iodine and selenium concentrations in<br />
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#<br />
•#<br />
•#<br />
•#<br />
•#<br />
organic milk: a systematic literature review and meta- and redundancy<br />
analyses. British Journal of Nutrition. 115(6): 1043-60<br />
Tang, M. (2014) The American Journal of Clinical Nutrition. Assessment of<br />
protein requirement in octogenarian women with use of the indicator<br />
amino acid oxidation technique. First published January 15, 2014,<br />
doi: 10.3945/ajcn.112.042325<br />
Tremblay, A., & Gilbert, J.-A. (2009). <strong>Milk</strong> products, insulin resistance<br />
syndrome and type 2 diabetes. Journal of the American College of<br />
Nutrition, 28 Suppl 1, 91S–102S. Retrieved from<br />
http://www.ncbi.nlm.nih.gov/pubmed/19571167<br />
Wiley, A. S. Does milk make children grow? Relationships between milk<br />
consumption and height in NHANES 1999-2002. American Journal of<br />
Human Biology : The Official Journal of the Human Biology Council, 17(4),<br />
425–41. doi:10.1002/ajhb.20411<br />
Health Survey for England 2012. Health and Social Care Information<br />
Centre, 2013. http://www.hscic.gov.uk/pubs/hse2012<br />
#<br />
############################################<br />
#<br />
i #National#office#for#statistics#quote#<br />
ii #same#as#above#<br />
iii #Text#book#from#library.#<br />
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<strong>UK</strong> FLAVOURED MILK <strong>2016</strong>-17<br />
Marketing<br />
& Branding<br />
Commercial<br />
Consulting<br />
Market<br />
Research<br />
HRA Food and Drink Marketing<br />
Rockwood House, Parkhill Road,<br />
Torquay, Devon, TQ1 2DU<br />
Telephone: 01803 203387<br />
Registered as a Limited Company number<br />
7654941 in England & Wales.<br />
VAT registration number<br />
GB 113 8468 16
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