Consumer demand for plant-based ingredients and the boom of special diets such as vegan and lactose-free benefited sales of milk alternatives towards the end of the review period. These products are perceived as being healthier, high quality, environmentally-friendly and ethically sourced, as well as a wide product variety being available.
The strong growth of milk alternatives led to a decline in cow's milk in retail volume terms in 2019. However, fresh milk, which is by far the biggest category within milk, saw a better performance than shelf stable milk, as this format is perceived as more natural and healthier.
Dairy only flavoured milk drinks saw a strong retail volume and current value performance in the review period, and this is expected to continue over the forecast period. Changes in consumer habits, such as on-the-go consumption and health and wellness considerations, have driven sales through increased demand for products such as ready-to-go breakfast drinks and those fortified with protein.
Private label continued to dominate drinking milk products in value terms in 2019, with Tesco, Sainsbury’s, Asda and Morrisons continuing to attract customers with competitive prices, promotional activities and increasing ranges, including fortified milk and milk alternatives.
The “war on sugar” is influencing new product developments in dairy only flavoured milk drinks. Mars Food UK and Grace Foods UK have introduced healthier versions of their products.
Alpro continued to lead milk alternatives in value terms in 2019, but important threats to its position emerged during 2018. Innocent’s move into dairy alternatives in April 2018 was one of the biggest events in the category, with the launch of a trio of milk alternatives in oat, almond and hazelnut variants.
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This industry report originates from Passport, our Packaged Food market research database.