Get in the driver's seat: Marketing milk and dairy products to today's and tomorrow's consumers

Abstract Text:

Who buys a head of iceberg lettuce anymore when pre-washed, trimmed lettuce blends are readily available? It’s the same person who buys a gallon of the white stuff and a chunk of cheddar. It’s not the consumer—today’s consumer--who grew up with more than 87,000 possible Starbucks combinations to create a customized drink. Millennials and their offspring are today’s and tomorrow’s consumers, demographics with unprecedented expectations of the food supply chain. They want customization, simplicity and transparency, but at the same time demand convenience, deliciousness and portability. According to the International Food Information Council Foundation’s 2015 Food and Health Survey, compared to the general U.S. population, Millennials have differing opinions on traditional eating habits, usage of resources and information for staying healthy, and even on the value of some nutrients. Understanding these views is paramount for dairy brands to thrive. According to the International Dairy-Deli-Bakery Association, the food retail world is changing, and the products and the players must change in tandem. Traditional food retailers are the most challenged, with data suggesting they will experience a 9% drop in market share (from 71% to 62%) over the next 10 years as non-traditional channels like fresh formats and online retailers gain 38% of the food market. Traditional supermarkets that want to survive are responding to the changing retail channel landscape by featuring full-service restaurants, smaller formats and Millennial-focused products and services. In 2014, ecommerce sales for consumables were $24.4 billion, an increase of 13.5% from 2013. Online purchases of foods and beverages are projected to almost quadruple between 2015 and 2020 to $49 billion, representing 4.5% of all food retail sales. When it comes to dairy, deli and bakery, as well as prepared foods, specialty cheese and specialty meats, the six fresh parameter departments in the traditional supermarket, consumers continue to appreciate the in-person experience. It’s no wonder that the greatest percentage of increase in store count has come from channels outside of traditional food, drug and mass merchandising formats, including convenience stores, warehouse clubs and dollar stores. Stores that focus on fresh foods, in particular single-serve options and convenience, invite consumers inside. And once inside, they often buy more than they really intended. Dairy foods manufacturers must make sure they are competing in this space.

Keywords: Millennials, innovation, consumer