Innovation And Npd In Dairy: Future Opportunities In Functional, Indulgent And Ethical Food And Drinks

Published by: Business Insights

Published: Jul. 1, 2007 - 142 Pages

Table of Contents

Innovation and NPD in Dairy

Executive Summary

Market issues

The dairy market

Innovation and NPD in dairy

Key trends in dairy

Conclusions

Chapter 1 Market issues

Summary

Introduction

Key issues affecting innovation in dairy

Obesity

Labeling

TV advertising bans

Ingredient elimination or substitution

Organic, natural and ethical

Ethical sourcing

Consumer engagement

Private label

Waitrose

Trader Joes

ASDA (UK subsidiary of Walmart)

Tesco

Private label organics

Chapter 2 The dairy market

Summary

Introduction

Dairy market value

Market value by category

Cheese

Milk

Spreadable fats

Yogurts and smoothies

Dairy market volume

Dairy market volume by category

Milk

Cheese

Yogurt

Leading players by region

Europe

The Americas

Asia-Pacific

Middle East and Africa

Innovative manufacturers

Chapter 3 Innovation and NPD in dairy

Summary

Introduction

NPD by category

Category analysis

Milk

Cheese

Yogurt

Spreadable fats

Regional analysis

Europe

The Americas

Asia-Pacific

Middle East and Africa

Innovation analysis

Innovation in formulation

Innovation in packaging

Innovation by category

Product tag analysis

Low fat

High vitamins

Upscale and premium

Private label

Kids

Flavor analysis

Chapter 4 Key trends in dairy

Summary

Introduction

Health

Functional products

Natural

Low fat

Wellbeing

Indulgence

Regional / authentic

Ethnic

Gourmet

Convenience

Portable

Environmentally friendly

Portion control / single serve

Chapter 5 Conclusions

Summary

Introduction

Overview of main trends

Organic / natural / ethical

Health

Functional trends

Health as a new desirable lifestyle

Premium

Index

List of Figures

Figure 1.1: The level of impact certain threats will have on dairy NPD over the next 5 years

Figure 1.2: UK Food Standards Association’s traffic light labelling system

Figure 1.3: US labeling system

Figure 1.4: Cathedral City Lighter Mature Cheddar

Figure 1.5: Soy based products capitalizing on their “Trans-free” status

Figure 1.6: Highgrove Food’s Gold Top Organic Milk

Figure 1.7: Products with “no artificial hormones”: Promise Land Milk & Mountainside UltraPure

Milk

Figure 1.8: Danone’s Xperiment drink

Figure 1.9: New private label offerings from Waitrose

Figure 1.10: Trader Joe private label products

Figure 1.11: Asda Extra Special Line

Figure 1.12: Tesco health products

Figure 1.13: Private label organic brands

Figure 2.14: 2006 product releases from Danone in Russia

Figure 2.15: Zott’s Allgautaler

Figure 2.16: Danone’s Jogurt Waniliowy z Cukierkami Czekoladowymi (Vanilla Yogurt with Chocolate Candies)

Figure 2.17: Dairy products with functional properties launched in Spain

Figure 2.18: Central Lechera Asturiana Natur Fibra Leche

Figure 2.19: Vita Reduce la Tension Arterial Cultured Milk Drink

Figure 2.20: Asturiana Oriental Yogurt and Danone Vitalinea Floral Yogurt

Figure 2.21: Kraft Cracker Barrel 2% and Kraft Natural Cheese Crumbles

Figure 2.22: Activalp Râpé Doré

Figure 2.23: Stilton cheeses launched in North America

Figure 2.24: Using associations with traditional production techniques : President Société Creme

Cheese & Senoble La Faisselle

Figure 2.25: Functional milk

Figure 2.26: Dairy Gold Heart Cholesterol Reducing Spread and St Hubert Cholegram

Figure 2.27: Sabatino Tartuff Truffle Butter and Delallo Butter from Parma

Figure 2.28: Growth in market value of dairy categories over the next 5 years

Figure 2.29: Tilamook Oregon Strawbetter Smoothie and Whitneys Yo on the Go Strawberry Smoothie

Figure 2.30: Yeo Valley Inner Balance Range

Figure 2.31: Tesco’s yogurts fortified with seeds and grains and Brown Cow’s Fruit and Whole Grain yogurts

Figure 2.32: Low sugar products

Figure 2.33: Sales growth potential of consumption occasions over the next 5 years

Figure 2.34: Company shares of top 5 players in each region, %, 2004

Figure 2.35: New convenient products launched in North America by Kraft

Figure 2.36: Danone’s Essensis

Figure 3.37: Share of dairy product launches, by sector, 2004-2006

Figure 3.38: Brimi Probiotici Mozzarella

Figure 3.39: Yeo Valley Extra Mature Cheddar, Arla’s Rosenburg Mellow Blue and Waitrose Medium Dutch Cheese

Figure 3.40: Innovative milk products launched

Figure 3.41: Lifeway Probugs Organic Whole Milk Kefir

Figure 3.42: Lifetime Immune Advantage Cheese and Asda’s Heartfelt Cheese with Reducol

Figure 3.43: Table-ready cheeses

Figure 3.44: Pilgrims Choice Cheese Connoisseur Collection

Figure 3.45: Premium European varieties with an American identity

Figure 3.46: Cortenuova Yogurt all’Orzo Tostato

Figure 3.47: Innovative processing

Figure 3.48: Unilever’s Rama Idee!

Figure 3.49: Flavored butters

Figure 3.50: % share of dairy food and drinks launched in each region, 2004-2006

Figure 3.51: Unilever’s Ades

Figure 3.52: Regions that will provide the most sales growth potential for dairy manufacturers over

the next 5 years

Figure 3.53: Tianshan Snow Red Jujube Milk, Robust Iron Zinc Calcium Milk

Figure 3.54: Meiji Biyo Yogurt Utsukushii Ashita

Figure 3.55: Healthy indulgence yogurts released in Israel by Danone in 2006

Figure 3.56: Yili yogurt and Milkman Cheese Slices

Figure 3.57: Nesquik Petit Para Beber Bebida Lactea

Figure 3.58: Kaiku Plus With No Lactose Milk

Figure 3.59: Kidz Dream Smoothie

Figure 3.60: Yo Lanz Jogurt drink

Figure 3.61: Innovative products launched in each category, 2004-2006

Figure 3.62: Nippon Lever’s Funwari Rama Vanilla Lemon no Fumi and Meiji’s Margarine and Marmalade

Figure 3.63: Yeo Valley and Valio Oy fat free yogurts

Figure 3.64: Products that claim to enhance the sensory experience

Figure 3.65: Private label dairy products

Figure 3.66: Importance of consumer groups for dairy manufacturers over the next 5 years

Figure 3.67: Healthy kids’ dairy products launched

Figure 3.68: Flavors and ingredients that will experience the most growth in usage in dairy food and drinks over the next 5 years

Figure 4.69: Importance of health trends in dairy NPD over the next 5 years

Figure 4.70: Products down-playing functional benefits

Figure 4.71: WellBeing iQ2

Figure 4.72: Products showing the future of the natural trend in dairy

Figure 4.73: Taste-path Yogurt and PrimaLiv Drinkable Yogurt

Figure 4.74: Leading wellbeing products

Figure 4.75: Meiji Dairies’ Relaxing milk drink and Nippon Luna’s Black Sesame Yogurt with GABA

Figure 4.76: Importance of premium trends in dairy NPD over the next 5 years

Figure 4.77: Hokkaido Melon Milk Drink, Ashgrove Tasmanian Farm Cheese, Waitrose Columbian Coffee Milk

Figure 4.78: Carrefour’s Reflets de France

Figure 4.79: Dairygold Jalapeño flavored cheese in Ireland and Kavli Ost

Figure 4.80: Dairy products with Indian flavorings

Figure 4.81: Gourmet Romme (Cream)

Figure 4.82: Combining new and exotic flavors

Figure 4.83: Importance of convenience trends in dairy NPD over the next 5 years

Figure 4.84: Danone’s Veloute Fruix XL

Figure 4.85: Portable dairy products

Figure 4.86: Fresh Natural Soya Drink and Danone’s Dzbanek Rodzinny Jogurt

Figure 4.87: Kraft’s mini tubs of Philadelphia cheese

Figure 4.88: Single serve and smaller portions of dairy products

List of Tables

Table 1.1: Number and percentage of overweight and obese adults by country, 2005-2010 (% adult population)

Table 1.2: Value of the US and European organic dairy food market, by country, $m, 2005-2010

Table 2.3: Dairy food and drinks market value, Europe and the US, $m, 2005-2009

Table 2.4: Dairy market value, by category, Europe and the US, $m, 2005-09

Table 2.5: Dairy market volume, Europe and the US, liters m, 2005-2009

Table 2.6: Dairy market volume, by category, Europe and the US, liters m and kg m, 2005-2009

Table 2.7: Top 10 innovative dairy manufacturers

Table 3.8: Unusual yogurt flavorings in products launched in 2006

Table 3.9: % of types of innovation within innovative dairy products, 2003-2006

Table 3.10: Top 20 product tags on dairy products, % share of all products launched, 2004-2006

Table 3.11: Top 20 flavors in dairy products, % share of products launched, 2004-2006

Abstract

• A 16% growth in market value is expected in the combined European and US dairy markets between 2005 and 2009. Growth will be driven by developments in health, innovation in the Spanish market and emerging markets in Eastern Europe.
• Yogurt and yogurt drinks are a key growth opportunity. Consumers are increasingly adding functional yogurts and yogurt drinks to their diet and smoothie-style drinks demand is booming.
• Premium dairy offerings including premium cheeses and organic milks and yogurts are a key growth area. The share of new product launches that made the upscale claim has increased by 1.9 percentage points since 2004 to reach 4.3%.
• Low fat is the most common product label in new releases for 2006 with just under 10% of products making this claim. This reflects the importance of the health trend and continuing efforts of manufacturers to revamp their product lines with healthier formulations.

• Identify and target new and emerging growth opportunities using this report’s US and European dairy market forecasts detailing market value and volume to 2009.
• Understand the key trends in the dairy market including the organic movement and the growing health trend and how these and future trends will affect the market over the next five years.
• Assess the competitive landscape with this report’s analysis of the strategies and market shares of leading players in the dairy market including Kraft, Nestlé, Danone and Arla Foods.
• Benchmark leading executives’ opinions on the future of the dairy market using this report’s analysis of our proprietary global survey detailing the key issues affecting the future of NPD and innovation across Europe, Asia-Pacific, South America and North America.
• Improve the effectiveness of your NPD strategies with this report’s analysis of innovation by category, region and product tag using Productscan data from 8,000 dairy food and drinks product launches between 2004 and 2006.

• Regulatory pressure. Government concerns about public health issues are forcing manufacturers to re-think formulation, advertising strategies and marketing.
• Competition in the organic dairy market. Organic manufacturers face rising competition as budget and private label lines start to the enter the market. The market leaders are responding by raising the bar for organic production and sourcing standards.
• Eastern European markets. Opportunities in Russia and Eastern Europe are emerging as the distribution of consumers becomes more urbanized and their incomes rise.
• The evolution of functional dairy products. Functional products are evolving, as niche products start to emerge that specifically address individual health issues for example brain or skin health.

• Which dairy sectors will see the most growth over the next five years?
• How can dairy manufacturers exploit consumers’ growing interest in health?
• Who are the leading innovators driving the future of dairy NPD, and what are the key developments that they are introducing?
• Which dairy product segments offer the greatest future opportunities?
• How are key consumer trends shaping the future of the dairy market?
• What is the outlook for the dairy industry in the future?

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