Free From Food Expo, Barcelona, June 2017 · Free From Food Expo, Barcelona, June 2017 . 2 Today’s presentation Boom in plant-based innovation and expansion of ... Plant-based milks

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The Dairy-Free Boom Free From Food Expo, Barcelona, June 2017

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Today’s presentation

Boom in plant-based innovation and expansion of

vegan positioning

Growth of

dairy-free

What was niche is now mainstream

Flexitarianism, not veganism The drivers

Taste, health, ethics and the environment as platforms Engaging

consumers

Potential future directions Where next?

3 Source: Mintel GNPD

Plant-based products now account for 11% of all ‘dairy’ NPD

94% 93% 92% 89% 89%

6% 7% 8% 11% 11%

2013 2014 2015 2016 2017 to date

Total Dairy-based Total Plant-based

Total European NPD in milk, yogurt and desserts,

by dairy- or plant-based


Germany shows a strong lead in plant-based innovation

10% 13% 18% 18% 18%

13%

18% 9% 10% 15%

14%

9% 15% 13% 9%

15% 9% 12% 12% 9%

10% 9%

9% 8% 9%

38% 41% 38% 40% 41%

2013 2014 2015 2016 2017 to date

Germany Spain France UK Italy All Others

Plant-based yogurt, milk and desserts

NPD in Europe, by country


Launches up in all segments, but greater focus now on yogurts

72% 77% 68% 68% 68%

19% 14%

22% 22% 23%

8% 8% 10% 10% 10%

2013 2014 2015 2016 2017 to date

Plant Based Drinks Plant Based Spoonable Yogurts

Plant Based Ice Cream & Frozen Yogurt


NPD in Europe, by segment

6

The big picture:

“Eat food. Not too much.

Mostly plants.” Michael Pollan, In Defence of Food: An Eater's Manifesto


NPD booms in vegan foods, grows in low/no lactose

0.0%

1.0%

2.0%

3.0%

4.0%

5.0%

6.0%

7.0%

8.0%

2013 2014 2015 2016 2017 todate

Vegan

Low/No/Reduced Lactose

European food & drink new product introductions

labelled vegan or no/low lactose, as % total NPD


Close to 1 in 5 new products in Germany is ‘vegan’

0%

2%

4%

6%

8%

10%

12%

14%

16%

18%

20%

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 todate

Germany

UK

Europe

Global

European food & drink new product introductions

labelled vegan, as % total NPD

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Health & Wellness

Diversity in protein

sourcing

Ethic & Environment

Recent

food safety scandals

Consumers limit their

consumption of meat

and dairy due to health

concerns

The variety of available

proteins (nuts, seeds,

soy, legumes, whole

grains) provides

accessible alternatives to

meat and dairy

Due to numerous

scandals some

consumers are

concerned about the

safety of meat and

poultry products

Animal welfare and

environmental

awareness encourages

consumers to look for

plant-based alternatives

A shift from niche vegetarians & vegans to

mass market flexitarians

Multiple factors explain the growth of plant-based diets

10 Source: Mintel Consumer Data 2017

Veganism is strong among young adults…

6

12 12

5

10

8

6

9

8

5

8

9

7

10

11

All % 16-24%

25-34%

All % 16-24%

25-34%

All % 16-24%

25-34%

All % 16-24%

25-34%

All % 16-24%

25-34%

France Germany Italy Spain Poland

‘I am a vegan’, Q1-2017


But many more avoid or reduce dairy consumption

24

27

31

16

22 21

30 30

35

22

25 24

19 21

19

All % 16-24%

25-34%

All % 16-24%

25-34%

All % 16-24%

25-34%

All % 16-24%

25-34%

All % 16-24%

25-34%


‘I am actively reducing my consumption of, or avoiding, dairy’, Q1-2017


Non-dairy yogurts are widely seen as healthy & tasty

29

38

17

31 30

36

30

41

22

29 31

38

24

39

31

27

34

42

26 29

All % 16-24 % All % 16-24 % All % 16-24 % All % 16-24 % All % 16-24 %


Non-dairy yogurts are healthier than dairy yogurts

Non-dairy yogurts are as tasty as dairy yogurts


Plant-based milks score well on health, less so on taste

28

34

19

32

24 24

32

38

24

28

16

23

12

18

15

18 18 20

13

19



Plant-based milk is healthier for you than dairy milk

I prefer the taste of plant-based milk to dairy milk


Lactose-free dairy is being overtaken by plant-based

7

17 16

11

16

19 18

25

19

13

10

12

20

24

19

7

11 10

Lactose-free cow's milk Soy milk Other plant-based milk

France - All % Germany - All % Italy - All % Poland - All % Spain - All % UK - All %

‘Have personally used…’, Q1-2017


It’s all about flexitarianism…

29

38

27

43

40

37

30

34

45

55



‘I would be interested in trying dairy milk that is

blended with plant-based milk’, Q1-2017

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Brands market around three key platforms

Health Taste Ethics

Ripple Original Plant Based Milk,

USA, made from yellow peas high

in protein, rich in vitamins and

minerals

Fresh Market Unsweetened

Vanilla Almond Drink, USA, a

naturally nutritional alternative

rich in antioxidants and calcium

Lima Organic Mocha Flavoured

Rice Drink, Germany, made

with a delicious combination of

roasted cereals & chicory

Provamel Organic Rice-

Coconut Milk, France, CO2

neutral production process

Kite Hill Artisan Almond Milk

Yogurt, USA, said to be better

for the environment

Alpro Go On Plain Soy Yogurt,

Europe, features a lovely fresh

taste

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Alpro (soy-based) yogurts lead top-selling new products

Alpro Natur with Coconut /

Almonds Alpro Go On

Said to have a silky texture and a refreshing

coconut flavour.

Launched May 2015, two varieties sold

€6.6m in first year; also a hit in other

European markets

Targets high protein snacking and indulgence,

with a thick and smooth texture, ‘lovely fresh

taste’, added calcium and vitamins

Three SKUs in Germany sold nearly €6m in

first year

Source: Mintel GNPD IRIS

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Boom in coconut milk yogurts, mostly from specialist players

Whollees (Germany),

Harvest Moon Coconut Milk

Yogurt, also sold in Austria,

Netherlands, Switzerland,

Portugal

The Coconut Collaborative

Coconut Milk Dessert. made

with the milk from one

whole coconut, selling well in

Germany and France, also

now in Netherlands and Austria

as well as the UK

Lucy Wagner Foods’ Pudology

Yogs Coconut Yogurt,

“beautifully indulgent and

delicious” (UK)

19

50%

17%

12% 9%

1%

5%

0% 0%

34%

18%

15% 13%

4% 2% 2% 2%

Soy Rice Almond Oats Coconut Hazelnut Cashew Nut Quinoa

2013 2014 2015 2016 2017 to date

• Although numbers of new products are up, use of soy is in decline

• Almond, oats, coconut are the ingredients showing most growth

Source: Mintel GNPD

Indeed, it’s less and less about soy…


NPD in Europe, by ingredient

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Dairies go vegan…

Molkerei Söbbeke, Germany Emmi, Germany

Organic, vegan, rice desserts, based on rice,

coconut milk, lupine flour and other vegan

ingredients

Soja Vit Organic Bircher Muesli, vegan fermented

soybean base with 35% fruit and cereals

21

Non-dairy ice cream next to boom?

Ben & Jerry’s a tipping point?

• USA, Ben & Jerry's Non-Dairy

Frozen Dessert made with

almond milk.

• Non-GMO ingredients, made

with Fairtrade sugar, cocoa and

vanilla, suitable for vegans.

• Launched in February 2016,

sales of c. $35m in first year,

across 4 varieties

Source: Mintel GNPD IRIS

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Conclusions & points for the future

Long-term success means moving on from the substitute

image and accentuating the tastiness, texture and intrinsic

benefits of plant-based ingredients

Don’t be just a

substitute

Appeal to consumers who also eat meat or dairy – future

growth is among “flexitarians”, rather than consumers who

opt for 100% vegetarian or vegan diets.

Appeal to

flexitarians

In the mainstream, taste and price are always the key factors

that determine purchase. Taste/quality

Smaller, specialist players provide real differentiation and

‘romance’ the (Millennial) consumer

But look out for the major players…

Innovation & the

entrepreneurial

spirit

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The preference for natural, simple

and flexible diets will drive further

expansion of vegetarian, vegan and

other plant-focused formulations

A Mintel 2017 Food & Drink Trend

mintel.com

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David Jago

Director, Innovation & Insight

+44 20 3416 4266

[email protected]

For more information:

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Free From Food Expo, Barcelona, June 2017 · Free From Food Expo, Barcelona, June 2017 . 2 Today’s presentation Boom in plant-based innovation and expansion of ... Plant-based milks