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1 MarketsandMarkets Publisher Sample Phone: (US) or or (Int'l) Hours: Monday - Thursday: 5:30am - 6:30pm EST Fridays: 5:30am - 5:30pm EST customerservice@marketresearch.com MarketResearch.com
2 DAIRY ALTERNATIVE (BEVERAGE) MARKET BY TYPE (Soy, Almond, Rice), FORMULATION (Plain, Flavored, Sweetened, Unsweetened), CHANNEL (Supermarket, Health Store, Pharmacy, Convenience Store) & Geography MarketsandMarkets
3 MarketsandMarkets is a global market research and consulting company based in the U.S. We publish strategically analyzed market research reports and serve as a business intelligence partner to Fortune 500 companies across the world. MarketsandMarkets also provides multi-client reports, company profiles, databases, and custom research services. MarketsandMarkets covers fourteen industry verticals, including aerospace & defence, advanced materials, automotives and transportation, banking and financial services, biotechnology, chemicals, consumer goods, energy and power, food and beverages, industrial automation, medical devices, pharmaceuticals, semiconductor and electronics, and telecommunications and IT. Copyright 2013 MarketsandMarkets All Rights Reserved. This document contains highly confidential information and is the sole property of MarketsandMarkets. No part of it may be circulated, copied, quoted, or otherwise reproduced without the approval of MarketsandMarkets. MarketsandMarkets Sample Page 2
4 1 EXECUTIVE SUMMARY As a substitute to cow milk, the milk derived from plants is considered as a dairy alternative. The dairy alternatives market has witnessed a significant growth in the last couple of years, due to a decline in cow milk consumption. Cow milk consumption has been declining due to an increased number of lactose intolerance consumers and dairy allergies reported by consumers. The dairy alternative beverage market has been segmented by types such as soy, almond, rice, and others i.e. coconut milk, hemp milk, hazelnut milk, oat milk, etc. It is further segmented on the basis of formulations such as plain-sweetened, plain-unsweetened, flavoredsweetened, flavored-unsweetened, and others that include low calorie, fortified, etc. The market has also been divided on the basis of sales channels such as supermarket, health food store, pharmacy, convenience stores, and others that include e-retailers, direct sales, etc.; and on the basis of geography such as North America, Europe, Asia-Pacific, and Rest of the World (ROW). FIGURE 1 DAIRY ALTERNATIVE BEVERAGE MARKET VALUE SHARE, BY REGION, 2012 % % As % No Eu RO % Source: MarketsandMarkets Analysis MarketsandMarkets Sample Page 3
5 2 PREMIUM INSIGHTS FIGURE 2 DAIRY ALTERNATIVE BEVERAGE SEGMENTATION Global Dairy Alternative Beverages Market Types Formulations Sales Channels Geography Soy Milk Plain-Sweetened Supermarket North America Almond Milk Plain-Unsweetened Health Food Stores Europe Rice Milk Flavored-Sweetened Pharmacy Asia-Pacific Others* Flavored-Unsweetened Convenience Store ROW Others** Others*** Others* Others** Others*** : Coconut milk, hazelnut milk, hemp milk, etc. : Low calorie, fortified, free-from, etc. : E-retailers, direct sales, etc. Source: MarketsandMarkets Analysis The dairy alternative beverage market was segmented based on types, formulations, sales channel types, and geography. The types of dairy alternative beverages include soy milk, almond milk, rice milk, and others such as oat milk, coconut milk, etc. The formulations of the market is sub-segmented into plain-sweetened, plain-unsweetened, flavored-sweetened, flavored-unsweetened, and others such as fortified dairy alternatives, free-from labeled products, etc. Dairy alternatives are available through various sales channels that include supermarket, health food satores, pharmacy, convenience stores, and others such as e- MarketsandMarkets Sample Page 4
6 retailers, direct sales, etc. The market was also segmented on the basis of geography such as North America, Europe, Asia-Pacific, and Rest of the World (ROW). MarketsandMarkets Sample Page 5
7 3 INDUSTRY ANALYSIS 3.1 SUPPLY CHAIN ANALYSIS FIGURE 3 DAIRY ALTERNATIVE BEVERAGE: SUPPLY CHAIN ANALYSIS Dairy alternative Beverage Packaging Distribution Dairy Alternative Beverage Processing Retail Consumer Transport of Raw Material Cereal & Nut Cultivation Source: USDA, Progressive Grocer, and MarketsandMarkets Analysis MarketsandMarkets Sample Page 6
8 The dairy alternative beverages industry includes farmers, associations, etc. as their suppliers. The suppliers provide F&B processors with raw materials such as cereals and nuts to process and extract milk. The processing and extraction of dairy alternative milk is followed by its packaging. The F&B manufacturers usually have an agreement or partnership with packagers, co-packers, transporters, logistics, for the proper storage and distribution of the products. The dairy alternative beverages are available in refrigerated packaging as well as non-storage packs in the retail outlets. These products are available through different sales channels such as supermarket, health food stores, pharmacy, etc. MarketsandMarkets Sample Page 7
9 4 MARKET OVERVIEW 4.1 WINNING IMPERATIVE PRODUCT PROMOTION Companies utilize natural and organic label to promote their products and be identified amongst the others. Most of the promotional strategy includes advertising in distribution catalogs and cooperative advertising. An appropriate combination of media to generate awareness influences the market growth. The companies achieve enhancement of brand equity and increased sales through the correct way of promotion. A consumer-relationship program serves to be another criterion to sustain in the market. This eventually impels the growth of the product, brand, and company. Provision of sponsorships and participation of events improves brand recognition. Considerable growth has been observed after the adoption of these promoting aspects. 4.2 BURNING ISSUE ADDED ADDITIVES The market for dairy alternatives such as almond milk, rice milk, soy milk, etc. has been increasing as it satisfies the requirements of the lactose intolerant, vegans, milk allergic individuals, and healthy diet followers. Although dairy alternatives have several nutritional benefits, they have additional additives such as carrageenan, gums, thickening agents, etc., that provides a creamy texture to the product. The presence of these hydrocolloids reduces ingestion and may cause gastrointestinal problems. The Joint Expert Committee on Food Additives (JECFA) considers Food-grade carrageenan to be safer as it passes through without digestion, but the non-food grade carrageenan has been considered carcinogenic by the World Health Organization s International Agency. Addition of carrageenan in dairy alternative beverages also created a MarketsandMarkets Sample Page 8
10 controversy in the market due to a few consumers myths towards the unhealthy output of carrageenan consumption. 4.3 IMPACT ANALYSIS FIGURE 4 IMPACT ANALYSIS OF THE DAIRY ALTERNATIVE BEVERAGE MARKET Medium Growth Impact High Growth Impact Low Growth Impact Source: MarketsandMarkets Analysis The different health benefits of dairy alternative have highly impacted their sales globally. This driver has shown a high growth impact on the market. Intolerance of lactose and milk allergy has been the second most influencing driver of this market. Better diagnosis and consumer education denotes a huge opportunity to this market. Also, marketing and positioning the product in the market impacts the growth of the company to a certain extent. MarketsandMarkets Sample Page 9
11 4.3.1 DRIVERS Health Benefits Drives The Plant-Based Beverage Market Companies market their products on the health platform that has helped change the consumers perception and has accelerated the sales. Nutritional benefits of plant-based dairy alternatives have enhanced their consumption. Soy milk has been majorly consumed, as it is a rich source of omega-3 fatty acids, protein, and fiber. Along with this, it contains isoflavones that have antiestrogenic and anticancer properties. Almond milk is rich in calcium and vitamin E. This is why it has been recommended for both skin and bone health. Hemp milk possesses essential fatty acids such as omega fatty acid 3 and 6 that helps in the proper functioning of the heart and is vital in the development of infant health. Consumers go for coconut milk, as it contains lauric acid. The low carb and low fat variety of dairy alternatives helps reduce fat. The nutritional benefits have enhanced the growth of the dairy alternative beverage market Varieties of Choice Dairy alternative manufacturers avail varieties of products in the market. Every variety has expanded their product line that includes sweetened, unsweetened, organic, flavor, fat-free, and numerous other varieties. They strive to meet the varied demands of consumers by cataloguing their products into different forms. Although dairy alternatives lack calcium, they are fortified with calcium to meet the absolute nutritional profile. MarketsandMarkets Sample Page 10
12 FIGURE 5 VARIETIES OF DAIRY ALTERNATIVE BEVERAGES Almond Milk Soy Milk High in Protein & Fat Creamy Texture Versatile Rice Milk Plain, Sweet Flavor Watery Texture Cereal, Smoothies Thick Texture Nutritious Cereal, Coffee, & Sipping Dairy Alternative Beverage Hemp Milk High in Omega Fats & Calcium Thick, Creamy Texture Hazelnut Milk Strong Flavor & aroma Thin Texture Great in Coffee Oat Milk Thick & Grainy Perfect for Hearty Cookies Source: MarketsandMarkets analysis Manufacturers also ponder on the product package size, and focus on offering their products as per the consumers convenience. These non-dairy alternatives are offered in cartons and aseptic packages, as the handiness of these products has increased their sales instantaneously. Due to this, the market has set a new horizon in the beverage industry, and it will achieve a significant growth than dairy milk. MarketsandMarkets Sample Page 11
13 Vegan Diet The vegan diet strongly supports animal rights. A number of the people perceive a vegan diet to be a healthy diet, and prefer consuming dairy alternatives such as soy milk, almond milk, etc. as a substitute for dairy milk. Vegan diet followers and healthy diet adopters have been one of the major consumers of dairy alternative, and have encouraged market growth. MarketsandMarkets Sample Page 12
14 5 DAIRY ALTERNATIVE BEVERAGE MARKET, BY TYPES 5.1 INTRODUCTION The market for plant-based dairy alternative beverage that is free of animal proteins, has witnessed a significant growth in the last couple of years, due to a decline in cow milk consumption. Consumption of cow milk has been declining due to an increased number of lactose intolerance and dairy allergies reported by consumers. Other consumers of dairy alternative milk include vegans, health conscious population, etc. Retail shelves generally showcase soy milk, rice milk, almond milk, and coconut milk. Other varieties of plant milk such as sunflower milk, hemp milk, oat milk, etc. have the potential to impact the market growth in future. A few of the plant-based milk are consumed as a traditional beverage and are easily available commercially in countries other than the U.S. This plant-based milk is presumed to be introduced in U.S. as well as other new markets because of their impact on consumer health and awareness, along with the globalization. Lactose intolerant and dairy allergic consumers have withdrawn their consumption of milk from their diet and prefer consuming dairy alternative milk. MarketsandMarkets Sample Page 13
15 FIGURE 6 ESTIMATED DIETARY COMPOSITION OF DAIRY ALTERNATIVE MILK Estimated % Composition Recommended Dietary Composition Cow Milk Soy Milk Oat Milk Rice Milk Protein Fat Carbohydrates Source: Dairy Council and MarketsandMarkets Analysis MarketsandMarkets Sample Page 14
16 6 DAIRY ALTERNATIVE BEVERAGE MARKET, BY FORMULATIONS 6.1 INTRODUCTION Dairy alternative beverages are consumed by the dairy intolerant population. The only treatment for this sect of the population is to consume dairy-free products. Thus, the market for dairy alternative beverages has been driven by dairy-intolerant consumers. Plant-based dairy alternatives have the advantage of low-fat and low-cholesterol that appeals to the health conscious as well as vegan population. Thus, the market is projected to grow rapidly with increasing consumer awareness on the benefits of dairy-alternative beverages derived from plants. Research indicates that about % of the population has contracted this health condition. Consumers thus prefer the consumption of dairy alternative beverages. The increasing ratio of the diabetic population has led to changing dietary preferences among people. The plain dairy alternative beverages are preferred by lactose intolerant population, while the flavored products are preferred by children and the vegan population. The other formulations include dairy alternative beverages fortified with essential nutrients, and products that are labeled as calorie-free, fat-free, etc. MarketsandMarkets Sample Page 15
17 FIGURE 7 DAIRY ALTERNATIVE BEVERAGE MARKET VALUE SHARE, BY FORMULATION, 2012 % % % Pl Pl Fl Fl % % Ot Source: MarketsandMarkets Analysis MarketsandMarkets Sample Page 16
18 7 DAIRY ALTERNATIVE BEVERAGE MARKET, BY CHANNEL TYPES 7.1 INTRODUCTION Plant-based dairy alternative beverages are a regular dietary drink for vegans and consumers with certain health conditions such as dairy intolerance, high cholesterol, obesity, etc. These beverages are widely available in the market through different sales channels such as supermarkets, health food stores, pharmacy, etc. The sales channels carry dairy alternative beverages in both refrigerated and non-refrigerated varieties. FIGURE 8 DAIRY ALTERNATIVE BEVERAGE MARKET VALUE, BY CHANNEL TYPE, ($MILLION) CAGR % ( ) ,000 1,500 2,000 2,500 3,000 3,50 Market Value, 2012 ($Million) *Bubble Size Indicates Market Value, 2018 ($Million) Source: MarketsandMarkets Analysis The increasing demand for dairy alternatives has enabled marketers to offer products through different sales channels. Supermarkets dominated the market value as well as volume of dairy MarketsandMarkets Sample Page 17
19 alternative beverages in The availability of dairy alternatives as specialty health food for consumers who suffer from high cholesterol, obesity, etc. is estimated to drive the market for health food stores. MarketsandMarkets Sample Page 18
20 8 DAIRY ALTERNATIVE BEVERAGE MARKET, BY GEOGRAPHY 8.1 NORTH AMERICA: THE DAIRY ALTERNATIVE MARKET In North America, about million people suffer from dairy intolerance. The number of supermarkets that sell dairy alternatives has increased in North America to meet the growing demand from consumers. North America has a large number of dairy alternative beverage companies. The companies introduce new varieties of dairy alternative beverages to satisfy consumer preferences. In 2013, The Hain Celestial Group (U.S.) launched dairy alternative beverages with new flavors and product benefits to satisfy the growing demand for natural and organic products. The Hain Celestial brand DREAM launched a new non-dairy sunflower drink, SUNFLOWER DREAM in In 2012, Turtle Mountain (U.S.) launched a new line of almond milk products with different flavors. In 2013, Blue Diamond Growers (U.S.) expanded their facilities to meet the increasing demand for almond milk. Soy milk has the largest market for dairy alternative beverages in North America, but faces intense competition from other dairy alternative beverages such as almond milk, rice milk, etc. Rice, hazelnut, and hemp milk are also growing in the dairy alternative market as they have calcium content and other nutritional benefits similar to that of soy milk. MarketsandMarkets Sample Page 19
21 9 COMPETITIVE LANDSCAPE 9.1 INTRODUCTION DAIRY ALTERNATIVE MILK: A HIGHLY COMPETITIVE MARKET FIGURE 9 DAIRY ALTERNATIVE MILK: COMPETITIVE DEVELOPMENTS, No. of Developments Source: MarketsandMarkets Analysis A total of developments were registered in the dairy alternative milk market from 2009 to The dairy alternative milk market has been growing. New product launches of several plant-based dairy alternative milk varieties such as almond milk, coconut milk, etc. have been increasing. In 2012, the number of developments increased from, to in 2013, and is projected to increase further. MarketsandMarkets Sample Page 20
22 10 COMPANY PROFILES 10.1 THE WHITEWAVE FOODS COMPANY OVERVIEW The WhiteWave Foods Company is a consumer packaged food & beverage company. The company is involved in manufacturing, marketing, and selling of three product categories that include plant-based food & beverage, coffee creamers & beverage and premium dairy products. The plant-based food & beverage products include soy, almond, hazelnut and coconut drinks. The leading brands of the company include Silk, Alpro, Horizon Organic, etc. The company operates through two business segment North America and Europe. WhiteWave Foods is a former subsidiary of Dean Foods Company that was separated in May The company operates throughout North America and Europe. The key competitors of the company include The Hain Celestial Group (U.S.), and Organic Valley (U.S.). Company at a Glance 2012 Founded : 1977 Headquarters : Texas, U.S. Employees : 2,600 Revenue : $ Million R&D : $ Million Ownership : Public, NYSE: WWAV Recent Financials % % % Total Revenue ($Million) Percentage change(%) Geographic Revenue Mix Business Revenue Mix % % % % North America Coffee Creamers and Beverages North America Premium Dairy % % North America Plant-based Foods and Beverages Europe Plant-based Foods and Beverages Source: Company Publication and MarketsandMarkets Analysis MarketsandMarkets Sample Page 21
23 PRODUCTS & SERVICES WhiteWave offers dairy alternatives products under the brand name of Silk and Alpro. TABLE 1 WHIEWAVE FOODS: PRODUCTS & THEIR DESCRIPTION Brands Products Varieties Description Vanilla Original Chocolate Very Vanilla Soymilk DHA Omega-3 Light Vanilla Light Original The company offers wide varieties of soymilk that are based on their flavors, additional ingredients, and their shelf stability. Light Chocolate Silk Organic Vanilla Organic Unsweetened Vanilla Original Almond milk Dark Chocolate Unsweetened Vanilla The company offers wide varieties of almond milk depending on their flavors, sweetness, ingredients, and their shelf stability. Unsweetened Original MarketsandMarkets Sample Page 22
24 Brands Products Varieties Description Light Vanilla Light Original Coconut milk Vanilla Original Unsweetened The company offers three varieties of coconut milk that are Silk Pure Coconut Vanilla, Silk Pure Coconut Original, and Silk Pure Coconut Unsweetened. Alpro Hazelnut Drink Almond Drink The product is a plant-based drink made from hazelnuts, which is smooth and creamy with hazelnut taste. The product is a plant-based drink made from almonds and has taste of lightly roasted almonds. Source: Company Publication and MarketsandMarkets Analysis STRATEGY & INSIGHTS The core strategies of the company include brand building and product innovation. The company invests on marketing and promotional activities to strengthen their brand position. R&D initiatives and new product launches are the frequently adopted strategies by the company to expand their product portfolio and garner a larger volume share in the market. The company adopts R&D programs to develop products that meet the market demand. They were the first company to commercialize almond drinks in Europe and meet the consumer preference for plant-based dairy alternatives in The soymilk brands, i.e., Silk and Alpro, offered by the company have shifted from a niche product line to a variety of plant-based dairy alternative products. They extensively seek cost-reduction opportunities that can aid the company to reinvest in value-addition for their existing brands and operational capabilities. They pursue various expansion opportunities in new markets to broaden their global reach. These strategies facilitate the recognition of their brands in new adjacent markets, which opens new avenues MarketsandMarkets Sample Page 23
25 for growth of the company. Acquisition of Alpro in 2009 enabled the company to enter the European market and seek growth opportunities across Europe and North America DEVELOPMENTS Date Approach Description March 2013 Agreement Dean Foods Company approved the distribution of its equity interest in The WhiteWave Foods Company to their shareholders. January 2013 Agreement Dean Foods Company sold their Morningstar Foods division to Saputo Inc. (Canada) for $ billion to increase their financial flexibility. July 2009 Acquisition Dean Foods Company acquired a soy-based beverage and food company, Alpro division of Vandemoortele N.V. (Belgium). This acquisition will establish their global leading position in soybased beverage and food products. Source: Company Press Release, Company Annual Report, Company Website, Company Publications, and MarketsandMarkets Analysis MarketsandMarkets Sample Page 24
26 Disclaimer: MarketsandMarkets strategic analysis services are limited publications containing valuable market information provided to a select group of customers in response to orders. Our customers acknowledge, when ordering, that MarketsandMarkets strategic analysis services are for our customers internal use and not for general publication or disclosure to third parties. Quantitative market information is based primarily on interviews and therefore, is subject to fluctuation. MarketsandMarkets does not endorse any vendor, product or service depicted in its research publications. MarketsandMarkets strategic analysis publications consist of the opinions of MarketsandMarkets' research and should not be construed as statements of fact. MarketsandMarkets disclaims all warranties, expressed or implied, with respect to this research, including any warranties of merchantability or fitness for a particular purpose. MarketsandMarkets takes no responsibility for any incorrect information supplied to us by manufacturers or users. All trademarks, copyrights and other forms of intellectual property belong to their respective owners and may be protected by copyright. Under no circumstance may any of these be reproduced in any form without the prior written agreement of their owner. No part of this strategic analysis service may be given, lent, resold or disclosed to noncustomers without written permission. Reproduction and/or transmission in any form and by any means including photocopying, mechanical, electronic, recording or otherwise, without the permission of the publisher is prohibited. For information regarding permission, contact: Tel: sales@marketsandmarkets.com MarketsandMarkets Sample Page 25
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