New nut-based milk alternatives flood the category, souring soy and rice-based product sales
SPINS data for the year ending April 22 shows sales of refrigerated almond milk jumped 9.8%, while shelf-stable sales grew 4%, according to Food Navigator. This contrasts with refrigerated and shelf-stable soy milk, where sales fell 10.5% and 9.6%, respectively.
Sales of refrigerated coconut milk products were up 5.2%, and shelf-stable brands increased 3.3%. Rice milk sales were down 5.6% in the refrigerated case and fell 3.7% in the shelf-stable categories. SPINS reported the highest sales growth was in newer products, such as beverages made from cashew, walnut, pea, hemp, quinoa, oat and flax, plus blends of almond and oat.
Total refrigerated plant-based beverage sales jumped 7% to $1.61 billion, while total shelf-stable sales increased 4.7% to $229 million. The SPINS data include conventional outlets and natural and specialty gourmet channels. Not included were online and convenience channels and some major retailers, such as Costco, Whole Foods, Aldi and Trader Joe’s, so SPINS noted the category size was "likely much larger."
Sales of plant-based beverages continue to make a splash in the alternative dairy category, but products made from soy and rice have seen their performance sour. Soy allergies and concerns about genetically modified soy may factor into this decline, as many health-conscious consumers worry over soy's impact on hormone production and other body systems. It's unclear why sales of rice-based beverages are slipping, but it could simply be a matter of increased competition in the crowded segment.
As for the surge in newer plant-based products, consumers tend to appreciate taste, health and innovation when it comes to beverages. They may be looking for unique flavors and functional value-adds from products made with nuts and grains. If shoppers see a dairy alternative on the shelf or in the refrigerated case that looks interesting and has a clean label — a premium beverage blend of oats and almonds, for example — they may choose this instead of a more familiar product.
Still, tried-and-true brands continue to make gains in the category. Almond Breeze from California-based Blue Diamond was a big winner in its category. Food Navigator reported the company had $514 million in sales for the year ending May 28 and 12.9% growth. Danone North America's So Delicious organic coconut milk also did well, and the company recently debuted an organic almond milk with cashews to appeal to new audiences looking for simple products.
SPINS predicted blends of plant-based beverages and coffee could be the next wave of growth, along with beverages offering cleaner labels and a higher nut content, which augments the fiber level. Brands need to differentiate themselves within their niche categories or get left behind, so it's likely the market will also see more blends of grains and nuts to help a product stand out.
Focusing on unique value-adds could help brands gain consumer recognition, especially if those attributes mimic dairy milk's benefits. For example, much of Ripple pea milk's marketing focuses on the beverage's protein levels — the product contains 8 grams of protein per serving, which is comparable with cow milk and higher than almond milk. The company also touts the sustainability of its ingredients and production process, another claim that could help alternative dairy brands get a leg up on rivals.