Fulfilling demand

Written by Kevin Catalano

When it comes to beverages, consumers’ choices are nearly endless. From juice to soda, enhanced water and tea, there are myriad flavor combinations and valued-added health benefits, such as vitamins, antioxidants and probiotics. The plethora of new beverages over the past decade has resulted in less and less space on store shelves for milk — once a staple across America.

To combat the steady decline in fluid milk consumption, the dairy industry has turned to innovation in products and packaging to keep the dairy segment growing in the $260 billion beverage market.

“Just as consumer trends evolve, we must do the same as an organization,” says Gigi Vita, senior vice president for DFA’s industry business development. “While we have had a tremendous amount of success in the past in the type of packaging and products that we have offered, we have to keep changing and improving our offerings.”

To do that, DFA has recently renewed its focus on innovation throughout the Cooperative. Part of this focus is the development of new dairy beverages that capitalize on consumer trends.

One such trend is protein consumption — particularly in a drinkable version. U.S. sales of packaged foods with protein-related claims on their labels rose to $7.5 billion in the year that ended February 15, 2014, up more than 50 percent from the same period four years earlier, according to research firm Nielsen.

Also tapping into the trend, the Milk Processor Education Program (MilkPep) earlier this year shelved its iconic “Got Milk?” slogan in favor of a new tagline, “Milk Life,” which puts emphasis on milk’s nutritional benefits, including its protein content.

At DFA’s Innovation Center in Springfield, Mo., scientists and strategists work with DFA’s brands and customers to develop new products and reformulate existing ones. With four product-development labs and one pilot plant, the Innovation Center blends the latest consumer trends and cutting-edge research to bring value to DFA members.

Currently, researchers there are working to capitalize on protein’s popularity by developing combinations of milk, coffee and protein components to make a protein-rich, dairy-based coffee beverage.
“We look for opportunities, especially in the space around innovation, in order to drive initiatives that are going to be sustainable and that we can build out into the future,” Vita says. 

DFA’s product development initiatives are also influenced by research coming out of the Innovation Center for U.S. Dairy, which was established in 2008 as part of the producer checkoff program. The Innovation Center for U.S. Dairy acts as an industry think tank, with leaders and producers in dairy cooperatives, companies and processors working precompetitively to move the industry forward. Several representatives from DFA participate on various Innovation Center committees, and the Cooperative is currently working with the Innovation Center for U.S. Dairy to develop a protein beverage.

“In the beverage area, one function of the Innovation Center for U.S. Dairy is to work upstream by creating a product concept with an industry partner — DFA in this case — that increase dairy consumption,” says John Stephens, DFA’s chief operating officer of consumer brands, who serves as chairman of the Innovation Center for U.S. Dairy’s research and insights committee.