Flavoured milk market will grow to be 71% of dairy drink in India by 2028

India may be one of the largest milk producers globally, Indian consumers associate milk with being healthy and just 37 per cent perceive milk to be a high source of calcium. Today’s consumers are pursuing healthier lifestyles and adopting diets that are beneficial to their overall wellbeing. Though Indian consumers may not fully recognise milk’s health benefits, it seems they are open to support their healthier lifestyles with their glass of milk. In light of consumer demand, there is a call for dairy brands to focus on ethical and environmental claims.

In recent years, India’s packaged flavoured milk segment has been enjoying an increased level of interest, and this attention has brought about a significant amount of product innovation in the country.

New research reveals that flavoured milk products accounted for 43 per cent of dairy drink introductions in India in 2016, up from just 20 per cent in 2012, which is predicted to increase upto 71 per cent of the dairy drink by 2028.

Types of flavours and varieties

Flavoured milk is ready to drink milk product produced from skimmed milk, added sugar and natural flavours like banana, pineapple, orange and chocolate. Stabilisers and emulsifiers such as dry premixed with other ingredients to reduce agglomeration a. Flavoured milk drinks are available in many types of flavours and varieties. It is available in traditional flavours like chocolate and in new and innovative flavours such as strawberry, vanilla and mocha. This milk is a highly palatable, nourishing beverage that can help people, particularly children, meet current daily dairy food and calcium intake recommendations.

This market is expected to register healthy growth in the near future, despite growing awareness about the unhealthy amounts of sugar. Flavoured milk includes artificial or natural flavouring mixed with milk, food colourings, and sugar. The flavoured milk market products often have a higher shelf life than plain milk products, due to reliance on high-temperature pasteurisation.

Consequently, the flavoured milk market also caters to high demand for refrigerated milk products. Major players in the flavoured milk market also sell syrups and flavoured milk powders which are largely in demand for their great taste.

In order to move forward, players in the flavoured milk market are likely to introduce healthy varieties of flavoured milk products. Such products containing minerals and vitamins may lead the way for future growth in the flavoured milk market.

Trending in the flavoured milk market

New developments in flavours and packaging are observed to be trending in the flavoured milk market, with companies introducing locally-preferred flavours. Additionally, there is a preference for fruit flavours among youngsters.

In addition, companies are observed to be launching flavoured milk varieties with enhanced functional properties. Moreover, they are offering low-sugar and fat-free varieties of flavoured milk products in order to tap into the increased diabetic and health-conscious population. Considering the opportunity posed by busier lifestyles and the need for convenience, companies are introducing on-the-go flavoured milk in order to increase their offerings and customer base.

Robust growth during 2021-2029

Global flavoured milk market is expected to grow in a robust manner during 2021-2029, thanks to their mass popularity among children, few alternatives to popular flavours such as chocolate flavoured milk, and busy lifestyle driving up the unscheduled consumption of milk.

Healthy flavoured milk also contains various nutrients such as flavoured milk contains many nutrients like potassium, calcium, and magnesium. While substitutes like soft drinks and plant protein drinks pose a challenge to the market growth, increasing disposable incomes and changing consumer preferences are expected to boost demand. Additionally, innovation is making new-inroads with consumers with the introduction of new flavours.

The flavoured milk market is segmented on the basis of flavour, packaging and distribution channel. On the basis of flavour, the flavoured milk market is segmented into chocolate, fruit, vanilla, and others. By packaging, the flavoured milk market is bifurcated into paper, plastic, glass and others. By distribution channel, the flavoured milk market is divided into supermarkets, convenience stores, online stores and others.

The flavoured milk market is fragmented with the presence of a few global players such as Nestle. Due to the dynamic nature of the market, it is highly competitive and fragmented. The companies are adopting strategies such as mergers and acquisitions, new product innovations and launches, expansions and partnerships. Companies also compete in terms of new variants of flavours and attractive packaging. There is ample scope for regional players to gain competitive advantage, provided that they bring in substantial innovation at ingredients and packaging levels.

Reposition flavoured milk

Finally, it seems the time is ripe for brands to also reposition flavoured milk in the Indian dairy market—as just 23 per cent of regular milk drinkers in India have drunk packaged flavoured milk in the last three months.

Of these flavoured milk drinkers, a significant portion drink flavoured milk for emotional reasons; some 30 per cent consume flavoured milk as a treat, while over a quarter (27 per cent) do so to satisfy a sweet craving. Meanwhile, a quarter (23 per cent) enjoy flavoured milk as a dessert. Looking for more choices, 14 per cent of Indian regular milk drinkers feel that there are not enough varieties of flavour in flavoured milk.

Flavoured milk is still not a category that enjoys mainstream consumption in India. Instead, it is typically consumed on impulse, with a sizeable population of flavoured milk drinkers consuming it as a treat or dessert. Brands can look to reposition flavoured milk as a product that allows for permissible indulgence to increase its appeal among Indian consumers.

Flavoured dairy beverages

Flavoured milk has gained ground in India over the past few years, and most dairy players in the country feature some form of the flavoured beverage in their product mix. On top of that, there has even been innovation from companies that are not typically associated with the dairy space. Much of the category’s retail growth in India can be attributed to the fact that urban Indian consumers are opening up to value-added dairy, particularly for its convenience and health benefits. The popularity of packaged flavoured milk in India is also due to consumers’ preference for assurance of safety.

The breakfast occasion presents an opportunity for companies in the dairy industry but currently very few launches highlight this positioning. In today’s fast-paced world, consumers do not have the time for a sit-down breakfast, and are on the lookout for convenient food and drink options that keep them full and nourished while on the move. This opens up quite a few avenues for value-added, fortified, on-the-go dairy innovations that achieve satiety while providing consumers with their breakfast nutritional needs.