Guest Columns

Perspective:
Industry Issues

Dairy producers are winning with lactose-free options

Michael Burdeny

Michael Burdeny is chief commercial officer and president of consumer products group, California Dairies Inc. He is a guest columnist for this week’s Cheese Market News®.

The fight for consumers’ attention, loyalty and spending in the dairy category is getting more difficult by the day. Some American consumers may think they need to move away from dairy due to lactose intolerance, but there is still a great opportunity for producers.

Lactose-free dairy products are the fastest-growing segment of the dairy industry. The global lactose-free market was valued at US$14.17 billion in 2023 and is projected to reach US$36.22 billion by 2031. The dairy industry has made significant strides in providing lactose-free products, transforming what was once a limited selection into a diverse array of options. While more than 98% of retail outlets offer lactose-free dairy milk, and there is a robust CAGR of 12.45% during the forecast period of 2024 to 2031, room for innovation remains.

The lactose-free opportunity we see is with butter. If you look overseas at the butter category in Europe, for example, you’ll always find a couple of lactose-free butter options in the store. With 8% of all milk volume sales in 2023 across retail and institutions representing the largest share of lactose-free volume sales in U.S. history, it only makes sense to have a butter offering.

• The Butter Opportunity

Despite all the challenges, the butter category continues to grow nationally, driven by a couple of factors: flavored butter, super-premium butter and new, consumer-friendly packaging and formats that make shoppers’ lives easier as we transition back to a “normal” world post-COVID. Although consumers are more price-conscious, often buying on deal or opting for private label, they are also shifting their spending to products that make meal planning easier, allow for indulgence, add flavor or comfort, or meet special needs like flavors, formats, or health benefits (such as lactose-free options). As we know, butter makes everything better.
Butter is also resonating with new cooks who are looking for less-processed, short-ingredient-list and natural products, as well as younger consumers who want to get the most out of their meals with wow-inducing, butter-rich flavor excitement. In the past, these shoppers had to choose between butter that didn’t agree with their digestive system and margarine.

Responsiveness to the market and the development of new products represent a tremendous opportunity for dairy producers. That means listening to consumers who want more lactose-free options.

According to Dede Wilson, founder of FODMAPeveryday.com, “About 68 percent of the world’s population has lactose malabsorption to some degree. While social media is not the place to seek evidence-based medical answers, it has been outstanding at normalizing digestive issues, leading more people to take control of their health. And now, more than ever, it is easier to find foods that align with our digestive needs. If you are suffering from a digestive issue like lactose intolerance, there has never been a better time to be a consumer,” says Wilson.

How many people are lactose intolerant is unclear, but it does lead to a decrease in dairy consumption. Surveys suggest that a large proportion of people use the internet to search for information on medical symptoms they experience, and around one-third of people in the United States self-diagnose using online information. According to a study published in The American Journal of Clinical Nutrition, “Self-perceived lactose intolerance may result in adverse dietary modifications.” While it’s still early, at Challenge, we’re seeing encouraging traction with our Lactose-Free Spreadable Butter. We’re excited about the potential of lactose-free butter, especially since this has been an underserved need for lactose-free consumers.

• The Benefits of Lactose-Free Butter

Whether people are actually lactose intolerant or not, offering lactose-free dairy options is a win-win. Lactose-free butter allows consumers to enjoy some of the most pleasurable culinary experiences without sacrificing taste or texture. At California Dairies, Inc., we recently launched Challenge Lactose-Free Clarified Butter with Canola Oil. The lactose removal process allows those with lactose sensitivities to enjoy the benefits of clarified butter without digestive discomfort, while the resulting product still maintains the rich flavor and versatility of clarified butter. Made with high-quality butter, it is carefully clarified to remove lactose and milk solids.

Additional benefits include:

• Blended with canola oil for easier spreading straight out of the fridge.
• Adds rich, buttery flavor to dishes without worrying about lactose intolerance symptoms.
• Versatile for a variety of culinary uses and is the only spreadable lactose-free butter in the marketplace.

We’re also seeing great momentum with our Challenge Spreadable Butter with Pure Avocado Oil, which is on-trend as consumers look for simple, healthy products and ingredients. We also see great potential in butter innovation that’s easy to use as convenience products continue to proliferate the grocery aisles.

By offering lactose-free options beyond just milk, dairy producers can cater not only to the lactose-intolerant but also to individuals focused on moving towards a healthy, plant-forward diet (as defined by the Dietary Guidelines for Americans) or interested in improving their gut health. Offering lactose-free product extensions can also build brand loyalty, positioning the producer as an innovator. Often, within households, one person may be lactose-free while other members are not. Producers who offer lactose-free options will see increased sales and market share.

Dairy producers must be steadfast about creating and selling products that meet market needs but also taste great. All the healthy options in the world don’t mean a thing if they don’t taste good. Thankfully, with our most recent innovations, lactose-free consumers no longer have to compromise on taste.

CMN

The views expressed by CMN’s guest columnists are their own opinions and do not necessarily reflect those of Cheese Market News®.

© 2024 Cheese Market News • Quarne Publishing, LLC • Legal Information • Online Privacy Policy • Terms and Conditions
Cheese Market News • Business/Advertising Office: P.O. Box 628254 • Middleton, WI 53562 • 608/831-6002
Cheese Market News • Editorial Office: 5315 Wall Street, Suite 100 • Madison, WI 53718 • 608/288-9090