US Insights

Got milk? Not so much

Lauren Masotti

Client Manager, US Beverages

Health 06.23.2015 / 09:20

glass of water

Kantar Worldpanel data documents dairy’s decline and the rising tide of, well, water

There is a time and a place for milk. In fact, on a per-week basis, there seem to be seven times and places for milk. The number of occasions in which Americans drink the beverage each week has remained remarkably stable over the past decade: 7.1 times per week in 2004, 6.7 times per week in 2014, according to data from Kantar Worldpanel.

Yet the percentage of Americans who drink milk in the average week is a different story, dropping 13 points in a decade from 62% as of December 2004 to 49% as of December 2014. Consumers have more beverage choices available to them than ever before, impacting the traditional American staples of milk as well as fruit juice.

Key Numbers

  • 62% of Americans drank milk in December 2004
  • 49% of Americans drank milk as of December 2014

In recent years, milk's decline has been fastest in two areas: among Millennial Consumers, as younger generations grow up with more beverage choices, and among those drinking it outside the home as more beverage choices are introduced at schools and in restaurants.

At the same time, regular whole milk has gained some ground among the Boomer Generation, while organic whole milk grows among acculturated Hispanics and Asians, but not yet enough to stop milk's overall decline. As these demographic groups are projected to experience substantial growth in the near future, milk may see some gains. The challenge for the milk industry is to work out how to compete more closely with its wider competitive set. The danger it faces if it can't? More lost drinkers.

Water looms ever larger as the competition not only for milk but for every other beverage category. According to Worldpanel's survey data, 78% of Americans consume tap water in a given week during an average 15 occasions and making up about one-third of the volume of all beverages consumed.

Worldpanel data over the past three years, between 2011 and 2014, shows water is now more likely to be consumed as a healthier choice. Tap water is up from 36% to 40% of healthier choice occasions; bottled water is up from 16% to 21%. Overall, the percentage of Americans who say they pick their beverages based on healthier choices grew a significant 32% from 2011 to 2014, while the percentage who say they pick their beverages to get nutritional benefits is down 7%, which may help explain milk's decline. We believe there is an opportunity for milk to re-position itself as a healthier choice to other flavored beverages, a tasty, nutritional treat that kids and adults can feel good about drinking.

Ultimately, Worldpanel feels there is an element of consumers wanting to go "back to the basics" but in a more permissive way. We see this among consumers limiting their intake of carbonated soft drinks from a daily behavior to more of an occasional treat with a meal. For milk, consumers are going to find ways to feel better about drinking the category, which we believe will be the opportunity among organic variants. As consumers turn to water as the go-to healthier choice, it is important for categories to deliver on secondary consumption drivers like taste and energy to keep themselves afloat among the tide of water.

Source: Kantar Worldpanel

Editor's Notes

Journalists, for inquiries or to speak with the author, contact us. Follow @Kantar and sign up for our insight alerts.

Kantar Worldpanel's data on beverage consumption is based on a demographically representative sample of 40,000 Americans age one year and older. Survey participants, including adults in households with young children, keep week-long diaries recording all beverage occasions including tap water, and including consumption both in and out of home.

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