1. food and drink

Powered by Dairy Opportunities for GrowthPreliminary Findings
October, 2013
Lynn M. Stachura
What we will cover:
• Why Is Powered By Dairy
Important?
• Foundation for Powered By Dairy
Research
• What Opportunities Can Dairy
Leverage Within The Energy
Space?
• Relative Size of
Prize/Opportunities Quantified
2
Basis of Interest for “Powered By Dairy” Research
Making dairy the go-to food/beverage for people
who want more physical or mental energy
Basis of Interest
Potential Ways to Bring to Life
•
Energy drink market in US was $4.8BN in 2008
Idea Thought Starters:
•
Functional drinks estimated to grow to $19BN by 2013
(160% growth from 2008)
•
Symbols on products to show ‘good source of protein’
•
Dairy energy bars/drinks
•
63% of Americans are concerned about lack of energy
•
Flavors associated with protein: peanut butter
•
69% say ‘provides energy’ is important in determining
products to buy
•
Mental energy drinks
•
Fusions – milk + high protein products (granola, nuts)
•
Chocolate milk proven to be a good recovery drink
•
21% are regular energy drink users, including 43% of
those ages 18–24
•
Only 29% of consumers strongly agree protein is
naturally found in milk; only 25% familiar to whey protein
Supply Chain Thought Starters:
•
Vending machines at health clubs, athletic centers at
universities
•
Machines that check energy levels (similar to blood
pressure machines) in food stores and then recommend
high protein items to buy
Innovation Center research compiled by GfK identified 3 dairy
categories that have possible opportunities within the energy space:
MILK
YOGURT
DAIRY
INGREDIENT
3
Team Work Plan to Uncover Opportunities Dairy Might
Leverage Within The “Powered” Space
Making dairy the go-to food/beverage for people who want
more physical or mental energy
Dairy entry into new & existing “energy” markets
What dairy opportunity can be
leveraged within the energy space
and who is the target consumer?
Understanding the Why behind
consumer needs, habits/practices,
attitudes, and behavior?
Help identify emerging innovative
energy territories
Players within the “claimed” energy
space?
TNS Landis Database Quantitative Work:
 Identify potential categories focused in the
“energy” arena so dairy can leverage equity and
consumer acceptance
GfK Qualitative Work:

Identify consumer needs by need state/
occasion/ segments

Conduct global scan for new product
innovation across energy market
Quantitative & Secondary Research:
 Exploration of energy claims within food &
beverage within the retail channel
 E.g. understanding energy drink/shot categories
4
Executive Summary
• Dairy has permission to play within energy space
• Highest priority areas for innovation are
– Regular yogurt, greek yogurt, smoothies, drinkable yogurt & low fat/skim milk
• Yogurt categories show most potential to compete w/ energy categories
• Uncovered preliminary roadmaps for both “close-in” and
“farther-out” innovation
– Closer-in growth doesn’t require new product development, rather leverages
current dairy benefits
– Farther-out growth requires greater innovation which can lead to higher
incremental growth
5
Executive Summary
Snack universe (defined by TNS):
• Regular and greek yogurt occasions have an opportunity to move into the
energy space, which accounts for 21% of the snack occasions
• Learnings from regular and greek yogurt can be applied to other
categories such as dessert yogurt, probiotic yogurt and frozen yogurt
• Relative potential for dairy-based energy snacks is $18.9 billion
Beverage universe (defined by TNS):
• Smoothies, drinkable yogurt and low fat/skim milk occasions have
opportunity to move into the energy space, accounts for 30% of the
beverage occasions
• Learnings from smoothies, drinkable yogurt and low fat/skim milk can be
applied to other categories such as reduced fat/calorie milkshakes, lactose
free milk and organic milk
• Relative potential for dairy-based energy beverages is 15.9 billion gallons
6
Powered By Dairy:
INITIAL DISCOVERY
7
Initial Discovery Uncovers Why “Powered
By Dairy” Is Important To The Industry
•
The functional food/beverage category is a profitable
market that grew 25% between 2008 - 2011 despite
the recession
•
Energy is among the fastest growing claims with sales
increasing 15% in the past year
•
Adults are increasingly more interested in obtaining
physical and mental energy in these hectic times
•
Natural energy is becoming the new functional
energy trend
IRI Sales versus year ago (1 year ending July 15, 2012)
New Nutrition Business 2011
New Nutrition Business Key Health and Nutrition Trends 2012
8
Consumers Are Changing Their
Diets For A Variety Of Reasons
67%
Weight management
54%
Overall improved health
and wellness
46%
Improve overall quality
of life
46%
Improve body shape/fat
composition
34%
Increase energy levels
Source: The NPD Group/Functional Foods & Beverages Custom Survey; June ‘12
Top Reasons for Changing Diet: % Made Dietary Changes in Past Year
Disclosed with permission of The NPD Group solely for the purpose for which it is being provided by DMI. The reproduction,
dissemination or use of the information for any other purpose is strictly prohibited without NPD’s prior written consent.
9
Physical And Mental Energy Are Important To Consumers
Types of Energy Consumer Are
Looking For In Functional Products
(Foods & Beverages; % of Adult Sample)
73%
63%
24%
Physical Energy
Mental Energy
Do not use for energy
Source: The NPD Group/Functional Foods & Beverages Custom Survey; June ‘12
Disclosed with permission of The NPD Group solely for the purpose for which it is being provided by DMI. The reproduction,
dissemination or use of the information for any other purpose is strictly prohibited without NPD’s prior written consent.
10
Energy Products Maintain Younger Consumers Interest,
While Older Consumers Seek More Natural Sources
36% of adults would rather get their
nutrients from foods and beverages
as opposed to supplements
Natural is a good point of difference
Source: Package Facts dietary supplements us 2010 study
Source: The NPD Group/Functional Foods & Beverages Custom Survey; June ’12
Disclosed with permission of The NPD Group solely for the purpose for which it is being provided by DMI. The reproduction,
dissemination or use of the information for any other purpose is strictly prohibited without NPD’s prior written consent.
11
The Move To “Natural” Products Is Evident In The Product
Does Dairy
Have
Permission
Introductions
And
Expanded
Usersto Expand Into Energy Space?
12
Powered by Dairy:
DAIRY OUTLOOK IN ENERGY SPACE
13
Using The TNS Landis Database,
Consumers Define “Energy” As…
• Helps manage my blood sugar
• Helps me get through my day
• Provides lasting energy
Sustained
energy…
Natural
energy…
• Boosts of energy naturally
• Won't impair performance
• Helps me lead active lifestyle
• Is good after physical exercise
• Enhances physical performance
• Energy w/o making me crash later
• Will not slow me down/feel sluggish
Mental
energy…
Energy
Physical Energy
(Exercise)
Quick
energy…
Protein Based
Energy
• Enhances mental performance
• Helps me stay sharp and alert
• Is a good way to start the day
• Helps me stay on track
• Helps me concentrate
• Helps wake me up
• Provides quick energy
• Picks me up/gets me going
• Is a supercharged energy source
• Is a good source of protein
• Is a good source of soy/ soy protein
Other
• Gives me energy w/o the calories
• Boosts my metabolism
• Rejuvenates me
• Revitalizes me
14
Note: Energy is defined as a need within food and beverage
Some Dairy Categories Have Opportunity
To Move Into Energy Space
1
• 11 dairy categories in the
Beverage Universe
• 14 dairy categories in the
Snack Universe
3
Energy
Attributes
25 Dairy Categories
52 Energy Categories
• The 26 energy attributes
aligned with 52 energy
categories
2
Energy Attributes
25 Dairy
Categories
• Energy attributes define
the energy categories
52 Energy
Categories
Examples of energy attributes:
• Provides quick energy
• Helps me get through my day
• Enhances my physical performance
• Is a good source of protein
• Enhances my mental performance
Prioritized 5 Dairy Categories
15
We Prioritized Five Opportunity Areas Where
Dairy Has Greater Permission to Innovate
1
2
Regular
Yogurt
3
4
Yogurt
Smoothies
Greek
Yogurt
5
Drinkable
Yogurt
Low Fat/
Skim Milk
Additionally, these dairy categories below have similar traits to innovate against:
• Yogurt- Dessert
• Yogurt- Probiotic
• Packaged Frozen
Yogurt
• Yogurt- Dessert
• Yogurt- Probiotic
• Packaged Frozen
Yogurt
Lower Priority
Dairy Categories
(Don’t meet energy needs or other
categories meet the needs)
• Reduced Fat/
Calorie
Milkshakes
• Lactose Free
Milk
• Organic Milk
Snack opportunities
Beverage opportunities






 Chocolate Milk
 RTD Refrigerated Milkshakes
 Whole Milk
String Cheese
Individually Wrapped Cheese Slices
Premium Ice Cream
Non Premium Ice Cream
Soft/ Spreadable Cheeses
Cottage Cheese
16
Note: Reduced fat/ calorie milkshake category are products that require “adding milk and stirring”
U.S. Snack Universe Within TNS Landis Database:
(Overview of Snack Need States)
Enjoyment
12%
NS3
Relieve Boredom
Multitasking
9%
NS5
Spontaneous, spur-of-the-moment, easy,
hand-to-mouth snacks to just open and eat
to relieve boredom
10%
NS4
Indulge With Family
Reward Me
6%
NS9
Socialize & Entertain
Simple/basic, shareable, savory snacks
with big flavor, enjoyed while spending
time with friends and family
Permit Plenty
4%
NS10
Save Time & Savor
13%
NS2
Speedy, Sweet & Portioned
Sharpen My Mind & Body
Vitamin-fortified, energy and
metabolism-boosting snacks that help
you stay focused, physically active and
looking your best
7%
NS7
Healthy Meal Replacement
A heart-healthy meal replacement with
nutritional value that boosts bodily function
and gives the body what it needs to feel
good
Savory options with crispy, baked texture,
that come complete with all the ingredients
and are quick to prepare, but with flavor
you don’t want to rush
13
4%
Enhance My Health
Nutritionally complete options for every day,
made with the goodness of real fruit, that
rehydrate and rejuvenate the body,
enhancing health over the longer term
Bite-size, pop-in-your-mouth, low-calorie
snacks, good anytime and portable for
anywhere, whether on the go or at work or
school, permissible for munching all day
For personal moments of indulgence that
are comforting and not rushed, to help you
relax and escape during and after a
stressful day
4%
NS12
14%
NS1
Simple, no-prep, hand-to-mouth savory
snacks that are not messy and can be
enjoyed while doing other things, whether on
the go, at the computer, or in front of the TV
Sweet, full-flavored, uplifting, and
craveable indulgent treats that are fun for
the whole family
4%
NS11
Do Other Things
Fresh & Filling
7%
NS6
Portable, single-serve, sweet, flavorful
treats for any time of the day, that provide
quick energy to keep going, whether
working at a desk or driving in the car
Energize Me
A natural energy source that revitalizes and
sustains throughout the day, with built-in
benefits (like antioxidants or calcium) to help
improve the body’s function and endurance
6%
NS8
Break the Routine
A freshly prepared, full-flavored option that
is a meal in itself – served warm, tastes
authentic, and is a good change of pace
from the usual routine
17
Dairy Opportunity Across Snack/Energy Need States
(Relative Size of Prize)
Need State/Consumer Segment
Dairy
Category
String Cheese
Individually
Wrapped
Cheese Slices
Regular
Yogurt
Premium Ice
Cream
Non-Premium
Ice Cream
Soft/Spreadab
le Cheeses
Greek Yogurt
Cottage
Cheese
Target Need State








Need State Definition
Speedy, Sweet
& Portioned
Portable, single-serve, sweet, flavorful
treats for any time of the day, that provide
quick energy to keep going, whether
working at a desk or driving in the car
Speedy, Sweet
& Portioned
Portable, single-serve, sweet, flavorful
treats for any time of the day, that provide
quick energy to keep going, whether
working at a desk or driving in the car
Enhance My
Health
Nutritionally complete options for every day,
made with the goodness of real fruit, that
rehydrate and rejuvenate the body,
enhancing health over the longer term
Sharpen My
Mind & Body
Vitamin-fortified, energy- and
metabolism-boosting snacks that help
you stay focused, physically active, and
looking your best
Sharpen My
Mind & Body
Vitamin-fortified, energy- and
metabolism-boosting snacks that help
you stay focused, physically active, and
looking your best
% of Snack Universe
13%
14%
13%
Healthy Meal
Replacement
A heart-healthy meal replacement with
nutritional value that boosts bodily function
and gives the body what it needs to feel
good
7%
Energize Me
A natural energy source that revitalizes and
sustains throughout the day, with built-in
benefits (like antioxidants or calcium) to help
improve the body’s function and endurance
7%
Energize Me
A natural energy source that revitalizes and
sustains throughout the day, with built-in
benefits (like antioxidants or calcium) to help
improve the body’s function and endurance
Dairy's share of the
energy related snack
occasions is…
54%
However, regular and
greek yogurt
occasions have
opportunity to move
into the energy space
which encompasses…
21%
18
U.S. Beverage Universe Within TNS Landis Database:
(Overview of Beverage Need States)
Emotional
Reward
17%
NS1
Indulgent
Moments
Craveable, indulgent, and fun
beverages that make you happy
and put you in a good mood
7%
NS7
Natural Soothing Selections
Fresh beverages that have a
homemade taste and help you
de-stress and relax
7%
NS8
Sweet Fun
with a Twist
Sweet, full-flavored, and fun
beverages that have a mix of
tastes and are made with fresh
fruit that my whole family can
enjoy
Portable
Convenience
9%
NS6
Fruity
Goodness
Fruit-flavored, vitamin and
mineral-fortified beverages with
a mix of tastes that boost your
energy naturally
9%
NS5
Easy, Quick,
Convenient
An on-the-go beverage that
gives you quick energy so that
you can keep going while you’re
doing other things
6%
NS9
Easy Refreshment
Refreshing, thirst-quenching,
and light-tasting beverages that
are good to have with a meal
Meal
Replacement
6%
NS10
Healthy Meal Replacement
Fresh, natural, and nutritionally
complete beverages that
strengthen teeth and bones,
build muscle, and tide you over
until your next meal
5%
NS11
Satisfying Energy
Enhancement
Filling, energizing beverages
that tide you over until your
next meal and make you feel
adventurous
Health
Management
11%
NS3
The Real Deal
All-natural, wholesome, and
great-tasting beverages that
have heart-healthy ingredients
and help set a good example
11%
NS2
Proper Health
Management
Beverages that make you feel
fit/healthier, enhance your
mental focus, aid your digestive
system, and make you feel that
your are taking care of yourself
10%
NS4
Healthy Weight
Management
Daily guilt-free beverages,
lower in sugar and calories, that
are not too filling and help you
manage your weight
4%
NS12
Low This,
Low That
Lower in sugar and calories
beverages that are not too filling,
don’t spoil your appetite, and
help you feel in control
19
Dairy Opportunity Across Beverage/Energy Need States
(Relative Size of Prize)
Need State/Consumer Segment (Beverage Universe)
Dairy
Category
Fruit or Yogurt
Smoothies From a
Restaurant/
Smoothie Shop
Chocolate Milk in
Bottles/Cartons
RTD Refrigerated
Milkshakes
Target Need State



Need State Definition
Fruity Goodness
Fruit-flavored, vitamin and mineralfortified beverages with a mix of tastes
that boost your energy naturally
9%
Easy, Quick,
Convenient
An on-the-go beverage that gives you
quick energy so that you can keep going
while you’re doing other things
9%
Satisfying
Energy
Enhanceme
nt
Filling, energizing beverages
that tide you over until your
next meal and make you feel adventurous
5%
Beverages that make you feel
fit/healthier, enhance your mental focus,
aid your digestive system, and make you
feel that your are taking care of yourself
11%
Drinkable Yogurt

Proper Health
Management
Whole Milk

Proper Health
Management
Beverages that make you feel
fit/healthier, enhance your mental focus,
aid your digestive system, and make you
feel that your are taking care of yourself
Healthy Weight
Management
Daily guilt-free beverages,
lower in sugar and calories, that are not
too filling and help you manage your
weight
Low-Fat/Skim Milk

% of Beverage
Universe
Dairy’s share of the
energy related beverage
occasions is…
44%
However, smoothies,
drinkable yogurt and
low fat/ skim milk
occasions have
opportunity to move
into the energy space
which encompasses…
30%
10%
20
The Study Defined Two Distinctive
Types Of Innovation For Dairy
Further-Out Innovation
Closer-In Innovation
How to innovate: Develop communication
that builds upon dairy benefits so it can
be positioned against energy categories
1.
2.
How to innovate: Create a new hybrid
product that leverages dairy benefits and
meets energy attribute needs
1.
•
2.
Innovation that is quick but yields less growth;
doesn’t require new product development
Leverage new benefits/positioning that
communicate dairy categories strengths
against existing competitive energy categories
•
Helps build upon needs not met by
energy categories yet delivered by dairy
•
Capitalize on needs that dairy
outperforms energy categories
Example: Position drinkable yogurt messaging that
delivers opportunities such as helping feel good,
looking my best or helping family maintain health as
a way to compete against other energy categories
High Innovation needed but yields high growth
New hybrid product not created, consumers
slower to grasp concept
•
3.
Highly incremental opportunity
Requires longer lead time
Need to address consumer needs that are
served well by energy categories however, not
dairy categories
•
Extending dairy into strongly connected
energy categories
Example: New to the world hybrid category…
Nutritionally Balanced Drinkable Yogurt Shots:
This product would deliver on helping consumer
feel and look their best and can be considered an
option for the family to stay healthy. Goal is to help
consumer meet energy needs of feeling fit/
healthier and makes up for less nutritional choices
21
Where Does Regular Yogurt Currently Play?
Need State: Enhance My Health
(Accounts for 14% of Energy – related Snack Occasions )
Defining… Enhanced My Health
 Health functions
 Fresh/natural ingredients
 Sound nutrition
 Better performance
 Natural lift
Categories Competing Within Enhance My Health Need State
 Fresh fruit –whole or precut
 100% RTD fruit smoothies
 Greek yogurt
 Dairy-based vegetable dips
 Cottage cheese
Who Is My Target Consumer…?
 Fruit cups
 Fruit Crisp Bars
 Cereal naturally sweetened
 Peanut butter in on-the-go cups
How To Innovate…?
Disciplined Eaters: Eat To Live
 Older consumers
 Proactive and disciplined
 Love food and are adventurous eaters
 Managing their food and nutrition choices
 Freshness and sources of the foods important
22
How To Innovate…?
Communicate Regular Yogurt Benefits*:
1
Needs Not Met By Energy Categories:
2
 Helps digestive system work at its best
 Helps maintain teeth/ bones strength




Closer-In Innovation
 Regular yogurt competes against these
energy based categories (competitive set):






Cheese/Queso dips
Dairy-based vegetable dips
Peanut butter OTG cups
Low-calorie chocolate candy bars
Reduced calorie brownies
Reduced calorie cookies
Yogurt Outperforms Energy Categories:
Enhances daily health
Helps ensure long-term health
Has redeeming nutritional value
Helps me feel good about self
Further-Out Innovation
* Must communicate all the regular yogurt benefits (above) to innovate far-out:
Important energy attributes needed to innovate:

Is naturally
sweetened

Use high quality
ingredients

Naturally rich in
vitamins
Build new dairy/energy product: Low to high innovation/risk factor:
 Fuse regular yogurt with energy
•Not applicable
LOW
Innovate Against Energy Competitive Set:
product to create new hybrid product
INNOVATION
 Higher innovation… higher growth
NEEDED
 Develop regular yogurt positioning that
 New product not yet invented
• Dairy-based vegetable dips
MODERATE
optimizes above communication/benefits
• Cheese/Queso dips
 Ex: Expand regular yogurt into energy
INNOVATION
NEEDED
space by leveraging above benefits
 Ex: Regular yogurt needs to communicate
• Fruit cups
• Reduced calorie brownies
along
with
energy
attributes
to
create
HIGH
some of its inherent benefits, such as bone
INNOVATION • Peanut butter OTG cups
breakthrough innovation fusion
health, to compete with the above
• Reduced-fat/sugar cookies
NEEDED
• Low-calorie chocolate candy bars
categories/products
competitive set
23
Note: *Must meet both criteria (1 and 2) before innovation
Where Does Greek Yogurt Currently Play?
Need State: Energize Me
(Accounts for 6% of Energy – related Snack Occasions )
Defining… Energize Me
 Gets me going, keeps me going
 Has sound nutrition
 Is a natural lift
 Has fresh/natural ingredients
 Supports body functions
Categories Competing Within The “Energize Me” Need State
 Peanut butter
 Packaged frozen yogurt
 Regular Yogurt
 Fresh fruit – precut or whole
 Fruit cups
Who Is My Target Consumer…?
 Cereal – 100% nutritionally
complete, 100% wholegrain
 Fresh, cooked or raw vegetables
 Heart-healthy spreads
How To Innovate…?
Life- Balancing Weight Manager
 Image is important for these consumers
 “Live to eat” as mindful of health & nutrition
 Yet struggle with weight/guilt of eating
 Take time to exercise and look attractive
 Yet not truly satisfied w/ how they look
24
How To Innovate…?
Communicate Greek Yogurt Benefits*:
1
Needs Not Met By Energy Categories:
2
 Helps build muscle
 Boost immune system
 Helps digestive system work at its best
 Good source of calcium
Closer-In Innovation
 Greek yogurt competes against these
energy based categories (competitive set):





Fruit cups
Cereal – high fiber
Cereal – 100% wholegrain
Cereal – 100% nutritionally complete
Heart-healthy spreads
Greek Yogurt Outperforms Energy Categories:
Further-Out Innovation
* Must communicate all the Greek yogurt benefits (above) to innovate far-out:
Important energy attributes needed to innovate:
Enhance physical/
mental performance
Good source of
antioxidants
Fortified w/ vitamins
and/or minerals
Is made with
fresh/real fruit
Promotes
healthy skin
Build new dairy/energy product: Low to high innovation/risk factor:
 Fuse Greek yogurt with energy
• Not applicable
LOW
product to create new hybrid product
 Develop Greek yogurt positioning that
INNOVATION
 Higher innovation… higher growth
NEEDED
optimizes above communication/benefits
• Cereal – 100% nutritionally
 New product not yet invented
• Cereal – 100% wholegrain
MODERATE
 Ex: Greek yogurt needs to communicate
 Ex: Expand Greek yogurt into energy
INNOVATION • Heart-healthy spreads
• Fruit cups
some of its inherent benefits, such as
NEEDED
space by leveraging above benefits
builds muscle, boosts immune system or
along with energy attributes to create
• Cereal- high fiber
HIGH
• Fresh fruit/precut with a dip
helps digestive system work its best to
breakthrough innovation fusion
INNOVATION • Fresh fruit/whole
compete with the above competitive set
NEEDED
categories/products
25
Note: *Must meet both criteria (1 and 2) before innovation
Innovate Against Energy Competitive Set:
Where Does Fruit/ Yogurt Smoothies Currently Play?
Need State: Fruity Goodness
(Accounts for 9% of Energy-related Beverage Occasions )
Defining… Fruity Goodness
 Good for body
 Fruit- flavored
 Natural energy
boost
 Kid-friendly
 Partner with
exercising
 Complex taste
 Good for lunch/
as a snack
Categories Competing Within Fruity Goodness Need State
 Bottle tea blend w/ fruit juice
 Fruit juice drinks/blends
 Sparking fruit juices
 Soft drinks fortified with
vitamins and/or minerals
Who Is My Target Consumer…?
 Fortified fruit juice
 Regular RTD sports drinks
 Pre-game fuel drinks
 Post-game drinks
 Herbally enhanced drinks
How To Innovate…?
Social Indulger: Live to Eat
 Eating is important to younger single men
 Rely on other to prepare food (at home & away)
 On-the-go consumers w/ active, busy lifestyle
 Don’t worry about weight or health issues
26
How To Innovate…?
Communicate Fruit/Yogurt Smoothie Benefits*:
1
Needs Not Met By Energy Categories:
2
Smoothies Outperforms Energy Categories:
 Good mixture of tastes
 Variety of tastes in every bite
 Good as a snack
 Fruit flavored, sweet
 Kids can prepared/serve themselves
 Kids like/parents approve of…
Closer-In Innovation
 Fruit/yogurt smoothies competes against
these energy based categories:







Flavored fitness water
RTD sports drink (regular/low calorie)
Pre-game fuel drinks
Post-game drinks
Herbally enhanced drinks
Nutritionally complete drinks
Calorie-burning drinks
Innovate Against Energy Competitive Set:
 Develop fruit/yogurt smoothie positioning
that optimizes above communication
 Ex: Smoothies needs to communicate some
of its inherent benefits, such as mixture or
variety of taste or good snack and kid friendly
to compete with the competitive set
Further-Out Innovation
* Must communicate all the smoothie benefits (above) to innovate far-out:
Important energy attributes needed to innovate:
Good for fast
paced lifestyle
Easy to
prepare
Doesn’t drip
when I drink it
Provides
quick energy
Good for when I am surfing the
web, blogging or texting
Build new dairy/energy product: Low to high innovation/risk factor:
 Fuse smoothies with energy product
LOW INNOVATION • Not applicable
to create new hybrid product
NEEDED
 Higher innovation… higher growth
• Herbally enhanced drinks
MODERATE
INNOVATION
 New product not yet invented
NEEDED
• Flavored fitness water
 Ex: Expand smoothies into energy
• RTD sports drinks
HIGH
space by leveraging above benefits
• Pre-game fuel drinks
INNOVATION • Low-calorie RTD sports drinks
along with energy attributes to create
NEEDED
• Post-game drinks
breakthrough innovation fusion
• Nutritionally complete drinks
• Calorie-burning drinks
categories/products
Note: *Must meet both criteria (1 and 2) before innovation
27
Where Does Drinkable Yogurt Currently Play?
Need State: Proper Health Management
(Accounts for 11% of Energy-related Beverage Occasions )
Defining Proper Health Management
Categories Competing Within Proper Health Management Need State
 Feel and look my best
 Promotes healthier lifestyle
 Promotes brain function
 Better bodily function
 Controlling the “bads”
 Soy milk
 Bottle water fortified w/ vitamins
 Vegetable juices
 Weight-loss beverages
 Low-fat/skim milk
Who Is My Target Consumer…?
 Protein-enhanced water
 Unflavored fitness water
 Nutritionally complete drinks
 Calorie-burning beverages
How To Innovate…?
Disciplined Eaters: Eat To Live
 Older consumers
 Proactive and disciplined
 Love food and are adventurous eaters
 Managing their food and nutrition choices
 Freshness and sources of the foods important
28
How To Innovate…?
Communicate Drinkable Yogurt Benefits*:
1
2
Needs Not Met By Energy Categories:
 Helps me look my best
 Helps me feel good
 Helps maintain family health
 Give my body what it needs to feel good
Closer-In Innovation
 Drinkable yogurt competes against these
energy based categories (competitive set):
 Nutritionally complete drinks
 Weight-loss beverages
Drinkable Yogurt Outperforms Energy Cat.:
Further-Out Innovation
* Must communicate all drinkable yogurt benefits (above) to innovate far-out:
Important energy attributes needed to innovate:

Helps me feel fit/
healthier

Helps make up for less
sensible choices
Innovate Against Energy Competitive Set:
 Develop drinkable yogurt positioning that
optimizes above communication/benefits
 Ex: Drinkable yogurt needs to communicate
some of its inherent benefits, such as
making me feel good, maintaining family
health to compete with the above
competitive set
Build new dairy/energy product: Low to high innovation/risk factor:
 Fuse drinkable yogurt with energy
product to create new hybrid product
 Higher innovation… higher growth
 New product not yet invented
 Ex: Expand drinkable yogurt into
energy space by leveraging above
benefits along with energy attributes
to create breakthrough innovation
fusion categories/products
Note: *Must meet both criteria (1 and 2) before innovation
LOW
INNOVATION
NEEDED
MODERATE
INNOVATION
NEEDED
HIGH
INNOVATION
NEEDED
• Not applicable
• Nutritionally complete drinks
• Weight-loss beverages
• Not applicable
29
Where Does Low Fat/Skim Milk Currently Play?
Need State: Healthy Weight Management
(Accounts for 9% of Energy-related Beverage Occasions )
Defining Healthy Weight Management
 Weight control/Better for me
 No-regret consumption
 Healthy ingredients
 Low/no sugar and Light/not too filling
 Better health management
Categories Competing In Healthy Weight Management Need State
 Unflavored fitness water
 Bottled spring water
 Bottled purified water – plain
 Low-cal. fruit-flavored drink mix
 Sparkling water – unflavored
Who Is My Target Consumer…?
 Unflavored bottled teas
 Soy milk
 Low-cal. RTD sports drinks
How To Innovate…?
Disciplined Eaters: Eat To Live
 Older consumers
 Proactive and disciplined
 Love food and are adventurous eaters
 Managing their food and nutrition choices
 Freshness and sources of the foods important
30
How To Innovate…?
Communicate Low Fat/Skim Milk Benefits*:
1
2
Needs Not Met By Energy Categories:
 No added sugar
 Helps lower cholesterol
 Low fat/low calories
 Can have every day
 Does not contribute to childhood obesity
Closer-In Innovation
 Low fat/skim milk competes against these
energy based categories (competitive set):
 Unflavored fitness water
 Soy milk
 Vegetable juices
Innovate Against Energy Competitive Set:
 Develop low fat/skim milk positioning that
optimizes above communication
 Ex: Low fat/skim milk needs to
communicate some of its inherent benefits,
such as providing no added sugar and
lowers cholesterol to compete with the
above competitive set
Low Fat/Skim Milk Outperforms Energy Cat.:
Further-Out Innovation
* Must communicate all low fat/skim milk benefits (above) to innovate far-out:
Important energy attributes needed to innovate:

Is low in salt/ sodium

Is sugar free
Build new dairy/energy product: Low to high innovation/risk factor:
 Fuse low fat/skim milk with energy
product to create new hybrid product
 Higher innovation… higher growth
 New product not yet invented
 Ex: Expand low fat/skim milk into
energy space by leveraging above
benefits along with energy attributes
to create breakthrough innovation
fusion categories/products
Note: *Must meet both criteria (1 and 2) before innovation
LOW
INNOVATION
NEEDED
• Unflavored fitness water
• Soy milk
MODERATE
INNOVATION
NEEDED
• Vegetable juices
HIGH
INNOVATION
NEEDED
• Not applicable
31
Relative Size of Prize For Dairy
Snacking And Beverage Energy Occasions
Energy Related
Snack Occasions
Energy Related
Beverage Occasions
•
Snacking is a $90+ billion industry 1
•
Beverage a 53 billion gallon industry 2
•
21% of snacking occasions are
energy-related, which creates a:
•
30% of beverage occasions are
energy-related, which creates a:
$18.9 Billion
Opportunity
15.9 Billion
Gallon
Opportunity
1: Innovation Center of U.S. Dairy, Snacking white paper (2009)
2: Innovation Center of U.S. Dairy, Dairy Beverage Reinvented (2012)
32
What Else Might We Uncover From
This Initial Work?
33
Additional Mining of This Data Could:
• Look more deeply into protein
energy connection
• Create work around energy dimensions
– Example: sustained, natural or quick energy etc…
• Dig into the consumer target(s) of highest priority
opportunities
• Explore some “lower priority” dairy categories
• Further refine sizing estimates based on new information
• Other issues of interest for your organization…?
34
Powered by Dairy:
APPENDIX
35
Matrix™ Consumption Universe
Methodology Overview – Overall Food & Beverage
What is the Consumption Universe?
A comprehensive insight resource for food and beverage marketers, leveraging the proprietary
TNS Matrix™ methodology to model how consumers see the market and make their product
choices
Massive scope: 24,000 consumer interviews – 360 food, beverage, and snack products/
categories evaluated across 360 occasion-based needs and product benefits, plus over 50
statements defining differentiated consumer targets based on shared beliefs, behaviors, and
lifestyle factors
The Matrix™ Consumption Universe is designed to help you:
 Understand all factors impacting consumer choice in your category – or a new category of
interest
 Quickly uncover bona fide gaps and opportunities grounded in consumer needs
 Efficiently expand your perspective beyond traditional category definitions to identify new
opportunities
36
Survey Overview
Many approaches, such as A&U’s,
ask a lot of questions on a
survey, the more the better, and
then hope something interesting
surfaces.
Matrix instead leverages a
consumer behavioral model to
drive survey content and
analytics/deliverables, and take
the guesswork/risk out of
research design and execution.
37
What is a consumer target?
Consumers have varied lifestyles,
behaviors, tensions, and beliefs
which predispose them to act in
certain ways.
Matrix uncovers the differentiated
consumer segments which comprise
your market targets – each with
different beliefs, behaviors, and/or
lifestyle tensions – and sizes them to
aid prioritization.
38
U.S. Consumption Universe – Consumer Segments
Overview of Beliefs & Lifestyles
LIVE TO EAT
EAT TO LIVE
Food Aficionados
Carefree
Struggling
Home
Cookin’
Family
Pleaser
(10%)
Upbeat
Food
Explorer
Social
Indulger
Routine
Convenience
Seeker
Stressed
Struggler
Conflicted
Stressed
Manager
(14%)
(11%)
(10%)
(15%)
(15%)
These women provide
basic home-cooked
food, and eat with their
families. They are not
focused on health or
nutrition, and do not
limit themselves or feel
guilty about it. They are
not impacted by daily
stresses in their lives.
These “foodies” are
adventurous in life,
cooking, and eating.
They moderate their
eating to maintain a
healthy lifestyle and an
active social life. They
enjoy freshly prepared
foods more than fast
food or junk food.
Eating is important to
For these single male
Life is stressful for these
these younger, single
consumers, food is fuel
consumers, and they
men, but they rely on that supports their on-the- lack the energy to tackle
others to prepare foods go lifestyle. Takeout and
life’s challenges.
for them – whether at
quick-cooking foods are
Although they struggle
home or away.
the basis of their meals
with weight issues, they
Their active, busy
and snacks, and they
rely on easy prep or
lifestyle means they are rarely prepare their own
simple meals to make
often eating on the go,
food. Neither explorers
their families happy.
and they don’t worry
nor adventurers, they
They tend to stick with
about weight or health
regularly eat the same
the “tried and true” in
issues.
foods. They eat what they their food choices, and
want without health
often use food for
concerns.
comfort.
These consumers
struggle to maintain a
healthy weight and try
to eat better, but don’t
always succeed. They
are focused on fresh
food and nutrition, and
do not rely on fast food
for their meals.
Disciplined
LifeBalancing
Weight
Manager
(11%)
Wellness
Proactive
These consumers are
mindful of health and
nutrition, but struggle
with weight issues and
guilt about eating.
Image is important to
these consumers, and
they take steps to
exercise and look
attractive, but they are
not truly satisfied with
how they look.
Although these older
consumers are lovers of
food and adventurous
about eating, they are
proactive and
disciplined in managing
their food and nutrition
choices. Freshness and
sources of the foods
they choose are
important to them.
(13%)
39
Energy-Related Categories
(Snack Universe)
Yogurt
Cereal
Yogurt - with probiotics
Yogurt - Greek type
Yogurt - regular type
Drinkable yogurt
Cereal - bran/high fiber
Cereal - 100% wholegrain
Cereal - 100% nutritionally complete
Nuts, Granola
Energy bars
Protein bars
Chewy granola bars
Chewy granola/cereal bars with fiber
Nutritional bars
Crunchy granola/cereal bars
Fruit crisp bars
Weight-loss meal replacement bars
Granola, fruit, and nut mix in pouches
Granola/muesli
Fortified nut mixes such as for bone or heart health
Trail Mixes
Fruit Based
Dried fruit
Fresh fruit - whole
Fruit cups
100% fruit smoothies - ready-to-drink
Confections/Treats
Low-calorie chocolate candy bars or clusters
Reduced-calorie brownies
Peanut butter in on-the-go cups
Natural/organic cookies
Bars
Dips/Spreads
Reduced-fat/fat-free vegetable dips
Heart-healthy spreads
Crackers/Seeds
Whole wheat/multigrain crackers
Seeds (like sunflower, pumpkin, etc.)
40
Energy-Related Categories
(Beverage Universe)
Protein Drinks
Energy Beverages
Protein-enhanced sports drinks
Protein drinks - ready-to-drink
Protein-enhanced water
Energy shots (like 5-Hour Energy, etc.)
Single-serve flavored powdered energy drink mix
Energy drinks
Single-serve flavored powdered energy drink mix
Weight Management Beverages
Calorie-burning beverages
Weight-loss beverages
Fuel/Functional Beverages
Pre-game fuel drinks
Post-game drinks with electrolytes and carbs
Regular ready-to-drink sports drinks
Low-calorie ready-to-drink sports drinks
Flavored fitness water
Unflavored fitness water
Herbally enhanced drinks
Nutritionally complete drinks
Coffee Beverages
Brewed coffee - regular
Instant coffee
Single-serve, one-cup-at-a-time coffee
Other Beverages
Vegetable juices
Soy milk
41