The global sour milk drink market is growing at a CAGR of 5.8% during the forecast period (2020-2025).
- This market is mainly driven by the increasing demand for functional food and healthier beverage snacking among the consumers. Also, bioactive components, flavor, and nutritional value, along with digestive wellness that is associated with fermented dairy beverages are a few of the various factors accelerating the demand for sour milk drinks. Adding convenience to the functional dairy beverage into a flexible, smaller pack enhances the profit margin in the global market. For instance, Amul has introduced Amul Masti buttermilk multipack of 200 ml (five in one pack) for convenience, which offers a high-profit margin compared to the 1-liter pack.
- On a segmentation front by application, the kefir sector accounts for the largest share owing to the health benefits it provides. Also, in the market segmentation in terms of distribution channels, supermarkets and hypermarkets account for more than 50% of the distribution sale of sour milk drinks. Increased new product launch from the private label has created a tough competition for existing players. Lifeway Foods, which is one of the major players in the Kefir market has started offering private label products owing to customer's demand. The company has signed an agreement with Food Lion, a new supermarket customer that has 1,200 locations in the Southeast and also gained entry into Ireland with 140 stores across two major retailers.
Key Market Trends
Increased Demand For Fermented Foods and Drinks
Consumer preference for fermented food and drinks has been witnessed with an increasing trend owing to the increasing health consciousness among the consumers. Also, initially, the favorable government regulations fueled the growth of the market. For instance, the US Food and Drug Administration (FDA) provides recommendations on manufacturing, storage, packaging, distribution processes, and appropriate quality control procedures for acid foods, acidified foods, and fermented foods. However, after December 2015, the FDA stopped regulating fermented food, since it had not found any cases of food illnesses till then. Also, in terms of distribution channels, online store sales for healthy snack foods are growing at a faster rate, attracting many vertical specialists like Amazon, Walmart, Carrefour, etc. who are riding on increasing e-retailing growth and vying for a significant pie in online healthy snacks space.
Europe to Drive the Global Market of Sour Milk Drinks
Europe is the dominant consumer of kefir owing to increased consumption of yogurt-like fermented dairy beverages. The product launches featuring Kefir in the region is growing at a faster rate globally as the inherent nutritional benefits created a point of difference from traditional yogurt-based fermented beverages has boosted Kefir sale. Also, with the increasing internet penetration, the online market for the purchase of sour milk drinks has seen rapid growth globally in the last 3-4 years in Europe. This category has attracted a few vertical specialists like Amazon, Walmart, Carrefour, etc. who are riding on increasing e-retailing growth and vying for a significant pie in online sour milk drink space.
The global market for sour milk drinks market is fragmented, owing to the presence of large regional and domestic players in different countries. Emphasis is given on the merger, expansion, acquisition, and partnership of the companies along with new product development as strategic approaches adopted by the leading companies to boost their brand presence among consumers. For instance, Lifeway Foods, which is one of the major players in the Kefir market has started offering private label products owing to customer's demand. The company has signed an agreement with Food Lion, a new supermarket customer that has 1,200 locations in the Southeast and also gained entry into Ireland with 140 stores across two major retailers.
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