Opinion from global food and drink experts, Zenith Global
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NO MORE BULL FROM DAIRY

April 5th, 2007 | Posted by Richard Hall in Dairy - (0 Comments)

The dairy industry has been pre-occupied with production issues for as long as anyone can remember. Today it is definitely turning the corner.

Last week, I had the privilege of chairing the First Global Dairy Marketing Congress in Amsterdam, attended by over 200 delegates from more than 30 countries.

The mood was upbeat. The energy was palpable. Why ?

Because dairy innovations are now leading the way across many food and drink categories. Because their health benefits are backed by proper science. Because consumers are responding with real enthusiasm. And because the result is a better deal for farmers as well as dairies.

What did I learn that was new ? This is always a good test for any conference. Much, of course, was reaffirmation.

But perhaps I realised for the first time just how many drinking milks, desserts, spreads and cheeses now have added health benefits beyond their valuable natural ingredients.

Three prevailing long term changes stand out in today’s market:

  • the scale of lower fat, lighter diet products,
  • the rapid growth of probiotics for those who simply want their bodies to function more efficiently and
  • the surge in a whole range of functional shot drinks with all kinds of merits from cholesterol reduction to cognitive enhancement.

One revelation was how far the US market must move to catch up with these trends elsewhere.

Three new emerging themes also seem to be taking shape:

  • the idea of satiety products, which make you feel more full and were the winners of an informal delegate vote as The Next Big Thing,
  • the need for muscle repair drinks to redress the slow weakening of ageing muscles known as sarcopenia and
  • the introduction of cosmeceutical products to improve skin suppleness.

Surprisingly little was said about the need for more exercise. Which must mean that the dairy industry is concentrating on what it can do to help, rather than trying to suggest solutions are up to others.

The weather is set fair for dairy to enjoy new pastures.

Some people think the world would be better off without bottled water. I believe the opposite.

They say bottled water is unnecessary and wasteful. Unnecessary because there is a direct substitute in tap water. Wasteful because of all the packaging and transport. There are also criticisms of comparative cost without real benefit.

These are all good arguments, but they could be levelled at almost any element of consumer choice.

My reasoning starts from the premise that all water is good. Drinking more water will do almost anyone more good. Whether from the tap or from a bottle. If we all drank more water, our minds would be clearer, our skin would be more supple, our organs would naturally flush out more toxins and our bodies would weigh less.

If you had to invent the perfect product for the 21st century, it would have to be water. Water is natural, healthy, calorie free and abundant.

Abundance, however, is not universal and nor is it without cost. Many regions of the world do not have adequate municipal supplies and bottled water is often part of the interim solution. In more developed countries, people still need hydration at work, at leisure or while travelling and bottled water provides that convenience.

Waste is an issue for the bottled water industry and it needs to do more in responding to increasingly widespread concerns. The full facts, I suspect, will favour bottled water more than its producers might imagine.

First, they waste very little water itself, less than any other beverage and way below other food or even non-food products. Secondly, they actually use only a tiny fraction of water resources in most areas. Third, natural mineral water is not treated at all and other waters are safeguarded by minimal purification. Tap water requires massive long term investment, all of it has to be treated, regardless of ultimate use, and leakages amount to many times the level of bottled water consumption.

Bottled water does use a lot of packaging and transport, but here too its record is among the strongest in industry. Most bottled water is sold at very low prices and is distributed only locally. It uses lighter weight materials than most other beverages and packaging is increasingly returned or recycled. The earliest biopackaging initiatives started with bottled water.

The number and volume of premium international brands is actually quite small. Is there any defence for them ? In my view, consumer choice is paramount within the bounds of social acceptability. And there are so many much more important concerns to address before this. If there is something wrong with buying a French bottled water outside France, that logic applies just as much to wine or coffee or bananas or toys or technology. Open and competitive free markets would fall apart if any one of these became a political football.

My last point is about benefit. Why pay hundreds of times more for bottled water when you can’t taste the difference and it is no healthier ? Well, some people can taste the difference and many bottled waters do contain a particular beneficial balance of minerals. You do at least know exactly where a natural mineral water has come from, that it is from a protected environment and that it has not been treated.

Personally, I enjoy all water and do not have a very discerning palate. There are many times when I buy a bottled water out of convenience or preference, but I drink a lot from the tap too. Increasingly, I expect I will pay more attention to products which tell me more about their environment and ethical credentials. If anyone wishes to stop me, then please look at the alternatives first.

Oh, and when there’s a natural disaster, what is always one of the first priorities for rescue teams ? Yes, quite.

So Coca-Cola is now a sparkling beverage instead of a carbonated soft drink and industry associations from Australia to Europe have removed soft drinks from their names in favour of beverages. Even Zenith’s own magazine softdrinksworld has been renamed beverage innovation.
Imagine the time devoted in boardrooms to these subtleties. Actually, finding the right expression for anything is important. Especially one that encapsulates an entire global industry. This blog will aim to add an informed and balancing comment on great issues such as this, as well as on quirky ones or on general new developments. It will also seek to stimulate wider debate in the hope of finding more satisfactory solutions or leading to better decision making.
Well, what’s wrong with soft drinks then ? In my view, not much. They’re fun, refreshing and affordable. They offer convenience, choice and increasing health benefits. Overall consumption is growing remarkably consistently. There are issues surrounding calories and packaging waste and I hope to address these in the future, but all industries have to adapt to social change. Soft drinks are among the fastest to adjust.
To me, the reason why the soft drinks industry is agonising over its name is because it is relatively young, it has never been regulated in the same way as agricultural products or alcohol, its success has brought unaccustomed scrutiny and society has yet to resolve its new perceptions about obesity or the environment. In some media, there is a straight line from soft drinks through sugar to obesity.
One of the problems with soft drinks is that the expression means different things in different countries. The United States has had the narrowest definition of carbonated soft drinks. Continental Europe has included still fruit drinks. Zenith has always embraced a wider definition including bottled water, fruit juice and iced teas. In time, the universe may be extended to include drinking yogurts and flavoured milks, as is already the case with ACNielsen research.
What of the alternatives ? Non-alcoholic is too negative. Sparkling could include champagne and water. Beverages are commonly associated with hot drinks as well as cold. Liquid refreshment beverages are rather a mouthful. For technical precision, one could decide on something like non-alcoholic non-dairy cold beverages, but that’s not exactly media or consumer friendly.
I have no problem with trying out new ideas. Sparkling may work. Beverages may do. But personally, I keep coming back to soft drinks as the generic category and carbonated soft drinks as the sparkling sector – as distinct from bottled water or fruit juice or other soft drinks such as still drinks or dilutables.
If you have better ideas, I’d be delighted to hear them via bevblog@zenithinternational.com
Richard