Oats: The Next Big Plant-Based Dairy Alternative

Tuesday, August 20th, 2019 | 1035 Views

The popularity of oat milk is growing and its taste, health benefits, and superior sustainability positioning will see it become the next big plant-based alternative. By Samantha Moore, Global Food and Drink Analyst, Mintel. 

Oat milk has recently replaced almond as the go-to non-dairy milk in coffee shops, especially in cities like New York and London. Coffee baristas like oat milk because it has a creamy-yet-neutral taste, for its ‘foam-ability’, and because it doesn’t split.

Oat milk’s influence has been driven by Oatly!, a Swedish brand that targeted influential US coffee shops before entering the retail market. In fact, there was a huge demand for Oatly! products, so much so that they were selling out at some coffee shops.

This year, we have seen the emergence of several oat milk brands in the market, with companies like Silk, Quaker and Alpro all launching oat milk products. In addition, more brands are appealing to coffee lovers wanting plant-based drinks with ready-to-drink (RTD) coffee oat milk products.

Utilising Oat Milk’s Success In RTD Coffee Innovations

Oatly!’s Cold Brew Latte from Sweden is an oat-based coffee drink that is 100 percent vegan and free from milk and soya.

Minor Figures Nitro Cold Brew Latte Coffee from the  UK is a nitrogen-infused cold-brew coffee drink is made with Colombian and Peruvian coffee with oat milk, and is brewed for over 18 hours in a micro-brewery in East London.

Oat-based drinks are, on average, 8 percent cheaper than popular almond milk options. As it is already well established in foodservice and is a cheaper alternative to almond milk, oat milk has the potential to recruit more consumers to the plant-based drinks category.

Differentiating oat milk from other types of milk in terms of price and sustainability will appeal to not just the minority of consumers with dairy intolerances, but also the wider majority of consumers who are incorporating more plant-based products in their diets for health and sustainability reasons.

There have recently been reports on climate change and the various impacts that different milks have on the environment. Crucially for oat milk’s long-term viability, it also has ecological credibility: almonds require six times as much water to grow as oats do, according to the Water Footprint Network. The backlash that almond milk is receiving—due to the amount of water needed to make it—is causing consumers to look to other plant-based alternatives.

Moreover, sustainability seems to hold more appeal among the younger generation, especially as they are more concerned about environmental issues. Indeed, Mintel research reveals that 40 percent of urban Australian consumers aged 16-24 prefer to buy products that use sustainable sourcing methods.

As a dietary supplement, oat milk is well-placed to support consumers’ diets. It is said to contain more fibre and protein than nut milks, is rich in iron and B vitamins, and has a neutral taste. In addition, unlike almond and soy milk, oat milk is free from allergens such as nuts and soy.

In light of the sugar tax happening in some countries globally, dairy and plant-based beverages are likely to be more popular options. This is especially so as most oat milk products are positioned as healthy and unsweetened with natural and clean ingredient decks. According to Mintel Global New Products Database (GNPD), popular claims in oat milk products tend to reflect health and naturalness; some of these claims include low/no/reduced allergen, ethical/environmentally friendly packaging, no added sugar, and vegan.

Unsweetened: Just Three Ingredients

Innocent’s Unsweetened Oat Dairy Alternative from the UK is made with just three ingredients (oats, spring water, and sea salt). It is said to be free from additives, lactose, and dairy, and can be used in tea, coffee, scrambled eggs pancakes, cereal, and more.

 

Just Five Ingredients

Elmhurst’s Milked Oats from the US are made with five ingredients and contain 20 g of whole grain per serving. It is said to be delicious in coffee, tasty in hot and cold cereal, and perfect for smoothies.

 

Free From Artificial Colours & Flavours

Silk Oat Yeah’s Plan Dairy-free Oatmilk from the US is said to be creamy and inspired by milk’s creamy goodness. It is free from dairy, nuts, soy, carrageenan, cholesterol, artificial colours and flavours, and is kosher-certified.

What Mintel Thinks

Companies, manufacturers and brands need to differentiate oat milk from other types of plant-based milks by calling out its superiority in features like sustainability, health and taste. They should also be positioning oat milk as a drink that’s not just for the minority who are intolerant to dairy, but also to those wanting to incorporate more plant-based products into their diet.

In order to stand out from the crowd and appeal to younger audiences, oat milk brands need to lead with fun and engaging packaging, as well as new exciting product and flavour innovations.

 

Photo Source: Mintel GNPD

 

Further reading:

Mintel: Nutritional Innovations For Asia-Pacific’s Cerebral Age

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