Clean label dairy
Manufacturers of dairy products are cleaning up their supply chain

CHICAGO — For many consumers, the term “clean label” extends beyond the ingredient statement. This is one of the dairy industry’s greatest strengths; its farm-to-fridge approach to sourcing, manufacturing and distributing dairy foods.

“There is no standardized definition of the term clean or clean label, and we have observed the food industry use the terms in various ways,” said Michael Neuwirth, senior director — external communication, DanoneWave, White Plains, N.Y. “In some cases, it may be employed to mean no artificial flavors, colors or sweeteners. Others may use it to show they have ingredients that people recognize and can readily pronounce. Still, others may use it to demonstrate a short, simple ingredient list. Generally speaking, dairy foods such as milk and yogurt are perceived as wholesome, which we believe is in part due to their nutrient density and association with beloved cows.”

Dairy foods marketers recognize that there’s a core group of consumers who are loyal to the category. But there’s a growing segment on the fence who is torn between dairy foods and the many plant-based alternatives in the market. That is why communicating the farm-to-fridge process has become an important element to the clean label movement in the dairy case.

This is a point of differentiation, because almond beverage manufacturers cannot do the same. That is one of the powers of dairy, the ability to keep food simple and close to what Mother Nature intended.

Oui by Yopliat yogurt
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“That’s why being part of a dairy cooperative like Arla is so special, as at Arla’s core are principles such as sustainability, environmental responsibility and transparency,” said Don Stohrer, head of U.S. operations for Arla Foods Inc., Basking Ridge, N.J. “A lot of what you’re starting to see promoted today is how Arla has always conducted its business. We strive to keep our ingredients simple and to give individuals great-tasting dairy without anything unnecessary.”

Clean label is also about building trust. In terms of ingredients, it’s about explaining the purpose of the ingredient, which may help explain why replacing something considered artificial with a more natural alternative raises the price or decreases shelf life. Some consumers may embrace these changes. Others may find the original, less expensive, less perishable product better suits their needs.

“Consumers today have less trust in companies, especially large ones,” said Lynn Dornblaser, director — innovation and insight, Mintel, Chicago. “As a result, they want more information about what is in the foods they buy. They want to know where they come from and why they have ingredients in them that they (the consumers) don’t understand.”

Dannon Strawberry Fresca yogurt
Growing consumer demand for transparency is being addressed both by regulation and with the rise of voluntary claims marketers make on packages.

This growing consumer demand for transparency is being addressed both by regulation and with the rise of voluntary claims marketers make on packages and in marketing materials. Each industry and segment are at a different stage of transparency, said Kristi Weaver, partner, McKinsey & Company, Chicago, who was a featured speaker at the TransparencyIQ conference held Oct. 18 in Rosemont, Ill. While artificial growth hormone-free liquid milk has become standard in retail, the market for cheese has yet to tip, with less than 30% of conventional U.S. cheese sporting the claim.

“Consumers today expect transparency from retailers and manufacturers,” Ms. Weaver said. “This impacts their purchase decisions.”

In the overall food industry, information about product ingredients ranks highest, followed by manufacturing process and sourcing practices. Many marketers invest in clean label claims to remain competitive. Others do so to secure a competitive advantage based on consumer demand and their willingness to pay.

“When it comes to dairy, as little ‘messing with’ as possible is desired,” Ms. Dornblaser said. “Clean label dairy foods should not have artificial growth hormones. The milk should come from cows raised responsibly, an image the consumer has of an open farm-like setting, with cows eating well and treated well.”