Some good news on dairy sales

Times are tough for most U.S. agricultural producers, including those in the dairy industry. But there's some good news on retail dairy sales, an industry analyst said.

"We've had a lot of people come back to our category (dairy) with a vengeance" during the COVID-19 pandemic, said Larry Levin, executive vice president of market and shopper Intelligence at IRI, a data analytics and market research company based in Chicago.

Levin was among the speakers July 15 during the Dairy Experience Forum, which was available online to the news media and others. The event was hosted by the American Dairy Association of the Midwest, a non-checkoff organization funded by food vending operations at state fairs and other dairy-related ventures.

"Our industry is coming in at about 22% growth (in sales) during the the post-panic (pandemic) era," Levin said. "Dairy (sales) is punching a little bit better than total edibles (sales)."

Sales of milk, butter, cheese and yogurt all have increased substantially. Butter, in particular, has enjoyed higher sales, at least in part because of more home baking, Levin said.

The dairy industry should be proud of higher sales, Levin said: "We are truly serving an important need for consumers."

The dairy industry, like other segments of our economy, continues to adjust to the pandemic, Levin said.

Consumers are shopping less often and spending less time when they do. That makes it increasingly important for shoppers to formulate their shopping plan before they reach the grocery store, he said.

So, "Do your (sales) promotions before people shop. Because they're not looking for new product innovation, they're looking to get in and out as quickly as they can," Levin said.

"E-commerce has been a boon to not just the total market, but the dairy market as well," Levin said. Just one sign of that: E-commerce milk sales have risen 279% from a year ago.

A quarter of the U.S. population has tried ordering dairy products online, and 70% of those shoppers say they will continue doing so after the pandemic ends or subsides, Levin said.

Even so, 12% of shoppers said the dairy products they wanted to buy weren't available online, Levin said. "We need to make sure we stock as well as we can."

Dairy products are increasingly popular at breakfast and as morning snacks, Levin said. "We have to take advantage of the fact that because of COVID we've created a lot more opportunities to partner with our consumers and make sure we have products available."

"Let's make sure we have the right products in front of the right people at the right time," he said. From a retailer's perspective, "It's about offering deals. I think the consumers are really pleading with the industry to try to make sure that we have the right discounts, the right deals, in front of consumers."

Dairy products should continue to be popular in home cooking and baking even after the pandemic ends or subsides, Levin said.

Yogurt will remain a popular snack after the pandemic, too, he said.

Cheese is increasingly used as a home snack or as an ingredient in home-made pizza, and maintaining those uses after the pandemic should be a goal of the dairy industry, Levin said.

Increasing package size also is something to consider, he said, noting that some cereal makers have increased the size of their boxes and bags.

Most importantly, as the country comes out of the pandemic, "Let's make sure that our category is easy for people to shop, (that) they get what they want." Levin said.