The a2 revolution that’s bringing dairy back

Australian company a2MC has gone from infant formula purveyor to one of the world’s most successful dairy businesses in just over a decade.

24 August 2018
image credit: ronstik/iStock/Getty Images

Dairy farmers worldwide collectively snorted in derision as World Plant Milk day came and went this week. It’s been a strange old year for the producers of one of the most iconic foodstuffs, with the vegan boom directly threatening dairy – and seemingly starting to win.

But, as reported by Food Spark this week, it’s not as cut and dry as all that. Plant-based milk remains niche, despite its clear successes, and the sales of full-fat dairy products are on the rise. While not turning the market on its head, plant-based products have fragmented it, with consumers given more choice with which to personalise their diets.

In the US, the growth of the plant drink market is reportedly slowing, while dairy products such as lactose-free milk have been gaining ground. This week, Australian-based a2 Milk Company (a2MC) – which entered the US market in 2015 – announced that sales in the US had doubled over the 2018 fiscal year. Its range of products has also just entered Walmart.

The brand, which provides a range of digestion-focused milk products based around the A2 protein, reported a 68% growth last year and a 31% profit margin, making them one of the biggest dairy success stories in recent memory.

The good, the bad and the intolerant

The concept behind a2 Milk is in the name. A third of the protein found in milk comes from something called beta-casin, which has two forms: A1 and A2.

It’s claimed by a2MC that the A1 protein was triggered by human domestication of the cow, with 70% of all cows now producing A1 naturally. Many of those suffering from lactose intolerance, as the hypothesis goes, actually have a specific intolerance to the A1 protein, which causes digestive discomfort and other symptoms similar to general lactose intolerance.

By working with farmers specifically on breeding and using a patented method, a2MC has managed to segregate cows that produce just the A2 protein, with the company now producing a number of different dairy products.

Its core demographic is consumers concerned about dairy affecting their digestive wellness, though a2MC is also continuing to make strides in the infant formula market.

Julian Mellentin, the founder of New Nutrition Business, believes that a2MC’s direct assault on the digestive wellness issue is a strategy to adopt for dairy concepts when standing up to plant-based alternatives.

“Many in the dairy industry in Europe and the US still think that A2 dairy is a marginal idea. That is a mistake,” Mellentin explains. “In 15 years, a2 Milk has gone from being the pariah of the dairy industry to the world’s most successful dairy business. It’s a case we can all learn from.

“An increasing number of regional dairies in the US are readying themselves in expectation of the emergence of an adult market for a2 milk, with several launching products with a2 milk in 2018. As so often, the pressing consumer need for digestive wellness and to ‘feel the benefit’ has shown how powerful an influence it is on consumer markets."

While there is in fact no definitive scientific evidence backing the conjecture that the A2 protein is predominantly responsible for lactose intolerance, there is no doubting that the marketing around a2 Milk has been effective.

“The success of a2 Milk also illustrates that it’s not just plant milks that can thrive by offering an ‘easy to digest’ alternative to conventional cows’ milk," adds Mellentin. "The case of A2 shows that no idea should ever be discarded as ‘too niche’ or ‘too weird.’”

Want to see more?

Get inspiration and support for your NPD and menu development.

• Emerging ingredients • Evidenced trends • Consumer behaviour • Cost watch • Openings • Retail launches • Interviews with innovators... See all that Food Spark has to offer by requesting a free no-obligation demo.


Add to Idea Book

"The a2 revolution that’s bringing dairy back"
Choose Idea Book