PARIS, France — Yogurt maker Danone has unveiled plans to fuel plant-based sales to €5 billion by focusing on the fast-growing food category.
Speaking at an Investor Seminar in London earlier this month, Emmanuel Faber, Chairman and CEO said the aim was to build a company uniquely positioned to embrace the food revolution.
“We are developing our unique portfolio of health-focused and purpose-led manifesto brands, acting as a catalyst for consumer reach. Our growth strategy focuses on valorized innovations to address some of the fastest-growing trends, notably among the younger generations,” he explained.
By maximizing the plant-based opportunity Danone plans to triple its worldwide plant-based sales from €1.7 billion to around €5 billion by 2025. In addition to accelerating its core plant-based beverages and yogurt categories, the dairy giant revealed it would expand into adjacencies, and aim to unlock unique opportunities through a combination of its leadership position in dairy business with the high plant-based growth potential.
Thanks to its investments in plant-based startups such as coconut water brand Harmless Harvest and its $12.5-billion acquisition of purpose-drive F&B company WhiteWave in 2016, Danone has already begun to position itself as a leader in sustainable, “better for you” products. The company’s New York-based venture arm, Danone Manifesto Ventures – the first corporate venture fund to achieve B Corporation Certification independently – has also helped to accelerate the company’s objective to “deliver superior sustainable profitable growth, to create and share value”.
“The B Corporation certification demonstrates the progress we are making and reflects our team’s collective efforts, including our portfolio companies, to support the health, wellness and environment of our communities. This important milestone will reinforce our commitment towards entrepreneurs who embrace our view that success is not only measured by profit but also by social and environmental impact”, commented Laurent Marcel, Managing Director of Danone Manifesto Ventures, at the time.
Danone is yet to announce any specific details regarding its planned new products, but plant-based versions of some of its popular yogurt brands such as Activia are expected to feature in the lineup.
“The intent is that any offering in which consumers would like to have a choice between dairy and plant-based alternatives, we should make it available because the consumer is looking for it,” a Danone spokesperson told Live Kindly.
With the global dairy-alternative market expected to exceed $24 billion within the next eight years, traditional dairy companies like Danone should look to the success of the younger industry, which has been quicker to embrace dairy-alternatives, according to a report by Rabobank.
“While it’s not essential to diversify into dairy alternatives, it would be wise for the dairy industry to at least learn one thing from the success of dairy alternatives, which may be putting the consumer first and trading in the old grass-to-glass model for glass-to-grass,” commented Tom Bailey, RaboResearch Senior Analyst – Dairy.
The report adding that results over the last five years have favoured companies that have invested in milk alternatives, with returns topping those of the standalone dairy category.