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Soy Delicious: soy beverage report

The explosive growth of soy beverages has levelled off in recent years. But a new batch of products may have consumers rediscovering the healthy benefits of soy

Ten years ago, soy beverages were a rarity on the shelves of most supermarkets. Not anymore. Soy is everywhere and consumers have plenty of choice: different flavours (chocolate and vanilla, sweetened and unsweetened), shelf stable and refrigerated products. Some are fortified with calcium. Others are enriched with a virtual vitamin alphabet: A, D, B2 and B12. Still others are promoted as light or lactose-free. And mainstream shoppers are discovering what their Asian counterparts learned at an early age: soy-based beverages are healthy and nutritious alternatives to milk.

There has been a lot of positive buzz about the functional benefits of drinking soy beverages in terms of preventing heart disease and certain types of cancer,” explains Todd Hoffman, director of customer business development with Vancouver-based Soyaworld Inc., a manufacturer of soy drinks.

Soy beverages are a staple in many Asian countries and children grow up drinking them the way Canadian kids slug back milk. But in recent years, these products have crossed the cultural divide thanks to growing public awareness of the nutritional benefits.  The mainstream market now accounts for about 95% of sales in the category, while the Asian portion is a mere five per cent.

But Asian and mainstream tastes can vary greatly. Asian consumers raised on soy beverages are accustomed to the beany flavour that comes with producing a drink from soy beans. Mainstream consumers tend to be put off by a strong bean taste. Some manufacturers have responded by making drinks specifically for them. Rather than using whole beans, the protein from the bean is isolated and extracted.

Meanwhile, some ethnic supermarkets have added to their product offering in response to growing demand for healthier products. Vancouver-based T&T Supermarket, which is now owned by Loblaws, has eight stores located in B.C., Alberta and Ontario and serves a largely Asian customer base. Marketing manager Sandra Creighton says that along with the traditional soy beverage, the company recently began to carry light as well as low-fat and calcium-enriched soy drinks.

The packaging divide

While manufacturers have crossed the bridge between ethnic and mainstream grocers, there appears to be very little crossover among consumers. They tend to shop in one milieu or the other. Industry experts cite two reasons. First, there is the divide between ethnic and mainstream tastes when it comes to soy drinks, says Peter Taylor, customer development manager for WhiteWave Foods of Aurora, a suburban community north of Toronto.

Ethnic consumers also buy their soy beverages in bigger containers because they drink larger quantities of it, says Janice Harada, vice-president of marketing with Toronto-based Hain Celestial Canada.

Beverages for the mainstream supermarkets tend to be packaged in square, 1.89-litre containers with gabled tops so that the product can be sold next to milk in the dairy refrigerator. Some Asian grocers sell soy drinks in plastic jugs similar to the three-litre containers once used for milk. “People in the Asian community are brought up on soy beverages so they’re consuming a lot more of it,” Harada says.

Soy beverages have traditionally competed against milk, but the milk-alternative category is quickly becoming much more competitive as new rice-, oat- and almond-based drinks start to come on the market. “People want something different,” says Harada. “Almond has a very strong nutrient halo these days. There’s been a lot of media buzz around the health benefits of eating almonds.”

New flavours

According to figures compiled by Nielsen, sales of soy drinks increased only one per cent, to $121 million, in the 52 weeks ending Jan. 16, 2010, up from $120.2 million a year earlier. On the other hand, sales by unit volume decreased three per cent, to 42.6 million containers, from 43.7 million.

Some observers believe that those figures reflect a natural levelling off of growth in the category. “Overall, it seem to be stable,” says T&T’s Creighton. “But there does seem to be a shift within the category toward drinks perceived as being healthier. Sweetened used to dominate among our customers, but we’re seeing more growth in sales of unsweetened. It’s related to health consciousness.”

Hoffman says category sales grew rapidly between the late 1990s and 2007 as mainstream consumers discovered soy beverages. Soy drinks have achieved a household penetration rate of about 20% and Hoffman says it will be difficult to increase the penetration rate significantly. But he thinks it is possible to increase consumption within households that are already buying soy beverages by marketing the drinks as treats or for special occasions. Soyaworld has taken that approach by developing chocolate- and vanilla-flavoured products as well as a special-edition product in which the flavour changes every six months.

However, Won Ha, director of sales and marketing with Korea Food Trading in Concord, Ont., sees potential for growth coming from several different directions. The first is fruit-flavoured soy beverages. Korean producers are working on banana and strawberry drinks and Ha plans to import these for his customers.

“People are trying to create different products to make them more attractive to mainstream consumers,” Ha says. “I think there are huge opportunities for growth.” He adds that some convenience stores are beginning to carry soy alongside regular milk products. And the perceived nutritional benefits will continue to have an impact. “Health-conscious consumers are going to the organic sections of their supermarkets and they see soy milk,” he says. “They realize that it’s a healthy product.”

Taylor is also optimistic about potential growth. Not just for soy, but also the broader category of milk alternatives that include almond-, oat- and rice-based beverages. He says that all the milk alternatives combined have reached a penetration rate of about 23% of households. WhiteWave has conducted consumer panel research that suggests the overall rate could be pushed to 40% as the newer beverages catch on. This year, WhiteWave plans to introduce a low-calorie version of its soy beverage and an almond drink to appeal to the health-conscious consumer. “We’re hoping that the next real growth opportunity will be for the low-calorie, alternative beverage,” says Taylor.

3 great ways to move more soy

Let ’em taste it

Sampling is the best way to introduce consumers to soy beverages. It also happens to be a great chance to educate consumers about the health benefits of soy. “A lot of people don’t know about the health benefits and may resist trying soy drinks because of the beany taste,” says T&T Supermarket’s Sandra Creighton.

Cross-merchandise

Place refrigerated soy drinks next to milk in the dairy section. Most households still drink milk products, and soy beverages can be seen as a complementary purchase or a secondary choice. Another idea: Place soy beverages in open bunks adjacent to the dairy refrigerators. This increases visibility of the products and can help boost sales, says Soyaworld’s Todd Hoffman.

Think organic

Display shelf-stable soy drinks in the organic or natural foods section in order to take advantage of consumer desires for wholesome beverages, says Peter Taylor of WhiteWave Foods. It helps, of course, if the drinks on display have their organic certification clearly labelled on the package.


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