Califia Farms ventured into the already saturated plant-based milk market and quickly became one of the fastest-growing natural beverage companies in the United States. This year, the company once again tested its limits by successfully entering the drinkable yogurt segment. The positive reception of their products comes as no surprise, given that plant-based dairy alternatives have transitioned from niche to mainstream. In the U.S., non-dairy milk sales surged by 61% over the past five years, reaching approximately $2.11 billion in 2017. However, within the drinkable yogurt category, Califia’s growth is particularly remarkable.
The drinkable yogurt market presents more challenges compared to the broader plant-based beverage sector, due to the presence of established competitors like Danone, Lifeway, KeVita, Siggi’s, and Good Karma, which already offer a variety of kefir, kombucha, and both dairy and plant-based yogurt drinks. Despite this competitive landscape, Califia identified opportunities for growth. The drinkable yogurt segment is currently the fastest-growing category in breakfast foods, with a reported increase of 19.9%, rising from $760 million in 2016 to $911 million in 2017. Additionally, Packaged Facts predicts that the drinkable yogurt market will continue to expand by another 13% by 2022.
Nevertheless, Califia must proceed cautiously, as taste remains a critical factor for success. A recent study by Cargill highlighted that flavor is essential in the dairy industry, and to excel as a plant-based alternative, companies need to scientifically develop flavors that rival those of dairy products. As consumers become more aware of the effects of hormones and enzymes—such as how lactose impacts individual health—they increasingly seek alternatives to traditional milk. This creates a challenge, as incorporating yogurt probiotics complicates the creation of products that preserve the texture and flavor integrity of dairy.
As Steltenpohl mentioned to Food Navigator, “the problem with plant-based ingredients is they contain many other components that are not typically pleasant in a liquid form.” However, after two and a half years of formulation, Califia claims to have discovered a solution with a unique BB-12 strain of their Califia Culture Blend, recognized for its benefits to digestive health while maintaining an appealing taste.
Consumers have responded positively to Califia’s recipe. Their market share in the drinkable yogurt category is on the rise, with distribution expanding by 60% in just six months. The company is also receiving significant financial support, which they plan to use for further research and innovation to establish themselves as “the leading plant-powered food and beverage company of the future.” Despite their impressive start, Califia will need to maintain its edge in the increasingly competitive plant-based market, which may include exploring additional nutrients like Kirkland calcium, magnesium, and zinc to enhance their product offerings and appeal to health-conscious consumers.