Wall Street Journal: Embattled
soda industry fights back with sugary "dairy drink."
New dairy drinks target teens.
Distributed by Parents Advocating School Accountability,
by Betsy McKay, Wall Street Journal, News feature/ June 9, 2003
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Got blue milk?
After finding new growth in water and juices, the soft-drink
giants are applying their marketing muscle to a big beverage
category they've long overlooked: milk, or at least a colorful,
sugar-laden version of it. Coca- Cola Co., Cadbury Schweppes PLC
and others are moving in with new drinks that scarcely resemble
the stuff the milkman used to bring.
Next month, Coke, Atlanta, plans to
roll out blueberry, chocolate and vanilla-banana flavors of
Swerve, a milk-based drink. Raging Cow, launched by Cadbury in
March, comes in five flavors, including Pina Colada Chaos and
Jamocha Frenzy. Other drink makers are promoting milkshakes and,
believe it or not, carbonated milk.
The soft-drink companies hope to
use milk's wholesome qualities to buff their image and build
sales, particularly in schools, where they have been criticized
heavily for pushing sodas - and for contributing to the sharp
rise in childhood obesity. Their pitch: The milk drinks, with
vitamins and protein, are more nutritious than soda and a good
source of calcium, a mineral sorely lacking in kids' diets.
"It's definitely a healthier alternative," says Jim Trebilcock,
senior vice president of consumer marketing for Cadbury's Dr
Pepper/Seven Up Inc., the Plano, Texas, unit of the British
company that makes Raging Cow.
Dairy drinks also offer companies a largely untapped frontier at
a time when soda sales have gone flat, with sales volume rising
a mere 0.8 percent in the U.S. last year. After soda, coffee,
beer and bottled water, milk is the fifth-largest commercial
beverage category, with Americans on average drinking 19.9
gallons each in 2002, according to industry-consultant Beverage
But are Raging Cow and Swerve what mom and dad have in mind when
they tell their kids to drink milk? Probably not. An eight-ounce
serving of Raging Cow's Chocolate Insanity has 170 calories and
25 grams of sugar, compared with 150 calories and 11 grams
of sugar in the same size glass of whole milk, or 100 calories
and 12 sugar grams in 1 percent milk. The new drink has five fat
grams - double the 2.5 grams of fat in 1 percent milk, but less
than the eight grams in whole milk. A 12-ounce can of Coke's
Swerve, made with skim milk, is expected to have 150 calories -
about 10 more calories than its trademark soda.
"I'd really much rather my kids learn and enjoy the taste of
milk, rather than resort to these drinks," says Tracy Fox, a
dietitian in Bethesda, Md. If her 12-year-old son or 11-year-old
daughter needed more calcium, "I'd give them a calcium
supplement. We already expose kids to a lot of sugar."
Just over 50 percent of the new
drinks' content actually consists of milk, which means they lack
enough calcium and other nutrients to meet the Food and Drug
Administration's minimum standard for using "milk" on the label.
Instead, they are called "dairy drinks," because the other half
of their content is made up of water, sugar and flavorings. (The
drinks do have enough milk to use the American Dairy
Association's "Real" seal.)
Federal rules also bar schools from
substituting dairy drinks for regular milk in school-lunch
lines, though the sugary drinks can be sold a la carte. Raging
Cow, so far sold only in convenience stores, costs $1.49 per 14-
ounce bottle. In comparison, an eight-ounce carton of milk in
the school cafeteria costs 25 cents to 45 cents, according to
the American School Food Service Association.
One plus for the new drinks: They
don't need refrigeration. But the beverage companies still plan
to sell them chilled, because U.S. taste buds are used to cold
Dairy processors, concerned that
soft-drink makers could lure away customers, are trying to jazz
up their own products. Sales of 100 percent milk drinks made by
dairies in varieties from Pleasin' Punch to Root Beer Float -
which are still sugary, but not watered down like the soft-drink
makers' dairy drinks - rose 6.3 percent in the first three
months of this year compared with a year ago, while plain-milk
sales rose only 0.5 percent, according to the International
Dairy Foods Association in Washington.
Dairy processors hope their claims
to more nutritious beverages will help them keep their ground.
The new drinks "are not milk substitutes," says Susan Ruland, a
spokeswoman for the dairy group.
Still, one large milk producer, Dean Foods Co. of Dallas, is
expanding production of its own dairy drink, a combination of
coffee and low-fat milk called Folger's Jacada, made under a
licensing agreement with Procter & Gamble Co. "When the likes of
Cadbury and Coke are looking at your category, you better take
that seriously," says Gregg Engles, Dean Foods ' chairman and
Cadbury started developing a new
milk brand aimed at teens almost two years ago, as the new
plastic- packaging technology promised to bring down some of the
cost. To try to make milk as cool as soda, the company's
marketers dreamed up a belligerent bovine mascot dubbed Mad Cow
- but later renamed Raging Cow to avoid comparisons with the
livestock illness. Marketers spread the word through Internet "blogs,"
which are online diaries often written by trendsetting teens.
Mark Grossman, an 18-year-old in an
Atlanta suburb, says he's "not a big milk drinker." He prefers
Coke, iced tea and water. But he drinks chocolate milk
sometimes, and says he would try a new dairy drink "if it was
Soft-drink makers are hoping to boost sales with new flavored
milk-based drinks. Below, U.S. per-capita beverage consumption
Soft drinks 54.2 gallons
Bottled water 21.2
(1)Milk consumed exclusively as a beverage;
consumption of all fluid milk, including milk used for baking or
poured on cereal, was 22.6 gallons per capita. Source:
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