Edible ‘dairy’: Yili ramps up focus on cheese and plant-based products in response to growing consumer demand
Yili has grown to become a major dairy market leader in China based on its traditional products such as liquid milk and milk powders, but given the rising interest of Chinese consumers in a wider range of dairy products and also dairy alternatives, the firm is now looking to expand its focus in other areas such as ‘edible’ dairy and plant-based innovations.
“The nutritional value of cheese has gradually been recognized by Chinese consumers. They are experiencing a transition from ‘drinking milk’ to ‘eating milk’,” Yili Assistant Vice President Yun Zhanyou told FoodNavigator-Asia.
“The catering, hotel and baking industries, with cheese, butter and cream as important materials, are also developing rapidly. All these provide opportunities for the rise of cheese with high protein, calcium and nutritional value.”
Under its cheese division, Yili has rolled out various cheese products including the Yili Cheese Bar for Kids, Wonderful Cheese for Adults, Yili Mozzarella Shredded and more, in addition to the launch of two professional series in 2020 dubbed ‘Oriental Inspiration’ and ‘Global Selection’ targeting B2B professional customers.
“We have also innovatively developed and launched the “squeezable cheese”, creating the first liquid product in the field of cheese,” added Dr Yun.
“In the past financial year, Yili’s retail market penetration of our cheese business has increased by about 6.7% compared with the same period in the previous year.”
In addition, Dr Yun also highlighted the firm’s rising interest in the plant-based products sector, stressing that they believe this not so much a competing as a complementary sector for the dairy firm.
Yili already has a variety of plant-based products in the market which is has been rolling out slowly over the past few years, including its Plant Selected soy milks and oat milks.
“Yili has a development layout focusing on diversified products [including] plant-based products, which we believe will help us to achieve sustainable growth,” said Dr Yun.
“In terms of innovation, we will also be launching a new plant-based product under the Plant Selected brand at the end of the year – a coconut fermented plant yoghurt, which will first be launched in mainland China to further enrich our plant-based product portfolio.”
Regular dairy will not be left behind
Despite increased focus in these heretofore non-conventional areas, he emphasised that this does not mean Yili will be taking its foot off the pedal in ensuring regular developments and innovations for its successful dairy business sector, especially as demand for these is also still high.
“The liquid milk business is Yili’s traditional superior sector. With the improvement of consumers’ health awareness and gradual formation of milk consumption habits, we still expect consumers to have a high demand for liquid milk,” said Dr Yun.
“In addition, as China is now facing the challenge of an ageing population in addition to the government’s new three-child policy, we believe that the demand for adult and infant formula powder will continue to grow here.”
The firm is also stepping up its efforts to conquer more sales channels, particularly online ones, as Chinese society is evolving to become more reliant on e-commerce than ever before.
“We have observed that innovations in terms of consumption channels are popping up in China, with the rapid development of online shopping, new retail and other channels,” he added.
“In recent years, as consumers have become more accustomed to making purchases via mobile devices such as cell phones, and thanks to the development of big data, IoT and cold chain technologies, online shopping and other consumption channels have entered a fast lane of development.”
Dr Yun cited the COVID-19 pandemic as having been a major accelerator for this trend, and told us that Yili has had to react by innovating products to be suitable for multiple consumption channels including e-commerce.
“The pandemic has further accelerated this trend, [and we do not expect it to end any time soon], but rather that it will continue on into the future,” he said.
“To accommodate this evolution, Yili will continue to promote the development of innovative products [and] explore multi-channel sales models to continuously improve consumers’ shopping experiences.”