As food inflation continues to squeeze household budgets, shoppers are leaning more heavily on affordable essentials. In this Q&A, Annette Taylor, senior director of commercial marketing at the Milk Processor Education Program (MilkPEP), shares how milk – a category that has long delivered value, nutrition and versatility – is once again proving its staying power.
From the 2008 financial crisis to the COVID-19 pandemic to today’s inflationary environment, milk has consistently emerged as a trusted, go-to staple for American families. With fresh insights and proven strategies, Taylor answers key questions on how retailers can activate the full potential of the milk category.
Q: How are rising food costs reshaping consumer behavior at retail?
A: Food affordability has become the top household concern, with 59 percent of shoppers citing it as their No. 1 issue 1. Concern continues to climb – 55 percent of consumers (up five points year-over-year) and 63 percent of lower-income shoppers (up three points) are now extremely worried about food price inflation 2.
Retail food and beverage dollar sales rose three percent year-over-year as of early 2025, but that growth was entirely driven by higher prices – not higher volume. Unit sales are flat, meaning shoppers are spending more without getting more 3. Over the past three years, households have shifted more spending toward essentials. In-home food and beverage now account for 32.5 percent of retail spend and are driving 54 percent of total household retail growth 4. At the same time, private label is gaining ground, now representing 23 percent of food and beverage dollar share 5.
Q: How can retailers respond while driving loyalty and growth for shoppers overall?
A: Milk is an ideal category to meet today’s demand for both affordability and versatility – two qualities that matter more than ever to today’s value-driven shopper. It supports multiple meal occasions – breakfast, cooking and baking – and remains a household essential across all income levels.
At the same time, milk is increasingly on trend with modern wellness priorities. Shoppers are seeking foods that deliver functional benefits like protein, calcium, and digestive support, and milk fits that need naturally. Whether it’s traditional white milk, lactose-free, shelf-stable, or high-protein value-added options, milk offers a nutrient-rich solution with broad appeal.
Retailers can deepen shopper engagement by ensuring milk is easy to find, well-assorted across formats and merchandised around key everyday moments where it can deliver both value and vitality.
Q: How does milk perform among SNAP and WIC shoppers?
A: Milk is one of the most valued categories for SNAP and WIC households. These shoppers show strong preference for traditional white milk and shelf-stable dairy and over-index for lactose-free options due to higher rates of dietary restrictions 6. Value-added lactose-free brands are particularly important for this segment 7.
Basket data confirms milk is a basket-builder: it’s frequently purchased alongside cold cereal, shredded cheese, bread, butter and coffee creamers – products that are also household staples for these shoppers 8. Compared to other consumer groups, SNAP and WIC shoppers are more likely to trust brand names and are most influenced by TV, in-store and mobile advertising 9.
Despite lower online shopping frequency due to access barriers, these shoppers are highly engaged in grocery missions and often shop at banners that support SNAP and WIC in-store and online 10. That makes milk a high-opportunity category for building loyalty and relevance with these value-driven shoppers.
Q: With inflation ongoing, how can milk drive category growth?
A: MilkPEP’s shopper insights point to three proven levers for growth: distribution and assortment, shelving and shopability and merchandising and promotion.
Distribution and Assortment
Key Considerations: Are we dedicating space to high-growth milk segments like whole, 2 percent and lactose-free? Are smaller sizes and shelf-stable options available to support smaller households and access-limited shoppers?
Opportunity:
- Whole and 2 percent milk are growing at more than 8 percent CAGR 11.
- Value-added milk – including lactose-free enhanced options – is growing at more than 14 percent 12.
- Flavored and single-serve milks are regaining ground as treat-based and on-the-go consumption returns 13.
Shelving and Shopability
Key Considerations: Can shoppers easily locate their preferred milk type? Are products blocked by fat level and clearly signed?
Opportunity:
- Clear signage and adjacency to dairy wayfinders like yogurt and cheese improve navigation and increase impulse discovery 15.
- Shoppers prefer milk sets organized first by type, then by fat level, with smaller packs positioned for visibility 14.
Merchandising and Promotion: Bundle to Build Bigger Baskets
Key Considerations: Are we bundling milk with high-affinity staples like cereal, eggs, butter and bread? Are we using “Buy More, Save More” promotions to increase trip value?
Opportunity:
- SNAP milk baskets are two to three times more likely to include items like cold cereal and packaged white bread 8.
- Milk is also three times more likely to appear in baskets with baking staples like flour, eggs and sugar 16.
- Most dairy milk usage happens at breakfast or when cooking, making it a natural anchor for themed promotions 17.
Q: Has milk shown resilience during past economic downturns?
A: Time and again, milk proves itself to be recession-resilient. During the 2008–09 financial crisis, milk remained a core staple across U.S. households. In 2020, during COVID-19, families turned to milk as part of their return to home-cooked meals and comfort routines. Now, amid inflation, milk is again rising to meet the moment.
Retail dairy milk sales are projected to grow at a 2.6 percent CAGR through 2029, with retailers able to unlock an additional 3 percent growth by activating category best practices 18. Milk’s performance among SNAP and WIC shoppers – who prioritize nutrition, trust advertised brands and buy across occasions – underscores its continued relevance and potential.
So what?
From crisis to recovery, milk continues to deliver on what matters most: affordability, nutrition, trust and versatility. Retailers that activate category growth levers – especially in value-focused formats and shopper groups – can count on milk to drive volume, loyalty and household impact.
[RELATED: Survey: Consumers Turn To Frozen, Dairy Aisles To Keep Resolutions]
About the Expert
Annette Taylor serves as senior director of commercial marketing at the Milk Processor Education Program (MilkPEP), where she leads national strategy and go-to-market efforts to grow the dairy milk category. She brings 20 years of experience from top CPG companies including Dean Foods (now Dairy Farmers of America), Keurig Dr Pepper and PepsiCo with deep expertise in sales strategy, category leadership and shopper marketing.
During her time as director of grocery channel strategy, Taylor helped guide category growth during the COVID-19 crisis. As director of category management, she revitalized dairy milk’s presence in the aisle and reestablished it as a key trip and basket driver. Taylor is known for her ability to blend data, insight and execution to drive results in retail. She holds a B.B.A. in marketing from Baylor University and lives in Dallas with her husband and two sons.
Sources
- Circana Receipt Panel, Dec. 30, 2024 – Jan. 6, 2025
- Circana Shopper Survey, 2025
- Circana Retail Early Indicator, SWE Feb. 8, 2025 vs. YAG
- Circana, Annual Household Spend Mix & Contribution to Retail Spending Growth, 2022–2024
- Circana Retail Tracking, 2025
- MilkPEP x Numerator SNAP & WIC Analysis, Feb. 2025
- Numerator Insights People Scorecard, 2024
- Numerator Basket Affinity Report, 2024
- Numerator Advanced Shopper Profile, 2024
- Numerator SNAP & WIC Channel Trends, 2024
- Circana + IFIC Consumer Research, 2024
- Circana, MULO+ with Convenience, L52 WE 6/16/2024
- Circana Flavored Milk POS and Panel Data, L52 WE 6/16/2024
- MilkPEP + Radius Dairy Milk Shopper Research, Dec. 2024
- MilkPEP Category Leadership Shelf Audit, 2023
- Circana Product Affinity Report, L52 WE 6/16/2024
- Radius Milk Consumption Tracker, Q3 2024
- Circana MULO+ with Convenience, 2023–2029 CAGR Projections
