The Wellness Premium: Marketing Strategies and Financial Implications of Milk Alternatives

Abstract

The dairy industry has been greatly affected by the global wellness movement. Diverse plant-based alternatives to dairy milk (e.g., almond, oat, soy, coconut, etc.) have quickly infiltrated the urban consumer market, offering a healthier and more sustainable option to dairy. But, the alternatives have skyrocketing prices (three to five times more expensive than traditional dairy milk). This begs the question, do consumers find the alternatives worthwhile due to nutritional and health benefits, or are consumers investing in the meticulously marketed wellness, which is a social construct? The purpose of the paper is to identify the intersection of marketing, consumer psychology, and price analysis that establish the wellness premium associated with plant-based milk alternatives. More specifically, the paper analyzes the impact of urban Indian consumers' purchase intentions and perceptions due to influencer marketing, premium packaging, wellness narratives, and most importantly, branding. The study adopts a mixed-method approach, primarily based on a consumer survey conducted in Ahmedabad city, along with in-depth interviews at urban cafes. The findings suggest the wellness premium to be a convergence of all things economically, psychologically, culturally, and symbolically. In terms of paying more for a product, the marketing cues influenced consumer perception of the health benefits more than the objective nutritional knowledge, income, urban exposure, and lifestyle identity. The study suggests that, in the context of Ahmedabad, the expensive plant-based milks are more of aspirational lifestyle products than health products, with the high price being sustained by clever marketing around wellness with little health or nutritional benefit.