Editor's note: Abha Mishra is senior editor at Allied Analytics LLP, which is part of Allied Market Research.

Many people do not know that milk and milk-based products are not necessary for daily nutrition. Milk derived from animals, which was once considered the elixir for growing babies and kids, is now slowly making way for dairy substitutes.

The phenomenon of veganism is also becoming more popular. Its adherents are no longer dependent on animals for dairy products, and want to use more cruelty-free products.

The dairy industry is catering to the needs of vegans — as well as the lactose intolerant masses — with the introduction of plant-based milks. Dairy alternatives, such as almond milk, soy milk, rice milk and milk from hemp are gradually winning over customers who are making the shift towards fat-free, organic substitutes.

The dairy alternative market is witnessing the entry of big brands and startups that are including innovative variants in their product profiles to meet the increased expectations of vegans. Reducing allergy aggravations for the lactose intolerant, promoting veganism and adopting healthier lifestyles are the prime targets of the dairy alternative market.

Dairy substitutes, including spreads, creamers, yogurts, tofu and flavored milks, are gaining a nod of approval from consumers. The plethora of options offered by different companies has helped the dairy alternative market earn greater revenues.

Analysts at Allied Market Research have studied the market in detail and analyzed the strategic moves and dynamics followed by leading brands. They have stated that the partnerships and acquisitions between the big dairy companies help in expanding the scope of the dairy substitute market.

Veganism—sparking off the plant-based milk trend

Milk derived from mammals, which was long touted as a primary source of calcium, protein and lactose, is now slowly being edged out with the emergence of veganism. As a lifestyle choice, veganism is increasingly adopted by health enthusiasts who have recognized the nutritive benefits of thriving on a diet that is rich in plant fiber. Raising ethical concerns over the use and abuse of animals in food and dairy farming, animal lovers have also contributed to mainstream vegan trend.

Plant-based dairy substitutes derived from almond, rice, coconut, banana and hemp fill in the lactose, calcium, and protein requirements in a vegan’s diet. Without the much-wanted creams, cheeses, butter, and yogurts processed from cow or goat’s milk, this diet might sound bland. However, with many companies cashing in on this trend, vegans have a wide array of non-dairy cream products from which to choose.

Big brands have recognized the need to come up with new dairy substitutes, and have added flavors to their milks, cheeses, and cream spreads. Certain startups and big brands have also launched ice creams created from coconut and soy milk. This is a testimonial to the huge scope for creativity in product diversification in the dairy alternative market.

Banana and coconut milk: Could dairy alternatives get any better?

What sounds better than eating bananas? Not much, except drinking vegan banana milk produced without dairy additives. It has proven to be the latest milk alternative craze in the vegan as well as non-vegan world. The fruit offers notable nutritive benefits without costing consumers a lot of money. Moreover, milk derived from soy, hemp, cashew or almond tends to have a slightly bitter and cloying taste, which might not meet the criteria of a few hesitant dairy consumers. With their natural sweetness, bananas promise to be the tastiest, cheapest and healthiest substitute to milk.

Coconuts also boast an impressive nutritive profile, with saturated fatty acids that can significantly lower the risk of heart disease. Moreover, it is easily absorbed by the body and gives instant energy. Coconut milk is also perhaps the creamiest version of a dairy alternative, because of its nutty taste.

The production of milk from bananas and coconuts can cost significantly less than other dairy substitutes. This might mean better opportunities for production of banana and coconut milk in countries that produce a surplus of these crops.

Non-dairy cheese as a healthy and delicious option

Just because lactose-intolerant people and vegans abstain from processed foods made with dairy, it doesn’t mean they have an uninteresting diet. Non-dairy cheese products have slowly gained a foothold in the market. Without compromising on taste, these products have belied the notion that dairy-alternative products aren’t as tasty as the traditional milk-based versions.

In addition to almond- and cashew-based cheese, companies are experimenting with other nuts such as macadamia, hazelnuts, and hemp seeds. The nutty, creamy and subtle taste of non-dairy cheese is finding many takers, and the dairy substitute market is reaping the same benefits of the same.

With nearly 75% of the world population prone to developing lactase deficiencies and growing ethical concerns over animal abuse, dairy alternatives are evolving fast to cater to a wide consumer base. Tofu and soy yogurt, banana and coconut milk, and processed nutty cheese are all making their way into kitchens.

Competitors are foraying into the field to create cheaper and tastier variants of non-dairy products for a diverse customer base. This is proof that the dairy alternative market is well on its way to become a booming industry, for foodies and vegans alike.