Gen Z is going all in on oat milk, prompting Philly coffee shops to adjust their lattes and their prices

Brooke Yacubeck can’t see herself ever drinking cow’s milk again.

The Fishtown 22-year-old switched from dairy to almond milk in high school. In recent years, she has become a huge fan of oat milk, drinking it with coffee four or five times a week.

While she was in the minority as an alternative-milk-drinking teenager in Hazleton, Pa., her preferences aren’t rare among her Philadelphia peers today.

“Absolutely not,” she said with a laugh. “I feel like it’s a meme, or a really common thing, that Gen Z and young millennials are all about alternative milks.”

“Oat milk latte is just so Gen-Z coded,” she added, referencing one of her favorite drinks and a popular choice at coffee shops.

And if the oat milk latte is in, the dairy milk latte is out, at least among a growing portion of 20-somethings.

Across the country, Gen Zers, the oldest of whom turn 26 this year, bought 20% less dairy milk last year compared to the national average, the New York Times reported last month, citing the consumer research company Circana. That’s prompted the dairy industry to launch a marketing campaign — one they hope to be as successful as the star-studded, milk-mustachioed “Got Milk?” ads of the 1990s — which is aimed at young athletes and bills milk as a sports drink.

“We have to reclaim milk’s mojo,” Yin Woon Rani, chief executive of the Milk Processor Education Program told the Times.

Nationwide, the amount of milk consumed per capita has been declining for decades, according to the USDA, though several Pennsylvania dairy farmers were quick to point out that consumption of other dairy products, such as cheese, has risen.

“It has a lot to do with the number of drink choices available to the public today, including water,” said Duane Hershey, a dairy farmer in Cochranville, Chester County. “You go into a grocery store, there’s 643 different drink choices. And milk has suffered just because the number of drinks that are available.” (He refuses to use the word milk to describe anything other than dairy milk.)

Meanwhile, consumption of plant-based dairy alternatives has increased, though they still hold a small share of the market, according to the consulting firm McKinsey, which surveyed consumers in August.

Philadelphia-area coffee shop owners have seen the data in these reports play out before their eyes, with some reporting that as many as half of customers now request their drinks be made with oat milk or another nondairy option. The shops pay more for oat, almond, and soy than they do for cow’s milk, as do customers, who shell out an extra 50 cents to $1.25 to have their drinks made with a milk alternative.

Many are willing to pay more, though the reasons vary.

As a nutritional therapy practitioner, Melyssa Bowers, 32, of Manayunk, doesn’t like drinking cow’s milk in part due to uncertainty about hormones the animals may have been given.

After eliminating dairy in her 20s, she said her skin cleared up and she felt less bloated.

She prefers almond milk, specifically the organic brand MALK, she said, because to her, “it’s the cleanest to drink and it tastes the best.”

While some cite environmental factors, most alternative dairy consumers told McKinsey that personal health was their No. 1 reason, followed by taste.

Those are the primary reasons Yacubeck opts for oat milk.

“It helps so much with how I feel,” said Yacubeck. “I know there is a lot of environmental context and discourse. … I’m more motivated by flavor and health.”

In early 2018, Philadelphia coffee shop owners were grappling with whether there was enough demand to add oat milk to their plant-based offerings.

More sustainable than almond milk, the beverage was becoming increasingly popular, due in large part to marketing of the Swedish-brand Oatly, which has since opened its Northern American research and development lab in the Bridesburg neighborhood of Philadelphia.

Five years and a global pandemic later, oat milk has proven more than just a momentary fad. As older members of Gen Z entered the workforce and COVID-19 led to a greater focus on health, the demand skyrocketed. Now, cafes in the city and suburbs say plant-based milks are just as popular as dairy milk, if not more.

At Forin Cafe in East Kensington, the consumption of plant-based vs. cow’s milk is “50/50, almost to the gallon on a weekly basis,” said Kyle Horne, a partner in Forin. While he finds a mix of milk drinkers in all generations, “folks that are older than millennials are probably a little bit more traditional-milk using. Gen Z tends to like alternative.”

And if someone orders a milk alternative, it’s most likely going to be oat, he said, though pistachio and macadamia milks are offered at one of their two locations.

In Ambler and Flourtown, a majority of Wake Coffee Roasters’ customers order oat milk, said co-owner Alec Satterly. At the Flourtown location, which is near several gyms, Satterly said customers opt for oat about 80% of the time. The demand has tripled since the pandemic hit, he added. Wake recently phased out almond milk because so few people were ordering it.

“A lot of it is TikTok trends, especially in the younger demographic,” he said, pointing to videos about the environmental footprint of different alternative milks.

Turk’s Head Coffee in West Chester sees a 50/50 split between nondairy and dairy milk orders, manager Carly Ackerman said, and the majority of college students opt for oat or almond milk.

“Younger millennial and Gen Z are gravitating toward oat milk a little more, probably because it’s been around for more of their adulthood,” said Matt Scottoline, director of coffee for ReAnimator Coffee Roasters, which has locations in Fishtown, Kensington, West Philly, Port Richmond, and South Philly.

Ted Renner, operations manager for Green Line Cafe, said he sees “monstrous demand” for oat milk at his shops in West Philadelphia, Point Breeze, and Center City.

The other nondairy choices at Green Line have expanded in recent weeks. Along with oat, sesame milk is now offered, as well as almond milk. A colleague learned about sesame milk at a recent coffee convention, Renner said, and suggested the shop offer it to its customers, many of whom are vegan and environmentally conscious.

“Nondairy milk definitely makes up the majority of what we sell, despite the fact that whole milk is still the default,” Renner said. It’s been the majority for about a year now.

Across the country, some coffee shops, such as the Blue Bottle chain, have made oat milk the default option if customers don’t specify otherwise. In the Philadelphia region, shop owners said they don’t see that happening, at least not yet.

At Greenstreet Coffee, owner Chris Molieri said whole milk still makes up about 65% of orders at the 11th and Spruce shop, he said, while 25% of orders are for oat milk and 10% are for almond milk.

Molieri said he could see alternative milk gaining a bit more traction, but he’s not convinced it’ll ever become the most popular choice, given that the trend seems mainly “generational.”

In time, “I would think it’ll ebb back to cow’s milk,” Molieri said.

While Satterly, of Wake Coffee, thinks alternative milks are here to stay, he said he doesn’t think they’ll remain as popular as they are now.

He has already seen demand for oat milk ebb and flow with the seasons. Some of his customers switch from oat to cow’s milk in the winter, when they want a frothy, more filling warm drink. People prefer the taste of oat milk in cold drinks, he said, so demand rises again as the weather warms.

And many customers enjoy cow’s milk in other forms, he said, sometimes while sipping on a plant-based drink.

“It definitely is not always about the dairy,” Satterly said. “People order an oat milk iced latte, and they’ll get an egg sandwich with extra cheese, regular dairy cheese.”

Still, the current surge in demand presents tough decisions. Oat milk costs about $10 more a gallon than cow’s milk, Satterly said, and Wake charges customers 50 cents more if they order oat milk.

They’re still making money off oat milk drinks, he said, but the margin is thinner than for dairy milk.

“What do we do?” he said. “Now we’re thinking, do we increase the cost of the drink?”