There’s been a spate of activity not just new products but promotions and advertising as manufacturers try to drive growth in this mature category. Cathedral City Chedds, Müller Milk, Lurpak olive oil, Kerrygold honey spread and Mini Babybel gouda are all new to the dairy chiller.
Cathedral City Chedds is a new kids’ snacking range. Gemma Baggaley, brand manager for Chedds at Dairy Crest, reckons it is the “most important launch in kids’ cheese snacking for a decade”.
She adds: “We’ve had an amazing response to the concept and we’re committed to making sure this launch is a success for the retailer, the mums that buy and the kids that will eat Chedds.” There are three Chedds lines: Cheese amp; Toasties, Nibbles and Bricks.
TV advertising is currently supporting the new product as part of a £3m marketing campaign which also includes social media and in-store activity.
Meanwhile, Müller moved into the chilled flavoured milk category this summer with the launch of Müller Milk. There are three varieties chocolate, strawberry and vanilla packaged in resealable 400ml PET bottles in shelf-ready trays of 12. Recommended retail price is £1.09.
As well as extending Müller’s reach into another section of the dairy chiller, the company says the move fits with its strategy of tapping into the “snacking market opportunity”.
It is the first time Müller has had a presence in the chilled flavoured milk category in the UK, despite Müllermilch being the brand leader in the equivalent ‘milk-mix’ category in Germany, where, according to Neilsen, it accounts for just over half of category sales. Müller Milk’s arrival in the UK follows its recent roll-out in eastern Europe. But it was first launched in Germany in 1983 and Müller says it now sells 120 million bottles a year.
Lee Rolston, marketing director at Müller, says: “Müller yogurts are purchased by more consumers than any other yogurt brand (Kantar Worldpanel) and the popularity of the brand makes the expansion into chilled flavoured milks a natural and fitting development for the Müller portfolio.
“In consumer research Müller Milk certainly got the thumbs up from the two key groups who purchase flavoured milk: young men who purchase on impulse for snacking and consumption on the hoof; and mums purchasing for children as an alternative to other soft drinks.”
Already Spar wholesaler Appleby Westward reports that it’s selling very well.
For Arla Foods, Lurpak olive oil is just one of many recent launches.
Stuart Ibberson, business unit director for butter, spreads and margarine (BSM), explains: “We have continued to extend the Lurpak Spreadable range over the last couple of years through the introduction organic and unsalted variants to add to the existing slightly salted and Lighter SKUs. Lurpak Spreadable is by far the biggest selling variant in the impulse sector worth £19m (Nielsen). Recently we have also launched Lurpak olive oil and Lurpak sea salt. We have also launched an unsalted variant of Anchor block to capitalise on the consumer trend towards lower salt consumption which has been backed by FSA initiatives and advertising.”
Likewise, Kerrygold has had a busy year with the launch of Kerrygold honey spread, Kerrygold lighter unsalted, Kerrygold Spreadable with Irish butter amp; olive oil, and Kerrygold Spreadable Lighter with Irish butter and olive il.
Alastair Jackson, marketing director for Adams Foods, explains: “By introducing first to market, unique products we think we will be able to go beyond competing purely on price as we will be giving consumers something new, something that doesn’t have an alternative.”
In cheese, new Mini Babybel gouda, described as ‘mellow and creamy’, is available in six-packs. Katherine Flannery, senior brand manager at Bel UK, is confident the new variety will help the brand reach even more consumers those familiar with gouda and those keen to explore new varieties and flavours.
But, of course as well as bringing new products to market, there’s the arguably more difficult job of driving sales of existing lines.
Tim Dummer, customer marketing controller at Dairy Crest, says the total BSM market is doing well in value terms up over 12% to £1.24bn (Nielsen 52 weeks ending August 6). And in convenience stores, sales are up just over 9% to £139m. But volume growth is just 0.5%.
“We’ve had flat volume growth for the past 10-15 years. Consumers have just been switching between products rather than buying more,” he explains.
“Household penetration is incredible at 99% but the downside is that there’s not much room for growth.
“We’ve got to get more shoppers buying more products. We’ve got to give them more ways to use BSMs and encourage them to trade up.”
Dummer says there are three main growth trends: health with consumers wanting lighter-style products and those with health benefits; convenience such as spreadable butters; and taste where some consumers want quality products and are prepared to pay more for them.
He reckons promotions are key for retailers to use to reward loyal customers. “Convenience shoppers don’t want to pick up multiple products so price promotions are best. Some shoppers view c-stores as being quite expensive so price perception is key and convenience retailers have to work hard to offer value.
“We offer price promotions as well as price-marked packs. We trialled price marking for six to nine months and now it’s a permanent part of our range. We have Clover 500g and Utterly Butterly 500g available in price-marked packs (PMPs)at £2.39 and £1.99 respectively. We expect to offer more PMPs next year.”
Dummer adds that in this difficult economic climate, retailers are looking for value for money and don’t want to hold too much stock. “We have reduced the cases sizes of Clover and Utterly Butterly to eights. This helps retailers financially and lessens the risk of waste.
“At the same time we have redesigned all our outer cases so the branding stands out more and products are more easily recognisable. This means retailers can select the stock they want quickly and easily.
“In depots, the chillers tends to be at the back and it’s also very cold. Retailers want to be in and out as quickly as possible so it’s important they can recognise what they want and make a quick choice.”
Much of the milk sold in convenience stores is own-label but there are brands around. Indeed, Wiseman’s Black and White is cited by Nielsen as one of Britain’s fastest growing brands. Wiseman sales and marketing director Sandy Wilkie says a key part of its success has been the regional labels which provide customers with a local product at no extra cost. “The regional labels help our customers meet the increasing consumer demand for produce with provenance. By offering milk which clearly identifies its source, without adding cost to the retailer, Wiseman is adding value to its milk which can be passed on to consumers,” he says.
There are five regional labels currently in the portfolio: Grampian, Milk from Scotland, West Country, Cornish and the more recently introduced Milk from Wales.
Wiseman also has a range of catering size products which Wilkie says are experiencing growth. These products include three- and five-gallon pergals of whole and semi-skimmed milk variants as well as litres of fresh cream.
“In the run up to Christmas the demand for cream in wholesalers and caterers increases and to help meet this demand Wiseman produces half gallon size packs of fresh cream,” he says.
Wiseman works with its customers to help them make the most of the milk category. Wilkie explains: “Our sales team works with customers to regularly review their products, look at merchandising plans and implement regular checks of stock levels and cleanliness using the on the hour, every hour tool.
“We worked with United Wholesale Scotland to implement a scheme to encourage availability of bread and milk, with a guarantee to consumers that if a store has run out of these products they receive their next purchase of bread or milk free. By ensuring the availability of these two key items they saw a like-for-like sales increase of 22%. Similarly Booker wants to make sure that it customers get what they need, when they need it and to encourage customers to ensure availability of stock.”
Wilkie continues: “The Cash amp; Carry Retailer Tracking Programme questioned shoppers about what is most important to them when visiting their wholesaler and the results showed that value for money, acceptable prices and availability of items are key.”
On the foodservice side, Pritchitts reports that its core products such as Millac Gold and Millac Maid Mini Pots of long life milk continue to perform very well.
Another product that is popular is Millac cappuccino milk.
The advanced foaming milk has a fat content of just 1%, which is lower than semi-skimmed, making it ideal to meet growing demand for skinny lattes and cappuccinos,” explains Simon Muschamp, head of marketing at Pritchitts.
“Thanks to its consistent and long-lasting foaming capabilities, cappuccino milk creates a luxurious, dense drink; ensuring a great cup of coffee, every time.”
Pritchitt’s Viva Milk is a key wholesale product due to its popularity in schools. The ‘Viva Daily Win’ promotion is running again this year, giving secondary school students the chance to win a free iPod shuffle every school day from now until December. The promotion includes a new ‘school bonus’ where if 50 or more pupils enter the free prize draw, the winning school will also receive £100-worth of sports equipment.
Pritchitts is also running a promotion for caterers. Pritchitts Magic Number gives them the chance to win prizes through to December 31, simply by entering the ‘magic number’ which is found on all Pritchitts-branded products.
Muschamp says the beauty of the Magic Number promotion is that wholesalers can take a slice of the action and benefit from stocking Pritchitts’ premium dairy product range.
“We understand the dedication and hard work put in by our loyal base of wholesalers, which is why caterers will be asked to enter their wholesaler and sales/telesales’ contact when they enter their codes, so that if they win you do too,” he explains. Those wholesalers that do win can choose from either a £60 spa treatment voucher or £60 HMV voucher.
There are still too many independent retailers that are not stocking chilled yogurts and pot desserts (CYPD), says Gary Miller, sales director at Müller Dairy. “CYPD forms the third biggest sector in the dairy category after milk and cheese it accounts for almost a quarter of dairy produce sales (Kantar Worldpanel) yet the importance of the category is not reflected in the space given to these products in a significant proportion of convenience stores’ chiller cabinets and, as a result, wholesalers as well as c-store retailers are losing out.
“The argument for convenience retailers to stock CYPD products is overwhelming 96% of British households buy chilled yogurts and pot desserts (Kantar Worldpanel) and three-quarters of households buy Müller brands; and yogurt shoppers can also have a big impact on a store’s turnover as they spend over 62% more per week than the average shopper.”
He says many of the retailers who aren’t stocking CYPD are “unjustly concerned” about waste, and quite a few of those who do stock them tend to under-estimate sales and are often out of stock of the most popular brands.
“The CYPD category is continuing to grow and it does represent a big opportunity for convenience stores,” says Miller. “Adult yogurt sales continue to perform ahead of the total CYPD market, and they represent a good growth opportunity for wholesalers and convenience retailers who really get behind the category.”
Total CYPD sales have increased by 2.7% in the last 12 months, and this has added £57.7m to the value of the category, which now generates sales of £2.2bn a year (Nielsen).
The Müller range has recently been refreshed with blue selected as the new signature colour. The new-look was introduced in August on all the Corner, Müllerlight and Müller Rice brands’ single pots, multipacks and trays.
August also saw three new flavours join the Müllerlight line-up: a limited edition Coconut with Chocolate Sprinkles which replaced the Summer Berries limited edition; Mango amp; Passionfruit which replaced Apricot in the regular range of Müllerlight flavours; and Lemon Cheesecake yogurt. Müller Amoré also has a new special edition – Gorgeous Coconut amp; Lime. There were also three new Indulge lines introduced to the Müller Rice range last month: Raspberry with a hint of White Chocolate; Smooth Chocolate amp; Caramel; and Rich Chocolate. Miller reckons the new Rice Indulge range will drive volume and value for both the category and brand by expanding its usage occasions.
Meanwhile, Oakland Distribution a multi-temperature supply chain specialist has been chosen by Müller to create a new bespoke distribution scheme designed with small wholesalers in mind.
Oakland international strategic development manager Pete Vaughan explains: “Our scheme with Müller will provide wholesale clients with the ability to continue to access Müller products, while giving Müller the chance to work with a wider base of potential smaller clients than before due to our ability to offer a more flexible distribution offer.”
Initially the scheme will service 20 wholesale clients, covering all areas of the UK, with the option to add more.
Vaughan continues: “As we develop the scheme’s service offer, we will be able to provide even faster order lead times than at present and as volumes and suppliers grow, we will increase the number of deliveries we can then service each week.”
Danone reports that Activia is currently growing at 14% year-on-year within the cash and carry sector (Nielsen). The company says Activia Strawberry four-pack is an absolute must stock.
The Activia range was extended last month with the launch of a thick Greek-style yogurt in three varieties: Golden Honey, Summer Berries and Juicy Lemon.
The recommended retail price for the four pack of 125g pots is £2.19 but there is an launch offer with packs priced at £1.50.
Activia Greek Style contains only 3% fat, but it also has probiotic culture, bifidus actiregularis, which is more commonly known as “good bacteria”.
The main focus for Yoplait within the wholesale channel is its Wildlife range and its two main products Wildlife Choobs and Wildlife Pots.
Both of these lines are price marked at £1. Yoplait says the benefit of these lines to the wholesale trade is that independent traders can compete like-for-like on price with the multiple grocers all year round.
Jon Rodriguez, business manager at Yoplait, explains: “The issue we have is getting the message across to the independent trade that these lines are available 365 days of the year. The trade think it’s a promoted line and only available when we advertise.”
In the cheese category, Pilgrims Choice’s lighter mature cheese has just been named Reserve Champion at the Global Cheese Awards at the Frome Agricultural and Cheese Show.
The brand’s marketing controller, Hannah Jenkins, says this win reflects how the industry is taking the lighter variant category more seriously.
According to Nielsen data, the lighter category is now worth £42.5m and is growing at an annual rate of 30.4%.
Pilgrims Choice lighter mature, containing 30% less fat than Pilgrims Choice standard mature Cheddar, was launched in February. Pilgrims Choice lighter extra mature will be launched next year.
While Cheddar is still the most popular cheese in the UK, Warren MacFarlane, foodservice marketing manager for Lactalis McLelland, says tastes are becoming increasingly sophisticated and, as a result, there has been an increase in sales of continental and speciality cheese.
“Mozzarella is in 9% growth (Nielsen), with our Galbani the number one brand of Italian cheese in Italy and the UK. It comes in a variety of formats to suit the different needs of caterers, with formats separated for cold and hot usage, with varying moisture content to match.”
He adds that despite an overall market decline of 3% in the soft mould cheese category, Lactalis McLelland’s French brand Président has seen 9% growth.
“Furthermore, there is growing interest in soft mould cheese produced in the UK. We are seeing growth in our Somerset range of Brie and Camembert, with customers looking for a UK version of these ever popular continental cheeses.”
Norseland operates in two areas: blended and continental cheeses. Within blended, its leading brands are Applewood and Mexicana, while in continental they are Scandinavian products, especially Jarlsberg.
Frannie Santos-Mawdsley, international sales and marketing manager (interim) at Norseland, says wholesale is one of the company’s key focus areas: “We have invested in growing the sector as we believe there is a lot more we can do. However, we have seen growth of 26% in this area in the last year. We are in the process of launching a new wholesale-specific website and we have just sent out our Wholesale Holiday Cheese Guide all aimed at further developing growth in the sector.”
As for specific stock recommendations, Santos-Mawdsley says: “We see a big interest from consumers in sliced products and this is certainly a range we recommend wholesalers stock. Christmas is a focus time for cheese and it is worthwhile investing in adding extra products to the range and passing the message on that the end consumer will be looking for something different through this channel.”
Dairygold Food Ingredients’ sales and marketing director Terry Cunningham, believes soft cheese is an ideal product for cash and carries to stock, as it’s so versatile. “It can be used in an incredibly wide variety of products in the foodservice industry including cheesecakes, sandwich fillings, sandwiches, salads and dips. As a result, by stocking just a few simple products, cash and carries can cater to a diverse range of customers and generate incremental profits.”
Spar wholesaler Appleby Westward recently launched cheese as part of its Spar West Country range of local products and the extra mature Cheddar won the silver medal at the Global Cheese Awards.
Produced by the Alvis family at Lye Cross Farm near Cheddar, Spar West Country Cheese is made by hand and matured for more than nine months. It has earned Protected Designation of Origin (PDO) status.
Donna Forward, head of multi-temperature trading at Appleby Westward, says: “The Spar West Country cheese has been very well received. Most stores which have tried this range have already re-ordered.
“In five weeks we generated over £7,000 in retail sales. We have also had a very successful launch of Spar West Country sausages, and Spar West Country clotted cream is now outselling the same size leading brand by 36%.”
Jack Clegg, buyer, Cleggs Chilled Food Service, Preston
Our business really spans three ways: wholesale to wholesale; small delis and market stalls; and schools. Both the wholesale to wholesale and schools are buying on price whereas the small delis and market stalls are more interested in provenance.
Health is also important and the schools are keen on low fat cheeses and mayonnaises; some schools will only take light mayos with reduced fat.
Some companies have been promoting world cheeses from New Zealand and Australia but they didn’t work for us. French cheese had died off but it has come back in favour. I think that’s because France is renowned for its cheese plus there’s been a lot of marketing.
Butter used to be a good money maker for us but now it’s a commodity. I understand there are some supplier problems so we expect prices to rise as we head to Christmas.