Danone Nutricia Early Life Nutrition, which includes the Cow & Gate and Aptamil brands, continues as the Baby Feeding market leader with an overall 58% share. Looking at the subsegments, their market share within Foods is at 19% and as high as 82% in Formula Milk (IRI 52 w/e 20/05/2017.)
“But that doesn’t mean we’re complacent,” says Roz Davies, Head of Category Development at Danone Nutricia Early Life Nutrition. “We are continually inspired by our purpose to ‘make every day count for you and your baby.’ This means providing our best for baby in the first 1,000 days of their lives, from conception to their second birthday, a key period in a child’s life with the power to influence life-long health.
“We work to support parents and carers in giving babies the nutrients they need while encouraging positive eating behaviours. For example, we know babies fed a range of different vegetables on a daily basis are more likely to accept new vegetables later. We transformed the Cow & Gate First Year Food range last year to reflect this, prioritising vegetable and fruit flavours and removing added sugar from 97% of our range.”
Baby Feeding is currently worth £651.3 m, a big sector with many opportunities, says Roz. “One of the big trends is convenience:
mums want help to make feeding easier so they get time back to focus on their little one and other important things in their life. They want to enjoy getting to know their baby and helping them grow, and spend less time on preparation and cleaning up. Ready To Drink liquids, pouches, and single-serve formats respond to this need and hence have experienced growth. We will continue to challenge ourselves to provide the solutions to help mum, dad and caregivers get time back.
“At Danone Nutricia Early Life Nutrition we will always ensure that healthy eating behaviours are the backbone of our solutions we provide, such as healthy snacks for little ones and alternatives to more sugary adult alternatives.”
A strong and stable market The UK is one of the biggest worldwide markets for baby feeding, and very stable compared to some markets, especially outside Europe, says Roz:
“The UK is quite balanced between foods and formula milk. In Italy and France, foods play a bigger role, but outside Europe the market is different again. Formula milks are by far the bigger segment in many Asian regions, where babies stay on milk for longer, combined with food to help get their nutrients. The UK is also a very innovative market, both for foods and formula milk.
“The trust parents place in us as a company is based on years and years of offering products their little ones love. However we continuously look to develop and improve our well-known products and formats to deliver to parents’ changing needs. We have made sure our Aptamil Profutura range not only offers our most advanced formulation but also comes in our most innovative packaging yet. This includes a more precise scoop that’s easy to use for right and left-handers, a tamper-evident seal and a secure outer locking system.”
Formula milk is a critical category for Danone Nutricia Early Life Nutrition, in which they hold an overall share of 82% and ensure UK mums who choose not to or cannot breastfeed have access to the right nutrition for their growing little one. The Aptamil Profutura range has gone from strength to strength since launch in January 2016, growing +311% YOY.
In Foods a number of innovative pack formats are experiencing growth, but traditional formats like jars are still important. At £43m, jars have 2.5 times more volume share than pouches and for many are the point of entry into the baby foods category thanks to their lower price point.
“Some shoppers move on to pouches and trays after a while, but others leave the category when they stop buying jars. We recommend retailers continue to offer a range of savoury and sweet jars within each feeding stage. Cow & Gate’s volume share within savoury jars has gone up by +0.9% to 49.7%, making it the leading brand in this sub-category. “
In convenience format stores Baby Feeding is in growth by as much as +23.2% YOY, a real opportunity for retailers. Formula Milks make up the lion’s share of Baby Feeding in convenience at 75%. The segment, especially Danone’s Aptamil Milk range, is outpacing the category at +31.8%. Baby Foods are also showing growth at +10.4% YOY. The main drivers are Pouches, up +14.7% and in particular Snacks, ahead +48% YOY.
Roz Davies says the golden rule is to “cater to mums’ different missions in Convenience stores – top-up shop, looking for dinner for tonight or food on-the-go. We recommend retailers setting up their Baby Feeding section cover breakfast, main meals, including savoury jars, and desserts as well as snacks. Formula milk is priority in convenience. Aptamil and Cow & Gate hold 96.7% of market share in the segment, so convenience retailers should ensure both brands are on their shelves.”
To make stores a go-to destination, Danone recommend offering a comprehensive range of the most important products and beacon categories and brands within the baby category. Besides formula milk and foods, this includes nappies, wipes, and medicines and toiletries.
“Also, consider the location of your store and what mission your shoppers are on. Are they just popping in, topping up for one or two days or doing a larger three to four-day stock-up shop? Think also about what your local competing stores offer and how you could be different or price competitive. Many convenience stores don’t stock any Baby Feeding products at all, so the very fact you offer them could be a competitive advantage.
Roz Davies continues: “Within baby food it is important to offer promotions that are appropriate for the segment and that fit the mission the shoppers are on. In segments such as main meals, we have seen success with multibuys because shoppers are looking to buy a mix of flavours and meal solutions.
Some aspects of milk pricing are controlled by specific regulations, for example promotional pricing or making special displays to induce sales of first milks are prohibited. Danone advise any retailer looking to list baby milks for the first time would be to familiarise themselves with the regulations:
Other major companies in other categories have been talking recently about cutting the SKU’s retailers stock. Roz Davies prefers to focus on shopper missions and need states:
“As with many other categories, the number of SKUs within Baby Feeding has grown exponentially over the last few years. However, stocking the best sellers based on the demographics and missions of the shoppers visiting your store will always be the right approach. Research tells us that mums think the Baby Food fixture is complicated and difficult to navigate. To make their lives as easy as possible, make sure you offer the right products and formats to cover baby’s different need states. This means stocking Formula Milks by stage – both liquids and powders – and within Foods, breakfast, main meals, desserts, and snacks.”