Bought by almost every UK household (99% penetration) on average every two weeks, retailers can expect strong sales of cheese throughout the year.
The category has seen dynamic growth of over 14% revenue and 13% volume over 52 weeks (IRI), with the surge in demand driven by the coronavirus pandemic, benefitting from growth of in-home lunch, snacking and evening meal occasions.
Much loved for its versatility, everyday block cheese has driven long term volume growth as home-bound households, many experiencing financial pressure as their jobs and lives have been disrupted, have sought comforting and flexible meal solutions that all the family can enjoy.
The nation’s favourite cheese brand, Cathedral City (+31% value YOY) has achieved more than treble the sector volume growth in the latest 12 weeks (IRI).
In April the brand announced a new #Stayhome advertising campaign, focusing on the comfort of home in troubling times, and has now returned to TV screens with an evolution of the campaign – #ReasonsforCathedralCity.
Convenient cheddar formats that cater to consumer demand for solutions to help manage time-pressed lives continue to show strong growth. Sliced and grated have both delivered volume growth in the latest 52 weeks in total market, seeing 9% and 13% growth, respectively (IRI). 16% of UK consumers state convenience as one of the main factors when they are purchasing cheese, indicating that this is front of mind when in the aisles (Mintel).
Both sliced and grated have delivered double digit volume growth in the latest 52 weeks in total market.
A nation of sandwich lovers – 67% of cheese eating occasions being with bread – Kantar estimates that an additional 50 million sandwich occasions per week have been generated since lockdown.
In April 2020, Cathedral City announced the launch of Sandwich Slices which are comprised of larger cheese slices, designed to fit a piece of bread perfectly.
Allison Wallentin, Cathedral City Category Manager for the Convenience Channel, explains, “The UK is a nation of sandwich-lovers, each of us eating an average of four sandwiches a week and 8 in 10 lauding the humble sandwich as their favourite lunchtime dish. For many of us navigating life in lockdown a sandwich also made a quick and convenient snack, while for workers returning to offices it is a perennial lunchbox staple. A perennial classic, cheese remains the nation’s favourite filling (with ham and cheese a close second), and these cheese sandwich occasions are by far the biggest contributor to sliced cheese volume.
“As the nation’s favourite cheese, our ambition is to bring consumers the ultimate ‘nation’s favourite’ (cheese) sandwich. Our consumer research found that the square slices currently on the market aren’t optimised for using with bread; over half of consumers revealing that they have to use 1.5-2 slices of cheese in their sandwich and almost 2/3 of our sample telling us they wanted a (cheese) slice that covers the whole slice of bread. In response to this demand we’ve taken the bold step to migrate our full Cathedral City sliced cheese range into a larger ‘sandwich sized’ format, for the perfect fit – with cheese in every bite. As the only brand to offer this benefit, we are confident that our latest innovation will provide shoppers with the perfect solution to their sandwich needs.”
While snacking categories have historically been associated with unhealthy foods, recent backlash against sugar and processed carbohydrates has seen more and more Brits paying attention to the nutrition label before purchasing. In pursuit of a healthier way of life, many of these consumers are turning their back on traditional sweet snacks in search of more nutritious savoury alternatives.
A naturally nutrient dense product, rich in calcium and a good source of quality protein, cheese is perfectly placed to drive consumption at these snacking occasions and offers a credible alternative to more traditional sweet and savoury snacks. Furthermore, snacking on cheese is already an ingrained consumer habit with Mintel reporting that 45% of adults claim to snack on cheese at least once a week.
While prepacked cheese snacks have seen growth soften over the past 6 months, impacted by the drop in Food to Go behaviour, and an increase in ‘snacking from the block’ in the home, the rise in the popularity of dairy-based snacking is expected to fuel a sector return to more positive growth as out of home mobility re-establishes.
Cathedral City continues to lead the way in adult cheese snacking, valued at over £12.7m in total market and contributing 31% of sector volume (IRI).
‘Flexitarianism’ is a new and growing trend amongst British consumers. While seven percent of the British population is vegan and 14 percent vegetarian, over 30 percent of the population now identify themselves as ‘flexitarians’ and more than a third (35%) have introduced one or more dedicated ‘vegetarian days’ per week over the past year. This new demographic has emerged through a desire to enjoy a more balanced diet and rising consumer environmental concerns (YouGov).
Cheese is often a mainstay ingredient on meat-free days, its nutrient rich profile contributing protein to dishes and its familiar flavour a guaranteed pleaser, and the perfect addition to any BBQ or al fresco dining situation.
Everyday block offers the ultimate versatility for flexitarian households, while the dynamically growing sliced and grated sectors offer convenience for today’s time-pressed consumers.
Demand for lighter alternatives to everyday products endures. Calorie reduction remains for many a popular way of managing weight and is increasingly a focus for legislative bodies.
The butters and spreads category has seen a macro trend over recent years of shoppers migrating out of spreads and into butter, driven by a consumer movement towards products that are perceived as more natural and less processed. Saputo Dairy UK’s Clover and Country Life are well placed to capitalise on this naturalness movement.
Now the UK’s number one spread brand, valued at £95.6m, Saputo Dairy UK’s Clover brand has significantly outperformed the sector in the latest 52 weeks, with revenue and volume growth of 14%, against spreads sector growth of just 4.6% (IRI).
Since the brand’s move to a simpler, more natural recipe, containing no artificial ingredients across both Original and Light lines, Clover has continued to recruit new customers and is now purchased by three in 10 UK households (IRI).
Saputo Dairy UK’s Country Life butter brand, currently valued at £57.1m and bought by 18.4% of UK households, carries the Red Tractor seal of approval and is made with 100% British milk, sourced exclusively from British dairy farms.
Packaged in Best of British livery Country Life packaging highlights the brand’s ongoing support for the British dairy farming industry and taps into increasing consumer interest in British food provenance, aligned with Country Life’s heritage.
Earlier this year the brand announced a second year of its on-pack partnership with English Heritage and Cadw, offering shoppers an exclusive 2 for 1 entry offer across promotional packs of Country Life.
Demand for Free From alternatives continues to grow, both amongst people who suffer from conditions or intolerances which lead them to avoid certain ingredients in their diet, as well as, increasingly, amongst people who believe Free From alternatives are key to their healthy lifestyle.
Dairy free is the largest free from segment, with 53% of UK households claiming to have bought dairy free products in the latest year (IRI).
Saputo Dairy UK’s Vitalite brand is the UK’s leading dairy-free spread, valued at £11.2m in total market.
As the number 1 cheddar brand in the UK market, Cathedral City is currently worth £305.5m and currently has over 56% of shoppers buying into the brand (IRI).
Gaelle Vernet, Group Marketing Manager at Bel UK, comments: “Cheese continues to grow in both value (+2.7%) and volume (2.2%). Retailers can capitalise on this category growth by stocking recognisable brands, with efficient and effective ranging which caters to varied customer needs and missions.”
Bel UK’s brands Mini Babybel, The Laughing Cow, Boursin, Leerdammer and Port Salut are enjoyed in 44.3% of all UK households (Kantar).
With 95% of adults regularly snacking, and Food-to-Go expected to grow +35% value by 2022 (IGD), it’s key for convenience retailers to get their offering right and cater to shoppers’ changing demands.
Convenience, health and protein are key trends, and with 73% of consumers seeing cheese as an easy way to get protein (Mintel) and 55% deem it to be a healthy snacking choice for children (Mintel), cheese snacking presents a strong sales opportunity for retailers, and continues to grow in both value (+7.5%) and volume (+6.1%) in the convenience sector and is now worth over £64.2m (Nielsen).
Highlighting the importance of cheese snacking to the wider category, in 2019, among all value added by NPD in the cheese category, 43% was through new branded innovation launches in cheese snacking (Nielsen).
“In order to drive snacking sales, retailers need to have the right products, taking the increasing consumer demand for natural, protein rich and portion-controlled snacks into consideration, as well as promotions and product placement within stores,” adds Vernet.
“There are 650 Mini Babybel unzipped, eaten and enjoyed every minute in the UK. Loved equally by adults and kids alike, on account of its portion controlled, natural and protein-rich format, Mini Babybel offers a quick and nutritious grab-and-go snack perfect for convenience customers.”
As the No.1 cheese triangle format (Nielsen), The Laughing Cow also delivers on these consumer demands, and are already enjoyed in 4.1 million UK households every year (Kantar). Both Mini Babybel (62 calories per Mini Babybel Original) and The Laughing Cow (42 calories per Original Triangle) adhere to Public Health England’s recommended 100 calorie snacking cap, making them perfect for all family occasions including lunchbox and on-the-go.
To complete the offering, retailers can consider additional consumer desires and demands, providing the solution for convenience with slice packs, such as Leerdammer, the UK’s No.1 sliced cheese brand (Nielsen), and for social occasions with Boursin, the No.1 indulgence cheese brand (Nielsen).
“Shoppers are visiting convenience stores around seven times a month, meaning the channel is growing ahead of the market,” says Vernet. “To maximise sales further, ensuring cheese snacks are instantly visible for time-poor consumers and stocking formats catering to all shopper missions is key.”
To help retailers maximise this opportunity Mini Babybel is available in a range of pack formats, including a net of 12, net of 6 and net of 3 and a single to target all cheese snacking missions.
With consumers increasingly looking to cheese and savoury protein snacks for a ‘quick fix’, Mini Babybel’s convenient on-the-go formats (nets of 3, singles) should be ranged within the food to go and meal deal areas of stores as this will help and guide shoppers while driving sales and encouraging impulse purchases.
Trials of secondary Mini Babybel sitings to test the potential of cheese within snacking have seen uplifts as high as 300% as a result of merchandising, with 42% of shoppers who purchased Mini Babybel having never bought the brand before, showing its importance in attracting new customers to the brand (C2C).
With a total of £2.9bn in sales (Kantar), cheese is certainly an important category for retailers when considering their dairy range. Processed cheese added £22.5m (Nielsen) to total cheese last year, and no other category has added more incremental sales.
“Shopping habits have changed dramatically since the beginning of the year, as consumer lifestyles evolve due to the Covid-19 crisis,” comments Susan Nash, Trade Communications Manager at Mondelez International. “Throughout the year, Mondelez has continued to be the single biggest contributor to growth within the cheese category (Nielsen), across both processed and cream cheese. This is due to established brands Philadelphia and Dairylea offering consumers the taste they love in convenient, tasty snacking formats, suitable for consumption both on-the-go and in the comfort of the consumer’s home.”
Products that are spreadable and versatile, including cream cheese, have in particular seen strong progress. The spreads segment has grown significantly since lockdown started (Nielsen). Philadelphia itself is experiencing double-digit growth and has delivered an additional £15m to the category year to date (Nielsen). As well as this, Dairylea was the fastest growing brand in the spreads, slices and snacking kits segment of the category in the run-up to autumn, as consumers return to their previous food-to-go routines.
Shopper demand for snacking kits for on-the-go consumption or to eat at home are seeing a return to growth, as consumers begin to return to their previous normal routines. The Philadelphia Snacks range, which was re-launched last year, is currently experiencing high levels of growth as a result of this (Nielsen). The Philadelphia Snacks range comprises two variants: Light & Tasty, and Light & Herbs. Both are available in single and 3x multipack formats.
Dairylea is the UK’s number one brand in processed cheese (Nielsen), meaning it’s well placed to tap into consumer desires for individually wrapped formats that can help with portion control. The brand allows retailers to make their dairy range suitable for both on-the-go and at-home snacking occasions. The snacking kits subcategory is the key driver of growth within processed cheese, growing at 10% (Nielsen), with Dairylea Lunchables having a 71% share and 4% annual growth (Kantar).
Dairylea has built on this success through the launch of the Dairylea Snackers with Cadbury Giant Buttons variant. The new packs contain Dairylea cheese slices and crackers, with Cadbury Giant Buttons to create a sweet and savoury snack. They will also be available in price-marked packs to help retailers drive value perception and shopper loyalty – the first Snackers pack to be available in PMP.
Dairylea is also growing the snacking kits segment with a new Streetfood sub-brand for its Lunchables range. Combining Dairylea with mini pizza bases and tangy pizza sauce, Dairylea Lunchables Streetfood Pizza are available in 65g packs now.
Also, new Dairylea Dunkers Cheesy Cones have launched in packs of 4x 40g. Each portion is less than 100kcal, reflecting the growing consumer focus on health and balance. The Dairylea Dunkers range is growing at 7% (Nielsen).
Nine out of ten households buy snacking cheese each year and, on average, purchase at least once a month (Kantar). From the highly versatile cream cheese, to on-the-go cheese snacks, spreads and cheese slices, it’s important to be able to offer shoppers a snacking cheese option to meet their needs.
“While consumers have had to alter how they live and work as a result of the Covid-19 pandemic, a focus on leading a healthier lifestyle continues to grow in prominence,” adds Nash. “Mondelez offers a range of different products with different fat contents to meet these consumer needs.”
Cream cheese, such as Philadelphia Light, enables consumers to make quick and convenient meals, while offering lower-calorie options they are looking for as part of their increasing interest in wellbeing. A demonstration of this move is in sales of low-fat products across the total cheese category, which have grown by 7% (Nielsen). Within this Philadelphia is in growth, contributing to nearly half of market sales (Nielsen).
Heloise Le Norcy-Trott, Group Marketing & Category Director for Lactalis UK & Ireland, comments: “Seriously Cheddar is one of our bestselling cheese brands, with it growing by +6.8% in value sales and +10.5% in volume sales year on year (IRI). We believe that this growth is due to cheese being considered a staple food, which is versatile and good value.
“It is also due to consumers scratch cooking more and making more sandwiches, with both occasions growing by +44% during lockdown (IRI). Sandwiches, as an occasion, has been in long term decline, therefore this increase was considered to be a great turning point for the cheese market.”
Président Brie is another of Lactalis’ bestselling cheese brands. As the number one brie brand in the UK, Président Brie is growing by +30.7 in value and and +26.3% in volume sales year on year (IRI).
“There are a couple of key trends that retailers should currently be aware of when it comes to cheese: they are global flavours and convenience,” adds Le Norcy-Trott.
The continental cheese category is performing really well at the moment, as UK consumers are becoming more experimental with their cooking and are seeking out global flavours, whilst also adding new cuisines and products to their repertoires. This is particularly true of current circumstances, as consumers are going out less and therefore have more time to cook and try out new cheese dishes.
“To tap into this trend, retailers should look to stock bestsellers like Président Brie, which is the number one brie brand in the UK and is growing by +30.7 in value and +26.3% in volume sales year on year (IRI),” says Le Norcy-Trott.
Another continental cheese must-stock for retailers is Galbani Mozzarella, which is the fastest growing brand in the mozzarella category and is growing by +40% in value and +28% in volume sales YOY (IRI).
“Convenience continues to drive consumer purchasing decisions, therefore retailers should look to stock products like Seriously Spreadable, which is both versatile and convenient,” comments Le Norcy-Trott.
Seriously Spreadable is worth £19 million and is currently driving category growth with sales increasing by +11.4% and +6.1% in value and volume sales respectively (IRI).
Kat Jones, Marketing Manager, Ice Cream at General Mills, comments: “The category has enjoyed an uplift in sales, largely driven by COVID-19 and the weather. This unprecedented time saw the rise of in and out of home treat occasions and sharing opportunities, from home movie nights to socially distanced picnics in the park.”
Häagen-Dazs offers a range of wrapped and portion-able ice creams, ideal for consumers with concerns surrounding hygiene and transfer risks as a result of the current pandemic, and is therefore benefitting.
“During these anxious times, consumers are more likely to indulge or crave a sweet comforting treat, adds Jones. “With over a third of consumers treating themselves more than ever (Kantar), the demand for extra comfort and pleasure fits perfectly with what the ice cream category can deliver.”
In the last recession, both value and premium brands grew. This was no different for the ice cream category, luxury ice cream value grew at 19% vs. standard & bulks 7% (Mintel).
“As a conscious treat spend, luxury ice cream brands do not sacrifice quality, providing taste enjoyment that delivers every time which is why it’s clear that people are trading up, especially across handheld which has had double digit rate of sale growth,” says Jones.
With nearly 60% of consumers worried about inside-only foodservice locations and over one third of consumers worried about outside-only locations (HIM), it’s likely that the increased in home trend will continue. In turn, innovation is what will keep shoppers engaged, especially as we head into the colder months, outside the traditional ice cream season.
General Mills relaunched its sticks platform this year, giving them a new look and recipe, on select SKUs, to redefine the handheld category. The new and improved chocolate featured in the Salted Caramel and Peanut Butter Crunch Stick Bars was designed to be perfect for that first bite moment, while the signature crunchy inclusions are stirred into the coating for ultimate luxury.
The sticks were created with the aim to present retailers with an increased sales opportunity by driving value and trade up within the category. They offer consumers previously forced to compromise premium ice cream vs premium coating with the best of both, as 87% of shoppers revealed they would trade up if they could have premium ice cream and premium coating in one product (CLT).
The Häagen-Dazs Salted Caramel Sticks has become the range’s best seller, enjoying +30% growth value since relaunch (Nielsen). In addition, Mango Raspberry has experienced double digit growth in value in the same time period (Nielsen).