Cheese delivers slice of growth for dairy

The dairy market saw slight improvement in the latest 12 weeks, growing at 0.7% versus the 0.6% seen in the previous 12 weeks. This compares favourably to the wider grocery market which is flat, but on the right path following a 0.5% decline last period. The wider fresh and chilled market also underperforms dairy, declining by 0.2%.

The performance of the specific dairy sectors has been mixed, as despite the overall improvement seen by the category, the likes of butter, eggs, margarine, milk, yoghurts and yoghurt drinks have seen notable downturn in performance. The key driver of the market’s improved performance has been cheese, which sees an improvement in 12-week growth of £9.2 million.

The mixed results for dairy were also replicated across most of the retailers, Olly Blurring, Client Manger comments: “Asda (-£4.9m), Morrisons (-£1.2m), Waitrose (-£0.9m) and Aldi (-£2.7m) all see a fall-back in their contribution to growth, whilst Tesco (+£5.4m) and Sainsbury’s (+£3.0m) were the biggest improvers for the sector. In proportion to their size, M&S’s growth of +£1.3m is impressive. However, almost all the retailers have seen an improvement when it comes to cheese,”

This varied performance is evident once again when looking at shopper demographics, with spend from class C2DE (-£2.2m) falling back,  and ABC1 shoppers spending more (+£2.6m). Spend from pre-family, young family and those with older dependents is in decline while all other life stages see an improvement. Within cheese specifically, spend is on the rise for all demographics, though spend from families with children aged five to nine is flat.

The cheese sector sees fewer sales on promotion - Y for £X and price reduction mechanisms - with growth coming through full price sales. Looking at the overall dairy market we see full price sales are in decline along with Y for £X promotions, with price cut promotions on the rise.