Table of Contents
Overview
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- What you need to know
- Products covered in this report
Executive Summary
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- The market
- Weakness of white milk continues to overshadow the category
- Some inflation for all segments 2017-21
- Mixed picture for volume sales 2017-21
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- Figure 1: UK retail value sales of milk, milk drinks and cream, 2011-21
- Cow’s milk volume sales falter in 2016
- Multiple factors boost flavoured milk
- Uncertainties linger over milk prices
- Antibiotic use comes under closer government scrutiny
- Companies and brands
- Own-label retains dominance in white milk and strengthens hold on cream
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- Figure 2: UK retail sales of white milk*, by leading brands, by value, 2016
- Leading flavoured milk brands fail to benefit from growth in the market
- Retailers and brands highlight ethics
- White milk leads on L/N/R sugar claims in 2016
- Advertising spend rises in 2016
- Arla remains the largest advertiser, with a strong focus on versatility
- The consumer
- Cow’s milk needs to woo younger consumers
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- Figure 3: Usage of milk, by type, February 2017
- Flavoured milk usage rises
- Health and food waste concerns restrict cream usage
- Majority of users would pay more for milk than supermarkets charge
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- Figure 4: How much milk users would pay for 4 pints (2.272 litres) of milk, February 2017
- References by glass could help to boost usage of milk as a source of calcium
- Guarantees of minimal antibiotics have wide appeal
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- Figure 5: Behaviours relating to milk, milk drinks and cream, February 2017
- Milk price cuts risk a backlash, good supplier relations appeal
- Clearer sugar labelling for flavoured milk valued by many users
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- Figure 6: Attitudes towards milk, dairy drinks and cream, February 2017
- Stronger emphasis on vitamins could enhance milk’s health image
- What we think
Issues and Insights
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- Shoppers’ concerns over farmers’ pay make it imperative for retailers to make good supplier relations tangible on-pack
- The facts
- The implications
- Minimal antibiotics guarantees have strong scope to appeal
- The facts
- The implications
- Smaller cream formats and recipe suggestions should help to allay food waste concerns
- The facts
- The implications
The Market – What You Need to Know
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- Weakness of white milk continues to overshadow the category
- Some inflation for all segments 2017-21
- Mixed picture for volume sales 2017-21
- Cow’s milk volume sales falter in 2016
- Multiple factors boost flavoured milk
- Uncertainties linger over milk prices
- Antibiotic use comes under closer government scrutiny
Market Size and Forecast
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- Troubles of white milk continue to overshadow the category
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- Figure 7: UK retail value sales of white milk*, cream and flavoured milk, by segment, 2011-21
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- Figure 8: UK retail volume sales of white milk*, cream and flavoured milk, by segment, 2011-21
- Slow growth with some inflation 2017-21
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- Figure 9: UK retail value sales of milk, milk drinks and cream, 2011-21
- Little movement for white milk over 2017-21
- Retailer price competition to dilute effects of inflation
- Volume sales growth to remain sluggish
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- Figure 10: UK retail value sales of white milk, 2011-21
- Consumer health concerns will continue to affect cream over 2017-21
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- Figure 11: UK retail values sales of cream, 2011-21
- Soft drinks levy should boost flavoured milk, but health concerns and price rises present barriers to sales
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- Figure 12: UK retail value sales of flavoured milk, 2011-21
- Forecast methodology
Market Segmentation
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- Cow’s milk volume sales slide in 2016
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- Figure 13: UK retail value sales of white milk, by fresh and longlife, 2014-16
- Figure 14: UK retail volume sales of white milk, by fresh and longlife, 2014-16
- Almond and coconut milks continue their rapid growth
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- Figure 15: UK retail value sales of white milk, by type, 2014-16
- Figure 16: UK retail volume sales of white milk, by type, 2014-16
- Consumer health concerns erode double cream sales in 2016
- Sour cream continues to benefit from world food trends
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- Figure 17: UK retail value sales of cream, by type, 2014-16
- Figure 18: UK retail volume sales of cream, by type, 2014-16
- Multiple factors boost flavoured milk
- Lack of innovation prevents milk modifiers from benefitting from sugar concerns
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- Figure 19: UK retail value sales of flavoured milk, milk smoothies and milk flavourings, 2014-16
- Figure 20: UK retail volume sales of flavoured milk, milk smoothies and milk flavourings, 2014-16
Market Drivers
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- Multiple factors affect milk prices
- Brexit vote raises multiple uncertainties
- Pound’s depreciation could lead to inflation for plant-based and flavoured milks
- Need for dairy industry to win over younger consumers
- Soft drinks sugar levy could give a boost to flavoured milk
- …but industry will still be required to reduce sugar
- …and health concerns could still limit opportunities to grow volume sales
- EFSA rules make it difficult for dairy drinks to make a low-sugar claim
- Government advice on Vitamin D provides opportunities for fortified milk
- Antibiotic use comes under closer government scrutiny
Companies and Brands – What You Need to Know
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- Own-label retains dominance in white milk and cream
- Leading flavoured milk brands fail to benefit from growth in the market
- Retailers and brands highlight ethics
- White milk leads on L/N/R sugar claims in 2016
- Advertising spend rises in 2016
- Arla remains the largest advertiser, with a strong focus on versatility
Market Share
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- Own-label retains dominant position in white milk
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- Figure 21: UK retail sales of white milk*, by leading brands, 2015-16
- Figure 22: UK retail sales of white milk*, by leading brand-owners, 2015-16
- Alpro continues to gain from growth of the free-from market
- Further growth for Graham’s Dairy
- Own-label strengthens its position in cream
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- Figure 23: UK retail sales of cream, by leading brands, 2015-16
- Figure 24: UK retail sales of cream, by leading brand-owners, 2015-16
- Leading flavoured milk brands fail to benefit from growth in the market
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- Figure 25: UK retail sales of flavoured milk, milk smoothies and milk flavourings, by leading brands, 2015/16-2016/17
- Figure 26: UK retail sales of flavoured milk, milk smoothies and milk flavourings, by leading brand-owners, 2015/16-2016/17
- Range extensions boost own-label, while smaller brands gain distribution
- Further strong growth for Starbucks milk drinks
Launch Activity and Innovation
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- Retailers and brands move forward on ethics
- Operators take differing approaches to reassure consumers on supplier relations
- Farmer organisations launch free range milks
- White milk leads on L/N/R sugar claims in 2016
- Flavoured milk brands take differing approaches to replacing sugar
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- Figure 27: New product launches in the UK milk, dairy drinks and cream market*, by top 20 claims (sorted by 2016), 2012-16
- Organic brands look to make organic claim more tangible
- Arla unveils Vitamin D Milk
- Arla ups competition with other soft drinks with on-the-go Cravendale
- Goat’s milk brand targets school lunchbox occasion
Advertising and Marketing Activity
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- Total spending rises in 2016
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- Figure 28: Total above-the line, online display and direct mail advertising expenditure on milk, dairy drinks and cream, 2013-16
- Arla continues to dominate advertising
- Cravendale promoted as a quality product, but also as fun and versatile
- On-the-go Cravendale promoted as helping people to get through their day
- Continued focus on B.O.B milk as offering both health benefits and taste
- B.O.B milk featured in breakfast campaign
- Organic milk advertising takes environmental focus
- Weetabix continues to focus on convenience of its breakfast drinks
- Frijj returns to TV screens for first time in three years
- Pushing associations with white milk
- Pro-vegan advertising campaign attacks the dairy industry
- Nielsen Ad Intel coverage
The Consumer – What You Need to Know
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- Cow’s milk needs to woo younger consumers
- Flavoured milk usage rises
- Health and food waste concerns restrict cream usage
- Majority of users would pay more for milk than supermarkets charge
- References by glass could help to boost usage of milk as a source of calcium
- Guarantees of minimal antibiotics have wide appeal
- Milk price cuts risk a backlash, good supplier relations appeal
- Clearer sugar labelling for flavoured milk valued by many users
- Stronger emphasis on vitamins could enhance milk’s health image
Usage of Milk
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- Age bias in cow’s milk usage makes it necessary to woo younger consumers
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- Figure 29: Usage of milk, by type, February 2017
- Usage of plant-based milks unchanged from last year
- Risk of backlash if plant-based milk’s eco-friendly credentials come into question
- Shift from whole to semi-skimmed milk has plateaued
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- Figure 30: Usage of milk and milk drinks, by variety, February 2017
- Flavoured milk usage rises
Usage of Cream
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- Three in five people use cream
- Smaller formats should help to address food waste concerns
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- Figure 31: Usage of cream, by type, February 2017
- Recipe advice could boost usage of culinary creams
How Much Consumers are Prepared to Pay for Milk
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- Most users still willing to pay more than supermarkets charge for milk
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- Figure 32: How much milk users would pay for 4 pints (2.272 litres) of milk, February 2017
- A quarter would pay £1.50 or more
- Farmers’ pay guarantees are a promising means to appeal
Behaviours Relating to Milk, Dairy Drinks and Cream
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- Calcium’s importance is widely acknowledged
- …but a third of users do not attempt to meet calcium recommendations
- References by glass could help to boost usage of milk as a source of calcium
- Lower awareness of milk’s calcium among younger consumers suggests targeted marketing is needed
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- Figure 33: Behaviours relating to milk, milk drinks and cream, February 2017
- Minimal antibiotics guarantees appeal to many
- Highlighting their credentials on antibiotics could boost organic producers
- Supermarkets could promote their antibiotic policies more widely
Attitudes towards Milk, Dairy Drinks and Cream
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- Risk of a backlash if supermarkets renew milk price wars
- Making good supplier relations tangible on-pack has wide scope to appeal
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- Figure 34: Attitudes towards milk, dairy drinks and cream, February 2017
- Detailed sugar labelling on flavoured milk could boost help companies to be seen as proactive on health
- Flavoured milk using British milk could appeal to consumers’ desire to support local agriculture
Qualities Associated with Selected Milks and Dairy Drinks
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- Stronger on-pack emphasis on cow’s milk’s vitamin B12 content would better enable these to appeal to the health-conscious
- Few people are aware of plant-based milks’ calcium or vitamin content despite widespread fortification
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- Figure 35: Qualities associated with selected milks and dairy drinks, February 2017
- Scope for expansion in on-the-go formats
- Flavoured milk does not benefit from white milk’s calcium associations
- Sugar concerns could present a barrier to health-based marketing
- Meal deals could help to reposition flavoured milk as a drink for adults
Appendix – Data Sources, Abbreviations and Supporting Information
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- Abbreviations
- Consumer research methodology
Appendix – Market Size and Forecast
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- Figure 36: Forecast of UK sales of milk, milk drinks and cream, by value, best- and worst-case, 2016-21
- Figure 37: Forecast of UK sales of milk, milk drinks and cream, by volume, best- and worst-case, 2016-21
- Figure 38: Forecast of UK sales of white milk, by value, best- and worst-case, 2016-21
- Figure 39: Forecast of UK sales of white milk, by volume, best- and worst-case, 2016-21
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- Figure 40: Forecast of UK sales of cream, by value, best- and worst-case, 2016-21
- Figure 41: Forecast of UK sales of cream, by volume, best- and worst-case, 2016-21
- Figure 42: Forecast of UK sales of flavoured milk, by value, best- and worst-case, 2016-21
- Figure 43: Forecast of UK sales of flavoured milk, by volume, best- and worst-case, 2016-21
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- Figure 44: UK retail volume sales of milk, milk drinks and cream, 2011-21
- Figure 45: UK retail volume sales of white milk, 2011-21
- Figure 46: UK retail volume sales of cream, 2011-21
- Figure 47: UK retail volume sales of flavoured milk, 2011-21
- Forecast methodology
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