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
- Inflation accelerates in 2017
- Further decline for volume sales in 2017
- Inflation and weak volume sales expected for 2018-22
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- Figure 1: UK retail value sales of baby food, drink and milk, 2012-22
- Baby milk volume sales fall in 2017 for the second year running
- Income squeeze threatens category growth
- Societal changes impact baby food and drink
- Companies and brands
- Ella’s Kitchen remains in growth in declining baby food market
- Own label gains ground
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- Figure 2: Leading brands’ shares in the UK wet and dry baby food market, by value, 2016/17*
- Danone brands continue to dominate milk, but lose sales
- Growth in L/N/R sugar claims
- Vegetarian claims become more prevalent
- Advertising spend falls in 2017
- Aptamil continues its focus on achievements
- The consumer
- Most parents use both homemade and manufactured products
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- Figure 3: Usage of baby food and drink, by type, December 2017
- In-store grouping by meal occasion is wanted by many parents
- Sugar concerns affect the category
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- Figure 4: Behaviours relating to feeding babies/toddlers, December 2017
- Parents have high trust in the medical profession, but little in brands
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- Figure 5: Trusted sources of advice on feeding babies and toddlers, December 2017
- 85% of parents switch between a small number of brands
- Details on ingredient provenance appeal to many
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- Figure 6: Baby food and drink buying behaviours, December 2017
- Few see own-label food as of lesser quality
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- Figure 7: Attitudes towards baby food and drink, December 2017
- What we think
Issues and Insights
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- Focus on ingredient provenance should help to build trust
- The facts
- The implications
- Products with ethical aspects have strong appeal
- The facts
- The implications
- Own-label is well-positioned to fly
- The facts
- The implications
The Market – What You Need to Know
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- Inflation accelerates in 2017
- Further decline for volume sales in 2017
- Inflation and weak volume sales expected for 2018-22
- Baby milk volume sales fall in 2017 for the second year running
- Income squeeze threatens category growth
- Societal changes impact baby food and drink
Market Size and Forecast
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- Inflation rises sharply in 2017
- Further decline in volume sales in 2017
- Rising prices and decreased promotional activity help to curb sales
- Societal changes act as further hindrance
- Lower inflation expected for 2018-22
- Income squeeze leaves category exposed
- Ageing population to diminish volume sales 2018-22
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- Figure 8: UK retail sales of baby food, drink and milk, by value and volume, 2012-22
- Figure 9: UK retail value sales of baby food, drink and milk, 2012-22
- Forecast methodology
Market Segmentation
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- Further volume sales decline for baby milk in 2017
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- Figure 10: Retail value and volume sales of baby food, drink and milk, by segment, 2015-17
- Weakness of wet baby food overshadows growth in dry
- Consumer health concerns and lack of innovation hit baby drinks
Market Drivers
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- Decline in live births hits baby food and drink volume sales
- Government immigration policies pivotal to volume sales growth
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- Figure 11: Live births in England and Wales, 2012-16
- Various demographic factors influence volume sales
- Falling fertility rates could have divergent effects
- Ageing population and rise in older mothers to hinder volume sales growth
- Multiple economic and financial factors affect the category
- Steep inflation hike in 2017
- Income squeeze leaves category at risk of cutbacks and switching
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- Figure 12: Annual percentage change in CPI and AWE (regular pay), by month, 2014-17
- Breast feeding rate rises slightly in 2016/17
- Unicef calls on Government to promote and support breastfeeding
- Sugar concerns affect the category
- Natural sugars are not held to ‘absolve’ high sugar content
- PHE campaign puts the focus on calories in snacks
- Lactalis product recall could put parents off formula milk
Companies and Brands – What You Need to Know
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- Ella’s Kitchen remains in growth in declining baby food market
- Own label gains ground
- Danone brands continue to dominate milk, but lose sales
- Growth in L/N/R sugar claims
- Vegetarian claims become more prevalent
- Advertising spend falls in 2017
- Aptamil continues its focus on achievements
Market Share
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- Ella’s Kitchen holds its own in declining baby food market
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- Figure 13: Leading brands’ sales and shares in the UK wet and dry baby food market, by value and volume, 2014/15-2016/17
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- Figure 14: Leading brand owners’ sales and shares in the UK wet and dry baby food market, by value and volume, 2014/15-2016/17
- Lack of innovation hinders Hipp
- Own label gains ground thanks in part to increased NPD
- Organix retains its lead in snacks but volume sales remain flat
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- Figure 15: Leading brands’ sales and shares in the UK baby snacks market, by value and volume, 2014/15-2016/17
- Figure 16: Leading brand owners’ sales and shares in the UK baby snacks market, by value and volume, 2014/15-2016/17
- Strong performances from Kiddylicious and Ella’s Kitchen
- Danone brands continue to dominate baby milk but lose volume sales
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- Figure 17: Leading brands’ sales and shares in the UK baby milk market, by value and volume, 2014/15-2016/17
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- Figure 18: Leading brand owners’ sales and shares in the UK baby milk market, by value and volume, 2014/15-2016/17
- New entrants heat up competition within the category
- Growth in free-from market boosts Alpro’s baby range
- Further decline for baby drinks
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- Figure 19: Leading brands’ sales and shares in the UK baby milk market, by value and volume, 2014/15-2016/17
Launch Activity and Innovation
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- No additives/preservatives remains the primary health claim
- Cow & Gate promotes its yogurts for on-the-go use
- Annabel Karmel innovates with chilled snack range
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- Figure 20: New product launches in the UK baby food, drink and milk market, by top twenty claims (sorted by 2017), 2013-17
- Rise in L/N/R sugar claims in 2017
- Little Dish launches cooking sauces
- ….and fruity cereal bars
- Further growth in vegetable-based snacks
- Smaller brands continue to turn to on-trend ingredients
- Piccolo adds split-pot baby meals
- Further growth in fortified claims
- Baby milk and food brands relaunch and redesign in 2017
- Brands use packaging redesigns to push health expertise message
- For Aisha moves to highlight its health aspects more strongly
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- Figure 21: New product launches in the UK baby food, drink and milk market, by top ten brands (sorted by 2017), 2013-17
- Heinz pushes its natural credentials in revamp of wet baby food range
- Discounters remain the principal drivers of own-label NPD in 2017
- Lidl rebrands its baby products range
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- Figure 22: New product launches in the UK baby food, drink and milk market, by branded and private label, 2013-17
- Adult brands enter the baby food market, and heat up competition
- Savsé claims European first with cold-pressed baby food
- Organic brand launches pasta sauce for toddlers
- Ella’s Kitchen pledges to make its pouches recyclable by 2024
Advertising and Marketing Activity
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- Advertising spend falls in 2017
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- Figure 23: Total above-the line, online display and direct mail advertising expenditure on baby food, drink and milk (sorted by 2017), 2013-17
- Aptamil continues its focus on achievements
- Multiple brands use social media to engage consumers
- Major and smaller players run classes and events
- Aptamil encourages women to stay active during pregnancy
- Various brands offer mother-and-baby socials
- Piccolo links with the Trussell Trust on charitable initiative
- Nielsen Ad Intel coverage
The Consumer – What You Need to Know
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- Most parents use both homemade and manufactured products
- In-store grouping by meal occasion is wanted by many parents
- Sugar concerns affect the category
- Parents have high trust in the medical profession, but little in brands
- 85% of parents switch between a small number of brands
- Details on ingredient provenance appeal to many
- Few see own-label food as of lesser quality
Usage of Baby Food and Drink
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- Eight in ten parents use homemade food
- Majority of parents use both homemade and manufactured baby food
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- Figure 24: Usage of baby food and drink, by type, December 2017
- Time saving is a key motivation for using manufactured baby food
- Younger parents are key users of manufactured baby food
- Brands could push the ‘family time’ angle more strongly
- Opportunities for baby food brands to extend into products for older children
- Younger parents are the core users of baby/toddler snacks
- Income squeeze threatens segment growth
- Snacks retain users for longer than meals
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- Figure 25: Usage frequency for baby/toddler food and drink, by type, December 2017
- Younger and better-off parents are the main users of formula milk
- Parents’ trust in NHS advice limits usage of baby/toddler drinks
Behaviours relating to Feeding Babies and Toddlers
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- More detailed in-store grouping is wanted by eight in ten parents
- Brands use various methods to promote usage occasions
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- Figure 26: Behaviours relating to feeding babies/toddlers, December 2017
- Sugar concerns affect the category
- Naturally-occurring sugars are not seen to excuse high sugar content
- Focus on sugar boosts the appeal of vegetable-based products
- Strong interest in products made with ‘wonky’ fruit and vegetables
- …but many parents will expect these to be cheaper than standard products
Trusted Sources of Advice
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- The NHS is the most widely trusted source of advice
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- Figure 27: Trusted sources of advice on feeding babies and toddlers, December 2017
- EU rules prohibit recommendations from individual doctors or health professionals
- Brands use various methods to showcase their professional links
- Advice from family/friends is as valued as advice from professional nutritionists
- Peer influence makes it essential for brands to safeguard their social media profile
- ‘Recommend’ a friend’ type schemes would help to harness the power of family/friend recommendations
- Only 15% of parents trust baby food brands for advice
Baby Food and Drink Buying Behaviours
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- 85% of parents switch between a small number of brands
- Promotions serve to undermine brand loyalty
- …and also encourage stockpiling of a favourite brand
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- Figure 28: Baby food and drink buying behaviours, December 2017
- Companies must find means to appeal other than price
- Focus on provenance would help to build trust and quality associations
- Charity pledges appeal to many
- Widespread label scrutiny gives opportunities to clean-label products
- Details on fruit/vegetable content are an enticement for many
Attitudes towards Baby Food and Drink
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- Income squeeze threatens category growth
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- Figure 29: Attitudes towards baby food and drink, December 2017
- See-through pouches can help to build trust
- Only a minority have negative views about own-label food
- Endorsements from parenting groups would help to boost sales of own-label
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 30: Forecast of UK sales of baby food and drink, by value, best- and worst-case, 2017-22
- Figure 31: Forecast of UK sales of baby food and drink, by volume, best- and worst-case, 2017-22
- Figure 32: UK retail volume sales of baby food and drink, 2012-22
- Forecast methodology
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Appendix – Market Drivers
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- Figure 33: Live births to non-UK born mothers, by percentage of total births, 2012-16
- Figure 34: Total fertility rate in England and Wales, 2012-16
- Figure 35: Live births in England and Wales, by age of mother, 2012-16
- Figure 36: Mean age of mother at childbirth in England and Wales, 2012-16
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