Cheese: Across the board

We’re a nation of fridge botherers, apparently. The average fridge door is opened 42 times a week whereas the average cupboard is opened a mere 22 times, according to analysts Nielsen. How many times this door-twitching amounts to nothing more than a fruitless search for ‘something exciting’, which you know you haven’t actually bought, isn’t stated, but it is clear that the British consumer is still keen on all things chilled. And one of those chilled offerings that the Brits are particularly keen on is cheese, which is the fourth biggest sector in the £2.6bn convenience chilled sector.

It seems we can’t get enough of the hard/soft/spreading/stringy stuff, with 98% of the population buying cheese every 10 days, according to Nielsen/Kerry. This has created a buoyant category, with the total cheese market rising by more than 30% between 2007 and 2012 (Mintel).

Cheddar continues to dominate, accounting for half of volume and value sales in the total cheese market, with 80% of consumers buying into it, says Mintel. And while the sector has been hit by rising milk prices, the market has been helped by NPD and the introduction of cooking occasion concepts.

Mintel reports that 40% of consumers say that they use cheese in cooking or pasta, while the majority are using cheese in sandwiches and 70% on toast.

According to Wyke Farms managing director Rich Clothier, growth in the market comes from both the value end of the market and quality home dining. He says: “These trends cement the need for a good strong pricemarked everyday low price offer, backed up by a quality offering across Cheddar, through additives and regional. Value and choice are paramount.”

According to Bel head of category management Stephen Gregory, buying for tonight is the key. “Cheese has been performing well, but it’s really been driven by a change in shopper habits and the arrival of the buying for tonight trend,” he asserts.

He says these customers are looking for more variety and choice. “Since the beginning of the current economic woes a lot more people have been cooking at home, but they’re becoming bored with what they’ve been making. It’s appealing to this variety, which is why the multiples are doing so well.”

Clothier says that the biggest challenge for convenience is matching the value and choice of the multiple convenience store. “A consumer’s needs from cheese in convenience are complex and it requires a more complex range than other categories. This means that it is space hungry in store. This can be helped by focusing on a quality mature Cheddar as hero, and avoiding duplication in ranging. We try to engage retailers by offering options on size ranges and price points. It’s simply no good for them to copy the multiple retail ranges.”

Gregory advises retailers to use their space well. “If you’ve got space for five cheeses make sure that those five cheeses represent variety. You need a cooking cheese, an indulgent cheese, and a snack cheese. Cover off those shopper missions. Then it’s not a question of competing with the multiples. The golden basic rule is range.”

Kerry Food shopper marketing director Sue McVie points out that the British market is still falling a long way short of our European cousins: “There is still significant room for category growth, particularly when drawing comparisons with similar sized European markets. By just consuming an additional 20 grams per person each week, we could add £450m to the category.”

And Clothier adds that the cheese market could do a better job in responding to the needs of the convenience market in Cheddar. He says: “I think that many cheese suppliers/brands are producing multiple retail ranges and ‘shoehorning’ them into convenience. We try not to do that. We try to offer smaller sizes and different pricing matrices.”

Last year the Wyke Farms brand underwent a revamp featuring a new brand identity designed to increase shelf impact and improve block branding.

McAvie says that the way to achieve success in block cheeses is extending usage. “Block Cheddar remains a promotion-driven commodity, but by extending usage occasions with convenient formats such as grated, slices and spreadable which are purchased alongside traditional formats, and by educating consumers, we can drive value growth,” she says.

Another key trend which continues to provide healthy sales is snacking, a relatively new sector in the cheese market. “Just over 15 years ago, the cheese snacking category didn’t exist, but it’s now worth £194m and continues to grow. With convenience, cheese snacking remains a brand-led category, with more than 90% of sales coming from the top three brands,” she points out.

McVie says that the Cheestrings brand is continuing to drive growth in the channel, with the brand up 7% and outperforming the market as a whole by 1%. However, the company says that only 7% of lunchboxes contain a cheese snack, a fact the company hopes to change with its forthcoming April launch: an extension to the Cheestrings range with two new flavours, cheese & onion, and cheese & tomato.

Another lunchbox favourite, Bel’s The Laughing Cow, took a sophisticated turn last year with the introduction of a lighter blue variant. Gregory says that there’s often a misconception about cheese spreads, particularly those that come in triangles. “One of the biggest surprises about The Laughing Cow is that almost half of its sales are due to adult consumption, particularly women watching their weight.”

He says that the launch of the lighter blue variety came after research showed interest in extending the brand with different cheese types, rather than by including other foodstuffs to go with it such as ham. “Blue was the strongest variant to come out of the research and performed very well,” Gregory adds.

He says that NPD from all manufacturers is really helping to drive the market and engage shoppers. “There’s going to be NPD in response to the major market trends of health, variety and cooking at home,” he predicts.

According to Mintel, the market looks to continue growth over the next five years, helped in part by an ageing population who are core users of cheese.

To meet the challenges of the market, retailers should be focusing on value and choice, says Clothier. “It’s making sure that when the shopper wants an item they have it, and making sure that it’s at an everyday low price so that the shopper does not feel price punished for running short and having to shop in the convenience store.

“Really successful convenience retailers are increasingly focusing on provenance, and by stocking ranges from small local suppliers are becoming hubs of the community and a really valued part of the local fabric of the community in the way that traditional grocers would have been.”•