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Dairy Market Trends: Cheese Growing Slowly
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First, consider the top ten brands of natural cheese chunks. This is a core subcategory for cheese. In the 52 weeks ended Oct. 2, dollar sales for all brands measured were up just 2.5%. Unit sales were actually off by 1%. These figures, courtesy of Information Resources Inc., are for supermarket, drugstore and mass merchandiser sales excluding Wal-Mart. They do not reflect foodservice or convenience channel sales. Seven of the top 10 brands had lower units sales than they did a year earlier. Admittedly, unit sales is a difficult measure to interpret, as it is not a true volume count and can be affected by packaging and purchasing trends. But the dollar sales figures are also less than spectacular, perhaps thanks in part to lower pricing in 2005. Another thought is that consumers must be buying more shreds. Looking at quarterly sales of both processed and natural shreds offers only weak evidence to support that explanation. Sales of natural shreds (not depicted in the tables) grew substantially in 2004, and again, that may have been affected by price hikes, but they are down measurably (-3.9% by dollar in the third quarter) this year. But unit sales have been steadily inching up. One thing is for certain sales of processed shreds are dropping rapidly after enjoying some introductory success in 2004. Perhaps as the price of natural cheese has moderated, processors are offering less processed products, and/or consumers are buying less. Whatever the case, the subcategory has taken double digit losses in the last two quarters in terms of both dollar sales and units. Meanwhile most of the top cup yogurt brands are doing well, as is the entire category. The two Yoplait brands on the heels of private label both showed substantial growth during the period, and while Stonyfield has gained substantial market share in recent years, its growth pace hasn't slowed. Finally, we focus on quarterly sales of flavored milk. Results in this once stellar category have been less than remarkable for some time, and it seems most recent periods reflect the same, with little growth and some shrinkage. One has to believe that flavored milk sales are doing better in convenience and retail channels than they are for in-home consumption. |
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