Biggest brands: Top 50 grocery brands by sales 2008

The value of the top grocery brands has withstood the consumer shift toward bargain-hunting amid the gathering economic gloom.

While consumers have been counting the cost of the credit crunch, brands have relied on price inflation not only to stay afloat, but also to increase their values significantly year on year. In fact, most of the top 50 grocery brands grew in value last year, with just 10% experiencing negative growth.

The 2008 Biggest Brands ranking, compiled exclusively for Marketing by TNS Worldpanel, offers an unparalleled picture of brand performance and British consumers' shopping habits. Although the state of the economy is having an impact across the sector - particularly in the growth of own-label products - premium brands continue to perform well. Despite the miserable summer, falling property prices and escalating fuel costs, consumers are still buying Pedigree dog food and drinking more wine than ever before.

The effect of price inflation on brand values should not be underestimated, however. It was most marked in ambient bakery, where value sales rose 10% in the year to 20 April; in savoury home cooking, which includes pasta, sales rose 9%; and in dairy, sales rose 11%. Rising fuel and energy prices, meanwhile, contributed to an increase in value sales across the board. However, as Chris Longbottom, director at TNS Worldpanel, points out: 'Brands only pass on price increases to consumers where they can convince retailers they are unavoidable.'

The fresh and chilled category is experiencing the highest inflation - it rose 6.9% in the 12 weeks to 20 April compared with the corresponding period in 2007, soaring to 11.7% in the 12 weeks to 10 August. Total ambient groceries rose 4.7% and 8.2% respectively.

Yet volumes have so far remained unaffected, according to Longbottom. 'People aren't downtrading from butter to margarine, for example. Lurpak's 22% value rise, much of which stems from its spreadable formats, shows that people are still prepared to pay for taste and convenience. Food now represents only 9%-10% of our disposable income, and we have to eat, so people tend to economise in other areas,' he says.

Indeed, one effect of the credit crunch - amplified by poor weather and the sense of gloom pervading news reports on the economy and personal finance - is that consumers are turning to 'comfort brands'. Number-two brand Heinz's 11% growth owes much to the strong performance of its soups during the summer, while Cadbury's leading position demonstrates that, despite the trend toward healthy eating, consumers still want to indulge.

McVitie's 16% growth also bucks the health trend and reflects the fact that 'everyday treats' and 'special treats' are the fastest-growing categories in the biscuit market. We seem to be drinking more, too - wine brand Hardys enjoyed a 22% rise. More consumers are choosing to drink at home and in greater volumes, another trend induced by the credit crunch.

The 24% value growth of bread brand Warburtons, taking it to fifth place in the table, is partly an effect of its broader distribution; however, the brand also taps into consumers' desire for healthy, 'authentic' products. Warburtons focuses strongly on its 130-year history as a family business in its branding and advertising, which allows it to sustain premium prices and avoid much of the promotional activity that rivals such as Hovis and Kingsmill carry out.

'Healthier' brands continue their march up the rankings. Weight Watchers rose 11% to 14th position, Tropicana grew sales by 24% and Quorn, which has, according to Longbottom, the youngest purchaser age profile of the top 50 brands, stole into the table for the first time on the back of an 8% growth in value sales.

One blot on an otherwise impressive copy book is Bernard Matthews, which is still struggling to reverse negative perceptions associated with celebrity chef Jamie Oliver's highly publicised campaign against its Turkey Twizzlers in schools, and a bird flu outbreak on one of its farms.

Ones to watch

Outside this year's top 50, a clutch of brands have fallen into the 'ones to watch' category (see table, right); if their current rate of growth continues, they may break into the main table next year.

Mass-market wine brand Stowells, for example, experienced the most impressive value sales rise, of 45%. It expanded its range last year with additions including a sparkling wine and a ros?, and widened its distribution. Rather than advertising, it focused its marketing on PR and in-store sampling around promotional activity, all intended to 'demystify' wine-buying.

Strongbow, meanwhile, owes its strong growth to a single-minded focus on 'refreshment' in its communications. In addition to TV work, it advertised on radio for the first time in 2007, consolidating its presence in the medium this year with its sponsorship of TalkSPORT's drivetime show (renamed Bowtime). More recently, the cider brand sought to amplify its 'first-pint refreshment' positioning with a TV campaign intended to strengthen its relation-ship with, and awareness among, its target customers.

The continued success of milk brand Cravendale, with 25% growth, is testament to the power of brand-building in a heavily commoditised market. With value sales approaching £130m, its strength lies in its unique filtration process, which removes the bacteria that cause milk to sour. The brand's strong functional attributes are communicated through humorous ads, including the recent 'Out of stock' and 'Last glass' executions featuring a cow, a pirate and a cyclist.

The 15% sales growth posted by Kenco, the third-biggest-selling drink in the hot beverages category, is the result of heavy investment by parent Kraft Foods. A redesign was supported by the 'Mr Makousa' TV campaign featuring actor Don Warrington, and NPD.

The launch of Kenco Pure - single-origin coffees sourced entirely from Rainforest Alliance-certified farms - into the super-premium coffee sector, makes Kenco the leader in the ethically sourced instant-coffee market, with a 28.1% share. Another Rainforest Alliance-certified coffee, Kenco Sustainable Development, was launched in 2005.

Lastly, the 18% rise in value sales of John West's canned fish products is the result of consumers' desire for the twin benefits of convenience and health.

'We believe strongly there is room in the market for both traditional cans and newer packaging formats such as pouches,' says John West marketing director Jeremy Coles. 'Far from being old-fashioned, cans are in a perfect position to capitalise on trends for low-fat, low-calorie, convenient nutritious food, while pouches offer portability.'

Top Selling Brands to Watch 2008
RankBrandSales (£000)Sales (£000)%change
20082007
1John West  129,647109,43918
2Cravendale  129,236103,27925
3Velvet  121,176107,37413
4Batchelors  117,207104,45512
5Kenco  113,22898,62315
6Uncle Ben's  112,36995,70617
7Strongbow  109,20199,06210
8Jacob's  100,52691,18310
9Wiseman  91,25675,47521
10Stowells  86,44259,52345

 

Biggest brands data source and methodology

These findings are based on TNS Worldpanel data for the 52 weeks to 20 April 2008. TNS Worldpanel monitors the grocery retailer take-home purchasing habits of 25,000 demographically representative British households. All data is based on the number and value of items being bought by these consumers.

In compiling the list, TNS Worldpanel has defined a brand as it would be seen in the eyes of a consumer. Products that have clearly defined on-pack branding have been counted to make up the total brand value. All own-labels have been separated into the top 10 own-label section. All bathroom toiletries brand values exclude cosmetic and fragrance ranges.

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