Sector Insight: Cheese

Despite price rises over the past few years, volume sales have remained steady, with soft cheeses faring particularly well.

The humble block of cheese is a shopping-list staple - nine out of 10 adults eat it
- but those with a serious cheese habit will have noticed a significant price rise over the past couple of years. This has been brought about by the rising farm-gate price of milk from an average of 21p a litre in 2007 to 26p a litre last year, which has had an effect on the price of all dairy products.

Despite some shoppers trading down to cheaper options or buying smaller pack sizes, the sector is generally bearing up well. In 2008, the cheese market was worth £2.1bn, and this figure is expected to be nearer £2.2bn this year, according to Mintel.

While the rise in prices has led to growth in value sales, volume sales have remained relatively steady. Last year's total of 374,000 tonnes was equivalent to 6kg a head, which is significantly lower than in France or Italy. Cheese remains an essential food item for many, with more than half of all adults eating block cheese at least two or three times a week, according to TGI.

Cheese is also caught between two camps in terms of the bigger trends affecting the food industry: its high
fat content means it may be avoided or eaten less by those trying to follow a healthier diet, but its provenance claims and natural credentials mean it appeals to those looking to reduce their consumption of artificial ingredients.

Health concerns have meant a boost in demand for low- or reduced-fat cheese options: four in 10 adults say they are following a lower-fat diet, according to TGI.

Cheddar has accounted for about half of value sales for several years. However, soft cheeses have gained ground (sales rose 36% between 2004 and 2008), as have UK territorial cheese such as Wensleydale and Cheshire (up 29% over the same period). Meanwhile, perhaps as a result of healthy-eating concerns, processed cheese's market share has dropped 7.5% over the past four years. As many such products are aimed at youngsters, the category has also suffered since Ofcom rules restricted the advertising of products high in fat, sugar and salt during children's TV programmes. 

Cheese is most likely to be used as a sandwich filling or eaten with biscuits. Mature and specialist cheeses tend to be eaten after a main meal or with crackers, but the rise in cooking from scratch has also been beneficial to the sector, as cheese is an adaptable cooking ingredient.

The under-35s are the heaviest consumers of cheese, but families are also crucial purchasers, especially for children's lunchboxes, where mild and inexpensive cheeses are often favoured.

There are some notable brand names in this sector, but own-label commands the biggest share, with just over 60% of value sales.

Kraft-owned Philadelphia is the leading soft-cheese brand and has been supported by substantial adspend over the past couple of years to consolidate its position. However, Kraft's Dairylea brand has suffered, and it relaunched Dairylea Bites, promoting them as
free from artificial colours and preservatives to reassure parents.

Dairy Crest's Cathedral City and Davidstow have helped it expand its share of the market. Last year, the manufacturer added to its range Cathedral City Vintage 20, an extra-mature cheese positioned as a more premium product, as well as repackaging its Lighter version for better differentiation.

Bel UK's range includes Babybel, Leerdammer, Port Salut and Boursin. Its Babybel, Laughing Cow and Cheez Dippers brands are very much aimed at the children's lunchbox and snacking market. In 2008, it launched Laughing Cow Giggles mini-cheese pods, aimed at pre-school children.

By 2014, the market is predicted to be worth £2.5bn, a rise of 16% compared with 2009, according to Mintel. When inflation is taken into consideration, this represents a more modest increase of 5% over the period.


Cheese Categories by Value and Share
RankCategory2008 (est)20082006
1Cheddar  106050985
2Continental  39819340
3UK territorial  24612220
4Processed  22211235
5Soft  1788150
Total  21041001930


Cheese Brands by Value and Share
RankBrand2008 (est)2007% change
1Cathedral City (Dairy Crest)  1718142721
2Dairylea (Kraft)  9751126-13
3Philadelphia (Kraft)  6836338
4Cheestrings (Kerry Foods)  5335133
5McLelland Seriously Strong  502522-3
6Pilgrim's Choice (North Downs)  44228155
7Babybel (Bel)  372372-1
8Wyke Farms (Wyke Farms)  24120124
9Laughing Cow (Bel)  21119110
10Leerdammer (Bel)  14111126
Other brands  23111229125
Own-label  12946112136112
Total   210410019771006
Source: Mintel 


Before commenting please read our rules for commenting on articles.

If you see a comment you find offensive, you can flag it as inappropriate. In the top right-hand corner of an individual comment, you will see 'flag as inappropriate'. Clicking this prompts us to review the comment. For further information see our rules for commenting on articles.

comments powered by Disqus
Brand Republic Jobs

subscribe now


Hottest virals: Cute puppies star in Pedigree ad, plus Idris Elba and Fruyo
Amnesty International burns candles to illuminate new hope
Toyota achieves the impossible by calming angry Roman drivers
Tom of Finland's 'homoerotic' drawings made into stamps
YouTube reveals user habits to appeal to 'older' marketers
Ex-M&S marketing chief Steven Sharp consulting at WPP
Wolff Olins reveals new CEO after Apple poaches Karl Heiselman
Glasgow offers £30,000 prize to best digital idea for 2014 Commonwealth Games
Google's revenues surge but shares drop as it grapples with transition to mobile
Facebook beats Twitter to most 'marketing friendly' social media site crown, says DMA
Fableists believe children like Finn should be outdoors enjoying life
Homebase, Baileys and Camelot join the line-up at Media360
MasterCard renews Rugby World Cup sponsorship to push cashless message
Lynx unleashes £9m 'Peace invasion' campaign
Social Brands 100 Youth: Pizza Hut most social youth brand in UK
Cheryl Cole is wild and arresting in new L'Oreal work
Morrisons told not to show alcohol ads during YouTube nursery rhymes
O2 head of brand Shadi Halliwell departs after 23 years at company in restructure
Tesco hit by further sales decline as it turns to digital Clubcard and social network
Branding guru Wally Olins dies aged 83
Duracell short film captures epic Transatlantic voyage
Ash runs Tinder experiment to show smokers are less desirable to opposite sex
British Airways teams up with Gerry Cottle Jnr for summer of rooftop film screenings
Arklu says 'girls can be superheroes too' with doll design competition
Coke enters squash market with Oasis Mighty Drops
Virgin Galactic signs up Land Rover as space flight sponsor
Motorola marketer Andrew Morley departs as Google gears up for sale to Lenovo
US Airways apologises after tweeting obscene image at a customer
Mumsnet admits users' emails and passwords accessed via Heartbleed bug backs 'rubbish' mobile app with TV ad