Cheese Category Report 2015
“There’s a multitude of reasons why that third are quite promiscuous,” says Harper. “You could argue that brands historically haven’t done enough to persuade these consumers that there’s a difference between branded and own label, and that it’s worth paying for.” Harper says there is evidence that some consumers have switched back to Adams Foods’ Pilgrims Choice on the back of a major relaunch in January supported by a £3m Pilgrims Choice Chosen campaign in May; however, he also concedes “there’s a price piece in there too that when a brand drops down to £2, which ourselves and Cathedral City have been doing, then switching occurs”.
Yet for all their negative effect on average price, promotions remain a key driver of incremental purchases within the cheese category. “It is a fundamental truth that a large proportion of consumers are deal shoppers,” says Amy Fisher, senior shopper marketing manager at Dairy Crest.
She continued, “They bring the incrementally to the market – without deals they would walk away. It is therefore not simply a case of stepping away from promotions as the reduction in volume sold, even at a higher price, would dramatically shrink the market.” Retailers have been ruthless in culling perceived duplicate cheese lines during the past year as part of ongoing range rationalisation strategies. One supplier source points to extensive range rationalisation on branded cheese throughout 2015, particularly by Tesco and Sainsbury’s, while Cathedral City and Anchor remain the dominant brands in Asda, leaving little space for challengers. Asda has also continued to undertake ‘rollback’ activity throughout the category, with a particular focus on its Extra Special range to better compete against the discounters. In this context, the battle among brands to remain on shelf has been fierce.
“It’s a tough place to be for me-too brands and brands without a clear proposition and point of difference,” says Hamish Renton, MD of HRA Global Food & Drink. “Own-label quality is broadly good, so the brands need to offer something special to survive.” Some branded suppliers are unconvinced that hollowing out ranges will prove an effective weapon for the supermarkets in addressing the threat posed by the discounters.
“The biggest weapon the major multiples have over the discounters is their level of choice,” says Clothier. “I think some of the major retailers in their battle to compete with the discounters are actually losing one of their major assets and their biggest point of difference, which is choice and interest.” Wyke is one of the suppliers seeking to address the assault on brands by updating its brand identity.
In October, it relaunched its core range of Wyke Farms Cheddar (Mature, Extra Mature and Vintage) with new packaging and a new design aimed at highlighting its environmental and family farming credentials. “The feedback we’ve had has been fantastic,” says Clothier. “We’ve seen from our rebrand that if you get the proposition right and you get the look and the feel of the brand right, shoppers will pick the product up and it will drive a bit of loyalty.”
Wyke is also targeting an uplift in sales through its successful export business and has set an ambitious target to achieve a four-fold increase in exports in the next 12 months. The export range has recently benefited from a revamp that sees Wyke clearly communicating its British premium luxury credentials.
