- It was strongly noted that unprocessed cheese was the preferred option by consumers in 2014. Unprocessed cheese saw current value growth of 3%, compared to processed cheese which declined by 4% (a stronger decline compared to 2013). The development of convenient unprocessed slices and gourmet packs of cubed and stick cheeses for entertainment platters and children's lunch boxes, also helped develop the unprocessed category, other than just the popular block cheeses. In particular, the Mainland brand from Fonterra Brands (NZ) Ltd had sliced singles and cheese sticks and Dairyworks Ltd had cheese and rice cracker packs, and mini slices.
- Fonterra Brands (NZ) Ltd continued to dominate cheese with a value share of 45% in 2014, up slightly on 2015. Seen as the leader and innovator, its brands are well supported by New Zealanders. Mainland remained the top brand (in the category and in Fonterra's portfolio) with a value share of 28%. Interestingly, the value brand of Valumetric moved into second position (available in block and slice cheese) at 8%, due to the Anchor brand refocusing on other chilled dairy products, therefore reduced value share down to 7%.
- Despite block cheese being the dominant cheese format, it is expected over the forecast period that more convenient formats will be made available such as the developments over the 2013/2014 period of slices, cubes and sticks. The influence of Mediterranean cooking becoming popular is likely to see the influence of more speciality cheeses from this area grow, such as feta, parmesan, mozzarella and bocconcini.
Drinking Milk Products
- 2014 saw the trend of functional and fortified breakfast milk products become popular. In 2013, Goodman Fielder New Zealand Ltd launched Kellogg's Nutri-Grain as a product extension to breakfast cereals and snack bars. Other breakfast products that have had strong product extensions are Sanitarium Up & Go range, and Anchor Fast Start Liquid (rebranded from Primo) also enjoyed good growth. In the novelty area, were Magic Straws imported by Macvad Ltd, which were flavoured powder beads within straws that turned the milk into a flavour whilst sipping through the straw.
- Fonterra Brands (NZ) Ltd continued to lead the category with an unchanged value share of 34%. Anchor remained the leading brand in the category with products available in cow's milk (both fresh and UHT), powdered milk and sub branded ranges, such as Anchor Fresh Start (breakfast liquid drink) and Anchor Calci-Yum (flavoured liquid milk for children). The company is considered a leader in the category, being owned by Fonterra Co-operative Group Ltd; a global company with its roots in New Zealand. Many New Zealand consumers are loyal to Anchor products. Of note in 2014 was the continued expansion of the light-proof bottle introduced in 2013 throughout the Anchor fresh milk and cream range. Furthermore, there was also the introduction of the novel flavour of Jaffa to the Primo flavoured milk range and the continuation of the Anchor-sponsored Fonterra Milk for Schools campaign.
- For manufacturers to move this category away from being commodity driven, innovation, value-added and premium products that taste good and are of high quality need to be developed. Both domestic niche companies of Lewis Road Creamery and Avalanche Coffee are good examples of developing new and exciting products in this category, which is likely to continue over the forecast period.
Yoghurt and Sour Milk Drinks
- 2013 saw a trend of products appealing to children, particularly innovative and fun yoghurt, such as The Collective Suckies developed by small, domestic player Epicurean Dairy Holdings Ltd. These products are yoghurt inside both flexible pouches and flexible tubes that are sucked rather than spooned, offering great convenience for children on-the-go with no mess. To follow this, the company introduced Moo Gurt squeezies in smaller-sized pouches in 2014. Further growth was spurred on by the launch from Fonterra Brands towards the latter half of 2014 with the launch of Anchor Uno, which captured health and wellness benefits for children by introducing a yoghurt fortified with vitamins and minerals, specifically supporting immunity. The high baby group born over the 2007/2008 years were now going to school, and healthy snacks such as yoghurt were seen by manufacturers as an opportunity to grow the category.
- Fonterra Brands (NZ) Ltd continued to dominate the category with a value share of 42%. The strongest brand remained Fresh 'n' Fruity, which was ranked the highest brand in the category with a value share of 37%. However, the main focus in 2014 was the launch under the Anchor brand of Anchor Uno, a yoghurt targeted at children. The probiotic yoghurt is fortified with vitamins and minerals and is marketed as a support to boosting immunity. Available in both six and twelve multipack tubs, the brand was launched with a strong TV advertising campaign. Meanwhile, Symbio Probalance probiotic low-fat yoghurt expanded its range over the 2013/2014 period from tubs, through to pouring yoghurt (introduced strawberry in 2014) and also with wholegrains for a low-fat yoghurt rich in fibre.
- It is expected over the forecast period that innovation, better quality taste profiles, interesting and premium flavours and a strong skew towards health and wellness within yoghurt is likely to drive the category. Therefore the smaller niche companies (most of which are domestic players) are likely to perform well.
- Most of the general categories within other dairy saw flat or a slight negative growth, with the exception of cream and condensed/evaporated milk. However, within each category, health and wellness saw positive growth. This is an indication that consumers are thinking about their health while purchasing other dairy products. In particular, reduced fat versions were a strong consideration over full fat versions.
- Fonterra Brands (NZ) Ltd led with a value share of 38%, followed by Goodman Fielder New Zealand Ltd at 28%, dominated the category with more than half of all sales going to these larger players. With the rebranding of all other dairy products within Fonterra's portfolio under the Anchor brand in 2013, and the rebranding and formulation in most dairy products in 2014 within Goodman Fielder's portfolio under the Meadow Fresh range; the 2013/2014 period was seen as a time of consolidation for both major companies with no real strong development in other dairy products.
- It is expected over the forecast period that two polar trends are likely to occur in other dairy. One is being the influence of premium, indulgent products to attract a higher price point, while the other trend is likely to be in health and wellness benefits (such as the development of soy-based non-dairy alternatives).
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Discover the latest market trends and uncover sources of future market growth for the Dairy industry in New Zealand with research from Euromonitor's team of in-country analysts.
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The Dairy in New Zealand market research report includes:
- Analysis of key supply-side and demand trends
- Detailed segmentation of international and local products
- Historic volumes and values, company and brand market shares
- Five year forecasts of market trends and market growth
- Robust and transparent market research methodology, conducted in-country
Our market research reports answer questions such as:
- What is the market size of Dairy in New Zealand?
- What are the major brands in New Zealand?
- How has the economic downturn impacted sales performance given its staple food status?
- Given mounting obesity concerns, are consumers moving from full-fat to reduced fat/fat-free offerings?
- How are volatile farmgate prices for milk impacting retail prices and sales performance?
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This industry report originates from Passport, our Packaged Food market research database.
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