Baby Food in Canada

PROSPECTS

Players look to expand consumption occasions and keep parents in the baby food aisle for longer

Baby food (excluding milk formula) manufacturers are seeking to expand consumption occasions for their products and appeal to a wider audience. Part of this is also to keep parents in the baby aisle for longer in stores.

Milk formula remains stable, but could goat milk project shake up the category?

Milk formula has been seeing stagnating sales in Canada in recent years, with no significant changes in the breastfeeding rate reported in the country over the review period. In addition, milk formula is highly regulated in terms of production, packaging, ingredients and distribution, leaving little room for major innovation.

Organic baby food sees strong growth, while other baby food benefits from snacking trend

The conversion to organic can be seen in the rapidly changing product offerings available on the shelves of major grocery retailers as well as the strong sales growth of organic products. In recent years, Kraft Heinz has made significant investments in organic offerings, Nestlé Canada re-entered prepared baby food with all-organic products and organic players such as Baby Gourmet Foods and Love Child Organics have continued to launch new products.

COMPETITIVE LANDSCAPE

Baby Gourmet and Love Child remain trendsetters in organic baby food

Baby Gourmet Foods is the clear leader in organic baby foods and, along with Love Child Organics, continues to be a pioneer and trendsetter in this product area. These players have been leading developments in organic baby food for years and remain active in terms of new products and innovations.

Big three continue to dominate milk formula

Mead Johnson Nutrition, Abbott Laboratories and Nestlé Canada remained the three dominant players in milk formula in 2019, accounting for most of the retail value share and seeing little other competition. Nestlé Canada appears to be placing increasing emphasis on products with added functionality and benefits such as iron and DHA, while Abbott has gradually added non-GMO claims to the majority of its offerings in milk formula.

Kraft Heinz Canada and Nestlé Canada strong in baby food outside of milk formula

The Heinz brand consistently lost share on an annual basis over the review period, with the merger with Kraft seeming to have done little to turn this around. Nevertheless, the brand is still a strong one in Canadian baby food due to its low price positioning, wide retail distribution and close relationships with retailers and distributors.

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