Steady positive growth is expected across cheese during the forecast period as demand for Western ingredients and cuisine continues to expand, especially among the urban middle class. This trend is being underpinned by improvements in the economic conditions and rising disposable income levels.
With demand for cheese among affluent urban dwellers becoming increasingly mature, the forecast period is likely to see the category’s leading brand owners and retailers exploring their options for appealing to less affluent consumers though stronger price promotion and the launch of basic products in simple packaging. The vast majority if the cheese currently available in Cameroonian supermarkets is considered too expensive for economy-minded consumers to purchase on a regular basis.
The forecast period is likely to see sales of cheese remain under pressure due to high unit prices, which make the products in the category unaffordable for many. This means that demand is largely limited to middle-income and high-income consumers.
Groupe Bel remained the leading player in cheese in 2019 and this was primarily due to the very strong position of its leading brand La Vache Qui Rit and its second leading brand Kiri. Groupe Bel’s success and the widespread popularity of its key brands is primarily due the France-based multinational company’s long-standing presence in Cameroon and its consistent use of strong advertising campaigns.
International brands almost completely dominate sales of cheese and local players are conspicuous by their absence from the category. Sales are accounted for mainly by international brands with a long-standing presence in the country.
Private label is set to improve its position in cheese over the forecast period and this is a sign that demand for cheese is spreading out from its traditional core consumer base of affluent urban-dwellers to include less affluent households. The main private label players in the category are the country’s leading supermarket chains, including Spar, Super U, Casino and Carrefour and these retailers are expanding the range of private label cheese they offer while giving it better shelf positioning to improve visibility.
The positive sales growth expected in drinking milk products over the forecast period is set to be due mainly to the efforts of the category’s leading players to reengage in more competitive pricing practices, with the consumer base for cow’s milk in particular likely to expand as a result of greater affordability. In addition, consumer loyalty to the best-known brands is set to remain a major driver of volume and value growth over the forecast period.
The forecast period is set to see new product development a major trend in drinking milk products. With numerous new entrants having recently expanded the range of products on offer in the category characterised by demand for fairly basic products, numerous new players are offering competitively priced, high-quality products, including Dano Milk, Dolac, Loya and Broli Milk.
One of the most important features of the distribution of drinking milk products in Cameroon is that many of the leading brands in specific parts of the country are distributed exclusively one or two regions. Some of these brands have weak distribution in other parts of the country, limiting the scope of their appeal to one or two regions.
The fiercely competitive environment that defined drinking milk products throughout the review period showed no signs of abating in 2019. With consumers seeing few differences between the various different products in the dominant category of powder milk for instance, companies are engaged in constant efforts to distinguish their products from those of their competitors.
The leading players in the dominant category of powder milk continue to focus on establishing a strong position at regional level as distribution issues and strong loyalty to brands segmented by region mean that establishing a foothold at national level remains problematic, while it is relatively east to generate strong sales and good performances in specific regions of Cameroon. The two exceptions to this are Nestlé with the Nido brand and OK Foods Cameroon with the Top Milk brand, each of which has been able to establish a strong position across all regions of Cameroon, resulting in these brands topping the rankings at national level.
2019 saw Africa Food Distribution enter the underdeveloped category of flavoured milk drinks, where demand is still very far from maturity and there remains strong potential for further sales growth. Although Broli Milk is a new brand, it is essentially an extension of the company’s Broli umbrella brand, which is present in numerous packaged food categories across staples, snacks and cooking ingredients.
Yoghurt and sour milk products is set to continue registering positive volume and value growth over the forecast period as more consumers come to appreciate the benefits of yoghurt, in particular. With incomes rising and life becoming increasingly hectic for the residents of Douala and Yaoundé, the conditions for sales growth have never been better for a category that has traditionally struggled to generate widespread appeal.
With competition in yoghurt set to become more intense over the forecast period, the category’s leading players are likely to focus more on the development of new products to remain relevant to consumers. In particular, innovation is especially likely to be seen from local players as they continue with their efforts to improve the quality and appeal of their product ranges.
With yoghurt becoming an increasingly competitive category, the leading players can be expected to focus more on establishing crucial advantages for their products and brands in an effort to capture rapidly rising demand. More aggressive marketing activities can thus be expected during the forecast period, mainly price promotions and media advertising campaigns.
Local companies continue to lead sales of yoghurt and this is a reflection of the requirement for short supply chains due to yoghurt being a highly perishable product. Other reasons for the strong positions of the leading local players are the competitive pricing of their products, as well as their widespread distribution.
Drinking yoghurt is becoming a more important category as consumers increasingly consider it to be the most convenient type of yoghurt. In response, numerous players are launching new products in the category in an effort to capture rising demand.
2019 saw MyL turn to innovation in a bid to boost consumer interest in its yoghurt. Specifically, the company innovated in the area of packaging.
Other dairy in Cameroon comprises entirely cream and plain condensed milk and cream, with other categories registering no more than marginal sales. Condensed milk is a very traditional product that has long been favoured for its shelf-stability, long shelf life and low price.
Unlike most other packaged food categories, the retail distribution of other dairy is still dominated by traditional retail channels and this is a direct reflection of the importance of traditional neighbourhood grocery stores for the low-income consumers who comprise the core consumer base for condensed milk. However, with there being a slim possibility that sales of other dairy will expand to include higher volumes of cream and a range of new products such as coffee whiteners and fromage frais and quark, the forecast period could see supermarkets and other modern retail channels playing a more important role in the retail distribution of other dairy.
With demand for condensed milk already fairly mature among the low-income consumer base that accounts for the bulk of sales in the category, players in other dairy are increasingly looking to middle- and high-income consumers to expand their products ranges and generate demand for a wider range of products. With the prices charged for cream and various other dairy products far too high for the majority of low-income consumers, and with these products by no means a traditional part of the Cameroonian diet, appealing to a modern, affluent urban consumer base is likely to be key to generating demand in categories in which sales are still marginal.
Nestlé remains the leading player in other dairy due to the popularity of its Nestlé brand in condensed milk. This brand is highly popular among Cameroonian consumers due to the company’s long-standing presence in the country.
Condensed milk is a category in which sales are largely dependent on competitive prices. For this reason, strong brands such as Broli, Loya, Dolac, Incolac, Netto and Jago are engaged in constant efforts to minimise unit prices, resulting in low margins and very little in the way of innovation or added value.
2019 saw Africa Food Distribution expand its operations in Cameroon and this includes sharpening its focus on the category of condensed milk. The company is expecting its Broli brand to perform well in condensed milk due to its affordable pricing, strong local positioning and wide distribution, which focuses on traditional grocery retailers and major chained supermarkets in Douala and Yaoundé.
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This industry report originates from Passport, our Packaged Food market research database.