Milk and Cream - UK - March 2006

TABLE OF CONTENTS

• Introduction and Abbreviations
• Definition
• Consumer research
• ACORN
• Advertising data
• Abbreviations
• Executive Summary
• Domestic supply problems
• The health impact
• Value-added heroes
• Healthy and fresh perceptions
• Jostling for Supply
• Branding comes to the fore
• Impulse comes to the fore
• Fat-conscious UK affects milk market
• Price pressures for the future
• Market Drivers
• The impact of age
  • Figure 1: Trends and projections in UKpopulation, by age group, 2000-10
• Are you lonely tonight?
  • Figure 2: UK households and one-personhouseholds, 2000-10
• Milk juggling
• Losing relevance
  • Figure 3: Household consumption of milkand cream, 1945-2000
  • Figure 4: Milk usage, November 2005
  • Figure 5: Household consumption ofbreakfast cereal, tea and coffee, 1945-2000
• Health, diets and allergies
• Healthy Living Blueprint for Schools
• Market Trends
• Farmgate prices
  • Figure 6: Prices paid to farmers in penceper litre of milk, 2000-05
• Market struggle
  • Figure 7: UK retail sales ofliquid whitemilk, liquid flavoured milk and cream, 2000-05
• Sales of milk by format
  • Figure 8: UK retail sales of milk, bysector, by volume, 2001-05
• Liquid burst for flavoured milkA slow death for cannedInstant -- it's about consumer interest
• White liquid milk
  • Figure 9: UK retail sales of liquid whitemilk, 2000-05
• The role of price
  • Figure 10: UK average price of liquidwhite milk, 2000-05
• Flavoured milk feels the squeeze
  • Figure 11: UK retail sales ofready-to-drink liquid flavoured milk, 2000-05
• Learning from yogurt drinks
  • Figure 12: UK average price ofready-to-drink liquid flavoured milk, 2000-05
• Cream
  • Figure 13: UK retail sales of cream,2000-05
  • Figure 14: UK average price of cream,2000-05
• Market Segmentation
• Liquid milk by fat content
  • Figure 15: UK retail sales of liquid milk,by fat content, 2001-05
• Biggest growth in 'others
• 'Liquid milk by process
  • Figure 16: UK retail sales of white liquidmilk, by process type, 2001-05
• New processes emerge
• Liquid milk by packaging
  • Figure 17: UK volume retail sales of whiteliquid milk, by packaging type and size, 2001-05
• Bigger pack sizes
• Cartons less appealing
• UHT shifts to multipack
• White liquid milk by sector
  • Figure 18: UK retail value sales of whiteliquid milk, by sector, 2002-05
• New consumer needs exist
• Soya sales
  • Figure 19: UK volume retail sales of soya'milk', by segment, 2001-05
• Ready-to-drink flavoured milk
  • Figure 20: UK retail sales ofready-to-drink flavoured milk, by lifespan, flavour and pack type,2002-05
  • Figure 21: UK sales of flavoured milk andmodifiers, by sector, 2005
• Milk modifiers
• Non-dairy modifiers do well
• Cream indulgence
  • Figure 22: UK retail sales of cream, bysegment, 2001-05
  • Figure 23: UK volume retail sales ofcream, by segment, 2002-05
• Value in versatility
  • Figure 24: UK value retail sales of cream,by segment, 2002-05
• The organic other
• Market stability -- at what price?
  • Figure 25: UK average price of cream, bysegment, 2002-05
• Milk support in pockets
  • Figure 26: Advertising support level,2000-05
• Dairy-free storms ahead
• The Supply Structure
• Farmers
• CAP reforms
• An exodus in domestic productio
• Milk processors
• Retailers
• Improvements have been made
• Price instability is the issue
• Brand shares
• Arla dominates
  • Figure 27: Manufacturer volume shares forliquid white milk, 2001-05
• Wiseman leaps ahead through acquisition
• Flavoured milk shows a different story
  • Figure 28: Manufacturer value shares forflavoured milk, 2003-05
  • Figure 29: Manufacturer value shares forshort-life flavoured milk, 2005
• FRijj dominates
• Ambient brands enter the chiller
  • Figure 30: Manufacturer value shares forlong-life flavoured milk, 2003-05
• Kids lead long-life
• Confectionery competes
• Brands drive support on white milk
  • Figure 31: Main monitored mediaadvertising on milk and milk products, 2000-05
• Major companies and brands
• Arla Foods UK Plc
• Strong support
• Staying ahead
• Dairy Crest
• A big hit with the men
• Advance support
• Youth culture
• Moving with the times
• Dairy Farmers of Britain
• Dairy UK
• First Milk
• Graham's Dairies
• Lactalis (UK) Ltd
• Longslow Food Group
• Milk Link Holdings Ltd
• Rachel's Organic
• Robert Wiseman Dairies plc
• Unilever plc
• Flavoured milk & milk modifiers
• British Sugar
• Exploring new media
• British Sugar takes out the sugar
• Britvic Beverages Limited
• Campina UK Limited
• Brand support
• Masterfoods
• My Goodness Limited
• Nestlé
• Dairy alternatives
• Alpro
• The big brand feel
• Maximising the health stance
• So Good International
• Other suppliers
• A E Rodda & Son
• St Helens Farm
• WT Foods Limited
• Industry bodies
  • Figure 32: Main monitored media spend onmilk and cream by industry bodies, 2000-05
• Milk Development Council (MDC) and UK National Dairy Council
• Farmers for Action (FFA)
• National Farmers Union (NFU)
• New Product Trends
• Relaxing milk
• New usage occasions
• New types of milk
• Products associated with milk
• Own-label moves closer to brands
• NPD by product claims
  • Figure 33: UK New product development byclaims, October 2004-05
• UK flavour analysis
  • Figure 34: UK New product development byprimary flavour, October 2004-05
• Global launches see health leaning
  • Figure 35: Global new product developmentby claim, October 2004-05
• Distribution
• Convenience channel flexes its muscles
  • Figure 36: Sales of white milk, by outlettype, 2002-05
• Doorsteps diminish
• Multiples move to single-sourcing
• Pack size discrepancy
• Flavoured milk taps into snacking
  • Figure 37: Sales of liquid flavoured milk,by outlet type, 2003-04
• Trading considerations
• Awareness issues
• Proliferating confusion
• Cream is a planned indulgence
  • Figure 38: Sales of cream, by outlet type,2003-04
• The Consumer
  • Figure 39: Type of milk drunk/used,November 2005
• Looking at the alternatives
  • Figure 40: Netted categories for milkdrunk/used, November 2005
• Ambient -- the old favourite
  • Figure 41: Consumer profile for users ofambient milk, November 2005
• Not quite convenient enough?The alternative market
  • Figure 42: Consumer profile for users ofdairy alternatives, November 2005
• Understanding buying behaviour
  • Figure 43: Repertoire of types of milkpurchased/used, by demographic breakdown, November 2005
• Alternatives not the one and only
  • Figure 44: Repertoire of types of milk,November 2005
  • Figure 45: Consumer profile of consumersbuying three or more types of milk, November 2005
• The Consumer -- Detailed Demographics
  • Figure 46: Type of milk drunk/used, bygender, age, socio-economic group, region, marital status, workingstatus, lifestage, Mintel's Special Groups, media use, tenure, householdsize, ACORN group, commercial TV viewing and supermarket usage, November200
  • Figure 47: Type of milk drunk/used, nettedcategories, by gender, age, socio-economic group, region, maritalstatus, working status, lifestage, Mintel's Special Groups, media use,tenure, household size, ACORN group, commercial TV viewing andsupermarket
  • Figure 48: Repertoire of types of milkpurchased/used, by gender, age, socio-economic group, region, maritalstatus, working status, lifestage, Mintel's Special Groups, media use,tenure, household size, ACORN group, commercial TV viewing andsupermarket
• The Future and Forecast
• Doorstep potential
• Shortage in supply?
• Cream of convenience
• Crème fraiche possibilities
• Future for flavour
• The threat from yogurt
• New health benefits
• Vending opens up new opportunities
• New investment for the future?
• Milk remaining static
  • Figure 55: Forecast of the UK retail whitemilk market, 2005-2010
• Flavoured milk, the fastest growing sector
  • Figure 56: Forecast of the UK retailflavoured milk market, 2005-2010
• Cream still remains a treat
  • Figure 57: Forecast of the UK retail creammarket, 2005-2010
• Factors used in the forecast