In-home dairy usage offers insight into growth opportunities

Wednesday, 31 May 2023

Monitoring in-home usage trends is key for assessing opportunities for any product, particularly for categories such as dairy which play such an important part in the nation’s diet. In an average week 91.5% of the population consume dairy products (Kantar Usage).

It is clear that consumers value dairy in their diets, and the latest data from Kantar (24 w/e 19 February 2023) indicates that cow’s dairy features in more than a third (35.9%) of all eating occasions. This is, however, a reduction from the highs seen during the first waves of COVID-19 lockdowns, as well as pre-pandemic, when dairy occasions peaked at 38.0%. While there may have been a slight dip in occasions featuring dairy, weekly usage remains broadly in line with last year and the consumer base is largely steady. This highlights that the challenges for dairy lie in the regularity it is used; therefore opportunities for growth for the dairy category may be found by capitalising on dairy’s existing presence within households.

Coffee key for milk

On average, milk is used by consumers in over 11 occasions every week (Kantar, 24 w/e 19 February 2023). It has a variety of uses: from a stand-alone drink, to an accompaniment to cereals, to inclusion in hot drinks. Its highest frequency of usage in home is as an addition to the humble cup of tea. However, despite its prevalence in home, cow’s milk has been losing out on usage occasions over time.

An opportunity for milk is coffee. Milk is vital to coffee, with 71% of all coffee occasions featuring some form of cows milk (Kantar, 24 w/e 19 February 2023). During the multiple lockdowns of the pandemic, with consumers spending more time at home, food trends such as Dalgona coffee and re-creating barista style drinks in home may have potentially given milk a boost. However, since then there has been a 1.3% decline in occasions compared to last year (Kantar, 24 w/e 19 February 2023). Despite this decline, coffee is a key opportunity for cow’s milk as the decline was the smallest for any milk host.

Opportunities exist to target young adults in family households with coffee as a host of milk. In an average week, consumers aged 16-24 had 5.6 cups of coffee in and out of home (Kantar, 24 w/e 19 February 2023). This is up from 5 cups last year and was the largest growth from any group. Adults aged 20-23 account for 12.9% of out of home coffee occasions, down from 16% last year and 17.4% in 2021. This indicates that some of these consumers are turning to in-home coffee occasions to get their caffeine fix, potentially with increased out-of-home coffee prices forcing them to look for cheaper in-home alternatives. An opportunity for premium offerings for in-home barista style experiences could offer a boost to the milk category: as even with an enhanced price point, it would still be a ‘cheaper alternative’ than the out-of-home equivalent.

Butter boosts tastes of basic meals

Butter is one of the most inflationary impacted categories in grocery; therefore some consumers are looking towards cheaper alternatives as a means of managing their ever-tightening budgets. Due to this, switching has been seen from block butter, as well as spreadable, towards margarine and plant-based alternatives. As such, in the 24 w/e 19 February 2023, there has been increased margarine usage at evening meal occasions, particularly in Italian and baked potato meals and for child occasions (Kantar). While butter is not able to compete on price, it increases enjoyment of meals and is more likely to be asked for by partners or children than some of the other yellow fats, therefore has the potential to improve the taste of meals on a budget.

At breakfast time, butter is performing much better. This is overwhelmingly due to toast. Block butter usage has seen an additional 19 million occasions year on year when linked with toast, where all other areas of yellow fats have seen declines (Kantar, 24 w/e 19 February 2023). Almost 75% of these occasions are due to taste reasons, and this is clearly an important growth driver particularly for consumers aged 35-54. To help boost occasions for butter, continuing to highlight the tastiness, particularly for toast based meals which are now the third most eaten meal at lunchtime, could help enhance its usage.

Sprinkling cheese provides versatility and taste on a budget

Cheese is a versatile product that can be used in a range of dishes. According to Kantar, in the 24 w/e 19 February 2023 cheese became increasingly more prevalent in meat-free meal occasions, while cheese and meat-based meal occasions were down 5.1% year on year. However, cheese meat-free occasions are up 2% in the same period. These types of meals are more likely to be consumed by empty nesters and retirees. While younger families continue to be more likely to combine cheese with meat at mealtimes, the overall family demographic has consumed 28 million fewer meat-based meals with cheese year on year (Kantar, 24 w/e 19 February 2023), potentially looking to switch towards cheaper replacements at mealtimes.

The three most popular meat-free cheese meals are toast based, Italian and baked potato meals (Kantar, 24 w/e 19 February 2023). Some of these meals should be noted as being budget friendly, therefore highlighting the importance cheese presence can have as a cost saver at mealtimes while delivering in terms of taste and treatiness. In these types of meals, health features less prominently than in cheese and meat-based meals (Kantar, 24 w/e 19 February 2023). Taste and treat needs are however increased, therefore targeting consumers with messaging which emphasises taste on a budget could be beneficial to increasing cheese occasions. This is particularly noted for pasta-based meals, where on average there is a 20% saving in having a meal with just sauce and cheese compared to one which also features meat, fish or poultry (Kantar, 24 w/e 19 February 2023). According to Kantar, these types of meals are particularly popular with younger families, largely due to pester power of children. The practicality, simplicity and cost-effectiveness of these meals, as well as the enjoyment they can provide, may be key for continued growth with these demographics.

Health and enjoyment requirements of consumers provide opportunities for yoghurt

Lunch and evening meals account for more than half of all yoghurt occasions. Yoghurts have declined almost 7% year on year (Kantar, 24 w/e 19 February 2023), which has been driven by a decline in dessert courses. This trend was first seen in 2018; however it accelerated in 2022, with the last 12 weeks of 2022 showing that 27.0% of in-home meals featured a dessert. Yoghurt is however gaining share in lunchtime and evening meals as an ingredient, as well as reaching a record high of featuring in almost 30% of breakfasts.

There are three main ways yoghurts can be boosted:

  • as a dessert, targeting consumers treaty need
  • as an ingredient in cuisines such as Indian, where consumers feel that inclusion makes the dish more enjoyable and healthier
  • by capitalising on gains at breakfast, with synergy with cereal

When yoghurt is included with these dishes, perceived enjoyment and health benefits are increased, so highlighting these benefits which yoghurt can bring to a meal may help consumers fulfil these needs and increase its presence at mealtimes.

Cream provides indulgence and variety to dishes

Cream has struggled over the last couple of years, with Kantar reporting occasions back 6.4% year on year, and its largest sector, double cream, seeing losses. Double cream accounts for almost 40% of total category occasions; however it has seen a fall in engagement over time. There has however been an uplift evident for single cream. Cost will have had some implication in this, with double cream commanding a higher price point compared to single cream (Kantar, 24 w/e 25 December 2022). However the versatility and enjoyment of single cream is encouraging an increase in consumers to shop the category and increase the frequency they do so. A key change for this movement is that single cream is increasingly being viewed as providing greater enjoyment. And while double remains the more treaty of the two, single is viewed as delivering on the taste needs of consumers, particularly for pasta dishes.

Kantar reported, in the 24 w/e 19 February, an additional 5 million Italian dishes featured cream compared with the previous year. This equated to an all-time high of 3.1% of all Italian dishes featuring cream as an ingredient, filling consumer needs for dishes that are tasty, treaty and provide variety, particularly for those aged 25-34. Targeting cream as a way of creating more indulgent Italian dishes, particularly for younger adults on a budget, could be an opportunity to boost cream usage.

Why is in home usage important for assessing opportunities for dairy?

The nation’s love for dairy is evident, with the majority consuming dairy products every week. What is apparent, however, is that the number of occasions it is being used is beginning to slip. It is becoming increasingly important to monitor any consumption trends, and remind consumers of the taste, versatility, and treatiness that dairy can offer at mealtimes in order to increase the frequency of its usage.

Image of staff member Charlotte Forkes-Rees

Charlotte Forkes-Rees

Retail and Consumer Insight Analyst

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