Dairy in France

Dairy in France

Prospects

Premiumisation helps to revive cheese value growth

Cheese improved significantly in value sales terms in 2018, confirming the success of diversification strategies deployed by manufacturers to embrace consumers’ habits. Cheese is not consumed after regular meals as was traditionally the case in France; consumers request it as an appetiser, a snack, as part of a dessert or as a cooking ingredient.

Hard cheese is substituting soft cheese, owing to its greater convenience

Packaged hard cheese posted a stronger value sales performance than soft cheese in 2018 thanks to its greater convenience; soft cheese is perceived as “old fashioned” by some. The wider availability of diversified formats is intended to appeal to young generations and new usages have helped the hard cheese category to grow.

Alternative types of soft cheese record significant value growth

While traditional French soft cheese faces challenges, other types of soft cheese, such as Italian and goat, is boosting value sales. Consumer enthusiasm for Mediterranean and more particularly for Italian cheese is not a new tendency, but these products capitalise on their flexibility and the various ways they can be consumed.

Competitive Landscape

Leading domestic players consolidate their positions with investments in snacking

The leading player, Groupe Lactalis, is mostly focused on its core brand, Président, which is positioned in soft cheese and hard cheese and is available in various formats, including Emmental, Comté, Camembert, Brie and grated cheese. Other Groupe Lactalis brands include Société, Chaussée Aux Moines, Galbani, Bridel, Salakis and Rondelé.

Diversification into niches is creating value sales growth

Manufacturers’ strategy of embracing niches in the cheese category seem to have produced value sales growth. For example, investments in winter cheese in 2018 were particularly relevant as raclette, tartiflette and fondue were commonly requested by consumers as such offerings provide high levels of convenience while being able to help provide a convivial dining experience during cold, winter evenings.

Initiatives are put in place to develop local and authentic supply chains

Following the EU’s lifting of milk production quotas in 2015, farmers are allowed to organise themselves in order to negotiate collectively with manufacturers on milk prices. In this context, Groupe Lactalis signed an agreement in 2018 with a group of farmers to shape the conditions for the provision of high-quality and local milk intended for its AOP brands Jorts, Lanquetot and Moulin de Carel.

Prospects

Changes in breakfast habits combined with wholesale price volatility cause volume sales to decline

Milk consumption was negatively affected in 2018, especially because of the decline in production in 2017 following the heavy price fall that hampered farmers over the review period. In addition to the turmoil resulting from the lifting of EU quotas on milk in 2015, France’s dry climate during summer 2017 was not favourable to milk production and led to a volume sales decline.

Locally sourced and fairly priced milk is widely requested by consumers

Regionally produced and fairly priced milk that supports local farmers has significantly revived the category. There has been a milk crisis owing to higher price volatility for farmers and manufacturers, which are subject to a likely price decline as was the case over the review period, so ethical concerns are becoming more pertinent among consumers.

The popularity of milk alternatives is rising in line with new lifestyle trends

The emergence of vegetarian diets and milk alternatives is of significant importance to consumers. According to a study in 2016, 57% of French consumers are worried about dairy products.

Competitive Landscape

A regional offering is emerging in drinking milk products

Drinking milk products was led by Groupe Lactalis followed by Cedilac SA in 2018. While the former relies almost entirely on its flagship Lactel brand, Cedilac has a more diversified brand portfolio with Candia, Viva and Nactalia.

Competition in milk alternatives intensifies

Over the review period, the competitive landscape in milk alternatives was relatively concentrated around two manufacturers, Distriborg France an organic-orientated player, which leads sales through its flagship brand Bjorg, and Triballat-Noyal SAS, owner of Sojasun, a Brittany-based brand specialising in dairy alternatives. Sojasun is a pioneering brand that has grown constantly owing to a position in soy milk.

Flavoured milk drinks manufacturer Sodiaal SA is investing in promotions

In flavoured milk drinks, Sodiaal SA dominates with its children’s brand Candy’Up, which is available in four flavours: chocolate, vanilla, banana and strawberry. In order to generate new revenues, Candy’Up has set up a licence contract with Nintendo, opening the possibility for young consumers to win prizes ranging from Nintendo video game consoles to Pokemon cards in order to maintain interest among its young target consumers.

Prospects

Changing consumer habits hurt yoghurt consumption

Yoghurt and sour milk products continued to decline in 2018 as the category is very mature in France and there are many options for consumers. Moreover, the emergence of the snacking trend, which is reducing the number of desserts and breakfasts eaten, is hampering yoghurts.

Niche categories become more popular

Anti-dairy campaigns have significantly hindered sales of dairy-based yoghurt. Moreover, the flexitarian diet is becoming increasingly popular among consumers as they are concerned about animal wellbeing, environmental issues surrounding intensive farming but also about eating healthier and more digestive products.

Consumers trade up from flavoured yoghurt to plain yoghurt and drinking yoghurt

While flavoured yoghurt constitutes the largest share of overall yoghurt sales in France, plain yoghurt and drinking yoghurt continued to perform better than it in 2018, probably because of health concerns regarding sugar in yoghurt. The category’s lack of naturalness is another key consumer concern, with some players being suspected of misleading consumers through their packaging illustrations when their products do not in fact contain any fruits.

Competitive Landscape

Previously strong functional and high-protein brands suffer

Danone France and Yoplait collectively dominated yoghurt and sour milk products in 2018, with both owning strong brand portfolios that cover every yoghurt category. Danone’s brands include Activia, Danacol, Taillefine, Actimel and Velouté, while Yoplait’s sales are more concentrated around its main brand, Yoplait, although it is also positioned in fruited yoghurt through Panier de Yoplait.

Naturalness and authenticity trend in new product developments

To counteract the decline in yoghurt consumption, manufacturers opted for strategies ranging from brand renewal to investment in niche categories in order to trigger value growth in 2018. Danone launched its eponymous brand Danone in plain yoghurt and flavoured yoghurt, producing it with full fat milk collected in France and using natural ingredients.

Competition intensifies within free from dairy categories

Free from dairy yoghurt was at the heart of an intense innovation effort in 2018 as several manufacturers entered or developed this category with new releases, resulting in tighter competition. Eurial Poitouraine SA for example launched five versions of oat-, almond- and rice-based yoghurts under a new brand, A bicylette, in 2017.

Prospects

The decline of family formats in chilled and shelf stable desserts adversely impacts sales, while the premium segment still thrives

Value sales declined in 2018 even though chilled dairy desserts are still purchased by many French households. With a penetration rate of 90%, chilled dairy desserts is a mature category but is on a downward trend.

Supply shortages constrain cream but demand has returned

Unit price increases, linked to a fall in milk collection and supply shortages, have somewhat limited sales growth in cream. Still, domestic demand for cream appears to have returned after years of mistrust and links with cholesterol.

The decline of reduced fat and fortified/functional products hurts other dairy

As is the case for yoghurt, other dairy is hampered by continual structural decline in its fortified/functional and reduced fat categories, which make up a significant part of chilled and shelf stable desserts as well as fromage frais and quark. These products are particularly affected by growing consumer concerns in regard to the real effectiveness of some of their nutritional properties and to their perceived lack of flavour.

Competitive Landscape

Mixed fortunes for leading players

Lactalis and Nestlé hold shares of 60% and 40% in the Lactalis Nestlé Produits Frais joint-venture company, respectively, which in turn owns a wide range of significant brands in other dairy such as La Laitière, Bridélice and Viennois. In 2018, the company gained category value share and consolidated its position thanks to significant TV advertisement for its La Laitière brand in the year.

Premium innovations contribute to value growth

The development of premium other dairy products continued to be successful in 2018. Indeed, consumers are shifting from unpopular reduced fat desserts to gourmet desserts, demonstrating their preference for pleasure.

Manufacturers look for natural ingredients

Manufacturers’ ingredient lists are required by consumers to be more transparent and shorter, as preferences for naturalness and authenticity are becoming among the greatest in the entire packaged food industry. Several strategies have been adopted by manufacturers to meet these requirements; for example, the development of organic other dairy by Marie Morin with the release of a chocolate sponge cake and a crème brûlée product in 2018.


Dairy in France - Category analysis
Butter and Spreads
HEADLINES
PROSPECTS
Domestic demand for butter is on the rise
Volatility in world milk prices negatively impacts butter consumption in France
Margarine and spreads and cooking fats are less appreciated by consumers
COMPETITIVE LANDSCAPE
Competition triggers innovation and product segmentation
Private label and economy butter decline owing to supply shortages
Margarine is abandoned by leading players
CATEGORY DATA
Table 1 Sales of Butter and Spreads by Category: Volume 2013-2018
Table 2 Sales of Butter and Spreads by Category: Value 2013-2018
Table 3 Sales of Butter and Spreads by Category: % Volume Growth 2013-2018
Table 4 Sales of Butter and Spreads by Category: % Value Growth 2013-2018
Table 5 NBO Company Shares of Butter and Spreads: % Value 2014-2018
Table 6 LBN Brand Shares of Butter and Spreads: % Value 2015-2018
Table 7 Distribution of Butter and Spreads by Format: % Value 2013-2018
Table 8 Forecast Sales of Butter and Spreads by Category: Volume 2018-2023
Table 9 Forecast Sales of Butter and Spreads by Category: Value 2018-2023
Table 10 Forecast Sales of Butter and Spreads by Category: % Volume Growth 2018-2023
Table 11 Forecast Sales of Butter and Spreads by Category: % Value Growth 2018-2023
Cheese
HEADLINES
PROSPECTS
Premiumisation helps to revive cheese value growth
Hard cheese is substituting soft cheese, owing to its greater convenience
Alternative types of soft cheese record significant value growth
COMPETITIVE LANDSCAPE
Leading domestic players consolidate their positions with investments in snacking
Diversification into niches is creating value sales growth
Initiatives are put in place to develop local and authentic supply chains
CATEGORY DATA
Table 12 Sales of Cheese by Category: Volume 2013-2018
Table 13 Sales of Cheese by Category: Value 2013-2018
Table 14 Sales of Cheese by Category: % Volume Growth 2013-2018
Table 15 Sales of Cheese by Category: % Value Growth 2013-2018
Table 16 Sales of Spreadable Processed Cheese by Type: % Value 2013-2018
Table 17 Sales of Unprocessed Cheese by Type: % Value 2013-2018
Table 18 NBO Company Shares of Cheese: % Value 2014-2018
Table 19 LBN Brand Shares of Cheese: % Value 2015-2018
Table 20 Distribution of Cheese by Format: % Value 2013-2018
Table 21 Forecast Sales of Cheese by Category: Volume 2018-2023
Table 22 Forecast Sales of Cheese by Category: Value 2018-2023
Table 23 Forecast Sales of Cheese by Category: % Volume Growth 2018-2023
Table 24 Forecast Sales of Cheese by Category: % Value Growth 2018-2023
Drinking Milk Products
HEADLINES
PROSPECTS
Changes in breakfast habits combined with wholesale price volatility cause volume sales to decline
Locally sourced and fairly priced milk is widely requested by consumers
The popularity of milk alternatives is rising in line with new lifestyle trends
COMPETITIVE LANDSCAPE
A regional offering is emerging in drinking milk products
Competition in milk alternatives intensifies
Flavoured milk drinks manufacturer Sodiaal SA is investing in promotions
CATEGORY DATA
Table 25 Sales of Drinking Milk Products by Category: Volume 2013-2018
Table 26 Sales of Drinking Milk Products by Category: Value 2013-2018
Table 27 Sales of Drinking Milk Products by Category: % Volume Growth 2013-2018
Table 28 Sales of Drinking Milk Products by Category: % Value Growth 2013-2018
Table 29 NBO Company Shares of Drinking Milk Products: % Value 2014-2018
Table 30 LBN Brand Shares of Drinking Milk Products: % Value 2015-2018
Table 31 Distribution of Drinking Milk Products by Format: % Value 2013-2018
Table 32 Forecast Sales of Drinking Milk Products Products by Category: Volume 2018-2023
Table 33 Forecast Sales of Drinking Milk Products Products by Category: Value 2018-2023
Table 34 Forecast Sales of Drinking Milk Products Products by Category: % Volume Growth 2018-2023
Table 35 Forecast Sales of Drinking Milk Products Products by Category: % Value Growth 2018-2023
Other Dairy
HEADLINES
PROSPECTS
The decline of family formats in chilled and shelf stable desserts adversely impacts sales, while the premium segment still thrives
Supply shortages constrain cream but demand has returned
The decline of reduced fat and fortified/functional products hurts other dairy
COMPETITIVE LANDSCAPE
Mixed fortunes for leading players
Premium innovations contribute to value growth
Manufacturers look for natural ingredients
CATEGORY DATA
Table 36 Sales of Other Dairy by Category: Volume 2013-2018
Table 37 Sales of Other Dairy by Category: Value 2013-2018
Table 38 Sales of Other Dairy by Category: % Volume Growth 2013-2018
Table 39 Sales of Other Dairy by Category: % Value Growth 2013-2018
Table 40 Sales of Cream by Type: % Value 2013-2018
Table 41 NBO Company Shares of Other Dairy: % Value 2014-2018
Table 42 LBN Brand Shares of Other Dairy: % Value 2015-2018
Table 43 Distribution of Other Dairy by Format: % Value 2013-2018
Table 44 Forecast Sales of Other Dairy by Category: Volume 2018-2023
Table 45 Forecast Sales of Other Dairy by Category: Value 2018-2023
Table 46 Forecast Sales of Other Dairy by Category: % Volume Growth 2018-2023
Table 47 Forecast Sales of Other Dairy by Category: % Value Growth 2018-2023
Yoghurt and Sour Milk Products
HEADLINES
PROSPECTS
Changing consumer habits hurt yoghurt consumption
Niche categories become more popular
Consumers trade up from flavoured yoghurt to plain yoghurt and drinking yoghurt
COMPETITIVE LANDSCAPE
Previously strong functional and high-protein brands suffer
Naturalness and authenticity trend in new product developments
Competition intensifies within free from dairy categories
CATEGORY DATA
Table 48 Sales of Yoghurt and Sour Milk Products by Category: Volume 2013-2018
Table 49 Sales of Yoghurt and Sour Milk Products by Category: Value 2013-2018
Table 50 Sales of Yoghurt and Sour Milk Products by Category: % Volume Growth 2013-2018
Table 51 Sales of Yoghurt and Sour Milk Products by Category: % Value Growth 2013-2018
Table 52 Sales of Flavoured Yoghurt by Flavour: Rankings 2013-2018
Table 53 NBO Company Shares of Yoghurt and Sour Milk Products: % Value 2014-2018
Table 54 LBN Brand Shares of Yoghurt and Sour Milk Products: % Value 2015-2018
Table 55 Distribution of Yoghurt and Sour Milk Products by Format: % Value 2013-2018
Table 56 Forecast Sales of Yoghurt and Sour Milk Products by Category: Volume 2018-2023
Table 57 Forecast Sales of Yoghurt and Sour Milk Products by Category: Value 2018-2023
Table 58 Forecast Sales of Yoghurt and Sour Milk Products by Category: % Volume Growth 2018-2023
Table 59 Forecast Sales of Yoghurt and Sour Milk Products by Category: % Value Growth 2018-2023
Packaged Food in France - Industry Overview
EXECUTIVE SUMMARY
French self-indulge but remain selective and demanding
Another year of food scandals, to the benefit of healthy and natural food
A-brands further widen their lead over private label
Hypermarkets are more than ever giants with feet of clay
Continuous upgrading in the short term
FOODSERVICE
Sales to Foodservice
Things improve in sales to foodservice
Ongoing interplay and mirroring trends between home consumption and foodservice
Growing concentration and diversification in the competitive environment
Consumer Foodservice
The impact of an improved economy and major shifts in consumer behaviour
In a more intense environment, independents underperform chained operators
Digital innovation set to lead to further productivity gains
Category Data
Table 60 Foodservice Sales of Packaged Food by Category: Volume 2013-2018
Table 61 Foodservice Sales of Packaged Food by Category: % Volume Growth 2013-2018
Table 62 Forecast Foodservice Sales of Packaged Food by Category: Volume 2018-2023
Table 63 Forecast Foodservice Sales of Packaged Food by Category: % Volume Growth 2018-2023
MARKET DATA
Table 64 Sales of Packaged Food by Category: Volume 2013-2018
Table 65 Sales of Packaged Food by Category: Value 2013-2018
Table 66 Sales of Packaged Food by Category: % Volume Growth 2013-2018
Table 67 Sales of Packaged Food by Category: % Value Growth 2013-2018
Table 68 GBO Company Shares of Packaged Food: % Value 2014-2018
Table 69 NBO Company Shares of Packaged Food: % Value 2014-2018
Table 70 LBN Brand Shares of Packaged Food: % Value 2015-2018
Table 71 Penetration of Private Label by Category: % Value 2013-2018
Table 72 Distribution of Packaged Food by Format: % Value 2013-2018
Table 73 Distribution of Packaged Food by Format and Category: % Value 2018
Table 74 Forecast Sales of Packaged Food by Category: Volume 2018-2023
Table 75 Forecast Sales of Packaged Food by Category: Value 2018-2023
Table 76 Forecast Sales of Packaged Food by Category: % Volume Growth 2018-2023
Table 77 Forecast Sales of Packaged Food by Category: % Value Growth 2018-2023
DEFINITIONS
SOURCES
Summary 1 Research Sources

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