The Baby Food Market in Italy 2017

The Baby Food Market in Italy 2017

Summary

In 2016, provisional statistics indicate only 474,000 births, 15.4% fewer than in 2006. Although a relatively wealthy country, ranked 29th in the world in 2015, it has struggled in recent years to maintain the standard of living it achieved in the 1990s. The highest standards of living remain in the North of Italy, although the centre is now not far behind. Italians place great emphasis on the quality of food and it is this that influences their purchases, rather than price alone.

Market has been contracting for the past six years and by 2016 stood at 60,989 tons, with value falling to €621 million (current prices), down by 10.6% since 2010. This was due to enforced price decreases in the milks sector and lower prices in real terms in all other sectors of the market, a result of competition between the leading brands, and manufacturers' efforts to stimulate sales. In real terms, value sales have fallen by 17.2% since 2010. Per capita consumption is high at 128.7kg, largely due to the unusually high volumes of wet meals and finger foods consumed.

Unusually, wet meals are the largest category in both volume and value terms, accounting for 49% of consumption and 41.5% of retail sales. Its share has increased, primarily at the expense of dry products and traditional products within the finger food sector. Milks accounted for 29% of retail sales in 2016, up from 28% in 2010. Consumption remains low, due to high prices and an increase in breastfeeding rates. Finger foods claimed 17% of retail sales and 23% of consumption, with rusks often used crumbled as a weaning food. Cereals, dry food, pasta, and drinks together accounted for only 12% of retail sales.

Grocery stores account for the majority of value sales, at 84% in 2016, a share that has been steadily rising since 2010, largely due to the convenience and lower prices often offered by the grocery sector. Distribution trends vary, however, according to product, with first-stage and special dietary baby milks continuing to do relatively well through pharmacy outlets, sanitarie and outlets specializing in children's products, although even here pharmacies are losing ground. Grocery stores are more successful in the sale of post-weaning foods, such as third-stage milks, wet meals, drinks, and finger foods.

Market is dominated by the multinationals Heinz and Danone with a combined 79.5% of value sales and 84% of volume sales in 2016. The only other player of significance, Nestlé, is well behind the leaders, with just 7%. Heinz continues to lead the market, mainly with its Plasmon brand, although it has come under increasing pressure from Danone. Heinz leads in the meals, drinks, and finger foods sectors, while Danone leads in milks and cereals. Other multinationals active on the market include Humana and Hipp, while local brands include the Neolatte milk brand, distributed by Unifarm.

Demand is expected to continue to fall, largely due to the forecast decline in the number of births, and slow economic progress. Between 2016 and 2022 consumption is predicted to decline by 7%, to 56,743 tons, with value growth of 6%, raising retail sales to €655 million in 2022. Per capita consumption is forecast to expand by only 2.3%, to 131.7kg, with the meals & others sector accounting for the majority of intake per baby. Consumption of baby milks, which remains notoriously low in Italy, is expected to continue to increase, to 15.9kg per capita. Meals will achieve the highest increase.

The report The Baby Food Market in Italy 2017 provides extensive and highly detailed current and future market trends in the Italian market.

In particular, this report provides the following analysis -

  • Consumption data based upon a unique combination of industry research, fieldwork, market sizing work and our in-house expertise to offer extensive data about the trends and dynamics affecting the industry.
  • Detailed profile of the companies operating and new companies considering entry in the industry along with their key focus product sectors.
  • Market profile of the various product sectors with the key features & developments, segmentation, per capita trends and the various manufacturers & brands.
  • Overview of baby food retailing with a mention of the major retailers in the country along with the distribution channel.
  • Future projections considering various trends which are likely to affect the industry.
Companies mentioned in this report: Heinz Italia SpA, Danone, Nestlé Italia SpA, Humana Italia SpA, Unifarm SpA, Hipp Italia srl, A Menarini Industrie Farmaceutiche Riunite srl, Granarolo SpA.

Scope
  • Italy's baby population (aged 0-3 years) has declined steadily since a recent peak of just over million babies in 2009. By 2016, the total had dropped to million, a fall of 12.8% compared with 2006.
  • The market for baby food stood at tons in 2016, representing a 12.8% decrease over 2010 adversely affected by the fall in the number of births, as well as by the poor economic situation.
  • Wet meals are the largest category in both volume and value terms, accounting for 49% of consumption and 41.5% of retail sales.
  • All of the leading market players are involved in the local production of baby food. The market is dominated by the multinationals Heinz and Danone with a combined 79.5% of value sales and 83.8% of volume sales in 2016.
  • Vegetable-based and sweet meals account for the vast majority of exports, with milks & cereals accounting for just 5% in 2015.
  • Grocery stores account for the majority of value sales, at 84% in 2016, a share that has been steadily rising since 2010, largely due to the convenience and lower prices often offered by the grocery sector.
Reasons to buy
  • Evaluate important changes in consumer behavior and identify profitable markets and areas for product innovation.
  • Analyse current and forecast behavior trends in each category to identify the best opportunities to exploit.
  • Detailed understanding of consumption by individual product categories in order to align your sales and marketing efforts with the latest trends in the market.
  • Investigates which categories are performing the best and how this is changing market dynamics.


  • Introduction
    • Executive Summary
    • Definitions: Market Sectors
    • Definitions: Terminology
  • Background to the Market
    • Births - Live Birth Rates: In 2016, provisional statistics indicate only 474,000 births, 15.4% fewer than in 2006
      • Table Birth & Population Trends, 2006-2016
    • Births - Live Births by Region: The clear division in birth rates between the urban, industrialized north of Italy and the predominantly rural south has been eroded
      • Table Birth Rate by Area, 2011-2015
    • Births - Live Births by Region: The North currently accounts for almost 46% of births, the Center for 19%, and the South/Islands for the remaining 35%
      • Table Birth Rate by Region, 2011-2015
    • Births - Measures to Boost the Birth Rate: From May 2015, the government introduced a baby bonus for all babies born to low-income families
    • The Consumer: Italy has struggled in recent years to maintain the standard of living it achieved in the 1990s
      • Table Households Not Living in Poverty, 2010-2013
    • The Consumer: The Italians place great emphasis on the quality of their food and it is this that influences their purchases, rather than price alone
      • Table Baby Food Sales, by Geographical Region, 2010
    • The Consumer: Of mothers, 86% consider it important that their babies have a special diet, specifically developed for babies
    • Socio-demographic Trends - Family Structure: By 2015 27.4% of babies were born to mothers outside marriage
      • Table Marriage, Divorce & Childbearing Trends, 1991-2015
    • Socio-demographic Trends - Births by Age of Mother: Under 10% of births are now to women in their early twenties, a major change on the situation a decade or so ago
      • Table Age of Mother at Birth of Baby, 2010-2015
    • Working Women - Female Employment: Women account for just 41.9% of the total number of people employed, a low percentage among OECD countries
      • Table Female Employment Trends, 2010-2016
      • Table Female Employment Rates by Age Group, 2009
    • Regulations: Female employees are legally obliged to be absent from work for two months before and three months after childbirth
    • Regulations: Italy has adopted some of the provisions of the International Code of Marketing of Breast-milk Substitutes, but enforcement is weak
    • Breastfeeding Trends - Promotion: The Ministry of Health has a strategy to try and promote breastfeeding, but no specific costed programs
    • Breastfeeding Trends - Prevalence: Rates of breastfeeding increased appreciably between 2000 and 2013
      • Table Breastfeeding Trends by Region, 2000, 2005 & 2013
    • Breastfeeding Trends - Prevalence: The proportion of mothers exclusively breastfeeding on leaving hospital varies from 64% to 83%
      • Table Breastfeeding Rates on Leaving Hospital, by Region, 2013
    • Breastfeeding Trends - Prevalence: Research in Emilia-Romagna indicates that there has been an increase in breastfeeding rates at three months and five months
      • Table Prevalence in Breastfeeding in Emilia-Romagna, 1999-2011
    • Breastfeeding Trends - Prevalence: The proportion of non-Italian mothers who breastfeed is significantly higher than in the case of Italian mothers
      • Table Breastfeeding in Emilia-Romagna, by Nationality of Mother, 2011
    • Breastfeeding Trends - Prevalence: Figures for the Lombardy region for 2006 and 2012 reveal lower levels of breastfeeding than in the Emilia-Romagna region
      • Table Breastfeeding in Lombardy, 2006 & 2012
    • Breastfeeding Trends - Duration: The average length of breastfeeding increased between 2000 and 2013
      • Table Average Length of Breastfeeding by Region, 2000, 2005 & 2013
  • Market Overview
    • Market Overview: The market has recently been adversely affected by the fall in the number of births, as well as by the poor economic situation
    • Market Overview: Unusually, the most important sector of the Italian market is wet meals with 49% of volume in 2016
      • Table Market Size, 2016, &Growth Rates, 2010-2016
    • Manufacturer Shares: The market is dominated by two multi-nationals: Heinz, which has 44% of the total market, and Danone, which accounts for 36%
      • Table Baby Food: Manufacturer Market Share Trends, % Value, 2010-2016
    • Manufacturer Shares: Danone is the dominant player in milks and cereals, while Heinz leads in all other sectors
      • Table Baby Food: Manufacturer Shares by Sector, % Value, 2016
    • The Future: For the period 2016-2022 as a whole, volume sales are predicted to decline by 7%, to 56,743 tons
      • Table Projected Market Size, 2022, &Growth Rates, 2016-2022
  • Sector Analysis
    • Sector Analysis: Baby Milks
    • Milks Sector Trends: Consumption of baby milks is extremely low by European standards, a fact frequently attributed to the high price of baby milks in Italy
    • Milks Sector Trends: The high prices on the Italian market have continued to be a subject of controversy
    • Milks Per Capita Trends: In 2016, per capita consumption of milks amounted to 15.3kg, one of the lowest levels in Western Europe
    • Milks Segmentation: The largest segment in the milks sector is first-stage milks, which accounted for 37% of volume sales in 2016
    • Milks Segmentation: Milk prices vary tremendously according to channel; pharmacies are in general appreciably more expensive than food outlets
    • Milks Segmentation: The price of special dietary milks now ranges between US$30 and over US$100 per kilogram
      • Table Powdered Baby Milks: Brand Price Analysis, 2017
    • Milks Segmentation: Most mainstream brands retail at between US$20 and US$40 per kg
      • Table Powdered Baby Milks: Brand Price Analysis, 2017
    • Milks Segmentation: Low priced milks tend to be priced between 12.45 and 20.54 per kg
      • Table Powdered Baby Milks: Brand Price Analysis, 2017
    • Milks Segmentation: In general, liquid milks are now considerably more expensive than infant formula in like-for-like terms
      • Table Liquid Baby Milks: Brand Price Analysis, 2017
    • Milks Segmentation: The 800g pack is by far the most popular size of powder formula on the market
    • Milks Manufacturer Shares: Two companies dominate the market, Danone, and Heinz, with a combined 60.5% of value sales
      • Table Baby Milks: Manufacturer Market Shares, Value and Volume, 2010-2016
    • Milks Brands: Danone has a strong presence in all market segments via the Mellin and Aptamil ranges, with Heinz active via Plasmon and Nipiol
    • Milks Brands: In addition to the main brands, there are many brands with a minor presence
    • Sector Analysis: Cereals
    • Cereals Sector Trends: The cereals sector has shrunk by 11% since 2010, to register consumption of 2,172 tons in 2016
    • Cereals Per Capita Trends: In 2016, per capita intake of cereals stood at 4.6kg, one of the lowest levels of cereals intake in Western Europe
    • Cereals Segmentation: Compared with many other European countries, the market remains under-developed and there has been relatively little product innovation
      • Table Baby Cereals: Price Positioning, 2017
    • Cereals Segmentation: Most products retail in 230g, 250g, or 500g boxes
    • Cereals Manufacturers & Brands: Danone`s Mellin brand is largely responsible for Danone's increased dominance in recent years
      • Table Baby Cereals: Manufacturer Market Shares, Value and Volume, 2010-2016
    • Sector Analysis: Baby Meals
    • Meals Trends: The meals sector is the biggest in the Italian baby food market and accounted for 56% of total consumption in 2016
    • Meals Per Capita Trends: In 2016, per capita consumption of meals stood at 72.1kg -a high level by international standards
    • Meals Segmentation: In volume terms, wet meals take an 87.7% share of sales, and the segment has consolidated its position since 2010
    • Meals Segmentation: Packaging and recipe innovation in the wet meals segment have boosted sales here to the detriment of dry meals and pasta
    • Meals Segmentation: Savory wet meals command a wide range of prices, ranging from below US$11 per kg to over 20 per kg for organic products
      • Table Savory Wet Meals: Price Positioning, 2017
    • Meals Segmentation: Fruit desserts and dairy desserts typically range from US$4.50 to US$11 per kg
      • Table Sweet Wet Meals: Price Positioning, 2017
    • Meals Segmentation: On a dry weight basis, dry meals cost US$150-250 per kg, while pasta is a low-price option
      • Table Dry Meals & Pasta: Price Positioning, 2017
    • Meals Segmentation: Italy is a conservative market and as a result the majority of savory meals and many fruit purées are sold in jars
    • Meals Manufacturer Shares: Heinz has suffered in the face of stronger competition from Danone
      • Table Baby Meals: Manufacturer Market Shares, Value and Volume, 2010-2016
    • Meals Manufacturer Shares: Heinz and Danone are the only major manufacturers to be present in all three segments of the meals sector
      • Table Baby Meals: Manufacturer Market Shares by Segment, Value, 2016
    • Meals Brands: Heinz operates via three brands - Plasmon, Nipiol, and Dieterba - and is the clear leader in the wet meals and pasta segments
    • Meals Brands: Nestlé is now only active in the sweet wet meals segment
    • Sector Analysis: Baby Drinks
    • Drinks Trends: The drinks sector is the smallest category in the Italian baby food market in terms of value
    • Drinks Per Capita Trends: Expenditure per baby dropped by 26% to 33.1 (US$36.8) at current prices between 2010-2016
    • Drinks Segmentation: The majority of sales in the drinks sector comprise juices or nectars, although granulated teas are also widely available
      • Table Baby Drinks: Price Positioning, 2017
    • Drinks Segmentation: The normal size for juices is 125ml bottles, although Hipp offers larger, 300ml and 500ml, products
    • Drinks Manufacturer and Brand Shares: This small market is largely in the hands of two companies, Heinz, the leader, and Danone
      • Table Baby Drinks: Manufacturer Market Shares, Value and Volume, 2010-2016
    • Sector Analysis: Baby Finger Foods
    • Finger Foods Trends: In 2016, consumption of finger foods stood at 14,282 tons, equivalent to 23.4% of the total baby food market
    • Finger Foods Per Capita Trends: In 2016, per capita intake of finger foods amounted to 30kg, very high by international standards, but down by 8% on 2010
    • Finger Foods Segmentation: The last few years have seen the arrival of a few "modern" snacks, including baby puffs and rice cakes
    • Finger Foods Segmentation: Prices range widely, from US$3.30 to US$11 for traditional biscotti to US$13 to US$40 for more sophisticated products
      • Table Finger Foods: Price Positioning, 2017
    • Finger Foods Manufacturer Shares: Heinz has long enjoyed a dominant position in the finger foods sector
      • Table Finger Food: Manufacturer Shares, 2010-2016
  • Production and Trade
    • Production: All of the leading market players are involved in the local production of baby food
    • Imports: The bulk of imports consist of cereals & milks (74% of volume imports in 2015)
    • Exports: Exports of baby food - dominated by baby meals and the like - are considerably lower than imports, but have risen strongly over the last few years
  • Company Profiles
    • Company Profiles: Together, Heinz and Danone accounted for 79.5% of value sales in 2016 and 83.8% of volume sales
    • Company Profiles: Heinz Italia SpA
    • Company Profiles: Danone
    • Company Profiles: Nestlé Italia SpA
    • Company Profiles: Humana Italia SpA
    • Company Profiles: Other Manufacturers
  • Distribution
    • Retail Structure: Hypermarkets, supermarkets and hard-discounters accounted for 44% of packaged food sales in 2016, although food and drinks specialist retain a strong role
      • Table Packaged Food Sales by Channel, Billion, 2010-2016
    • Baby Food Retailing: Over half of all sales of baby milks now occur via grocery outlets and children's stores, and more than four-fifths of overall baby food sales
      • Table Baby Food: Sales by Outlet Type, 2010-2016
    • Baby Food Retailing: Pharmacies remain an important outlet for baby milks, although they have lost considerable ground in recent years
      • Table Baby Milks: Sales by Outlet Type, % Value, 2001 & 2005
    • Baby Food Retailing: Within the organized distribution sector, supermarkets account for over half of baby food sales and hypermarkets for a further third
      • Table Baby Food Sales, by Type of Food Outlet, 2010
      • Table Pharmacy Sales, by Type of Baby Food, 2011/2012
  • Economic Background
    • Economic Background: Since 2014, the economy has begun a modest recovery
      • Table Italy: Key Macro-Economic Indicators, 2010-2017
    • Key Macro-economic Forecasts: Inflation fell heavily in 2014 and in 2015 and 2016 was almost non-existent, but is expected to pick up from 2017
      • Table Key Macro-Economic Forecasts, 2016-2022
  • Prospects and Forecasts
    • Birth and Population Projections: Despite the fact that Italy already has the lowest birth rate in the EU, ISTAT projections continue to forecast a decline in the birth rate
      • Table Birth & Population Projections, 2010-2022
    • Forecast Overview: Prospects for baby food sales over the next few years are not bright
    • Future Trends: GlobalData estimates that value sales will increase by 5.6% at current prices by 2022, to reach 655 million, but consumption will shrink
  • Appendix
    • Appendix - The Baby Population: Between 2016 and 2022, the baby population of Italy is expected to register decline of 10.7% to just over 1.3 million
      • Table Baby Population, Number of Babies, 2006-2022
    • Appendix - The Baby Population: The number of women of childbearing age will continue to decline, from 13.2 million in 2016 to 11.8 million in 2022
      • Table Number of Women of Childbearing Age by Age Group, 2016 & 2022
    • Appendix - Market Value: The value of the market stood at 621 million at current prices in 2016, down by 10.6% since 2010
      • Table Baby Food: Market Value, Current Prices, 2010-2016
    • Appendix - Market Value: In real terms, the market has recorded a fall of 17.2% since 2010
      • Table Baby Food: Market Value, Constant Prices, 2010-2016
    • Appendix - Market Value: In 2016, the market stood at US$688.8 million - a fall of 25.4% since 2010
      • Table Baby Food: Market Value, US$ Million, 2010-2016
    • Appendix - Market Volume: The market for baby food in Italy stood at 60,989 tons in 2016, representing a 12.8% decrease over the 2010 level
      • Table Baby Food: Market Volume, Tons, 2010-2016
    • Appendix - Per Capita Expenditure: Spend per baby has risen by 6% at current prices, and in 2016 stood at 1,309
      • Table Baby Food: Per Capita Expenditure, Current Prices, 2010-2016
    • Appendix - Per Capita Expenditure: In real terms, expenditure per baby fell by 1.9% between 2010 and 2016
      • Table Baby Food: Per Capita Expenditure, Constant Prices, 2010-2016
    • Appendix - Per Capita Expenditure: Per capita expenditure dropped by 11.5% to US$1,453, with wet meals the only sector to show growth between 2010 and 2016
      • Table Baby Food: Per Capita Expenditure, US Dollars, 2010-2016
    • Appendix - Per Capita Consumption: Per capita consumption of baby food rose from 124.4kg in 2010 to 128.7kg by 2016
      • Table Baby Food: Per Capita Consumption, Grams, 2010-2016
    • Appendix - Milks: Despite growth in per capita consumption derived from existing low levels, the sector has failed to make headway
      • Table Baby Milks: Sector Trends, 2010-2016
    • Appendix - Milks: Increases in the size of the growing-up milks segment and declines elsewhere saw growing-up milks take 16% of sales by 2016
      • Table Baby Milks Segmentation, Value & Volume, 2010-2016
    • Appendix - Milks: Danone's broad product range covers the full spectrum of price positions
      • Table Baby Milks Powder: Brand Price Analysis, 2017
    • Appendix - Milks: Heinz's Plasmon brand's standard products occupy the lowpriced segment, but it has a range of premium-priced special formulae
      • Table Baby Milks Powder: Brand Price Analysis, 2017
    • Appendix - Milks: Nestlé occupies the lower end of the price scale, and even its special formulae are positioned in the mid-priced segment
      • Table Baby Milks - Powder: Brand Price Analysis, 2017
    • Appendix - Milks: Unifarm's Neolatte is one of the cheapest brands on the market
      • Table Baby Milks - Powder: Brand Price Analysis, 2017
    • Appendix - Milks: Aptamil is Danone's most expensive brand, with Heinz fielding Plasmon at a slightly lower price; likewise Mellin is higher priced than Nipiol
      • Table Baby Milks - Liquid: Brand Price Analysis, 2017
    • Appendix - Milks: Nestlé Mio is the cheapest liquid milk available
      • Table Baby Milks - Liquid: Brand Price Analysis, 2017
    • Appendix - Cereals: The cereals sector is small and is declining in the face of heightened competition from wet meals and finger foods
      • Table Baby Cereals: Sector Trends, 2010-2016
    • Appendix - Meals: Baby meals form the largest sector, representing over half of volume, and the sector is gaining share
      • Table Baby Wet Meals: Sector Trends, 2010-2016
    • Appendix - Meals: Wet meals take an 88% share of sales, and the segment has consolidated its position since 2010
      • Table Baby Meals: Sector Segmentation, Value and Volume, %, 2010-2016
    • Appendix - Drinks: Sales of drinks have dropped by a third to stand at 3,140 tons in 2016
      • Table Baby Drinks: Sector Trends, 2010-2016
    • Appendix - Finger Foods: The finger foods sector is significant and accounts for almost a quarter of baby food volumes, but has fallen back by 23%
      • Table Baby Finger Foods: Sector Trends, 2010-2016
    • Appendix - Imports: After rising strongly between 2010 and 2012, imports have since fallen back, although milks have continued to grow
      • Table Imports of Baby Food by Type, Volume & Value, 2010-2015
    • Appendix - Imports: Poland has taken over from the Netherlands as the leading supplier of baby milks and cereals, with France also significant
      • Table Imports of Milks & Cereals by Country of Origin, Volume & Value, 2013-2015
    • Appendix - Imports: Spain and Germany account for the bulk of imports of other baby food
      • Table Imports of Other Baby Food by Country of Origin, Volume & Value, 2013-2015
    • Appendix - Exports: Exports of milks are low, but Italy is a significant exporter of other baby foods and volumes have been rising
      • Table Exports of Baby Food by Type, Volume & Value, 2010-2015
    • Appendix - Exports: Iraq dominated exports of milks & cereals in 2015, whereas in earlier years, small quantities have been exported to a variety of destinations
      • Table Exports of Milks & Cereals by Country of Destination, Volume & Value, 2013-2015
    • Appendix - Imports: The UK is the largest destination for other baby food, with the remainder split between a number of countries around the world
      • Table Exports of Other Baby Food by Country of Destination, Volume & Value, 2013-2015
    • Appendix - Value Forecasts: The market will grow to 655 million by 2022, with all sectors except drinks achieving some increase
      • Table Baby Food: Market Value Forecasts, Current Prices, 2016-2022
    • Appendix - Value Forecasts: In real terms, the market will shrink by 2.4%, although sales of finger foods will show a marginal increase
      • Table Baby Food: Market Value Forecasts, Constant Prices, 2016-2022
    • Appendix - Value Forecasts: The overall market will increase by 5.6% between 2016 and 2022, with growth rates picking up from 2020
      • Table Baby Food: Market Value Forecasts, US$ Million, 2016-2022
    • Appendix - Volume Forecasts: Consumption will decline by 7% between 2016 and 2022, reducing the market to 56,743 tons
      • Table Baby Food: Market Volume Forecasts, Tons, 2016-2022
    • Appendix - Per Capita Forecasts: Expenditure per baby will rise to 1,520 by 2022, fueled by buoyant growth in meals and finger foods
      • Table Baby Food: Per Capita Expenditure, Current Prices, 2016-2022
    • Appendix - Per Capita Forecasts: In real terms, per capita expenditure will increase by 7%
      • Table Baby Food: Per Capita Expenditure, Constant Prices, 2016-2022
    • Appendix - Per Capita Forecasts: Expenditure will increase by 16% between 2016 and 2022
      • Table Baby Food: Per Capita Expenditure, US Dollars, 2016-2022
    • Appendix - Per Capita Forecasts: Per capita consumption will show small annual increases, rising to 131.7kg by 2022
      • Table Baby Food: Per Capita Consumption, Grams, 2016-2022
    • Summary Methodology
    • About GlobalData

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