2023
9
UK Dairy and Dairy Alternative Drinks, Milk and Cream Market Report 2023
2023-08-01T04:05:04+01:00
OX1158185
2995
165412
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Report
en_GB
“The income squeeze and eye-watering price rises have prompted consumers to scrutinise even their use of the household staple that is milk, volumes falling sharply. Once household incomes regain momentum,…

UK Dairy and Dairy Alternative Drinks, Milk and Cream Market Report 2023

$ 2,995 (Excl.Tax)

Description

Stay ahead of the curve and future-proof your business with Mintel’s UK Dairy and Dairy Alternative Drinks, Milk and Cream Market Report 2023. Our full report is packed with consumer-led market intelligence, the latest UK dairy market trends and consumer behaviours affecting your business. Get a 360° view of the dairy and dairy alternatives industry, including market size, share and forecasted growth to help you align your business strategy with the needs of your audience.

Below, we’ve handpicked the key insights analysed in the full report and summarised the core topics.

Topics Analysed in this Report

  • The impact of the cost-of-living crisis on the UK dairy market.
  • Trends in launch activity in the dairy and dairy alternatives market, and opportunities for further innovation.
  • Usage of different types of cow’s milk and plant-based alternatives, as well as cream.
  • Consumer behaviours related to the UK dairy market.

UK Dairy Market Outlook

The cost of living crisis and the eye-watering price rises seen by white milk has prompted many people to scrutinise their use of even this kitchen staple. Once household finances regain momentum, the UK dairy market will come under threat from the pricier on-the-go and foodservice occasions stealing share from at-home ones. However, this should also start to facilitate trading up within the dairy and dairy alternatives market, including from cow’s milk to plant-based alternatives.

  • UK dairy milk market size: In 2023 price rises have fueled value growth of 12% to an estimated £6 billion.

Dairy and Dairy Alternatives Market Trends and Opportunities

Dairy milks continue to explore sustainability

The income squeeze has put a keener spotlight on food waste and recyclability. Various brands in the UK dairy market have led innovation by adapting their packaging by including freezing instructions and replacing the coloured milk bottle caps with clear ones to help improve recyclability. Several plant-based alternative brands are also introducing a 1-litre-sized carton for their fresh milk ranges.

Growing demand for barista-style dairy

Barista-style dairy milk appeals widely and warrants attention. Such products hold much-needed potential for dairy milk to engage younger generations. This interest bodes well for Müller’s launch of a Barista milk in June 2023, the first major brand to do so in the cow dairy market, though the challenge remains to justify its premium price.

  • UK dairy milk opportunity: 23% of those who have bought milk, milk drinks or cream are interested in buying barista-style dairy.

To learn more about the UK Dairy and Dairy Alternative market, including a five-year forecast, analysis of consumer behaviour, and recommendations for market opportunities, purchase our full UK Dairy and Dairy Alternative Market Report.

Leading Brands in the UK Dairy Market

Arla, Cravendale, Alpro, Oatly, Freshways, Müller Milk & Ingredients, Graham’s, Yeo Valley.

Additional Features Included with Your Purchase

  • Interactive Data Book: This gives you unlimited access to a consumer confidence tracker that is segmented into 25 different demographic categories.
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  • Mintel’s Clients Portal: Our portal offers instant access to actionable analysis and trends pieces relevant to your industry that are published almost daily. You can also browse for more market research reports.

Expert Insights from a Drinks Analyst

This report, written by Isabelle Shilling, a leading drinks analyst, delivers in-depth commentary and analysis to highlight trends in the dairy and dairy alternatives market and add expert context to the numbers.

The income squeeze and eye-watering price rises have prompted consumers to scrutinise even their use of the household staple that is milk, volumes falling sharply. Once household incomes regain momentum, the market faces rising competition from out-of-home occasions. However, this will also facilitate trading up in the market and allow sustainability to become more front-of-mind again, supporting the growth of the plant-based segment, and dialling up the pressure on the dairy segments to convince shoppers of their green efforts.”

Isabelle Shilling
Research Analyst

Table of Contents

  1. Overview

      • Key issues covered in this Report
        • Products covered in this Report
        • Executive Summary

            • The five-year outlook for the category
              • Figure 1: Category outlook, 2023-28
            • The market
              • Market size and forecast
                • Figure 2: Market forecast for UK retail value sales of dairy and dairy alternatives, milk and cream, 2018-28
              • White milk and cream struggle in 2022, flavoured milk leaps ahead
                • Figure 3: Retail value sales of white milk, flavoured milk and cream, 2020-23
              • Cost pressures fuel sharp rises in farmgate prices of milk in 2022
                • Figure 4: United Kingdom farmgate milk price, January 2017- April 2023
              • Companies and brands
                • Own-label extends its lead in white milk
                  • Figure 5: Leading brands’ sales and shares in the UK retail white milk^ market, 2020/21-2022/23
                • Plant-based drinks attract further NPD
                  • Dairy milks continue to explore sustainability
                    • Adspend rose sharply in 2022
                      • The consumer
                        • Milk enjoys near-universal usage
                          • Figure 6: Usage of milk, by type, 2022 and 2023
                        • Two in five worry about dairy farming’s greenhouse gas emissions; Keen interest in more tips on using plant-based milk/cream
                          • Figure 7: Behaviours related to dairy and dairy alternative drinks, milk and cream, 2023
                        • Barista-style dairy milk appeals widely; world cuisines hold potential for flavoured milk
                          • Figure 8: Concepts of interest in dairy and dairy alternative drinks, milk and cream, 2023
                      • Issues and Insights

                        • Income squeeze has mixed effects on the market
                          • Highlight dairy industry’s commitment to sustainability
                            • Empower consumers to use plant-based milk and cream by giving more usage instructions
                            • Market Size and Performance

                              • Volumes fall in 2022 in the absence of COVID restrictions and amid pressure on household incomes
                                • Figure 9: Market size for UK retail value and volume sales of dairy and dairy alternatives, milk and cream, 2018-23
                            • Market Forecast

                              • Category outlook
                                • Figure 10: Category outlook, 2023-28
                              • Slow volume decline expected over 2023-28
                                • Figure 11: Market forecast for UK retail value sales of dairy and dairy alternatives, milk and cream, 2018-28
                                • Figure 12: Market forecast for UK retail volume sales of dairy and dairy alternatives, milk and cream, 2018-28
                              • Learnings from the last income squeeze
                                • Forecast methodology
                                • Market Segmentation

                                  • Value soars whilst volumes drop for white milk in 2022
                                    • Figure 13: Retail value and volume sales of white milk, by fresh and long-life, 2020-23
                                  • Oat milk remains the star performer as white milk struggles in 2022
                                    • Figure 14: Retail value and volume sales of white milk, by type, 2020-23
                                  • Cream volumes fall in 2022 in the absence of COVID restrictions
                                    • Figure 15: Retail value and volume sale of cream, by type, 2020-23
                                  • RTD coffee posts strong growth in 2022
                                    • Figure 16: Retail value and volume sales of flavoured milk, dairy smoothies, milk modifiers and breakfast and coffee drinks, 2020-23
                                • Market Drivers

                                  • Inflation is the key concern for consumers
                                    • Further interest rates increases will hit mortgage-holders
                                      • High inflation and rising interest rates will compound the impact of the slowing recovery
                                        • Consumer spending power will be curbed
                                          • Low unemployment is helping to underpin consumer confidence
                                            • Consumers’ financial wellbeing has fallen from the highs of 2021…
                                              • Figure 17: Household financial wellbeing index, 2016-23
                                            • …and most people are feeling the effects of price rises
                                              • Income squeeze has mixed effects on the market
                                                • Cost pressures fuel sharp rises in farmgate prices of milk in 2022
                                                  • Figure 18: United Kingdom farmgate milk price, January 2017- April 2023
                                                • Retail price of milk rises 64% in 18 months to December 2022
                                                  • Figure 19: Average retail price of pasteurised milk, January 2017-April 2023
                                                • Interest in sustainability expected to rebound
                                                  • Sustainability features on government’s food strategy, but dairy reduction doesn’t
                                                    • Spotlight on the environment fuels dairy reduction
                                                      • HFSS volume promotions ban postponed until 2025
                                                      • Market Share

                                                        • Own-label extends its lead in white milk
                                                          • Oatly retains volumes to gain share
                                                            • Figure 20: Leading brands’ sales and shares in the UK retail white milk^ market, 2020/21-2022/23
                                                          • Elmlea and Rodda’s gain value share
                                                            • Figure 21: Leading brands’ sales and shares in the UK retail cream market, 2020/21-2022/23
                                                          • RTD coffees continue to appeal
                                                            • Figure 22: Leading brands’ sales and shares in the UK retail flavoured milk market, 2020-21/-2022/23
                                                        • Launch Activity and Innovation

                                                          • Plant-based drinks continue to attract NPD
                                                            • More activity in “barista” variants
                                                              • Figure 23: Oatly product launches, 2022-23
                                                              • Figure 24: Launches of “barista” plant-based milk alternatives, 2022
                                                            • Rude Health branches out into no-sugar products
                                                              • Figure 25: Rude Health No Sugars Organic Oat Drink launch, 2023
                                                            • Nestlé relaunches Wunda with new design, before pulling the brand
                                                              • Packaging updates in plant-based milk
                                                                • Figure 26: Mighty Ultimate Oat Barista M.lk, 2023
                                                              • More plant-based NPD in flavoured milk and cream
                                                                • Figure 27: Jörd Oat & Vanilla Drink Launch, 2022
                                                              • Plant-based milk brands explore powder formats
                                                                • Figure 28: Overherd Oat Drink Powder launches, 2023
                                                              • Arla expands its B.O.B range, Müller launches Barista milk
                                                                • Figure 29: Arla B.O.B Semi-Skimmed Milk and Müller Barista Milk, 2023
                                                              • Milkshake brands look to create a more premium feel, Starbucks pushes on-shelf standout
                                                                • Figure 30: Flavoured milk packaging revamps, 2022-23
                                                              • A spotlight on milk waste
                                                                • Dairy companies look to improve recyclability
                                                                  • Clear milk lids for own-label, Yeo Valley switches to cartons
                                                                    • Figure 31: Fresh milk new packaging launches, 2022-23
                                                                  • Müller cream pots adopt recycled plastic, Yazoo Kids range switches to cartons
                                                                  • Advertising and Marketing Activity

                                                                    • Adspend rocketed by 69% in 2022
                                                                      • Figure 32: Total above-the-line, online display and direct mail advertising expenditure on dairy and dairy alternative drinks, milk and cream, 2019-2023
                                                                    • Arla remains the top spender…
                                                                      • Figure 33: Total above-the-line, online display and direct mail advertising expenditure on dairy and dairy alternative drinks, milk and cream, by advertiser (sorted by 2022), 2019-2023
                                                                    • …and highlights its new higher welfare standards for Cravendale
                                                                      • Jörd uses experiential activity to promote oat alternative range
                                                                        • Alpro promotes new This is Not M*lk range with ‘M*lk Believe’ campaign
                                                                          • Moma launches new campaign as part of growth strategy
                                                                            • Dairy drinks brands focus on taste and indulgence
                                                                              • Chocomel and Shaken Udder launch debut TV ads in 2023
                                                                                • Shaken Udder launches TV first
                                                                                  • Müller Dairy continues to push its ‘Feel The Urjj’ message
                                                                                    • Emmi repeats Love Island tie-up
                                                                                      • Dairy milk highlights its sustainability credentials
                                                                                        • AHDB spotlights importance of red meat and dairy through TV ad
                                                                                          • Dairy UK launches new sustainability-focused campaign
                                                                                            • Nielsen Ad Intel coverage
                                                                                            • Brand Research

                                                                                                • Müller seen as most trusted brand
                                                                                                  • Figure 34: Attitudes towards and usage of selected brands, 2023
                                                                                                • Key brand metrics
                                                                                                  • Figure 35: Key metrics for selected brands, 2023
                                                                                                • Plant-based alternatives come up top in associations will wellbeing
                                                                                                  • Figure 36: Attitudes, by brand, 2023
                                                                                                • Plant-based and organic brands take lead in ethical image
                                                                                                  • Figure 37: Brand personality – macro image, 2023
                                                                                                  • Figure 38: Brand personality – micro image, 2023
                                                                                              • Usage of Dairy and Dairy Alternative Drinks, Milk and Cream

                                                                                                • Milk enjoys near-universal usage
                                                                                                  • Figure 39: Usage of milk by type, 2022 and 2023
                                                                                                • One in three people use plant-based milks
                                                                                                  • Top income households and under-65s show highest usage of plant-based milk
                                                                                                    • Cream usage rebounds from 2022 ebb
                                                                                                      • Figure 40: Usage of cream by type, 2022 and 2023
                                                                                                  • Behaviours Related to Dairy and Dairy Alternative Drinks, Milk and Cream

                                                                                                    • Two in five worry about dairy farming’s greenhouse gas emissions
                                                                                                      • Figure 41: Behaviours related to dairy and dairy alternative drinks, milk and cream, 2023
                                                                                                    • Highlight dairy industry’s commitment to sustainability
                                                                                                      • Figure 42: Norrmejerier white milk launch highlighting its climate-friendly credentials, 2023
                                                                                                    • Methane reduction sparks wide appeal
                                                                                                      • Figure 43: Dairy launches highlighting methane reduction, 2021-22
                                                                                                    • Eco-scores interest two in five
                                                                                                      • Figure 44: Better Naked Pork Chipolatas with Eco Impact score, 2022
                                                                                                    • Eco-score framework recommendations to be delivered in 2023
                                                                                                      • Precision fermentation holds potential
                                                                                                        • Figure 45: Bored Cow Animal-Free Dairy Milk, 2023
                                                                                                      • Genetic Technology Bill paves the way for progress
                                                                                                        • Marketing of precision fermentation will play a key role in its appeal
                                                                                                          • Empower consumers to use plant-based milk and cream by giving more usage instructions
                                                                                                            • Keen interest in more tips on using plant-based milk/cream
                                                                                                              • Untapped potential for on-pack communication
                                                                                                                • Figure 46: Plant-based milks with on-pack usage advice, 2023
                                                                                                              • Swap tips and flagging up pairings stand to unlock new occasions
                                                                                                                • Figure 47: Kellogg’s and Alpro tie-up in-store, 2023
                                                                                                            • Concepts of Interest in Dairy and Dairy Alternative Drinks, Milk and Cream

                                                                                                              • Barista-style dairy milk appeals widely
                                                                                                                • Figure 48: Concepts of interest in dairy and dairy alternative drinks, milk and cream, 2023
                                                                                                                • Figure 49: Müller Barista Milk and Arla Latte Art Milk, 2023
                                                                                                              • Pressures on household budgets pose challenges and opportunities for added value products
                                                                                                                • World cuisines hold potential for flavoured milk
                                                                                                                  • Figure 50: Flavoured milks featuring international flavours, 2022-23
                                                                                                              • Appendix – Data Sources, Abbreviations and Supporting Information

                                                                                                                  • Abbreviations
                                                                                                                    • Consumer research methodology
                                                                                                                    • Appendix – Forecast Methodology

                                                                                                                      • Market forecast and prediction intervals
                                                                                                                        • Figure 51: Market size and forecast for UK retail value and volume sales of dairy and dairy alternatives, milk and cream, 2018-28
                                                                                                                        • Figure 52: Market forecast and prediction intervals for UK retail value sales of dairy and dairy alternatives, milk and cream, 2023-28
                                                                                                                        • Figure 53: Market forecast and prediction intervals for UK retail volume sales of dairy and dairy alternatives, milk and cream, 2023-28
                                                                                                                      • Market drivers and assumptions
                                                                                                                        • Forecast methodology
                                                                                                                        • Appendix – Market Share

                                                                                                                            • Figure 54: Leading manufacturers’ sales and shares in the UK retail white milk^ market, 2020/21-2022/23
                                                                                                                            • Figure 55: Leading manufacturers’ sales and shares in the UK retail cream market, 2020/21-2022/23
                                                                                                                            • Figure 56: Leading brand owners’ sales and shares in the UK retail flavoured milk market, 2020-21/-2022/23

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