Competitor Strategies in Dairy Products and Alternatives

Delivery

This report comes in PPT.

Key findings

Multinationals dominate the ranking with their wider coverage and well-established brands

The top 10 list of the dairy products and alternatives industry is mostly occupied by multinationals except for Chinese Yili, Mengniu and Gujarat. While multinationals retain their positions in the ranking thanks to their wider global footprint and well-established brands, domestic players mostly gain through local expertise and agility making them more resilient to unexpected situations, eg supply chain disruptions, over the historic period.

Acquisitions and divestments are a means of expansion and of refocusing capabilities for key players

Acquisitions and strategic divestments are key elements in remaining resilient and securing the healthy expansion of capabilities, enabling manufacturers to be agile and stand out while the competition intensifies. In this regard, key players, eg Nestlé and Danone, are revamping their product portfolios to focus on strategically identified key growth areas and making acquisitions serving their future growth while divesting slow-growing businesses.

Value-added products are a must to stand out while the industry sees sluggish performance

All top companies are focusing on innovations around healthy eating to better respond to consumers’ evolving demand. In this context products fortified with nutrients promoting gut health are becoming prominent. Furthermore, companies are navigating the strategies around tailored products designed specifically for a particular market to go forward in the competition; eg Nestlé’s patent activities for a component specifically designed for Chinese babies in milk formula in 2024.

Private label disrupts by making premium affordable

Consumers are increasingly seeking high-quality products at reasonable prices, especially during a cost-of-living crisis, and private label is stepping up to meet this demand. To compete, brands are exploring new strategies beyond shrinkflation, such as launching family formats with the same quality at a lower unit price. For example, Lactalis launched Parmalat yoghurt in a family size in South Africa.