Consumers have been living through a difficult period in Western Europe in recent years, with inflation hitting unprecedented levels in some countries, following fast on the heels of the upheavals caused in the region by the pandemic. In addition, baby food is struggling for growth in a number of countries given the low or even falling birth rates. While dairy products are moving through a mixed landscape performance-wise, plant-based dairy has at least generally maintained its dynamism.
This report comes in PPT.
Plant-based dairy is expected to continue seeing dynamic growth in Germany, which is already home to the region’s biggest market for these products. In addition to the growing flexitarian, vegetarian and vegan segments, a sizeable proportion of the general public is also reducing their consumption of animal-based products, motivated by health concerns, environmental awareness and ethical considerations.
In Italy, the growing demand for protein-rich foods was a major trend in 2024. Driven by rising health consciousness, consumers are increasingly seeking dairy items high in protein but low in fat, with players therefore focusing on developing high-protein versions of dairy products. This trend is also extending beyond major dairy items to include products typically aimed at a youth audience, such as chilled snacks.
Modern grocery retailers dominate sales in Western Europe, with discounters, already the main distribution channel in Germany, making major gains in Turkey and becoming the leading sales mode in this country over 2019-2024. The strength of the modern grocery retailers can also be seen in the leadership of private label, which accounts for a third of regional retail value sales.
The second set of HFSS regulations are set to be introduced in the UK in October 2025. These will include limitations on multibuy offers and a ban on advertising both online and on television. This will likely continue to push brand owners to reformulate any products high in fat, salt or sugar ahead of the upcoming legislation.
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