Sliced and grated Cheddars are the rising stars in the cheese category, says Dairy Crest marketing director Richard Tolley.
According to TNS data, convenience formats such as sliced and grated are enjoying impressive growth year on year - 23% in value and 20% in volume - while the total cheese market in convenience is down by 3.1% in value and 3.3% volume.
"Sliced and grated is an opportunity for convenience stores and an area they can work harder on," says Tolley.
While sales of block cheese declined last year the top two brands, Cathedral City and Pilgrim's Choice, are both in growth, by 18% and 16% respectively. Wyke Farms, an up-and-coming brand in the cheese sector with 42% growth in the total market last year, also drew £11m in revenue from c-stores in 2006, representing 33% growth year on year, according to AC Nielsen data. "The general trend is that brands are doing very well and own label is going backwards, particularly in mature Cheddar," says Tolley.
He puts this trend down to increased marketing spend among branded cheeses. "Cathedral City is back on air now with an £8m spend this year. Sales are up 18% to £125m and the advertising has helped that growth. This year it's all about Cathedral City Lighter, which launched in February and comes in a 200g pack for c-stores.
"This pack size is ideal for top-up or for smaller households. We will see how that progresses throughout the year and will look at more convenience formats. There may be snacking opportunities for lighter, or grated and sliced offers."
While cheese is an important category in convenience stores, retailers are still missing a huge opportunity. "Our research shows that cheese is in 31% of baskets in the multiples, but only 11% of baskets in convenience stores," says Tolley. "Milk is in 36% of baskets in convenience and 34% in convenience stores, so we see cheese as a huge opportunity. Retailers need to offer a tight, meaningful range and make the fixture easy to shop. They need to offer a depth of range with the key Cheddar brands and supplement the range with some continental cheeses such as brie and other soft cheeses."

Cheese snacks

The cheese snacks sector is growing in both value and volume at 5.4% and 5.7% respectively, reveals Sarah Petts, channel and communications manager at Kraft Foods, which manufactures the Dairylea and Philadelphia brands.
The cheese snacks sector is split into two sub-sectors - adult snacks and kids' snacks. Kids' cheese snacks is the largest sector and growing at a rate of 1.7% year on year to £135m. The top three sellers are Dairylea, Babybel and Cheestrings.
Dairylea Dunkers is in 16% growth, which Petts puts down to product development such as the launch of Dunkers Baked.
He says: "Lunch combinations such as Dairylea Lunchables are also performing well and up 5% in value. Lunchables has benefited from improvements to the nutritional content and now has added vitamin D to help the absorption of calcium. Salt and saturated fat levels have also been reduced."
But it's the adult cheese snacks sector that Petts says is the most exciting. "It's only small at the moment at £19m, but is in huge growth of 42% and is a sector retailers shouldn't ignore." The top three sellers are Brunchetta, Philadelphia Splendips and Cathedral City Dip & Go.
"Adult consumers want portion- and calorie-controlled snacks," says Petts. "Reduced fat cheese snacks are an ideal alternative to crisps."
Petts says the trick is to stock the right combination of top sellers. "Dedicate space relevant to the size of the category. It's worth doubling up on top sellers to create impact. Shelf-ready display outers are also good for c-stores because it gives the best-sellers more impact and makes it easier for the retailer to merchandise."

meet the supplier

Supplier: MJ Morris & Son
Background: MJ Morris & Son is a third-generation family business which has been supplying fresh produce since 1941. The company sources a broad range of prepared, prepacked and loose vegetables, fruit, salad and exotic produce from top English, European and International growers. It also supplies fresh flowers and indoor and outdoor plants.
Over recent years MJ Morris has developed prepacked goods for the convenience market. Flow-wrap lines are produced daily for optimum freshness. The company offers retailers advice on handling, storing and merchandising fresh produce, as well as controlling wastage.
Recent launches: Micro-Steam range of vegetables
Distribution: As north as Scarborough, south as Dagenham, and east and west as Norfolk and Shropshire.

in brief

Rachel's Organic is reducing its carbon footprint by making its 450g yogurt pots from mainly biodegradable cardboard instead of plastic.
Marketing director Steve Clarke says: "The pots provide an environmentally friendly solution to packaging. They will vastly reduce non-renewable waste going to landfill."
Yeo Valley Organic is giving away thousands of trees to buyers of its milk and natural yogurt product.
For eight weeks from this week, Yeo Valley Organic will give shoppers a free tree, complete with support cane and tree guard, in return for five labels collected from its milk and organic yogurts.
Eight labels will provide two trees, and for anyone not wanting a tree the brand will make donations to The Woodland Trust in return for the labels.
The promotion is part of a £3m support package for the brand this year.
This month's New Covent Garden Food Co soup of the month celebrates its association with the Royal Horticultural Society.
The 600g Kitchen Garden soups will be in-store until May 13 and retail for £1.99.
The packs will feature an added value offer, allowing consumers to take advantage of reduced price membership to the Royal Horticultural Society.
Danish Bacon kicks off a marketing campaign this month that focuses on the much-loved bacon sandwich. The print, broadcast and internet campaign encourages consumers to look for the Danish 'sizzle' when selecting bacon.
The ads will direct consumers to a micro website to share their 'perfect sandwich moment' and win prizes.