Affordable premiumisation and healthy innovation boost Britain’s biggest brands

Posted by Daniel Palmer on 30th September 2008

The results of TNS Worldpanel’s annual Biggest Brands survey for Marketing magazine show significant growth for brands who offer innovation in the areas of healthy eating and/or ‘affordable’ premium products. Cadbury came out on top of this year’s biggest brands list with sales of up to £590 million. Heinz, Kellogg’s, Walkers Crisps and Warburtons rounded out the top five biggest brands in Britain.

Brands such as Walkers (+11%), McVitie’s (+16%), Danone (+11) and Weight Watchers (+11) have all seen growth following the introduction or re-positioning of health benefits, a key trend over the past few years. Walker’s reduction of saturated fat and introduction of Sunbites, or the continuing development of McVitie’s Go-Ahead are key examples.

Brands such as Heinz (+11%), Kellogg’s (+4%), and Muller (+9%) continue to attract consumers with innovations that can be described as “affordable premium” – satisfying consumer demand for more indulgent, premium-like products without an extreme price tag. TNS point to Kellogg’s new offerings such as Multigrain Cornflakes and Chocolate Wheats, and Heinz’s innovations in the soup market such as Farmers’ Market, as sound examples helping to boost these brands.

“Healthy eating is of great importance to British consumers, and the success of brands who offer product innovations that are positioned to meet this need, proves that this trend is still very strong,” Chris Longbottom, Research Director at TNS Worldpanel, said. “At the same time consumers are not willing to make sacrifices when it comes to quality.”

In many cases brands have turned around declining sales trends from the previous year. Hardy’s wine brands, for example, achieved +22% growth this year (last year: -7%), making Hardy’s one of the most successful take-home alcohol brands in the UK.

Young’s turned the virtually stagnant growth from last year into +13% growth this year, mainly due to a great year in frozen foods. The industry also has successfully managed to change consumers’ perception of frozen foods as ‘cheap’ and given them a healthier, natural, value-added image. This has provided a boost to company’s with strong interests in frozen food, such as Young’s and Aunt Bessies.

“The big hit with consumers seems to be ‘affordable premium’ products that offer superior quality at affordable prices. This trend isn’t just linked to food and drink – some pet food and personal care brands have fared very well in this year’s rankings. Notable growth has come from the likes of Whiskas and Pedigree, as well as Colgate and Andrex; suggesting consumers are spending more on quality products in all areas of the market,” Mr Longbottom noted. “It remains to be seen whether the credit crunch and the increasing prices – currently confined to limited sectors of the FMCG arena – will cause consumers to re-evaluate their preferences in 2008 and the coming year.”

Lucy Barrett, editor of Marketing Magazine, added that despite heightened interest in private label, trusted brands are still proving very popular with consumers. “It is interesting to see that despite the continuing growth of own-label products consumers are still turning to trusted brands for reassurance,” she said. “With the continued gloomy news reports on the state of the economy it is little surprise that consumers are investing in ‘comfort brands’ such as Heinz, while the abysmal British summer at least brought good news to hot beverage brands such as Kenco, Horlicks and Typhoo.”

The UK top ten (% sales growth in brackets):

1. Cadbury (+4)
2. Heinz (+11)
3. Kellogg’s (+4)
4. Walker’s (+6)
5. Warburton’s (+24)
6. Bird’s Eye (Unchanged)
7. Muller (+9)
8. Coca-Cola (Unchanged)
9. McVitie’s (+16)
10. Nescafé (+8)