Action has been hotting up in the £1.3bn chilled yogurt and desserts market in the last few months, and not just in product innovation. Some well-established brands have been changing hands, with Nestle acquiring Ski and Munch Bunch from Northern Foods in Fubruary, and Uniq offloading troubled St Ivel Shape on Danone for £32m last month.
Gerry Roads, marketing director of Yoplait Dairy Crest, which owns leading children's brand Petit Filous, says the upheaval is due to the impact market leader Muller's continual product innovation and price promotions, such as three for 99p', have had since its UK arrival 10 years ago. " He anticipates "enormous turmoil and a much bigger ad spend in the market in the coming year, which will be great for retailers".
The German company commands a share of almost 40%, with 53 products in 18 ranges.
However Nestle new acquisitions have brought it an 11.5% foothold, making it the number two player ­ and it has big ambitions.
Greg Krol, md of the company's newly formed chilled dairy business unit, aims to make Nestle clear challenger to the market leader. "We want to use the Ski and Munch Bunch brands as pillars to build a strong presence in the UK," he declares.
Plans include major relaunches for both brands with substantial support budgets. "We'll bring in lots of innovation and we may also reposition the brands slightly," promises Krol, who singles out added value and children's products as particular areas of interest. "The UK has fairly low consumption compared to the European average, and we can bring continental know-how as well as products," he adds.
Despite being tipped by many in the City as the most likely buyer for Shape, Nestl頲ejected the challenge. "Shape is not in good shape," Krol explains. "It's a very narrow brand ­ just diet-focused; not even wellbeing. It did a good job introducing low fat yogurts 15 or 20 years ago but it's now in a difficult position."
But Danone, which accounts for 5% of the UK market and is the fastest growing supplier, obviously thinks differently with its deal to buy the brand. MD Mark Grosselin has declared "huge ambitions in this country" and sees the healthy segment as underdeveloped.
"Shape has been asleep as a brand," he says. "We are going to wake it up." However, the City is sceptical about Shape's future success. The beleaguered diet brand continues to lose money despite a £6m relaunch in February. "Unless Danone can turn Shape into a niche brand or pump some innovation into it, I can't understand the logic behind the deal," says one analyst.
Value in the yogurt sector has risen consistently ­ between 5% and 10% a year ­ for the last five years. The driving forces in yogurt are at the extremes ­ health and indulgence. Children's products are also growing, as is the small functional products sector, boosted by the arrival of Mí±²í¼¥r's Vitality Bio yogurts last year.
Mí±²í¼¥r has streamlined its indulgence offerings by rounding up the Luxury and Crumble sub-sectors of its bestselling Corners brand under the Dessert Corners banner. Strawberry and Lemon cheesecake desserts with biscuit bases are new additions. The company has also revamped the standard and fat-free Mí±²í¼¥rice ranges and introduced a chocolate variant, while YDC has extended its flourishing Best There Is! luxury range with a third four-pack.
Other activity has included a new chocolate and hazelnut flavour in Onken's mousse stable, while St Ivel is adding Dairy Milk and Caramel Puds to its Cadbury dessert portfolio.
Goats milk yogurts are also getting more adventurous. A new range from TV chef Antony Worrall Thompson, produced by Delamere Dairies, includes a mandarin and ginger variant.
Even low fat brands have added to their list of luxurious-sounding flavours, with Shape bringing out chocolate and toffee yogurts, fruit trifles and Mississippi Mud Pie and Banoffee desserts.
Confectionery connections are doing well in the burgeoning children's sector, with Nestl駳 branded chilled dessert formats ­ particularly its Rowntree's range ­ thriving.
Meanwhile, Mí±²í¼¥r has added to its children's product stable with Magic aimed at five to 10-year-olds. The two yogurts include a secret ingredient' ­ strawberry-flavoured Bats' Blood and raspberry sherbet Fizzing Cauldron ­ with concentrated advertising planned around Hallowe'en.
On the character licences front, Arla has massed the might of Bob the Builder, Channel 4's the Hoobs, the Powerpuff Girls and Dexter's Laboratory characters, while St Ivel has enlisted the help of the Bang on the Door brand's Groovy Chicks in a bid to grab the tweens' market.
Poké­¯n and Butt-Ugly Martians have joined the ranks of YDC's fromage frais, with 1960s TV favourite Andy Pandy, the company's latest recruit. "This gets parents nostalgic," says YDC's Roads.
The company's Petit Filous, however, does not have a licence and Roads says one of the reasons behind this is the brand's appeal to adults.
"Despite its marketing targeting children, about 30% of consumption comes from households without children," he says. A new, more sophisticated product ­ a layered dessert with fruit pur饠and fromage frais in clear pots ­ also recognises this.
YDC's Roads says merchandising by eating occasion as well as product type ­ particularly with lunchbox ­ would offer big rewards. "Lunchbox items are high premium and they need their own space," he says. "If a retailer can trade up a consumer from a six-pack for 99p to more portable products at £1.79, they're going to do well."