Sales for specialty cheese are at $2bn and growing, with dollar sales growth up 7% and volume sales growth up 4%. This makes specialty cheese one of the top 10 fastest growing deli categories, according to a report from the International Dairy Deli Bakery Association, in partnership with the Nielsen Perishables Group.
However, there may be a lack of connectivity between specialty cheeses and other retail departments, something that is capping its potential.
Alan Hiebert, senior education coordinator at IDDBA, told DairyReporter that the average household spending on specialty cheese, per year, is $18.
“We were talking in the office here and said how can it be that low?” Hibert said. “Just about everyone in this building spends way more on that and wouldn’t have a problem spending that on a weekly basis. What we realized, at least the people who work in this industry, is that we’re far from average.”
Making it easy for customers to spend on cheese
Education is the big issue in Hieberg’s mind, as most people simply don’t think speciality cheese is for them. It is an “elite product” in most people’s minds, with a knowledge gap when it comes to flavor profiles. This is where Hiebert believes connectivity within the store can become handy.
“Even something like feta cheese can go with watermelon in a feta watermelon salad,” he said. “That’s something I never would have thought of until I was talking to a chef about it.”
Having more information about pairings and placement within the store could mean more sales. The IDDBA/Neilson report noted that the average basket size with specialty cheese is $92, while the average basket size in general is $48. Hiebert said much of this is due to affluence, but customers interested in specialty cheese are also more likely to put together meals from scratch, using products from various sections of the store.
Aligning products
Per the report, some good products specialty cheese can align with include:
- Bread
- Fresh beef steak (with a buyer overlap of 66%)
- Fish, especially salmon
- Deli dips and snacks
- Cakes, cookies and other sweets
“I think that’s why the supermarket industry is seeing a lot more serious competition from other formats of shops,” he said. “The convenience store doesn’t have departments. Restaurants don’t have separate departments. Don’t sell cheese out of one department and bread out of another.”
“It’s a really difficult challenge that supermarkets have. I don’t know too many stores that have been successful in breaking down the barriers - but they do need to. From a customer ease standpoint, it may need to happen.”
How can manufacturers help?
Although most of the issue in the market falls to the retailer’s side, Hiebert said manufacturers could think about publishing recipes, showcasing pairing ideas on labels and creating a digital space where consumers can learn about farmers and information about the cheese.
“It’s difficult to get buy in from the end user; it probably would take some partnering with retailer in terms of getting integrated with some kind of shopping app, but that can be done,” he said. “But there's also co-promotion with coupons and things like that with other products that tend to be linked to specialty cheese. That’s a possibility.”
Much of this work will be done in figuring out what products individual specialty cheeses work best with. The report found that specialty cheese has a positive correlation with 83 out of 237 grocery categories representing 24% of the store’s dollars, so getting a retail shop's attention may not be extremely difficult.