Cheese consumption is down, but there are ways to adapt to changing consumer habits
Canadians’ love affair with cheese peaked during the pandemic, as lockdowns had people returning to their refrigerators for a snack more often and diving deeper into home cooking, frequently using cheese as a key ingredient. COVID led to record-breaking consumption, with the average Canadian eating cheese 388 times per year in 2021, according to Ipsos FIVE, which tracks individual consumption behaviours across all food and beverage categories.
This pandemic spike provides critical context for assessing a downturn in the past year, as Ipsos FIVE reports a 5% decrease in consumption rates compared to 2021. When it comes to cheese, this may be a return to normal.
“We’ve settled down to near pre-pandemic rates,” says Kathy Perrotta, vice-president of market strategy and understanding with Ipsos Canada, who notes that the average Canadian still reached for cheese 375 times last year – a figure nearly identical to 2019.
Still, several triggers are impacting everything from purchase decisions to product development and could affect the size of the market in years to come.
Inflation
According to a Statistics Canada report released last August, the cost of cheese rose 10.4% year over year. Perrotta confirms that inflation is contributing to declines at the dairy case and with more expensive deli options as well.
Jean-Philippe Leblanc, vice-president, cheese and butter at Agropur, says the company is doing what it can to keep costs down for consumers. “We try to reduce the effect of inflation by putting pressure on our own manufacturing costs, by doing things like renegotiating agreements for things like packaging and transport.”
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Teresa Spinelli, president of Alberta’s Italian Centre Shop – a specialty store that offers artisanal cheeses such as Drunken Goat and Moliterno with Truffle – says rising costs have affected which products her customers are buying. “We’ve definitely seen a decline in the past year in those high-end cheeses, as opposed to the mozzarellas of the world.”
Product innovation
Cost-conscious customers and an emphasis on home cooking are driving the development of both cheap-and-cheerful products to high-end fare.
More consumers are returning to work, and at the same time maintaining a desire to make their meals at home. The resulting time constrictions are inspiring products like Saputo’s Armstrong Mmmm… Bacon Shredded Cheese, a SKU that incorporates bacon to deliver convenience and taste for a variety of recipes, including as a homemade pizza topping.
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“We know that while consumers are looking to save, many are also seeking convenience,” says Iva Barukcic, vice-president, consumer and market insights, strategy and innovation for Saputo.
Agropur is also experimenting with new flavours, from jalapeno cheddar in the dairy aisle to the more upscale maple-washed OKA and smoked Saint-Paulin cheese in the deli department.
“We’re seeing more and more people experiment with different cheeses and using them in unique ways,” says Lucy Antonacci, senior category manager, deli and prepared foods at Longo’s, who adds that smoked cheeses and versatile options like burrata are especially popular with customers.
Also proliferating is plant-based cheese. According to Ipsos FIVE, this category counts for 9% of cheese consumption. Products in this vein include Babybel plant-based cheese, Daiya’s Feta Flavour Block and Grilling Cheeze Block.
Consumers are also seeking products that promise functional benefits, such as Black Diamond Cheestrings Probiotic from Lactalis. And Saputo is addressing digestive issues with its new Armstrong Lactose Free Triple Cheddar Shredded Cheese and Lactose Free Marble Cheddar Cheese Block – with a lactose-free feta expected to hit the market soon.
“Rising focus on personal health goals, unique dietary regimes and restrictions and conscious consumption priorities are all factoring into growth,” says Perrotta.
Marketing and promotion
Retailers are working to maintain Canada’s love affair with cheese. Antonacci says Longo’s introduces customers to products by sharing recipes in its Experience Magazine, while also highlighting new cheeses in its flyers and through its Thank You Rewards program.
Others, like the subscription-and-delivery-based Savvy Company, focus on making connections between consumers and cheese producers. Its Cheese of the Month Club profiles new cheeses for subscribers, and through virtual fondue parties participants get the featured products delivered and go online to talk – and melt – cheese together.
An emerging opportunity
Perrotta says while conventional chains will likely never beat the likes of No Frills and Walmart on price, they may dominate the deli cheese segment – especially with smaller niche cheese markets recovering more slowly from the pandemic.
“We see in our data that there’s an opportunity for conventional grocery to own the specialty cheeses in the current environment,” Perrotta says. “It’s a real opportunity for conventional grocers to ensure they have a nice array of cheeses, presented well.”
This article first appeared in Canadian Grocer’s May 2023 issue.
