The kefir class has exploded up to now 5 years, going from area of interest to mainstream, as shoppers focus their consideration on pure meals with practical advantages.
Having been confined to the ethnic dairy sections years in the past, the classy, low-lactose, probiotic-rich drink has a agency presence within the chilled dairy aisle at the moment.
Kefir can also be made into yogurts, ice lotions, pouches, frozen popsicles and different codecs past drinks and is more and more utilised in cooking purposes corresponding to marinades, salad dressing, smoothies, and extra.
In baking, it’s more and more used as a buttermilk, yogurt or milk various, displaying its versatility as each an ingredient and a standalone product.
And shoppers carry on shopping for kefir. Based on Kantar, the UK market is experiencing important worth progress throughout each potted and liquid codecs, primarily pushed by new consumers and extra journeys.
Liquid kefir, which attracts a youthful demographic in comparison with potted, is main this progress, we have been informed.
In the meantime, the rising use and entry to GLP-1 weight reduction drugs is re-shaping the meals and beverage area. Right here, practical meals like kefir are poised to enchantment to consumers by means of dietary and well being advantages.
Everybody desires ‘a sip’ of the market
All these elements are main main dairy manufacturers from Danone North America within the US to Müller in Europe to take a keener curiosity within the class and its market-share leaders.
Within the US, Danone twice tried to buy Lifeway Foods, Inc. on the tail finish of 2024, however push-back from the Lifeway board over the valuation of the deal has up to now seen the 2 sides unwilling to compromise. Nevertheless, Lifeway has indicated it stays open to a sale.
Why shoppers love small manufacturers
Whereas large manufacturers have pull and energy, in segments like practical meals, small manufacturers may be much more interesting due to demand for authenticity, sustainability and innovation.
In FY2024, Lifeway posted internet gross sales of $186.8m; up 17% year-over-year, and internet gross sales of $46.9m in This fall, in accordance with the corporate’s newest accounts.
Lifeway CEO Julie Smolyansky mentioned: “We acknowledge the tailwind from rising client curiosity in protein-rich meals with probiotics and bioavailable vitamins and have meaningfully invested in our core branded choices to drive trial and speed up velocities to seize a better share of that demand. The buyer give attention to well being and wellness continues to develop, and we stay targeted on capitalizing on that heightened curiosity.”
Over within the UK, dairy main Müller UK & Eire cast a deal to accumulate kefir firm Biotiful Intestine Heath in an indication of market consolidation.
As we reported earlier, the deal would enable Müller to realize a foothold within the practical meals area the place it presently lacks important presence; whereas enabling Biotiful to proceed its progress.
Biotiful, which was based in 2012, dominates the UK kefir market alongside Yeo Valley and Bio+Me. The corporate made near £2m in revenue in FY2024, up from round £237,500 in 2023.
One other UK participant, Yeo Valley Natural, can also be experiencing worth progress, in accordance with Kantar – however its efficiency is hindered by a slowdown in potted kefir gross sales, we have been informed.
Yeo moved to accumulate The Collective, a flavored fruit yogurt and kefir maker, earlier this 12 months.
The place is the kefir market heading?
With yogurt drinks seeing progress throughout the board within the US (up 10.4% in {dollars}, 11.6% in models and eight.5% in quantity in comparison with 12 months in the past in accordance with Circana LLC.) and the UK kefir market persevering with to broaden, the class is poised for additional progress in 2025 propelled by client curiosity in digestive well being and protein consumption.
Varied market analysis businesses give the class a CAGR of between 3.7% to greater than 6% and anticipate it to breach a valuation of $2bn+ within the subsequent 5 to eight years.
