Just desserts for Müller

Now that the yoghurt manufacturer has fended off own-labels and rivals, it is keen to get a life as a snack rather than a dessert. By Caroline Parry

UK consumers do lead a Müller life, it seems. The family-owned dairy brand remains the UK’s leader in the branded yoghurt market, accounting for 38 per cent of the overall sector (Leatherhead Food International) despite shifting trends in the category.

Müller, which launched in the UK in 1986, has long been the dominant branded manufacturer in this country, but rivals Nestlé and Danone are ramping up their new product development and advertising in an effort to erode Müller’s share. It is also facing stiff competition from own-label ranges.

Industry insiders claim that the tough environment and concerns over Müller’s performance are the reasons why the company’s headquarters have taken over the running of the UK division. It is understood that there are no plans to replace former general manager Andrew Harrison; instead, key directors at the company are reporting to the German head office (MW last week).

While Müller is still widely acknowledged as the market leader in terms of sales and innovation, Müller UK marketing director Chris McDonough admits that last year was tough for the brand. But he adds that this year has seen it return to form.

This is supported by AC Nielsen figures for the year to the end of September: in value terms the overall brand has grown by eight per cent compared to market growth of six per cent. In volume terms, it has grown by 12 per cent compared to 6.5 per cent across the market.

However, there have been fierce battles in mature segments of the market. Gerry Rhodes, marketing director at rival Yoplait Dairy Crest, says that a key problem for Müller has been a determined effort by the supermarkets to win back share from its low-fat product Müllerlight.

He explains: “There has been a lot of pressure from own-label brands in light yoghurts. The supermarkets made a determined effort to redress the balance by introducing new lines and competitive pricing. There have also been new developments like the launch of Sveltesse from Nestlé.”

The low-fat segment became the “killing fields in light yoghurt”, he says. Müller fought back with aggressive price promotions: in January it launched its first “buy one, get one free” offer. Rhodes says: “It has turned Müllerlight around and clawed back its share but it has devalued the overall category.”

While McDonough agrees that last year did see a fightback against own-label brands, he says Müller responded with innovation in flavours, such as lemon cheesecake and apple pie, not by promotion. He adds that while Müller invests in promotions to drive incremental sales, it ploughs more into product development and brand support. He points to the “ead a Müller Life” advertising strategy, Müller’s first brand advertising.

The campaign, created by TBWA/ London, focuses on the entire range and aims to reposition the brand as being more relevant to today’s snacking market, an area McDonough believes is key to continued growth. Over the next few months, the campaign will widen to include new executions that focus on sub-brands. He says: “We have retrained our competitive set. We are looking to the snacks market; we want the UK to feel good about snacking. We have to reposition to get there and that is what the advertising is about.”

McDonough says Müller is working to change how people think about yoghurt so that they look above and beyond the product as a dessert. “Our direction is to invest more in the brand and product, and to move into new areas – otherwise yoghurt would be just a commodity.”

Müller is keen to develop “real points of difference” in the market as McDonough says that this is the only way to stay ahead of the pack. The strategy will include new products, but Müller is also exploring new routes to market that will support the brand’s move towards snacking. These could include totally new areas for dairy, such as vending machines.

The significant growth of functional products in the yoghurt market shows that UK consumers are prepared to accept new formats such as probiotic yoghurts and drinks that claim to have blood pressure- lowering qualities. This category is worth £57m and saw an increase of seven per cent last year (Leatherhead Food International).

But the challenge for all manufacturers is finding new convenient ways for people to eat yoghurt. They must identify ways to help change consumers’ perceptions about yoghurt, moving it away from being a dessert into the broader snacks market.


Ludwig Müller made the first Müller yoghurts in 1896 at a small dairy in Bavaria. His grandson, Theo Müller, now runs the company.

When Müller launched in the UK in 1986, Ken Wood, formerly group managing director international, was the brand’s only UK employee.

Last year, Müller , which employs more than 2,400 staff, turned over £625m. Its UK factory is in Market Drayton in Shropshire.

The brand makes more than 70 yoghurts and desserts including the original Corners, Müllerice and newer lines such as Amore and Vitality.

Müller handles the sales and marketing for Cadbury’s dessert portfolio, having taken over the range in May last year.

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