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Own Label Milk Prices Down. Branded Lines Up

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Tesco’s recent milk price decreases have triggered price matching by Sainsbury’s. Whilst overall price drops have been seen on Standard Own Label milk, a number of branded milk products have experienced price increases.

The graph below details the price for Own Label 4 Pint variants when they are not on promotion – Whole, Semi Skimmed, Skimmed and 1% Fat. Sainsbury’s were quick to react to the price drop seen in Tesco, lowering their price the following day (5th March) to match the £1.00 point set in Tesco and Asda. Morrisons continue to maintain a base price of £1.39.

Price for Own Label 4 Pint variants when not in promotion

When taking a closer look at the effect of promotional activity on the price of milk, we can see that both Tesco and Morrisons ran Buy 3 for £3 promotions prior to Tesco’s price drop announcement, meaning that consumers could have previously purchased milk for £1 per unit if they had opted for the multibuy offer. Tesco implemented this multibuy from July 2013 onwards, briefly removing the promotion before making changes to the base price in March. Morrisons have run this promotion consistently for more than 52 weeks.

The effect of promotional activity on the price of milk

Whilst Own Label 4 Pint milk has experienced base price decreases across retailers, the following graph tells us that the base price across leading branded milk SKUs have seen price increases this year.

Alpro has increased in price throughout January and February this year. This has been driven by increases of up to 20p in Tesco and 21p in Sainsbury’s.

Cravendale’s average price increase is primarily driven by Asda’s changes to the Skimmed, Semi Skimmed and Whole Milk 2000ml variants, from £1.98 to £2.20.

Lactofree’s average price has decreased, driven by price drops in Morrisons, from £1.39 to £1.34. Price increases for Lactofree were, however, experienced in Sainsbury’s and Tesco in February, up by between 1p and 5p.

The price of Organic Own Label milk in Tesco increased the same day as the price drops for Standard Own Label 4 Pint SKUs. A total of eight organic milk lines increased on 04 March, up by between 2p and 14p.

Price increase for organic milk lines

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