A short presentation highlighting some of the trends, threats, and opportunities within the Romanian Dairy category.

1. KNOWLEDGE
Romania Dairy
Trends, Threats and Opportunities
March 2011
See further, deliver more

2. introduction
The following pages represent a short summary of some of the trends, opportunities, and
threats to dairy on both a global/regional level and to Romanian dairy market specifically.
This report has been compiled by and comes courtesy of Cocoon Group Knowledge Center.

3. Trends and Opportunities

4. green friendly
Globally, social responsibility and "green friendliness" are
being reflected in a great number of sustainability projects
and locally produced, fair trade and bio products. Milk
increasingly included.

5. social media savvy
There is an increasing presence across all social media
by FMCG producers as companies and brands begin
to sort out effective strategies and realistic objectives.

6. healthy boomers
Health issues drive new product development in dairy.
Omega 3-fortified products, introduced in Western
Europe in the first half of the last decade - and other
nutritional additions - are arriving in CEE in a greater
scale. This trend is strongly influenced by Boomers’
increasing health awareness and purchasing power.

7. conscientious
indulgence
There is still a lot of space for variation in healthy food
regarding presentation and nutritional benefits. Conveniently,
Conscience meets Indulgence when the taste appeal of the
dessert comes with the promise of better health.

8. growth space
Some dairy sub-segments, such as yoghurt and specialties, still show
low consumption levels in Romania, when compared to more mature
countries in the European Union. Growth potential is evident.

9. novelty
Romanians are known for being open to innovations and
willing to try new products and formats. For instance, new
proposals in the cheese segment (snacking cheeses,
flavored cheeses, mixed cheeses, specialty cheeses) or milk
segment (flavored milk) are welcome.

10. online activity
There is a lot of space for the development of more efficient and
attractive online strategies. For instance, as the nutritional appeal of
new advances in Dairy are given more attention to by the producers, it
is not a bad idea to include online health information and advice
sections and put them within easy reach of the consumers.

11. hunger for
private labels
Private brands are eagerly swallowing market
share due to their strongly functional
positioning and affordability. As the
consumers realize that these value for money
products fulfill basic needs for a lower price,
the exodus from other brands is felt
worldwide.
Dairy brands, as with most categories, must
continually justify their price points through
innovation and non-functional benefits.

12. Threats

13. category blur
Categories are overlapping. Dairy fights with more
than just dairy when it comes both to nutritional
values and taste appeal: fruit juices and smoothies,
desserts, soy products, supplements and other
products that bring similar benefits as milk products.
Solid communication strategy, innovation and
creativity - all reflected in attractive packaging - are
invaluable weapons in this war.

14. EU invasion
A current threat to the national production lays on the fact
that imported milk products from other European Union
countries frequently arrive in Romania with lower prices
than those locally produced.

15. lack of
capital
Romanian dairy farmers, already lacking the capital to modernize or grow, now face
additional pressure because of steep declines (or even cancellations) of government
subsidies due to the recent financial crisis. This anemic level of state and private
investment threatens to undermine quality and amount of production in the country.

16. Thank you for your attention.
For more information, please contact:
Cocoon Group Romania CG Knowledge
Simona Straut Douglas Kaufman
s.straut@cg-eu.com d.kaufman@cg-eu.com
0040 212 222 077 00420 222 998 516
Emanoil Porumbaru street, no. 43
011422, Bucharest 1, Romania
www.cg-eu.com