Kerrygold sales in Germany forecast to exceed €280m by end of year

The Irish Dairy Board has predicted record sales exceeding €280m in 2013 for Kerrygold butter in Germany, where it celebrated 40 years of trading yesterday.

The IDB has also announced a €10.5m investment in new state-of-the art facilities to support continued growth in Germany, Europe’s largest market.

The IDB is responsible for the overseas marketing of two-thirds of Irish total milk output, notable exclusions being Glanbia and Kerry Group.

Kerrygold is Germany’s number one butter brand, with a 17% market share and more than a 50% branded share. It sells close to 200m packs of butter in 23,000 outlets each year — enough butter to stretch from Dublin to Berlin, 14 times.

The iconic Irish brand was first launched in just a handful of stores in Germany in 1973, the year in which Ireland joined Europe’s Common Market. This German investment is a key part in the IDB’s strategy to grow the market for Irish dairy goods in the run up to the abolition of milk quotas in 2015.

The capital expenditure will fund extended storage, packing, state-of-the-art production facilities and new product development. The IDB employs 110 staff in Germany.

IDB chief executive, Kevin Lane, said: “Germany has been the most successful export market for the IDB. Turnover in Germany in 2013 will surpass €280m, which will be a record performance for the business. The €10.5m investment we are announcing is strategically very important for the IDB. Our base here allows us to further expand our business in Germany and throughout this region.

“This expansion is good news for our consumers, for IDB Deutschland, for our employees and for Irish dairy farmers, who will have a bigger market for their quality milk. In the run up to 2015 and beyond, core established markets such as Germany, as well as new emerging markets, will be very important for the Irish dairy industry,” he said.

Mr Lane said the IDB business model in Germany has been based on developing a solid understanding of the consumer. Investment in research into consumer insights, along with a willingness to invest heavily in product development and supported by extensive marketing, has been a powerful mix for the group.

“We have learned that above all else, in terms of food, Germans value quality of ingredients and quality of product,” he said. “Today, many German consumers refer to Ireland as the Garden of Europe and have a strong emotional connection with the Kerrygold brand which is underpinned by its Irish origin and personality.”

Mr Lane said product innovation being critical to growth, IDB Deutschland continues to bring new products to market.

Recent new IDB product launches include butter with sea salt crystals packaged in an upside down tub, Butterkäse, a mild creamy breakfast cheese developed to appeal to the German palate and Kerrygold Bratcreme, a liquid butter and rapeseed oil blend used for cooking.

Meanwhile, to coincide with the anniversary, IDB has released the next video in the Meadow Milk media campaign. Titled ‘A Day in the life’ and appearing on TV and YouTube, it features Cavan farmer David Cassidy and his family, winner of the 2012 NDC and Kerrygold Quality Milk Awards.

Mr Cassidy milks 80 dairy cows and is a third generation farmer. In the video he describes his relationship with the land and how he started farming with his wife and family. The Meadow Milk campaign showcases the unique attributes of Ireland’s grass-based farming methods to consumers across international markets.

The series comprises four videos, each focused on a different theme: the weather and climate; the farmers behind the brand and their craft; Ireland’s unique landscape and animal welfare.