Dairy Milk enjoys prolonged purple patch
Cadbury's Dairy Milk has cemented its status as the UK's second largest grocery brand, in a clear indication that it weathered the storm following this summer's salmonella scare.

With a brand value of £524m (€775m), the iconic chocolate bar is headed only by Coca Cola in the list of the UK's 100 most valuable grocery brands, as calculated by brand valuation consultancy Intangible Business. Wrigley's Extra chewing gum rates as the second most valuable confectionery brand at number 25 while confectionery staples Galaxy, KitKat and Maltesers also feature in the top 50.

According to Intangible Business, sales of Cadbury Dairy Milk have grown 13% annually since 2003 making it the UK's biggest selling chocolate brand. It notes that the product enjoys a strong brand heritage; an asset which helped it emerge from the salmonella scare with its reputation intact.

"Dairy Milk has been around for more than 100 years and is deeply embedded in the national culture," explained William Grobel, marketing director at Intangible Business.

Further more, Cadbury's regular tweaking of the packaging design ensures Dairy Milk's contemporary and familiar feel, while product innovation, such as new flavour variants and product sizes, broadens the brand's appeal.

Of its big-name rivals, Grobel earmarked Galaxy as the brand most likely to close the gap on Dairy Milk at the top of the pile. He also cited KitKat as a brand with a degree of unrealised potential. "For a number of years KitKat pursued a brand extension strategy which didn't really work. If it can re-strengthen and remain loyal to its core offering it can maybe challenge Dairy Milk again."

Confectionery is the second largest sector of the UK grocery market with a cumulative brand value of £1.6bn. It also boasts 16 of the top 100 grocery brands, the most achieved by any single category.

Of the major brand owners, Mars holds the most valuable collection of confectionery brands with ten linss in the top 100, worth a combined £1bn. Cadbury Schweppes' five most lucrative brands are collectively worth £806m placing it marginally ahead of rival Nestle whose six top 100 brands total £801m in value.

The study observes that the majority of the confectionery brands making the top 100 have been around for generations and are owned by multinationals, making it tough for new bradns to enter the market. William Grobel, claims that while there are opportunities for new brands to make significant headway in the market, as long as they lack the financial clout of a multinational behind them, they will always struggle to reach the scale of established rivals.

Nevertheless, brands that make great waves in their infancy can make themselves ripe targets for acquisition. Grobel cites the example of Green & Black's as a brand that has gone from strength to strength since it was bought by Cadbury Schweppes in May 2005.

The UK's most valuable confectionery brands 2006
1. Cadbury Dairy Milk, £523.8m
2. Wrigley Extra, £154.6m
3. KitKat, £119.3m
4. Galaxy, £118.9m
5. Maltesers, £107.1m
6. Aero, £62.1m
7. Mars, £62.0m
8. Cadbury Flake, £61.0m
9. Cadbury Roses, £60.2m
10. Twix, £58.5m
11. Quality Street, £58.5m
12. Haribo Gums and Jellies, £52.1m
13. Magnum Ice Cream, £48.3m
14. Snickers, £44.0m
15. Celebrations, £40.7m
16. Bassetts Confectionery, £35.1m

In the biscuits and snacks category, only Mr Kipling Cakes, McVitie's Cakes and McVitie's Chocolate Digestives managed to infiltrate the chart as crisp brands came to the fore. Despite being valued at £70.3m, the study claims that Mr Kipling is in danger of losing some of its lustre as it struggles to disassociate itself from the past. Nevertheless, almost 130m packs of Mr Kipling cakes are sold every year and they are eaten in 50% of UK households.

An overview of the top 100 chart shows that food provenance is becoming increasing important as retailers attempt to reduce food miles and strengthen a brand's values and heritage. Another notable trend is the increased popularity of organic and fair-trade foods, which has prompted many companies to launch organic and fair-trade brands in a bid to highlight their ethical credentials.