How can dairy industry succeed?

American milkman, circa 1925

Little has changed in marketing milk to consumers since the American milkman, circa 1925 (Photo credit: Wikipedia)

Some things never cease to amaze me.

Like how the dairy industry thinks that consumers will automatically buy their product simply because they produce it.

One thing you can bet on with dairy farmers, news like this won’t stop them from producing more milk, even if fluid consumption continues to fall.

So what’s the dairy industry doing to combat this? Well, they’re putting out campaigns like “The Science of Imitation Milk,” which is going to make people run right down to the local grocery store and buy more fluid milk just like the previous campaigns such as the “Got Milk?” and “Happy Cow” campaigns did.

The latest ad campaign from the California Milk Processor Board is apparently trying to get people to buy real milk by portraying other forms of “milk” as icky! Never mind that the folks bringing us the lactose-free versions of “milk” (I’m sorry, I just can’t call it milk if it doesn’t come from an animal) have obviously found market-friendly ways of selling their products.

The latest newspaper article centers on the falling consumption of fluid milk. While cheese consumption has done well, what with pizza and other products helping to keep cheese in what we eat, dairy farmers and the organizations they pay through their mandatory check-off programs have done an abysmally poor job of selling more milk. Kudos to the Almond Board of California and other commodities groups that have found substitutes for dairy milk. I may not drink the stuff because I personally find it repugnant and not very tasty, such is not the case with other consumers.

I recently had a twitter conversation with a cattle rancher and M.S. degree candidate from the University of Kentucky. Part of our discussion centered on what I believe is the crux of the problem within some components of American agriculture, and that is the inability to to effectively convince consumers to consume their products. Rather than focus on trying to sell more product to consumers, some farmers remain stuck in their circular arguments and ancient talking points that do nothing to create consumer demand for the products they produce.

Dairy was my prime example in the conversation I had with the college student. My point was, and remains, that the dairy industry in particular will continue to suffer like this as long as its main focus is arguing over how formula pricing and other government programs help or hurt dairy farmers and their partners, the dairy processor.

Until there is a complete attitude change and focus within the dairy industry in which producers and processors stop fighting over formula pricing and other convoluted issues that nobody understands, and instead start focusing on the reason they’re in business — to sell more milk — then stories like this in the Bakersfield Californian will continue to be published and dairy farmers will continue to cry about the unprofitable conditions in which they continue to produce the milk that fewer consumers are buying.

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9 thoughts on “How can dairy industry succeed?

  1. Thanks for sharing this with me, Todd. I think you’re spot on with your observation of the dairy industry’s marketing schemes. In the end, what is important are your customers, not the pricing structures and government subsidies. Farmers and ranchers need to reroute their focus to that of their customers, instead of pointing fingers at each other and their competitors. Finding ways to emphasize the quality and worth of your product and meeting your customers’ needs in the end is the best avenue to increase your products’ demand.

  2. Hi Todd. Great thought provoking post. I dairy farm with my husband in northern Vermont. I also dabble in dairy economics. I wish it could be as simple as it sounds. DFs are so far removed from actual product marketing to consumers and it’s difficult to have any influence on what our product comes out as to consumers, unless of course we package & sell our own milk. Checkoff dollars have more to do with an overall message which I agree seems off center, though Got Milk is still out there and I think it was just recognized as a top campaign somewhere. I think many dairy farmers have done well to reach out to the general public through social media channels. I also wonder if various labels such as rBST-free have had a negative effect on consumer perceptions of milk as well. Regardless, I think the bottom line is we need to stop the decline in fluid milk milk consumption and then send it back the other way.

    • If the check-off system is failing, why put another dime into the program then? After all, if check-off = marketing and fewer people are consuming your product, then the simple answer seems to be in who dairy farmers are paying to market their products.
      I’ve heard the grumbles at dairy meetings over the check-off program but nobody seems to want to address it head-on. Those are my thoughts.

  3. Hey Todd, thanks for the reply. To be clear, while I think some messages may be a little off-center, to catalog all of what our dairy promotion boards do across the country, they are still doing great things. And let’s not forget, we do have representation on our promotion boards so if we’re not happy it’s our responsibility to communicate that; after all it is our money. My point is with the dairy product company – marketing and R&D budgets are typically dismal except for perhaps organic milk companies. Making things like “Muscle Milk” (which, IMO, is pretty gross) only reaches a certain segment of our audience. Making things like an 8-oz container to grab and go at a convenience store or pack in a lunch (much like Horizon Organic’s product) reaches many segments, especially those health conscious consumers counting calories & fats but who could do well with milk’s 9 essential nutrients. The question is, how do we get sway over that area of our value chain?

    • I think if you’re talking about the fluid aspect of milk, that’s what your experts you pay through your check-off dollars should be focused on like a laser.
      The industry needs to be willing to spend the money necessary to effectively market your products, but not on the same old programs that haven’t worked before.
      Then again, maybe the problem isn’t marketing, but the heavy government control over milk in the United States.
      All I know is I’d be much better off financially if I could find the answer – believe me!

  4. I agree with much of this sentiment. Unfortunately, many people I know involved in dairy attempt to do too little too late. Organic folks are promoting with tactic that work by getting to the concern every family faces…food safety and quality.
    If we all just sat back a minute and thought for two seconds about why fluid milk prices are dropping and consumers just aren’t buying…it’s because the majority of the population has some fairly strict “rules” to which they purchase food now. Some farms, especially the one’s with open communication with the consumer about what the consumer wants (from welfare to quality), are doing alright.
    I think that the biggest underlying issues behind the milk debacle is that too many farms produce for quantity, not quality. I know that even to this dairy farmer, milk from the store today tastes very different from even ten years ago. It is watery and without that creamy milk taste I remember from growing up. I think somewhere along the lines, we as a dairy industry, need to leave the big farms to produce all of that milk that goes into commodity markets and the smaller farms (with less than 200 or so cows) to take care of the quality production of milk.
    But, on the flip side, the marketing of quality milk across the country IS severely lagging. The only group, Organic (who chooses to use scare tactics over antibiotics and hormones in conventional) has discovered what consumers really want. They want assurance through quality control that they are getting milk from animal who are treated with respect, that they know are not injected with every drug known to mankind (not that most farms to that) and that they are fed forages and rations that are produced as safely as possible.
    Where is conventional dairy on this subject???
    Out wasting money on what I call fluff ads that leave no lasting memory with the person viewing it. Remember Elsie the Bordon cow? We (as a conventional ag. collective whole) need to go back to that type of marketing. We need to get companies that bottle and retail the milk to work with the dairy industry to produce marketing campaigns to highlight what most farms are really doing.
    People want to know and heaven forbid they do the searching on their own…to find Youtube videos posted by PETA and HSUS about animal abuse and antibiotics. Don’t believe they have a huge impact of the dairy industry? Just go on there and do a search for dairy farms. Then start taking a look at the view numbers when compared to someone who posts videos for conventional ag.

    • Speaking as a consumer, you hit the nail on the head in your first paragraph regarding food safety and quality. While I don’t ponder every purchase at the grocery store based on these items (I’m like many consumers in that I simply TRUST that the food I buy is safe and meets my quality standards) I think agriculture needs to capitalize off of this basic trust that the consumer has over our food. Why not build on that trust and educate consumers about the various things farmers do to ensure quality and safety (from inspections to the careful use of pharmaceuticals and pesticides?
      Agriculture doesn’t have to respond to every false premise put forth by PETA and HSUS. Agriculture needs to be out FRONT in these promotions, rather than responding to false premises and letting the antagonists set the narrative.

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