A Case of Marketing not Working- Dairy Farmers of Canada

Most Canadians drink milk or eat yogurt or cheese, however, Statistics Canada’s recently released data on retail sales show that per capita consumption of milk in Canada has fallen by 18 per cent to 74 litres a year between 1995 and 2014. Taking into account population growth, Canadians consumed approximately 20 million litres less milk in just one year, between 2013 and 2014. http://www.theglobeandmail.com/report-on-business/rob-commentary/so-we-drink-less-milk-lets-understand-why/article26158646/

The decline is so striking that the Dairy Farmers of Canada commissioned a survey to find out why milk drinkers are ditching it in droves. The survey comprised 6,800 Canadian households and has some enlightening findings.

The two age demographics to see the greatest decline in milk drinking? Middle-aged empty nesters, who reported almost completely dropping milk, and families with children under the age of 12, who comprised a surprising one-quarter of the decline. The reason? A revealing 10 per cent of non-milk drinkers stated they had gone vegan — a word almost unheard of just a few years ago. Eight per cent said they no longer wanted to support an industry whose practices they regarded as cruel. http://www.producer.com/2014/11/allergies-among-factors-cited-for-dip-in-milk-consumption/

This may be surprising to some, but the reality is that the recent rise in food prices has eroded the food industry’s impenetrability. More consumers are feeling that they are part of the value chain and can vote with their food purchases. Our collective awakening has been spectacular and has caught many by surprise, including the dairy sector. Both distributors and processors have been exposed to market pressures for years. Now, these systemic pressures are catching up to primary production. And yes, that would include dairy farmers.

Milk consumption is facing many headwinds that dairy, admittedly, cannot change.

For one, demographics are generally working against the sector. Like many other industrialized countries, Canada is getting older. In fact, Canada has more than five million consumers who are 65 or older. With many boomers coming of age and converting to empty nesting, that group will either reduce its consumption of milk or outright eliminate milk from its diet altogether.

Then there is ethnicity. Canada welcomes many immigrants from parts of the world where milk is not perceived as a food staple, as it is here. Milk is essentially a luxury product for many emerging markets. When migrants come to Canada, they bring along culinary traditions that often don’t include milk. As new Canadians settle in and support future generations, these traditions can only negatively influence domestic dairy consumption.

Another phenomenon hitting the dairy sector particularly hard is the rise of veganism. The Dairy Farmers of Canada  noticed in their survey that a surprisingly significant portion of the drop is due to consumers who believe that industrial farming practices are unethical. Even if this movement remains marginal, it would be a mistake for the dairy sector to not consider animal welfare as an important issue moving forward.

We can always drink more milk and consume more dairy products to meet our daily recommended servings, suggested by the Canada’s Food Guide. But looking at the ensemble of systemic pressures, a strategy purely based on “selling” milk, like the Dairy Farmers of Canada’s “Get Enough” campaign, is simply silly. Year after year, dairy farmers spend millions in advertising just to reinforce the fact that we need to drink our milk, as per capita consumption has continued to decline. Few agricultural groups can afford such a lavish campaign. http://www.theglobeandmail.com/report-on-business/rob-commentary/so-we-drink-less-milk-lets-understand-why/article26158646/

Here is the ad. Get Enough – Milk 2015

Talking about flogging a dead horse or should I say cow, you would think the dairy folks would change their strategy but they continue to use strategies that are clearly not working.

The Dairy Farmers of Canada seem convinced that if they just throw enough money into advertising, they can shove these horrors back under the rug. The national policy, lobbying and promotional organization spends an estimated $80-$100 million each year on promotion and advertising, including TV, magazine, social networking and YouTube ads, national in-store media campaigns, and video and banner ads on websites such as Allrecipes and Epicurious.com.

This on top of the less savoury co-opting of over 1,500 foodie bloggers, maintaining over 26 public websites that promote dairy consumption, and cultivating sponsorship agreements that push milk into the hands of marathoners.

Remember those kids under 12 whose families don’t want them drinking milk? The Dairy Farmers of Canada lobby them heavily away from their homes by installing milk drink machines in their schools, encouraging participation in World Milk Day which instructs kids to drink milk every day, and hitting up their teachers by supplying curriculum-based teaching materials and giving free teacher workshops.

Never mind that there’s no truth to the claim. In fact, a study recently published in the British Medical Journal tracked 61,000 women and 45,000 men for a whopping 20 years and found that high milk intake (i.e. three or more glasses of milk a day — as the Dairy Farmers of Canada recommend in their 26 websites) was linked to higher mortality in some men and women. For women, consumption of milk was also associated with an increased risk of sustaining a fracture. http://www.bmj.com/content/349/bmj.g6015

Despite the fear-mongering and the tens of millions spent to peddle dairy, the Canadian public can now see the dairy industry for what it is. And no amount of advertising will make them “un-see” it. http://www.huffingtonpost.ca/twyla-francois/canadians-dairy-industry_b_6280934.html

A significant shift is needed in how milk is marketed in Canada. We have seen some innovation from the Dairy folks but not nearly enough. Most new products have been developed to respond to supply-focused needs and relied on a push-driven strategy. Better analytics, better research and more market-based innovation can only lead to more prosperity for the sector. Clearly a new strategy is required for the marketing of milk in Canada!

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