The California Milk Processor Board: Branding a Commodity Got Milk? The California Milk Processor Board: Branding a Commodity

The Issue at Hand Steady decline in milk consumption over 20 years – accelerated pace $23 million ad budget Based on milk deprivation research Goodby, Silverstein campaign reversed accelerating decline but has not increased consumption beyond 23 gal per person. Here is what they did.

The Players Farmers – fund campaign from profits Processors – transform raw milk into products that hit grocer’s store Retailers – one of most profitable products for grocery stores Distribution channels – grocery, school districts, food service establishments [all contribute to decline in consumption] CMPB – want to increase sales and consumption of milk

The Challenge of Marketing a Commodity More similar to product category than brand No brand name Too much input from suppliers (milk people) – status quo Hard to change attitudes toward a category Lower budgets than competition (cola) Distribution levels are 100%, but no pressing need to purchase Demand influenced by other products

Competitive Situation 1,805 new beverages in 1991 alone Media spending $2 billion (beer and soft drinks) 1975-1993 consumption of beverages increased 18% - but NOT MILK (dropped by 10%)

The ‘Skinny’ on Milk Goal: 1 additional glass per week Some cannibalization of milk Family unit link – 89% consumed at home Nostalgia and ritual important Regular times (meals) and with other food

Factors in Milk Decline UDIA 1992 study [1252 interviews] Proliferation of other beverages Lack of portability Lack of flavor variety Not thirst quenching Lack of consumer mind share Competitive spending level Shared nature of consumption [cereal, cookies, PB&J]

The Marketing Strategy People had positive attitudes toward milk; but there is not a corresponding change in behavior. Objectives: Change consumer behavior – increase 1 glass & change way consumers think about it Make consumers think about milk (mindshare) Halt sales decline

The Marketing Strategy Target market Regular users [70% Californians] Segmented by behavior – what they liked to eat with milk When and where it is consumed Research Milk deprivation research – focus groups denied milk

Creative Development No mention of health benefits (already knew that) Never show the milk Television ads using humor Joint promos with Wheaties, milk coupons, POPs, shelf talkers for complements, check out dividers, billboards, print

The Results [California] 3 months – 60% aided recall; 6 months – 70% awareness level Number of people using “several times/wk” jumped from 72% to 78% One year later – sales volume increased 1.07% or $13 million for a total turnaround of $31 million

Got Milk Goes National Combined budget: $180 million Co-promos with General Mills, Nestle, Quaker, Keebler, Girl Scouts Ads with Trix, Rice Krispies, Cookie Monster, Dole – even Hot Wheels

The Here and Now… Consumption has reached a plateau. What now? Evaluate the marketing strategy. What changes would you make? What associations do consumers have for milk? How does this translate into brand equity?