Milk’s Stuck in Supermarket Siberia

11/9/2013 7:00 AM
By Jessica Rose Spangler Reporter

With the world’s population growing, more food will have to be produced to feed all those people.

One could assume that implies the consumption of milk has a bright future, especially since dairy products are in countless products besides the good old-fashioned glass of white milk with breakfast.

But let’s not get the glass ahead of the cow.

According to John Stanton, professor of food marketing at St. Joseph’s University, unless the dairy industry gives milk a face lift, we could actually see a continued decline in milk consumption.

Stanton spoke about “Fluid Milk Processing and Consumption Trends in Pennsylvania” on Nov. 1 as part of the Pennsylvania Dairy Futures Analysis webinar series conducted by the Center for Dairy Excellence, the University of Pennsylvania New Bolton Center and the Penn State Extension Dairy Team.

To help forecast what future trends may look like, Stanton first looked at past data, which indicated a consistent decline in milk consumption since 1975. One of the reasons for this decline is a consumer shift toward more convenient options.

“Consumers are in the middle of a time famine,” Stanton said. The dairy industry’s “best consumers are families with kids, and they’re the busiest consumers.

“The worst part in milk is that we haven’t paid attention to consumer trends because trends take place so slowly that we don’t see it,” he said. “We must continually reinvent convenience.”

To illustrate his point, Stanton used Quaker Oats as an example. In 1877, Quaker Oats simply came in a can that took five to 10 minutes to prepare on the stovetop.

By 1920, Quick Quaker Oats was delivered in the same manner, but only took two to three minutes to prepare. Then came the microwave option in the 1950s and instant oats in 1999.

In 2003, Quaker Oatmeal Bars were unveiled as an on-the-go, no prep-time option for the busy consumer.

“We can’t say milk is just milk. We have to be more open to change,” Stanton said.

Look at Smucker’s. “How long does it take to make a peanut butter and jelly sandwich?” he asked.

“Too long,” he said.

To help keep up with consumer trends, Smucker’s has come out with Uncrustables — pre-made, thaw-and-eat peanut butter and jelly sandwiches.

And that’s not all. Butterball has developed a fully cooked turkey for a quicker meal option this Thanksgiving.

“I really like the excitement we’re seeing from McCormick. Their pre-measured spices are a really interesting approach. The price is dramatically higher per ounce compared to the bigger” single spice containers, Stanton said.

On top of milk’s lack of convenience, Stanton believes that the dairy industry isn’t focusing on a rapidly expanding market — Hispanics.

“The Hispanic-speaking market (in the U.S.) is the second largest in the world behind Mexico. It’s larger than the entire population of Canada,” he said. “We don’t market to Hispanics, but our competitors do. I don’t see any Hispanic labeling on dairy products.”

On top of a lack of convenience and not targeting a core demographic, the one thing the dairy industry is targeting is declining — grocery store sales.

“The pace of growth in the grocery channel is declining,” Stanton said. “We shouldn’t be surprised to see milk sales decline in the grocery stores because it’s happening to everything.”

The number of times a consumer visits the grocery store is decreasing too, he said.

But a bright spot can be found in the compounded growth in convenient, nongrocery outlets such as gas stations and minimarts. The catch is that items being sold there are of the single-serve variety, not the gallons of milk the dairy industry would rather see fly off the shelves.

The dairy industry also needs to improve its labeling compared with drinks like Gatorade and Red Bull.

“When you walk down the beverage section, what are you buying?” Stanton asked. “Soda, water, juice, not milk. In focus groups, I’m told that the milk section is like Siberia and the beverage aisle is fun.”

He pointed out that milk is one of the few beverages that isn’t in the beverage aisle of the grocery store. It’s in the milk section, typically in the back corner of the store.

“Per capita consumption is really important when we look at the future because you can always count on an increased population,” Stanton said. “Pennsylvania milk sales have a slow downward decline. The future doesn’t look good if we do nothing.

“It’s not so negative that there’s no hope,” he said. “We have to take affirmative, positive action. We’ve got to become a nag. We’ve got to tell people milk is good for them like my mother did.”

One area that the dairy industry has minimally expanded into is the flavored-milk category.

“Flavored milk has really held its own. You see all sorts of flavors of Gatorade and iced tea,” Stanton said. “We basically just offer chocolate.”

Stanton suggests targeting the audiences that want milk. For example, children and what’s relevant to them — possibly bubble gum- and root beer-flavored milks.

“Frosted Mini-Wheats comes in 12 flavors that target what their audience wants,” Stanton said. “Studies show that kids want milk that tastes like their cereals.”

Relate that to drinking the “flavored” milk at the bottom of the cereal bowl.

But adults like flavor too. Research has shown that adults would like a variety of milk flavors to use with different things, like with their coffee or in cooking.

Compare the packaging, shape of the bottles and coloring of the drinks sold in the beverage aisle. Oftentimes, they’re bright, in fun designs and in single-serve quantities with multiple flavors available.

And the flavors aren’t simple things like chocolate and strawberry. Oftentimes, the flavors have creative and catchy titles like “cool blue” that provide very little insight to what the actual flavor of drink is.

“Then there’s milk — white, chocolate and strawberry. The packaging just says milk.’ Apparently we thought consumer didn’t know what was in the bottle,” Stanton said.

Some flavored milks that are available now include Starburst, Spiderman, 3 Musketeers, Milky Way, milk and fruit, and Slim.

“Marketing isn’t making people buy what you want to sell. It’s selling what people want to buy,” he said. “There’s no question in my mind that people will pay for what they want. The smaller the quantities, the more you pay per ounce. Compare that to frozen dinners.

“Our obsession with keeping things at the lowest possible prices is throwing away a potential market,” Stanton said.

This isn’t just a Pennsylvania problem, but a national decrease in milk consumption.

But because Pennsylvania “sells so much milk, we should take a leadership role, showcase our farmers and producers and products,” Stanton said. “It’s not a pretty picture, but there’s things we can do to fix the future.”

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