California Case Presentation

“I like the taste of cold milk.” “Milk is a healthful drink.” “Milk is needed for growth.” “I should drink more milk than I do.” “Milk is a good source of calcium.” “Adults should drink milk.”

Case Presentation

got milk?: BRANDING A COMMODITY Group Members: Bijayshwori Shrestha Rashmi Baral Richa Mishra Sandeep Bajracharya

Saturday, April 04, 2009

Quiz! Whiz!! time *Best of Luck*

1. Jeff Manning was the executive director of CMPB which stands for..  Consumer Milk Processor Board  California Milk Processor Board  California Milk Packaging Board  Consumer Meat Packaging Board

Quiz! Whiz!! time *Best of Luck*

2. Which of these groups do not make up dairy industry:  Drinkers  Farmers  Processors  Retailers

Quiz! Whiz!! time *Best of Luck*

3. “got milk?” ad in 2000 emphasized in preventing which disease?    

Common Cold Blood Cancer Osteoporosis AIDS

Quiz! Whiz!! time *Best of Luck*

4. In 2004, California was ......Largest overall cheese producer in the nation.  first  second  third  fourth

Quiz! Whiz!! time *Best of Luck*

5. California milk began targeting which ethnic group in its marketing campaign?    

Hispanic White American Indian Black

“I like the taste of cold milk.” “Milk is a healthful drink.” “Milk is needed for growth.” “I should drink more milk than I do.” “Milk is a good source of calcium.” “Adults should drink milk.”

Case Introduction 

One of the most popular ad campaigns of the 1990s—was borne of necessity.

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Jeff Manning: Executive Director of the California Milk Processor Board (CMPB), reviewed reports on per capita U.S. consumption of milk over the last fifteen years. two decades decline & was accelerating.

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Manning only had a $23 million budget to be heard among noise

got milk? 

revitalization

A “milk deprivation” strategy

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reminded consumers of consequences of not having milk with certain foods.

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Positive response: more milk consumption

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Licensed nationally & became a catchphrase all over America.

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Successful in California & reversed the sales & consumption slide, while consumption levels continued to decline nationally.

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In 12th year some questioned: effective sustainability

The Dairy Industry Three major groups :   

Farmers: the milk producer Processors: convert raw milk into whole lower-fat milk Retailers: sell the final product

By 2003: Milk remained the most frequently purchased grocery item with U.S. milk industry value of $23.1 billion.

Other Distribution Channels  

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Major sales: Grocery stores Remaining sales: stores, schools & food service establishments. Latest threat: School districts policy 

1982: Five choices in children’s lunch including milk.

1986 to 1991: 3.8% decline in non-commercial food service milk volume  1991: Expense in food increased from 25 to 33% while commercial food service milk volume actually dropped 23% instead of enjoying 

BRANDS VS COMMODITIES marketing

Complexities: Name, product categorization

Supply Side Differences  Too many decision makers.  Small budgets  Slow budget process  Push versus Pull

Demand Side Differences  Changing a category versus market share.  Influenced by other industries.

BACKGROUND The Beverage Category In 1993 fierce competition among new beverages 

Media spending: Approached $2 billion, with over half of the total accounted for by beer & soft drinks. Milk spent less than 10% what beer spent on media

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While soft drink per capita consumption increased by 80% from 1975 to 1991, milk consumption dropped by 10 percent. In addition, milk’s market share dropped from 17% to 13%.

What about milk promotion campaigns ????

Promotion Campaigns prior 1993 Traditionally communicated a three messages: 

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Adults: Milk

is good for you and should be a regular part of the diet. Teens: Milk makes you beautiful and strong. Kids: Milk is cool and fun.

Focused target members drinking a glass of milk with brief mention of the nutrients in each.

Early 1990s: Two dominant campaigns Milk does a body good  Good 1992 UDIA national consumer survey revealed the acceptance: fast food •80%, “I like the taste of cold milk.” •89%, “Milk is a healthful drink.” •91%, “Milk is a good source of calcium.” •83%, “Milk is needed for growth.” •74%, “Adults should drink milk.” •52%, “I should drink more milk than I do.” 

CALIFORNIA’S MILK ENVIRONMENT Exhibit 1: Fluid Milk Consumption per Capita (gallons)

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Trends in 1993

35 -

Decline of milk sales accelerated from 1990 to 1993

30 -

31.3 million people with only 21 million potential drinkers. One glass per week increment in milk consumption profits increase over $100 million per year

25 U.S.

California

20 15 10 5 -

1980

1983

1986

1989

Source: USDA Economic Research Service

1992

1995

1998

2001

2004

Previous advertising campaigns: 

Effective in communicating health benefits

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Gains in sales of low fat and skim milk had come at the expense of sales in whole milk

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By 1980s: Milk sales increased by 10.9% while population increased by 26%.

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Average family included 2.5 kids decreased to 2.1 kids per family.

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Increase of working mothers

What comes the next?????

idea like a

California Milk Processor Board (CMPB) 

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Very dangerous/dynamic/supernatural hero… …

Observed accelerated decline of milk sales from 1990 to 1993. Therefore, specified its goal i.e. increase the sales & consumption of milk in California

Growth opportunity Latinos: fastest growing ethnic groups in the state, heavy users

C MPB

Group of processors to fund advertising & public relations programs for increase in milk sales & consumption. Initiation 

Hired Jeff Manning as executive director

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Raised about $23 million for promotion

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Agreed to sponsor legislation requiring them to contribute $0.03 per gallon of milk sold in the state in the 1st year, with slightly smaller contributions in the remaining years of its initial three-year charter.

The UDIA Consumer Study Probable factors for milk consumption decline :      

Proliferation of other beverages Lack of portability Lack of flavor variety Not thirst quenching Lack of consumer mind share Shared nature of consumption

Relationship of Milk with Other Foods 

With things like Oreos or any other kind of cookies or cake, none of these would be good without a big glass of milk.” - female, mid-30s

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At night with cereal, or for dunking Oreos. - female, mid-20s

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It’s a pain in the a— because you usually find out (that you’re out of milk) just after you pour the cereal. - male, late-30s

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“What are Cheerios? They’re nothing. But you add milk and it’s everything.” - male, late teens

CMPB’S BRANDING STRATEGY Developing a Strategy  

Invest in R&D to expand the number of flavors available. Expand the potential usage occasions.

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Cooperate with consumer packaged goods companies for joint promotions.

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Develop an advertising campaign to clarify the health benefits of milk.

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Generate a new image for milk through advertising.

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Target Hispanics and aging Californians.

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Milk consists of………

Need for new, innovative advertising campaign 

Change in consumer behavior

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Break the mold for milk advertising, grab attention, and shake consumers out of their “milk malaise”.

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Strong brand images by taking a more light-hearted approach, which talked directly to consumers

Manning reflected back on the decision:  

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The dairy industry has taken itself too seriously. Eating is a form of entertainment...the most popular form of entertainment in California, the USA, & the world. Get people smiling at your advertising and they will look, listen, and, we believe, consume more milk

Campaign objectives 

Change consumer behavior

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Increase mind share

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Halt sales decline

Target market 

“regular” users of milk—70 percent of the California market

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behavior segmentation strategy focused when and where consumers drink milk

“got milk?” Creative Development 

Used Deprivation Strategy “without milk”

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Television Ads  “Aaron Burr”  “Heaven”

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The “got milk?” tagline urged consumers to run to the refrigerator and make sure the answer was “yes. humorous ads and well received by focus groups

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“got milk?” Creative Development 

The campaign broke away from previous milk advertisements in two important ways:

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there was never any mention of how milk could benefit a healthy diet

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milk was never actually shown in the ads (food shown without milk)

Additional Communications Programs 

CMPB ran joint promotions with major brands such as Wheaties and Oreos

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These promotions included coupons, ‘got milk?’ logos on cereal boxes, point-ofpurchase displays, shelf talkers at the complementary food locations, and “got milk?” check-out dividers.

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Billboards were used extensively to reinforce the television campaign.

Media Strategy 

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Reached consumers during three ideal times to communicate the milk message: at home where milk could be immediately consumed, on the way to the store, and in the store

Media Strategy primary focus on television and

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concentrated on targeting consumers when they drank the most milk: 

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mornings during breakfast, afternoon snack time, and late evening snacks heavy outdoor campaign to target consumers on the way to and inside grocery stores. “got milk?”

Media Strategy 

Annual budget of $23 million doubled the previous year’s spending

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This placed milk among the top ten advertising spenders in all of California

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the campaign helped to compete with other beverages for the first time in milk advertising history

Would the deprivation strategy work??????

“GOT MILK?” SUCCESS 

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The campaign zoomed to a 60 percent aided recall level in only three months, enjoyed 70 percent awareness within six months campaign in top-of-mind awareness in less than a year The “got milk?” campaign quickly became a consumer favorite

“GOT MILK?” SUCCESS 

Exceeded initial sales expectations

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A year after the launch, sales volume increased 1.07 percent or $13 million, for a total turnaround of $31 million

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Milk consumers jumped from 72 percent at the start of the campaign to 78 percent a year later

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For rest of the country consumption declined over the same period by 0.1 percent

“got milk?” Goes National and International 

In 1995, the ads won an Effie Award and top honors from several other major advertising award committees

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“got milk?” licensed to the national dairy farmers’ group Dairy Management Inc. (DMI) who ran the campaign nationally.

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In 2004, “got milk?” went international and the ads began running throughout England, Wales, and Scotland.

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National Milk Processors’ Education program (MilkPEP) In 1995 MilkPEP’s ‘milk mustache’ with slogan ‘Milk. What a surprise’ Focused on ‘good for you’ In 1996 changed tagline to ‘Where’s your mustache?’ In 1998 obtained licensing rights to ‘got milk?’

Products and Partnerships 

products included t-shirts, baby bottles, mugs bearing the “got milk?” logo, and even a “got milk?” themed Barbie doll.

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General Mills, Nestle, Quaker, Keebler, and the Girl Scouts of America worked with CMPB

Products and Partnerships In October 1998, the CMPB 

established the www.gotmilk.com 

In 2005, the CMPB licensed apparel maker MJC Corp. to produce men’s clothing to be sold through WalMart.

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“got milk?” baby products were expanded into Babies “R” Us, Buy Buy Baby, Baby Depot and Macys.com.

Revising the Deprivation Strategy

Drysville’s ad “ Deprivation was only happening to “them”, the people of Drysville, not to consumer.” •

Milk Branches Out

Portable and flavored milk products manufactured, chugs “Milk where you want it”  “got chocolate milk?”  Healthier types of milk grew; soy milk, organic milk 

“got milk” Reconsidered

Growth Slows Exhibit 1: Fluid Milk Consumption per Capita (gallons)

California Class 1 Milk Sales in Millions of Gallons

35 30 25 U.S.

California

20 15 10 5 -

1980

1983

1986

1989

Source: USDA Economic Research Service

1992

1995

1998

2001

2004

New directions in “got milk” Marketing 

Back to health  “milk is healthy”  Milk, a necessary ingredient to stay healthy and get rid of Osteoporosis  Prevents PMS

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Launch of Gravity Tour (1998) Official sponsor of Major League Soccer. Theme developed “ Strength comes from within.”

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Hurdles on the way 

Independent Farmers Speak Out 

Won the Cochran case after three years and therefore continued to campaign.

New directions in “got milk” Marketing Hispanic Consumers  32.5% of California’s total population (2001)  Developed tagline targeting Spanish speaking households as “Familia, Amor Y Leche”.  Launched ad targeting Hispanics “La Llorona” which won “TV Silver” award  Created a campaign around the Mexican drink Licuados.

New directions in “got milk” Marketing Got Cheese?  Cheese consumption grew every year reaching an all time high of 34 pounds in 2004.  46% of all milk was used for cheese production.  California was the second largest manufacturer of cheese in the nation.

New directions in “got milk” Marketing Expanding Distribution  Capitalizing obesity crisis  Improved portable packaging and variety of milk flavors  Expand distribution into vending machines, schools, and fast food restaurants.  Child Nutrition Act 2004  Restaurants chains like McDonald’s began to serve milk with their meals.

New directions in “got milk” Marketing 

What’s next? 

Focus on new demographics  Russian

Family

Come up with fresh creative new innovative products and packaging  Expanded distribution ,or  ……………………………………….what next? 

initiatives. Does the CMPB risk alienating its current consumer base? Hispanic, being 32.5% of the total population, was a large market segment to be addressed. •

CMPB risk was not alienating its current consumer base as it was addressing different market segments differently. •

There are several areas of growth that lay ahead of the CMPB-health, cheese, Hispanic and new channels of distribution. Given the trends, what should they do and how should they do it. Work on Flavours • Packaging • Expansion of Milk Products • Target emerging markets like India and China. •

Exhibit 4: Annual Expenditures on Milk per Household, 2002

180 -

Hispanic

Dollars

160 140 -

White & Other Non-Hispanic

120 100 80 60 Source: Bureau of Labor Statistics

Black

campaign? What can they do to keep the message and strategy fresh in the consumer’s minds? Are there other examples of other successful campaigns that ran this long?

As long as people stop responding to the campaign. •Call to action  “got ......?” •Continue with celebrity endorsements. •Associate with sports and athletes. •Sponsor different events. •Increase the number of collaborations. •Use of web ads in online magazines. •

Thank you. “got milk?” Have a Nice Day.