One of the distinguishing features of the American dairy case has been the dominance by regional milk brands and the lack of a real national brand, even as national brands have proliferated and done well in every other dairy segment. Much has to do with the local imperatives of fresh milk distribution as well as the federal government’s regional pricing structure.
So Dean Foods took a big bet in 2015 when it decided to introduce DairyPure. It launched as America’s largest brand of regular fluid milk by bringing all of its regional dairy brands under one label. And the investment paid off financially, too, as two years later the DairyPure brand is generating $1.5 billion in sales.
Dallas, Tex.-based based Dean crafted the DairyPure brand by combining the appeal of a true national brand of milk—backed up by a “Five-Point Purity Promise” to affirm its values—with the confidence of a co-branded local or regional brand in each market, leading to co-branded packaging with the DairyPure logo. There have also been co-branded marketing campaigns such as a recent Kraft Macaroni and Cheese tie-in.
The pledge promises that DairyPure contains no artificial growth hormones, is from cows treated with no antibiotics; continuously tested for purity throughout processing; from only cows with a healthy diet; and cold shipped fresh from a local dairy.
Little has actually changed with the products per se, and most of the sales volume was present under Dean’s collection of regional brands. But DairyPure already accounts for more than 14 percent of America’s total $10.4 billion fluid milk market. And it ranked No. 1 on the 2016 New Product Pacesetters list from market-research firm Information Resources Inc., with a launch that generated nearly $1.2 billion in sales.
“Labeling and creating a large national milk brand had never been done before, and now we can advertise and communicate the benefits of the brand,” Kurt Laufer, Senior Vice President, Chief Customer, Marketing and Innovation Officer for Dean Foods (right), told brandchannel. “But we will maintain the local brands because people want to understand that they’re getting the purest milk possible and that’s being delivered via their local dairy.”
Laufer told us more in a Q&A:
What were the factors that led you to create DairyPure?
When you just have local brands, it’s hard to have media-buying efficiencies. It’s hard to invest efficiently when you’ve got small regional brands that are fragmented. We also knew that there would be a market for a branded milk. Only about 10 percent of American consumers are “branded consumers,” who only buy branded milk. Another 30 percent only buy private-label milks [in part because of the heavy impact of pricing movements in the category]. About 50 percent to 60 percent of milk shoppers go both ways.
Did the success of TruMoo, the one percent-fat chocolate milk brand you introduced in 2011, pave the way for DairyPure?
Yes. We learned from TruMoo that there is certainly room for a national brand even while in many cases keeping the local brand too. It has evolved over time, but that same concept allows us to advertise nationally, and the sub-brands allow us to tie that back to the local brand. Consumers are very aware of local brands, and we don’t want to come across as a big, bad national brand, where you can’t be sure where your milk actually comes from.
How has the Five-Point Purity Promise helped the brand grow so quickly?
One reason is that more people are tempted to switch to plant-based “milks.” They think they have to go to plant-based milks to get that purity. DairyPure starts to create the promise and tell truths out there rather than have false perceptions.
Also, we’re starting to see whole milk back on the rise. This is the first time in years the discussion is all about whole and full fat, and we’re excited about that. We’re going to start to move that into the forefront of our advertising and what we picture in it. It’s hard to buck that trend: Shoppers tell the truth, and that’s where it’s going.
How will the DairyPure brand grow from here?
We recently extended DairyPure into a line of creams, coffee creamers and sour creams, and we plan cottage cheese in 2018. We’ll be a master brand in the dairy category – anything that could play in the purity segment. Everything has to be able to stand up to that 5-Point Purity Promise. So we’re being very intentional about where we can play and where we can’t with this brand—you won’t see it in dips, for example.
And why are retailers excited about DairyPure?
The market basket for the person buying DairyPure also probably includes buying Eggland’s Best eggs, a premium product, and maybe they’re making a point of buying Land O’ Lakes butter. So it’s a branded dairy shopper who is very valuable to retail partners. That’s where this brand is starting to make a difference.
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