Published on: June 17, 2021
I got the following email yesterday from Yin Woon Rani, CEO of MilkPEP.
(Just for context, MilkPEP - which stands for Milk Processor Education Program - is. Washington, DC-based organization that describes itself as "funded by the nation’s milk companies, and dedicated to educating consumers and increasing consumption of fluid milk. MilkPEP activities are led by a 20-member board and monitored by the U.S. Department of Agriculture’s (USDA) Agricultural Marketing Service. MilkPEP’s robust campaign efforts aim to increase awareness for milk’s nutritional benefits and safeguard milk’s reputation against competitive claims and anti-milk messages that impact consumers’ purchasing decisions.")
Thank you for your recent on-the-ground report from the GMNC/Retail Tomorrow Mid-Year Meet-Up in Dallas, Texas. However, I wanted to point out that one of your observations is incorrect. While paraphrasing futurist keynote speaker Nancy Giordano, you made the assertion that “more than half the milk consumed in this country now comes from plants, not cows.” If you look at the latest data, you’ll see that that statement is inaccurate.
According to IRI MULO+C for the latest 52 weeks ending 5/16/21, plant-based alternative milks represent less than 10% of the total milk (dairy + plant-based) volume sold in the United States. Perhaps you misheard Giordano, or she didn’t have her facts straight, but as you can see, the number you cited doesn’t add up.
In reality, nearly every household in the United States buys dairy milk (92.9% penetration) and households that buy dairy milk tend to buy on average 30.3 gallons a year, whereas households that buy plant-based milk purchase only about 6.7 gallons a year. As you can see, that’s quite a difference. These figures come from IRI’s all-outlet consumer panel, one of the most trusted sources in the industry, which we’re happy to share with you for any future reporting you might be doing on the milk category.
To that end, you go on to state that the dairy industry isn’t willing to “embrace change, even when it threatens us.” I strongly disagree with that statement, and so do the facts.
The dairy industry has been innovating for decades in order to meet the ever-evolving needs of American consumers. In recent years, we’ve gone to great lengths to meet consumers’ increasing demand for better health, wellness and sustainability. In fact, some of the fastest-growing milk segments provide additional health benefits. Here are the most recent numbers according to IRI MULO+C for the latest 52 weeks ending 5/16/21 versus its year ago period:
• Health enhancements (+12.7% gallons)
• Organic White Milk (+3.4% gallons)
• Lactose-free (+15.9% gallons)
Let it suffice to say, the dairy industry is adapting and innovating in response to consumer needs in real time. Beyond the fact that many of our dairy processors are also deeply involved in the plant-based movement, we pride ourselves in offering consumers a wide range of cow milk varieties to choose from, including DHA Omega-3, chocolate milk, lactose-free milk; on and on. Is it any wonder that cow milk can be found in 93% of households?
Thank you again for your report, KC. The dairy industry is counting on you for accurate reporting and we’re happy to act as a source for you at any time.
Apologies for playing fast and loose with the facts in commentary that may have been overly glib. Points taken.
Also got some criticism yesterday about some commentary I offered about the National Grocers Association (NGA) offering its regular assessment of the role that its core constituency - independent food retailers - plays in the broader economy. I wrote:
The ability of the independent grocer sector to remain, as NGA puts it , at the heart of the economy and the communities they serve, depends on retailers' ability and willingness to innovate, disrupt their own business models, and challenge conventional thinking about food, format and functionality.
Anything less will put the sector into perhaps irreversible decline.
Prompting one MNB reader to write:
Most of the time we align on viewpoints and I read your comments as validation of the scope of an issue. In this particular case, I have to call attention to the fact that your comments ignore the core issue being offered, that manufacturer favoritism of big box retailers (via trade spend, allocations, etc.) puts the independent sector at a disadvantage. Are you trying to walk a fine line here or do you not acknowledge the core issue NGA is attempting to address?
I was not trying to walk a "fine line." For better and sometimes for worse, I tend to trample on fine lines. My comments were aimed at a segment of the independent retailer community that believes being independent somehow makes them morally superior to chains and enough to guarantee their survival. (Not every independent, to be sure. And for the record, my favorite retailers tend to be those that most folks would identify as independent.)
Since you brought it up, I will take note of a conversation I had recently with a supplier who talked about independent retailer complaints about product allocations, especially during the pandemic. This person said that he was sympathetic to independents, but that if Walmart represents 30 percent of a manufacturer's business, then Walmart is going to get a 30 percent allocation, especially when suppliers are tight. If Amazon represents 20 percent of its business, then it gets a 20 percent allocation. But, for the sake of argument, if a wholesaler represents five percent of a manufacturer's business, and an independent represents five percent of the wholesaler's business, then the independent cannot really complain about allocations that match up to its percentage of the manufacturer's volume. And I suppose the same equation could be laid out for promotion dollars/trade spend.
Is this manufacturer favoritism? The supplier with whom I was chatting essentially said that this may not seem fair, but it actually is the very definition of fair.