Dairy checkoff money helps

build strategic partnerships

When American consumers bite into a pizza or a fast-food sandwich or get their kids a fast-food meal they may be buying into a strategic partnership forged between dairy farmers and some of the nation's food-marketing giants.

Loganville dairy producer Randy Roecker and Jim Montel, executive vice president of strategic initiatives with Dairy Management Inc., talked with Wisconsin State Farmer about some of those partnerships at World Dairy Expo.

Montel said the dairy farmers who decide what direction their checkoff dollars will go take a look at categories where these strategic partnership programs can make a difference. For example pizza consumption had declined since the early 2000s and since 25 percent of U.S. cheese consumption is on pizzas, getting people to eat more pizza was one way to turn the trend, he said.

That led to partnerships with Pizza Hut and Dominoes pizza chains. Montel and others on the DMI staff worked with the companies to increase pizza "traffic" - moves included aggressive promotion and pricing, limited time offers and new products like specialty cheese pizzas. One of them is pizza with 80 percent more cheese. Some of the others are pies with more varieties of cheese used.

Montel said one of the pizzas uses a blend of cheese that includes Asiago and Feta cheese. Another is an All-Wisconsin cheese pizza. One of the things they worked on with the pizza chains was prices that had gotten too high for the average consumer, he said. "Pricing got high and needed to be improved."

Roecker said producers have been very proud of the products that have come from these strategic partnerships. "These partnerships drive sales but they also put the producer's face on the things people eat," he said. "We are very proud of that."

Roecker grew up on the Loganville dairy farm he now operates in partnership with his parents and his wife. His dad began with 50 cows and five years ago they built a new facility that allows them to milk 340 cows. They also farm 600 acres. He has been on the dairy board for three years and has been reappointed to serve another term.

As a member of the export committee he went to China with U.S. Dairy Export Council and said he saw a world of opportunity there.

Back here at home, dairy sales are being driven not only by pizza, but also by other partnerships as well. Montel said since McDonalds provides such an opportunity for marketing additional dairy products, strategic partnerships and work on specialty products has been ongoing. "Twenty-seven million people per day visit McDonalds," he said.

Dairy Management Inc. has worked with the restaurant company on developing specialty and seasonal milk shakes and worked to make fat-free chocolate milk (with only 130 calories) the default drink with the company's signature "Happy Meals" for youngsters. "We expect to double the amount of milk sold through Happy Meals," said Montel.

"Through new product development we want to build credibility and identify opportunities where dairy farmer assets can best be used," he said.

McDonalds needed to have an on-staff dairy scientist to carry forward many of the new initiatives and they agreed dairy was a growth area for their company because of taste and nutrition, Montel said. "But they didn't have a lot of dairy expertise."

Dairy farmers have helped McDonalds staff its Oakbrook, Illinois test kitchen with specialists who can offer expertise in dairy - dairy scientists, a registered dietician, a chef and a marketing manager. Their contributions, he said, led to the decision on chocolate milk in the kids' meals as well as development of things like smoothies and the well-received "Mc Cafè" coffee drinks, which use significant amounts of dairy products.

Montel said that one of the ways these strategic partnerships pay dividends is that the dairy industry builds credibility with the partners they work with, and then others follow the trend they have helped create. "Not only do we have additional sales through McDonalds and the pizza companies, but others in that segment of the industry will follow them," he said.

"Success breeds success," he said. "Once you get momentum going you need to point to it and others do follow." Montel and his staff hold meetings or conference calls with their strategic partners once or twice each week to keep that momentum going.