Monday, 15 June 2009

What Irish Farmers, Free Range Cows and Johnny Rotten Tell Us About Butter Eaters

Butter advertising. There’s a lot of it about at the moment.

Advertising is expensive. The costs can run into millions, so companies want to get their advertising right. This they try and do by talking to consumers about butter in general, and their brand compared with competitors’ brands. Armed with all this market research, companies come up with the messages and slogans they think will persuade us that their butter is best.

So a look at what each of the brands is saying in their advertising gives us a good steer on what is important to consumers when it comes to butter.

Three of the four biggest brands are foreign owned – Lurpak from ARLA, Kerrygold from the Irish Dairy Board, and Anchor from Fonterra. Only Countrylife owned by Dairy Crest is British.

Here’s what each is saying.

Lurpak, the brand leader, sells on taste. Their slogan is “ Good food deserves Lurpak”, and it reminds us that taste is all important when it comes to a food product.

More interesting is the Kerrygold advert. Aware of growing respect on the part of the public for farmers, a group of healthy looking Irish dairy farmers explain that they are part of a cooperative which means they get a fair price for their milk. The advert shows that they love their cows, implying that they will be well cared for. They say the cows are grass fed, and this, plus showing acres of lush green fields, puts across a feeling that Kerrygold is a natural, wholesome product. Whilst a very complicated set of messages, the overall tone reassures those consumers worried about farmers being fairly rewarded, those worried about animal welfare, and those who want to be sure their butter comes from cows fed naturally on grass.

Anchor with their slogan “The free range butter company”, emphasises that their cows are free to roam outside all year. To the strains of the theme tune from the Great Escape, a cartoon cow astride a motor bike leaps the fence to freedom. By using the words free range with their overtones of a better life, the clear implication is that Anchor cows have a better life than those who cannot get out. Again it’s an animal welfare story, but with a natural slant too, for a cow free to roam will by implication only eat good fresh grass.

And so to Countrylife featuring Johnny Rotten, or John Lydon as he is now known. Unashamedly jingoistic, it trumpets the brand’s Britishness, picking up on the consumer trend to support British brands. It also has a quality message too, with Lydon saying at the end that he buys because of the butter’s great taste.

What do these advertising messages suggest about consumers, butter and British dairying?

The thorniest issue has to be indoor housed cows with the twin implications of a life cooped up in a small space, and a questionable diet that does not include fresh grass . According to the NFU, only 1% of British cows are kept in this way. Nevertheless, two big, foreign owned brands feel they can use the fact that their cows are able to go outside as a reason to buy their products. Such advertising might raise a doubt in consumers' minds about exactly what sort of a life the British cow has, and what precisely is going into the butter product.
More straightforwardly, it is clear that food products have to taste great to succeed, and that the main reason to buy butter as opposed to margarine is that it is an all natural food.

Finally, the Kerrygold advertising reminds us that not only Irish farmers enjoy a good reputation with the public. There is a warmth now towards farmers and farming which should be

Friday, 5 June 2009

From the Farmer's Mouth - Diversification in a Downturn

Despite the downturn it seems the appetite for diversification continues. Among the businesses showcased in the farming press in the last 6 months are a goats cheese maker, sheep milking, a seller of Herefordshire apples and pears, a couple of farm shops, Welsh lamb and traditional breed meat being sold to smart London chefs, beef pastries, premium sausages, dairy product processors, and an arable farmer who produces woad dye.

Although the products sold are different there are commonalities in the way that the farmers approach their businesses. All emphasise the importance of listening to what the customer wants. James Manning, the Herefordshire grower selling his fruit direct has built his business by offering a bespoke service where he is prepared to sell just one or two boxes if that is what the customer wants, and won’t push for higher volumes because he feels it breaks the bond of trust between him and his customers.

William and Daphne Tilley and sons John and David sell Elwy Valley Welsh Lamb to high end catering customers, and attribute success to listening closely to what customers want, and being prepared to alter flock management to achieve it. They are now prepared to spend £1000 on a tup to get the good back ends but also loin with a big eye and good meat cover from neck to tail that chefs demand.

Ian Howard, the Woad grower, will not compromise the quality of his dyes by adding chemicals, even though it would be many times cheaper, because “that is what my customers want”.

Graham Kirkham of Beesley Farm near Preston, selling Mrs. Kirkham’s Lancashire Cheese, uses up all the milk from his 100 cows in his cheese making and says “The biggest lesson I learnt from the (farmers) markets is to listen to customers”.

There is consensus about the importance of selling a top quality product, and when it comes to food, the best way to get customers to buy the product is to let them taste it first. Graham Kirkham says “Taste is everything”. Richard Vaughan who with wife Rosamund sells Longhorn Beef, Middle White Pork, and Ryeland Lamb under the Pedigree Meats brand says “ We rely on our customers being our ambassadors as it is only by tasting it you realise it is different”. James Manning does tasting sessions for his fruit, William and Daphne Tilley believed firmly that “taste must be outstanding” and were so confident that they built their business by challenging chefs to compare their lamb with that of their current supplier.

On pricing, the tone coming through the features is that you have to be realistic, and acknowledge that consumers are being very careful about where and how they spend their money. Alan, John and Brian Philby farm in Felbrigg East Anglia and sell beef, fruit, veg and turkeys through their farm shop as well as local stores and some wholesalers. They believe that the public still wants to buy fresh and local food, but that the secret is to keep prices keen so that customers come back again and again. Alan says that last Christmas they priced their turkeys competitively and not only sold the whole 800 very quickly, but benefited from many customers purchasing vegetables in addition.

Heather Parry who manages Fodder, a new food hall at the Great Yorkshire Showground, intends to source at least 85% of the stores food from within Yorkshire, but says “I’m very definite that local food shouldn’t mean more expensive”.

Neville and Mary Kemp who with 230 suckler cows keep one of the biggest Angus herds in the country sell their Absolute Angus Beef Pastries through 16 Tesco’s, and a local independent supermarket. Neville recognises that he is competing with big national brands, and says that “the market place is very competitive at the moment”.

On the other hand, Richard Guy who runs the Real Meat Company says “If they (customers) say they can’t afford to eat our meat I tell them they can, but do they want to”.

Whilst there are still many examples of diversifying farmers controlling the whole process from production on their own farm to selling to the end consumer, The Real Meat Company is an example of a trend to divorcing ownership of the brand name from the production side of things. Real Meat is mainly a franchise business with Richard owning the brand name “Real Meat” and managing the sales, marketing, and production standards for 16 independently run shops and their various farmer suppliers.

The divide between those who embrace dealing with supermarkets because of the volumes they can sell, and those who won’t have anything to do with them continues. There is no right or wrong here, but good advice comes from Janet and Mick Forsham who are turning their milk into yogurt and fromage frais in the Forest of Bowland. They say the key is not to rely too heavily on one particular customer.

Despite the downturn, farmers are showing creativity, energy, and success in their diversified enterprises. Diversification remains a time consuming activity which is not without risk, particularly in the current climate. But it can also be financially rewarding, particularly for farmers who can build a good brand name, and manage costs along the supply chain. As Richard Vaughan from Pedigree Meats says “ Selling 100 cattle direct is financially a better business than when we were selling 1000 to supermarkets”. Importantly, diversification can give farmers a control over their destiny often lost when selling unbranded goods into the mass market.