Milk caught in the price war crossfire

Published 12 March 15

Wales’ milk industry could match the success of the lucrative branded bottle water sector, according to a communications expert.

Volvic and Evian produce 24 per cent of all bottled water sold in the UK, even though their price tag is double that of unbranded alternatives.

Ed Garner, communications director at Kantar Worldpanel, told the DairyCo Welsh Conference at Aberystwyth, that the milk industry could learn from these brands.

“Milk is cheaper than branded water but not cheaper than unbranded water. We need to take the same approach with our milk, to add value,’’ he said.

The conference was themed ‘Communicating with the consumer’ with speakers including Mr Garner, Amanda Ball, the head of marketing and communications at DairyCo, and Amy Jackson, Nuffield scholar and PR consultant.

Mr Garner warned that supermarket price wars would remain a threat for milk because retailers regard it as the ideal loss leader – heavy and perishable, which therefore limited volume sales. “Retail turmoil is irreversibly changing the landscape and milk is caught in the crossfire,’’ he said.

But consumers were becoming more sympathetic to the cause of dairy farmers, largely driven by a ‘warming effect’ resulting from high profile media coverage of the milk price crisis.

“When farming is in the mainstream press we see a spike in interest, a warming effect. The public are more likely to think that dairy farmers are doing a good job,’’ said Amanda Ball.

The current milk price situation has highlighted the need for dairy farmers to unite as one voice, whatever their scale and system.

Powys farmer Fraser Jones, whose six year battle to secure planning permission for a 1,000 cow dairy is well publicised, insisted there was no right or wrong type of system or herd size.

“It is great that we have different farming systems and farm sizes in the UK, it is important we celebrate all types,’’ urged Mr Jones, a speaker at the conference. “We must be proud of our industry and shout about it.’’

Amy Jackson shared his message. “Don’t knock others,’’ she said. Ms Jackson had investigated whether the public could learn to love the mega-dairy. She believed farmers could learn from companies such as Gressingham Foods, which had a policy of engaging with the local community ahead of any new development. It also pre-empted future development by ensuring good landscaping was in place before an application was submitted.

And yet she also discovered that there was a big demand for small farm products. “There is a nostalgia for brands from family farms, there is a real opportunity to add value.’’

You can download the speakers’ presentations from the DairyCo website:

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