DAIRY TO DREAM
A more efficient supply chain and new promotional efforts
freshen up the fluid milk category in the convenience channel.
BY TRACI CARNEAL
> Whole Milk
> 2% Milk
> 1% Milk
> Skim/Nonfat Milk
> Flavored Milk
> Cream/Creamer Products
> Other Ready-to-drink
Fluid Milk Products
NACS category definitions can be
used to establish performance benchmarks and a framework for retailers and suppliers to discuss market
performance comparisons. For more
NACS category definitions visit nac-sonline.com/categorydefinitions.
Even the tried and true c-storecategories need rejuvenatingfrom time to time. For the fluidmilk category — where the suc-cess of many c-stores is rooted— the upside is that it still ranksamong the top 10 category lead-ers in store sales. The challenge
is keeping this convenience staple fresh for consumers
amid the influx of innovative beverage products.
For many convenience stores, dairy has always been
in their DNA. Wawa was established as a dairy farm in
the late 1800s and Weigels Convenience Stores opened
as a dairy business in 1931. Cumberland Farms was a
New England dairy in the 30s and 40s, before expanding
its business. Some chains, including Kwik Trip, Rutter’s
Farm Stores and Stewart’s, remain in the dairy business.
“We view milk as a rich tradition in convenience
Keeping It Fresh
retailing,” said Derek Gaskins, chief customer of-
ficer at Rutter’s Farm Stores. “At Rutter’s, we are
proud of our heritage, and recognize the importance
that Rutter’s milk plays in strengthening our brand.”
The chain’s fresh milk and dairy products — from
approximately 30 family farms located in central
Pennsylvania — have gained a large following, with
devotees taking to social media sites like Facebook
to create fan pages for different products.
Once a staple beverage, milk now has competition from many angles, including energy drinks, flavored water and smoothies. To rejuvenate a product
seemingly going sour, marketers are trying to revitalize consumer interest in the category.
The Milk Processor Education Program (Milk-
PEP), for example, is launching a multi-million
dollar, cross-platform campaign that reinforces
milk’s nutrition benefits, including its high-quali-
ty protein content. Funded by U.S. milk processors,
MilkPEP activities are led by a 15-member board,
The program promotes new usage occasions,
such as repositioning chocolate milk from a kids’
drink into a post-workout recov-
ery beverage for adults — and
the strategy is working.
“Today, chocolate milk is making an impressive comeback, and
the recovery message has brought
lapsed milk drinkers back into the
fold, successfully driven incremental sales and created a halo effect for
the entire category,” said Julia Kadison, interim CEO at MilkPEP.
Developments from a supply
chain view also bring wholesome
news to the category. In the past,
dairy consolidation onto broadline distribution was not common practice. However, in recent
years, as retailers have sought
a lower cost and longer-coded
dairy program, this has changed.
As a result, more retailers
are gravitating toward a lower cost, more efficient supply chain in an effort to reduce
costs associated with Direct
“They have done this by utilizing their broadline supplier to
leverage the fixed cost of supplying their stores,” said Christopher
K. Hobson, senior vice president,
marketing at Core-Mark International, Inc. “In many cases, this
consolidation of vendors has allowed for a more frequent delivery schedule from their broadline