As for the recent interest in whole milk, stemming in part from a more relaxed attitude towards fat as sugar comes under renewed scrutiny, Georgia-based Dreaming Cow has always been ahead of the curve, says Wehner, who now sells his wares in 4,000+ stores from Publix to Whole Foods to Sprouts, Ahold and Kroger, and is still generating triple digit growth year-on-year.
“We were doing clean label, low sugar, grass-fed whole milk way before it was cool, but now we’ve really started to look at the labeling hierarchies and call out the things we’ve always been doing, but were not really flagging up before [the latest packaging gives ‘grass-fed’ top billing].
“We’re also using the phrases ‘100% pasture-raised’ and ‘barn-free-cows,’ which no one else really uses, but we wanted to make it clear how our animals are raised, because so many different brands now use the phrase ‘grass-fed’ when they all mean slightly different things, and you’ve got this proliferation of pseudo grass-fed dairy brands.”
We’re using the phrases ‘100% pasture-raised’ and ‘barn-free-cows
While shoppers are starting to see claims such as ‘100% grass-fed’ appear on food packaging, even that could arguably be misleading to consumers, in that the cows in question will still typically have their diets supplemented with other things such as molasses, he says.
Other companies, meanwhile, are more preoccupied with whether cows’ diets are ‘grain-free’ rather than how the cows are actually spending their time, he says.
“Our cows by virtue of geography are pastured 200% more than many other cows, so I talk to consumers about non-confinement [you can feed a cow grass in a barn, but is that what consumers want?], but we also supplement with corn silage in the field instead of molasses, which would be problematic if you’re looking for some kind of grain-free certification.
“I think consumers buy into grass-fed in part because of nutrition [grass-fed milk has higher omega-3 content], but mainly because of animal welfare.”
Pasteurized, but not homogenized, and no stabilizers…
The other notable feature about Dreaming Cow –aside from its innovative flavors (honey pear, maple ginger, dark cherry chai) – is that its milk is pasteurized, but not homogenized [a mechanical process that breaks the fat globules into smaller droplets so that they stay suspended in the milk rather than separating out] so a layer of cream rises to the top of the cup.
While this ties into consumer demand for products that undergo minimal processing, it can be hard for consumers to understand why the product is not as blended as other yogurts, he says. “We wanted to do the minimal amount of processing, but we’re still grappling with whether this is what consumers want when it comes to yogurt.”
Keeping the product looking as good when you grab it from your fridge as it did when it came off the production line is also tough when you have an un-homogenized product and you don’t use stabilizers to keep everything suspended, he says.
“Stabilizers also hugely benefit how your product looks, but when we started, we wanted to keep processing to a minimum [no homogenization] and labels as clean as possible [no stabilizers]. I’d say the look of the product is actually one of our biggest challenges, believe it or not, because it’s very hard to get people to handle it with care right through the supply chain.
“We even go as far as writing ‘handle like eggs’ on our case boxes just to get people to take better care, so that’s been a huge issue.”
Honey Pear ingredients:
Grade A Pasteurized Grass Based Whole Milk, Pear Juice, Honey, Natural Pear Flavor and Live Active Cultures: S.Thermophilus, L.Bulgaricus, L.Acidophilus and Bifidus
We’ve had to bootstrap
Wehner, who manufactures his own products in-house at his parents’ Jumping Gully Farm in Pavo, south Georgia, with his wife (COO) Janelle (a Kiwi he met in New Zealand while he was studying), says this is more capital intensive than working with a co-packer, but enables them to have complete control over the supply chain.
“Being young and inexperienced, we didn’t really realize what we were getting into and if I had the time over again I don’t know if I’d have gone to a co-packer. Being vertically integrated is great, but it’s also very hard having to wear every single hat, from supply chain to logistics to safety, when other start-ups are just worrying about sales and marketing. But it taught us to be extremely scrappy because we had to bootstrap.”
The farm - which also supplies milk to his sister Jessica’s Sweet Grass Dairy cheese business – is also capable of meeting Dreaming Cow’s needs as it grows, he says. “We’ve got more than 2,000 cows on pasture across three different milking platforms and close to 3,000 acres of grass-fed agriculture.”
“I can’t say any more probably until we launch at Expo West next year, but we’re working on being first to market with something completely different that no other brand has done.”
Kyle Wehner, co-founder, Dreaming Cow
Promotional dynamics in the yogurt category
So what’s happening in the notoriously competitive yogurt aisles? Right now, grass-fed and whole milk are bang on trend, he says, while a few years back, all retailers were interested in was Greek. Overall space devoted to yogurt products is also increasing, especially in natural, specialty and organic, although much of this is now being allocated to yogurt drinks, he says.
From a pricing perspective, however, it’s hard to get consumers to try new things when you’ve got the big three players (Yoplait, Dannon, and Chobani) slogging it out on price.
“I remember when Noosa started [Aussie-style yogurt in a distinctive shallow tub] they were charging $2.79 but now they are doing two for $4 and there is more competition out there now. It’s really hard to get out of the rat race.
“It’s crazy when you think about it, that they’re selling Gatorade – which is basically sugar, water and flavor - for more than they are selling yogurt for, which requires you to breed and raise animals, harvest their milk, pasteurize it to pharmaceutical grade standards, refrigerate it, and get it to market without messing up!”