Increasing Demand for Pasture-Based Dairy: What Attributes and Images Do Consumers Want? - Re-Thinking Organic Food and Farming in a Changing World - page 123

1999 ;Nott 2002 ; Kriegl and Frank 2004 ; Conner et al. 2007 ). Product differentiation
based on consumer demand for specific attributes is a well-established strategy
for small- and medium-scale farmers who lack the volume to provide family
viable incomes given the tight margins of commodity markets (Lancaster 1966 ;
Porter 1985 ;Duffy 1998 ). Yet, according to a recent study, most (80 %) pasture-
based dairy farmers in Michigan sold their products to commodity pools, including
Michigan Milk Producers Association, rather than as differentiated products (Haan
et al. 2011 ). This presents a probable missed opportunity, as research in Michigan
finds that consumers value pasture-based dairy products, are likely to buy them
if available and the majority (87 %) are willing to pay a premium price (Conner
and Oppenheim 2008 ). Demand for these products is based on perceived benefits,
including improved human health, and animal welfare, and reduced environmental
impacts, which are also rated as important by large majorities of consumers in the
United States (Howard 2006 ; Conner et al. 2008 ; Howard and Allen 2010 ).
Consumers in one recent study, for example, stated they were willing to pay a
$1.00 per gallon (median) premium for pasture-raised milk (Conner and Oppenheim
2008 ). Multiplied by one-half (reflecting median) of the state's population (about
five million) (U.S. Census Bureau 2010 ) and per capita milk consumption (23.9 gal
per year according to USDA (Economic Research Service 2012 ), these findings
imply a net gain of more than $117 million to the state's dairy industry if half the
state's milk consumption could be converted to pasture-raised milk, made available
to consumers and identified as such. While this number is admittedly an upper
bound, it demonstrates the potential gains if this demand is met.
One key message of this study was the current lack of effective promotional
messages to communicate desired product attributes to potential pasture-based dairy
consumers (Conner and Oppenheim 2008 ). The goal of this research was to fill
this gap by using focus groups to create and test promotional messages, while also
investigating the current perceptions and attitudes of dairy consumers. The results
will be incorporated into a subsequent online survey and may ultimately be used to
expand the demand for pasture-based dairy. The goal was to generate and/or identify
key themes that resonate best with milk consumers to help connect them with the
important attributes of the product, leading to increased profitable sales.
Consumers participating in this study were recruited from retail food co-
operatives and natural food stores in Michigan, since the growth of organic eco-
labeled products took root in these niche markets and are likely places for alternative
eco-labeled products, like pasture-raised, to also gain support (Organic Trade
Association 2010 ). Similar motivations and values are shared between natural food
store shoppers and food-co-op members, although inherent differences also exist.
Food co-operative members who frequently purchase organic foods tend to also be
concerned for environmental health (Goldman and Clancy 1991 ; Wilkins and Hillers
1994 ). Altruistic and relational values are reflected in retail food co-operatives'
ideological features of organizational participation and democratic decision-making
(Brown 1985 ) despite these structure's potential hindrances to economic viability
(Cotterill 1983 ). Natural food retailers do not share the ideological structure of
cooperatives but have still contributed to the growth of the alternative eco-product's