October 1, 2006
by James Dudlicek
The Bennett Family Focuses on Health and Community in Furthering the Oakhurst Mission.
They say imitation is the sincerest form of flattery. For Portland, Maine-based Oakhurst Dairy, it’s a double-edged sword.
On the one hand, seeing its main regional competitors renounce the use of milk from cows treated with artificial hormones is a vindication of sorts for the stand Oakhurst took against rBST when it was introduced more than a decade ago.
On the other hand, the recent move by HP Hood and Dean’s Garelick Farms takes away one of Oakhurst’s main points of differentiation — one that the hometown favorite withstood a lawsuit with Monsanto to uphold.
“Even though the FDA states that there is no significant difference in the milk from cows treated with artificial growth hormones, our consumers were concerned, and we listened,” says Stanley Bennett II, Oakhurst president. “Oakhurst milk carried America’s first farmers’ pledge not to use artificial growth hormones. Oakhurst has never had them and never will.”
That FDA disclaimer was added to Oakhurst’s packaging as part of the 2003 settlement with Monsanto, maker of artificial hormone Posilac, which challenged the on-label “farmers’ pledge” against the use of rBST.
But the competition jumping on the bandwagon doesn’t necessarily foretell a drop in demand for Oakhurst milk, the brand leader in northern New England, or a drop in enthusiasm among the Bennett siblings who own and manage the family company. Since Dairy Field’s last visit to Oakhurst five years ago, the company has spent millions to upgrade its infrastructure, adding filling and storage capacity and making other improvements that will allow Oakhurst to build upon its equity in northern New England and expand its foothold in Massachusetts.
At $92 million in annual sales and growing (including Oakhurst-branded milk, ice cream mix, fresh and UHT creams, sour cream, cottage cheese, juices and drinks, plus co-packed products), the Bennetts have big plans for promoting the healthful aspects of dairy products under the Oakhurst brand. Key to that strategy is their Nu-Trish brand, Oakhurst’s venerable probiotic milk product that’s being looked to as a wellness platform.
“Nu-Trish is potentially the first in a platform of products that could be more health-focused,” says Jim Lesser, director of marketing. “The industry has done a great deal of research on milk and the benefits of milk. MilkPEP is doing a good job today communicating some of the benefits of milk. There will be a lot more focus coming back on this most nearly perfect food. Our industry already has a healthy platform in dairy that can be leveraged more. The associations are doing as much as they can to promote the health benefits of dairy, but it will take a brand owner to really drive the message to consumers. I don’t believe there are any brands today really driving that message.”
Home and Away
It’s the family’s connection to the community and its closeness to its supply chain that have helped keep Oakhurst ahead of its competitors on its home turf. They’re now hoping the “natural goodness of Maine” message will resonate with more consumers a little farther south.
“It’s a very competitive marketplace, that’s for sure,” says John Bennett, vice president of sales. “Our brand-name recognition is incredibly high in Maine and gaining all the time in the rest of New England; New Hampshire is very strong as well. We try to offer a higher-quality product, a great level of service and the touch that an independent, smaller, family-owned business can provide.”
Lesser elaborates: “Oakhurst has consistently stayed in front of the consumer, with advertising, consumer promotions and community involvement. The company should be applauded for its efforts in good years and bad of making sure it stays in front of the consumer, talking about the product benefits. It’s a family-owned company, and the family is very visible in the city and throughout the state of Maine, something our competitors don’t have the ability to do.”
However, the Bennetts are cautiously aware that the family connection might not play as well farther away from Portland.
“Right now, we’re trying to take that message and translate it to New Hampshire and Massachusetts, where the focus of dairy has been that milk is just milk,” says Althea Bennett McGirr, director of customer relations. “We’re communicating the significant differences we have, our commitment to the community, participation in local fairs and local sampling opportunities. We don’t toot our horn about our family as much out of state because that doesn’t resonate as much as the quality of the product and our relationship with the farms and our commitment to the BST-free product.”
For this fall, Oakhurst has launched a 10-ounce plastic line for school milk that has been very well received by its customers, including many new school contracts. Last year, the Bennetts cooperated with the Maine Dairy Council in exploring new formats and formulations for school milk.
“There was a lot of debate over whether it was going to be 8, 10 or 12 ounce, but not a 16 ounce, because 16 ounces was too much, and actually, for a high school student, an 8 was too small,” McGirr recounts during DF’s visit in late August. “We worked cooperatively with them to decide that we would develop a 10-ounce. In the less than a week that the schools have been open, I’ve never heard so many unbelievably positive comments about our product.”
Beyond that, Oakhurst is ramping up its product development efforts, working on some new concepts that are still under wraps. “With all the good news on milk, we think it’s a perfect opportunity for us to be finding out exactly what attributes and benefits consumers want,” Lesser says, “and we will work to do that and come out with additional new products in the near future.”
To that end, Oakhurst hired a nutritional consultant to serve as a spokesperson for the company as well as a resource for consumers at public events and the Oakhurst Web site. Pamela Stuppy is a licensed dietitian with practices in Maine and New Hampshire whose master’s degree is in nutritional science related to bone density issues. She has written a book for health professionals on osteoporosis and speaks nationally on the subject.
Having such an authority virtually on call for consumers is just the latest way Oakhurst has endeavored to maintain a close relationship with the public. Starting with founder Stanley T. Bennett (grandfather of the four Bennett siblings who now run the company), whenever a baby is born in Maine and New Hampshire, the family receives a congratulatory card from the Bennetts along with a $10 gift certificate for any grocery item — which most often gets used to purchase Oakhurst products.
“Oakhurst is reaching out to potential consumers at what is a very emotional time in that person’s life, making a tight and lasting connection for that person with our brand. Consumers appreciate our recognition of this event in their lives and often call to say thank you,” Lesser says. “That’s the level of commitment this company has had to its market and its consumers, and Oakhurst has always worked to connect with the consumer emotionally.”
Oakhurst follows up through age 12 with a kids’ fan club for Oakie, the company’s acorn mascot. The program offers prizes, birthday greetings and coupons, and Oakie makes appearances at community events. “We have tried to find really good opportunities for Oakie to send a message that we really care about children,” McGirr explains. “I think because Oakie doesn’t speak and he’s so hands-on that as a mascot he’s really caught on and works well for us. I get e-mails from people in California who have visited in the summer and they went to a fair and they saw Oakie and they want to join the club.”
That concern carries even further into Oakhurst’s long-standing policy of donating 10 percent of its pre-tax profits to charities concerning children and the environment.
“It relates back simply to the key tenets we run this company on: family, community, service and quality,” says William Bennett, executive vice president and chief operating officer. “You can’t, nor should you, run a company and be successful without contributing back to the community. It’s been ingrained in us since we were kids, that’s this is what you’ve got to do. That’s part of the deal. That makes us different than other companies.”
McGirr sums up Oakhurst’s key business obstacle, which existed even before its competitors jumped on the no-rBST bandwagon: “Being the little guy in a big market. We still are the little guy in the dairy world.”
The size issue translates into the ability to deliver a premium product in a price-driven, commodity environment. “We have competitors with much larger operations and much greater economies of scale in their production,” says Thomas Brigham, executive vice president, chief financial officer and treasurer. “It’s a continuing challenge for us.”
This challenge appears surmountable, as the Bennetts foresee growth of up to 25 percent over the next five years.
From a marketing standpoint, it’s cultivating that premium brand perception. “In the state of Maine, we’ve got it,” Lesser says. “As we move west and south, our challenge is positioning the brand in a believable way that will enable us to sell a premium product.”
Looking forward, Oakhurst sees consolidation among grocery retailers as a possible open door to expansion.
“There’s been so much change in ownership of larger supermarkets. At one time it may have been impossible to get into a chain in a particular location; those opportunities are opening up,” McGirr says. “It may not be that we are the least expensive brand they have, but we have the quality they’re looking for, and our emphasis on health and wellness does open up an opportunity.”
… and Within
Oakhurst’s family-oriented attitude toward its consumers is directed at its employees as well. Whether it’s the deferred profit-sharing plan and 401(k) with match, interest-free loans to purchase home computers, paid fitness memberships or encouragement to participate in community activities, the company refers to its low turnover as “bragging rights.”
“Even when employees do leave for what they believe are ‘greener pastures,’ most ultimately try to come back within just a few months,” says Joseph Hyatt, vice president of human resources. “We tend to involve more people rather than less in making critical decisions about employees. Going the extra mile for an employee in need is openly encouraged, rather than just accepted by the leadership team.”
And while consumers trying to reach the dairy are likely to have someone named Bennett pick up the phone when they call, management maintains an open-door policy for the work force.
“Our management style has changed over the years out of necessity. We have opened new depots; we now have folks who don’t come to this plant every day, who don’t see us,” McGirr says. “We’re working on a new strategic plan that will help us manage the growing number of remote employees.”
The uniqueness of Oakhurst Dairy appears to be rooted in the activity of so many members of its founding family, who are committed to the proper stewardship of their legacy as well as the consumers and community they serve.
“You have a business with a management team, half of which is family. The family members are actively involved day to day, and they are committed to the brand, our customers and, most importantly, our consumers,” Lesser says. “They’re passionate and they are humble, often referring to Oakhurst as ‘just a little dairy from Maine.’ Oakhurst may be small in size, but it’s huge in terms of the impact this company has and can have on the industry.”$OMN_arttitle="Guiding Lights";?>