Borden Dairy declares bankruptcy

US-based Borden Dairy has filed for bankruptcy becoming the second ‘big’ milk producer to do so in just two months (after Dean Foods). Borden Dairy’s business “will continue operating as normal” as it navigates bankruptcy with an improved balance sheet and lower debt payments. According to the company, they hope to achieve “a more viable capital structure.”

What we think

Consumers will want to rescue beloved Elsie the Cow
Borden Dairy and its “spokescow” Elsie the Cow are household names in the US. According to Borden CEO Tony Sarsam: “Over the past 163 years, we have earned the distinction of being one of the most well-recognized and reputable national brands.” Data from Mintel Purchase Intelligence confirms that Borden Dairy is perceived by US consumers as a trusted brand.

Borden Dairy’s news, and the potential loss of Elsie the Cow, might encourage consumers to want to ‘rescue’ Elsie either by buying more products and/or by showing their support through social media and online petitions. According to Mintel research, seven in 10 US consumers claim to enjoy things that remind them of their past (eg childhood).

Consumers expect more from dairy products than just reputable brands
Borden Dairy will need more than the emotional support of Elsie the Cow to reduce its debts, especially since brand has little influence on consumers buying milk. Milk’s fat content and the container size matter more than brand, according to our research; just a quarter of US dairy buyers consider brand an important factor of choice when buying dairy milk, compared to over a third who look for container size and three in ten for fat content.

To move away from being perceived as a commodity, dairy milk brands must break the category norms and reinvent themselves with more on-trend proposals. Brands can look at product positioning that is more modern and less traditional. Milk packaging design that features cows grazing on bright grass is definitely out of fashion. Innovating in adjacent, value-added categories – eg yogurt, ready-to-drink coffee – is a better way to tap into growing dairy consumption.