Cow Wow Cereal Milk Case Study

With $175,000 of his own money, he made his first 9,000 cases in late 2012. A distributor landed some of his milk in convenience stores and gas stations in Southern California, and Mr. Pouy got Cow Wow into Legoland and the Los Angeles Zoo. Then, in April 2013, with the product still in limited local distribution, Cow Wow went viral, much to Mr. Pouy’s surprise and joy — at least initially.

Proclaiming that Cow Wow “tastes like heaven,” the late-night TV host Jimmy Kimmel riffed on the product for nearly a minute. “Just when the Twinkie dies, we come up with cereal-flavored milk. I’ve never been prouder to be an American,” he said. In June 2013, Cosmopolitan magazine displayed the Fruity Trudy package and hailed Cow Wow as the lead “fun item” in a list of fun stuff. And in September 2013, BuzzFeed included Cow Wow in its list “27 Reasons It’s the Greatest Time to Be Alive.”

It was great publicity. But there was one problem: the age of the viewers and readers. Mr. Pouy said he quickly realized “these are not the people I’m trying to sell my product to.” That disconnect nagged at him as he began talks with an investor, the owner of an incubator, who would ultimately acquire a majority stake in Cow Wow and become a silent partner, leaving Mr. Pouy as president.

By November 2013, still aimed at children, Cow Wow was being put on shelves in the first of 900 Kroger supermarkets. Because Mr. Pouy lacked the resources to offer discounts and coupons, his milk was priced about 20 cents higher than flavored milks in Tetra Paks offered by Organic Valley and Horizon Organic. His sales did not meet expectations. “I was groomed on the more conceptual, marketing side of things, not on pricing or how to enter a market,” Mr. Pouy said. “What I found out was, Mom is the most frugal shopper of them all, and price made more of a difference than I thought it would.”

Then in May his local distributor, who happened to serve Santa Monica College as well, got Cow Wow into the school’s food court. Fifteen cases sold in the first week. The next week, Mr. Pouy stood near his product and watched. “Pretending to be a teacher, I saw people taking all three flavors,” including the new Cinny Minny, he said, “and that’s all they bought.”

THE OPTIONS Two days later, he met with his partner to discuss three possible paths:

■ Stay the course. Stick with young children, who are, by far, the biggest consumers of milk. This option was appealing because high schoolers and college students are notoriously fickle. What if Cow Wow was a fad? To pursue this option, Mr. Pouy’s next step would be to target private and charter schools and expand national sales in Kroger and other grocery stores with a marketing push to educate mothers about the benefits of flavored milk and alert children to Cow Wow’s flavors. The expected cost: $100,000.

■ Change course. Follow the buzz and the sales and pitch the product to millennials. To pursue this option, Mr. Pouy would rebrand, redesign, repackage and reformulate. He would try to hook 18- to 35-year-olds with hipper cows and a larger package with a resealable cap instead of a straw. To cut costs, he would switch to a nonorganic formula, “since millennials are less concerned about nutrition than mothers.” He would focus on selling to colleges and convenience stores. Cost: $100,000.

■ Adopt a hybrid strategy. Try to market to both age groups simultaneously. To pursue this option, Mr. Pouy would need to create two distinct marketing campaigns, one targeting mothers, the other millennials. With little overlap, the cost would double to $200,000.

WHAT OTHERS SAY Seth Goldman, co-founder and chief executive of Honest Tea: “At 150 calories per 8.5 ounces — roughly 50 percent more calories than low-fat milk — this isn’t a product that should be marketed to kids. Mr. Pouy is better off promoting his drink toward the millennials that are already gravitating toward his drinks. He should invest in field marketing efforts on campuses where students can enjoy the drinks as an occasional chance to reconnect with their childhood.”

Kara Goldin, founder and chief executive of Hint, a brand of flavored water: “I recommend focusing on a single target market. A cereal-flavored milk for the college market? I doubt it. But if that is your market, move out of the Tetra boxes and into a wide-mouth resealable bottle. And millennials young and old do care about ingredients, not just calories. And don’t settle for just any space in the stores you get into. If moms are your market, be where moms will look in the store. In the milk section is O.K., but how about in the cereal aisle? Or in the baby/kid food section?”

Doug Hall, founder and chief executive of Eureka Ranch, a consulting firm that helps companies create innovative products: “My advice is to stop being greedy. You have found a group of people who love Cow Wow. Focus 100 percent of your energy on millennials. Our research has found that presweetened cereals would have a hard time being introduced today. They exist only because they are ‘grandfathered in’ through the memories of older people. Let millennials adopt and own it. Then let diffusion of the innovation pull the product to the mass market.”

THE RESULTS Offer your thoughts on the You’re the Boss blog at Next week, on the blog and on this page, we will provide an update on what Mr. Pouy decided to do.

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Chris Pouy is the founder of Cow Wow Cereal Milk, a drink that tastes like “the leftover milk at the bottom of the cereal bowl.” After selling $20,000 worth of Cow Wow, he pitched the business on Shark Tank in 2014. It didn’t go well. When the Sharks learned that each container contined 20 grams of sugar and 170 calories, all of them went out – even though a regular cup of milk contains about 14 grams of sugar.

[27 Favorite ‘Shark Tank’ Products at Amazon — New 2017 List]

According to the Cow Wow website, it’s still available at a number of grocery stores but it is no longer available for purchase online. (The buy online button on the website links to Amazon which no longer carries the product). According to Pouy’s resume, he’s currently working as a copywriter at ad agency Deutsch LA, working on the Taco Bell account. P.S. The woman who went on Shark Tank with Pouy is actress Tiffany Panhilason. She has since appeared on The Mindy Project, Anger Management, and Days of Our Lives, among others.

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