It shows how being up-front and transparent can ultimately save you if things go tits up (pun intended).
Happy Cow Milk Co’s story began four years ago when founder Glen Herud wanted to create a more sustainable model for dairy farming and built his own milking shed and processing equipment to fill reusable glass bottles that can be recycled.
So far, so good.
The company had a following of customers who believed in its purpose.
You need only look at the comments on Happy Milk Co’s Facebook page from some of its 4500 followers to get the picture: “I don’t drink cows’ milk or eat veal because I think most farming practices are cruel or unethical at best. But I’d happily change my mind and buy milk from you.”
But reality bites.
Investors were hard to pin down and the economics caught up with this small upstart, which this month went into liquidation owing creditors about $100,000.
What interests me is not the David versus Goliath story, against milk processing giants, but the way Happy Cow Milk Co valued its customers.
This was a company that not only talked to its customers from the get-go but treated them like insiders, as part of its purpose and journey – through the good and the bad.
When Herud shared the story of his decision to wind down the company on Spinoff it attracted attention from around the world. So much so, he decided it was worth pursuing again – this time with crowd funders and a new distribution model.
Happy Cow Milk Co set up a sign-up page for supporters to receive updates on the company’s website and received thousands of hits.
On a Business is Boring podcast, Herud says he has received invitations to speak, investor inquiries from San Francisco and renewed interest from local investors he’d been trying to entice.
Why? Because consumers have spoken, because it was a continuation of a conversation, because it was like hearing a friend needed help.
“People really want to know the story and that’s because no-one’s really doing what I’ve been doing.
“No one’s really actually committed to solving the problem,” Herud said on a video on Happy Milk Co’s Facebook page.
Customers don’t expect perfection – they expect transparency.
The take-out from this is that it’s okay for companies to admit failure and talk about how they plan to improve the situation.
We’ve seen the opposite of this in the retail industry recently, where a doyen of fashion, World co-owner Dame Denise L-Estrange-Corbet, has appeared defensive and out of touch with her customers.
World has been vocal about the importance of making its clothes in New Zealand but a Spinoff investigation recently revealed its clothing is not entirely NZ-made.
The problem World faces is not that some garments are made elsewhere but that the company appears to not have been upfront about using offshore manufacturers and promotes its brand as Made in NZ – not surprisingly, the Commerce Commission is investigating.
It’s when people feel misled that brands can really suffer damage.
Back at Happy Cow Milk Co, sure, there’s been failure but all is not lost.
The future appears to be in the hands of its supporters-cum-investors and whatever comes next will be followed on social media and not just in NZ – there’ll be interest in this story from other dairying nations facing similar challenges.
In the words of a Happy Cow Milk Co Facebook follower: “The future of dairy. Compassion and empathy.”
