McDonald’s announcement last week that it was switching from vegetable-based, liquid margarine to real dairy butter wouldn’t have happened without the dairy checkoff, says Tom Gallagher, CEO of Dairy Management, Inc.
Gallagher and other DMI executives spoke at a teleconference with reporters this afternoon.
More than 20 McDonald’s menu items, including its iconic Egg McMuffin breakfast sandwich, will now be made with real butter. The switch, says Gallagher, will conservatively use the milk equivalent of 500 to 600 million lb. of milk.
High demand for butter here, and high butter prices, have resulted in a loss of export sales in 2015. Pennsylvania dairy farmer and DMI Board Member Harold Shaulis believes McDonald’s switch to butter will more than offset those lost export sales.
The use of butter will be in all of McDonald’s 14,000 U.S. restaurants. Promotions to support sales launch in October and will continue through the 4th quarter, says Barbara O’Brien, DMI senior executive vice president. McDonald’s will use a portion of its $1 billion annual advertising budget to promote its use of butter.
In 2009, DMI moved away from generic milk advertising and started partnering with major fast food restaurant chains. McDonald’s was one of the first partnerships formed. DMI made its staff dieticians and food technologists available to McDonald’s for formulating new menu items with dairy products.
And the effort has paid off. “If you eat a dairy product at McDonald’s, that product was created by our own [DMI] scientists,” he says. In the case of butter, DMI dairy food specialists wrote the specifications, such as melting points, and trained McDonald’s owners and franchise operators on how to incorporate butter in food preparation.
Gallagher and Shaulis believe McDonald’s switch to butter will have a catalytic, “me, too” effect, where other restaurant chains will opt for real butter over margarine. A similar thing happened in pizza, when DMI worked to re-invent Domino’s pizza to include more real cheese. Before long, chains such as Pizza Hut saw the positive sales gains Domino’s was achieving and started using more cheese on their pizza.