August 17, 2012

$3M lobster marketing plan wins board's OK

By Jessica Hall jhall@pressherald.com
Staff Writer

AUGUSTA -- The Lobster Advisory Council unanimously voted on Thursday to move forward with a $3 million plan to market Maine lobster in an effort to increase prices, which are currently at the lowest level in 30 years.

click image to enlarge

Freshly caught lobsters rest in a crate at Harbor Fish Market in Portland on Tuesday. The Lobster Advisory Council unanimously voted on Thursday to move forward with a $3 million plan to market Maine lobster in an effort to increase prices.

Portland Press Herald photo by Tim Greenway

The details of the marketing plan and the specific way it gets funded -- such as through higher lobster license fees -- must be hashed out by the state legislature. The eleven members of the council voted in favor of the plan at a 3-hour meeting attended by about 50 members of the lobster industry.

Some lobstermen balked at the thought of higher fees, but others embraced the idea of trying marketing to try to increase demand.

"For about $500 more, you're buying $3 million of promotion. That's a pretty good investment," said Peter Miller, a lobsterman from Tenants Harbor, who supported the idea of a marketing campaign. "Hopefully it will lead to more consumption as demand increases and more demand will lead to higher prices.

"I see advertisements for California dairy on TV in Maine. Why can't they see ads for Maine lobster there?" Miller said.

The new $3 million campaign would compare to the current marketing budget of about $400,000. The new budget and marketing effort would be phased in over three years.

"I think an increase in the fees is a bad idea -- it's hitting people who already have been hit. The cost of fishing is already so high -- bait prices and diesel prices are up," said Randy Johnson, manager of the Winter Harbor Lobster Co-Op. "If they increase the fees on dealers, that's going to eventually come out of the lobstermen, too."

"It all comes out of the lobstermen. On a normal boat-price year, it might be one thing, but when you have prices where they are now, it's hard to ask them to pay additional fees," Johnson said. "I don't think constantly squeezing the lobsterman is the way to go. Changes in advertising isn't going to trickle down and help the lobstermen."

The average commodity group spends roughly 1 percent of its production value on marketing, according to marketing consultant John Sauve, president of the Food and Wellness Group, who had been hired by the Lobster Advisory Council to study the potential of a marketing campaign.

Last year's lobster catch of about 105 pounds was worth more than $330 million at wholesale prices. Lobstermen are currently getting $2 to $2.50 a pound for their catch, down from $3.19 a pound last year.

The concept of marketing a commodity is not new. There have been campaigns on everything from milk to pork to beef and even pistachio nuts. The Got Milk? advertising campaign increased California's milk sales increased for the first time in over a decade after it was introduced in 1993.

Now, almost 20 years later, the Got Milk? campaign is part of the national lexicon.

Lobsters should be so lucky.

"To get the consumption of lobster to increase has some hurdles. It's perceived to be difficult to cook and eat. It's not sold in every store. You have to buy it live or very quickly. It's not wildly known or easy to eat. An education is important," Barbara Sullivan, managing partner of a branding and marketing agency in New York.

"I would try a targeted campaign in some isolated markets where you can set benchmarks and determine whether you're getting a return for your investment. That's opposed to a broad, national campaign that they probably don't have the resources to do," Sullivan said.

The economics of the lobster industry have come into focus in the past month, as Canadian lobstermen set up blockades to prevent Maine lobster from being shipped to New Brunswick processors.

Gov. Paul LePage met with two lobster processors last week and the administration said the state needed to ramp up demand for Maine lobsters. Patrick Keliher, the commissioner of the Department of Marine Resources, said that promoting the Maine lobster brand was needed if local processing plants were going to be financially viable.

The glut of soft-shell lobster this summer has prompted promotions such as coupons from Hannaford Supermarkets, urging customers to buy lobster to support "over 300 local lobstermen in New England." Hannaford gets its lobster from New Meadows Lobster in Portland.

The Lobster Promotion Council and the Penobscot Bay Regional Chamber will be hosting Lobsterpalooza in Rockland and Camden "to raise enthusiasm for eating lobster and celebrating an abundant supply in the Midcoast this summer."

Lobsterpalooza features everything from a free lobster with special spa treatments to cooking classes and cash mobs to spend money at local markets selling lobsters. The August 26-31 celebration is part of the Maine Lobster Lovers Celebration created by the Lobster Promotion Council.

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