A2 Milk the Dyson of dairy, says chairman David Hearn

A conga-line of copycats are looking to lap up A2 Milk’s cream, but chairman David Hearn has declared the company can become the Dyson of dairy.

A2 chaiman David Hearn: ‘People coming in actually vindicates the proposition. If we do it well, it will reinforce our position as the original and best.’ Picture: Peter Hemphill

A2 Milk chairman David Hearn is betting on imitation being the greatest form of flattery, declaring he believes the company can become the Dyson of dairy, as more and more of its rivals launch copycat products.

The trans-Tasman dairy brand has sued Lion over the use of the A2 name on Pura Milk, and is currently gearing up for a battle in the US courts after Braum’s, a family-owned fast food chain in Oklahoma, launched its own range of A2 dairy products.

Meanwhile, A2’s highly successful Platinum-branded infant formula is being copied by Bellamy’s Organic, Nestle, Karicare, Cow & Gate, Junlebao and Mead Johnson.

Asked how he intended to keep on top of defending the company’s brand in the wake of an influx of copycats, Mr Hearn — who is a British tax resident — pointed to one of his compatriots, James Dyson.

“Dyson invented the cyclonic vacuum cleaner. When he came along and invented that everybody else had what was seen as old technology. If you speed forward today, everybody has got a cyclonic vacuum cleaner at prices well below his and his business has never been better,” Mr Hearn said.

“If you build a brand and relationships with consumers, then competitors coming in validates your position, not destroys it. If you’re smart and continue to innovate and invest heavily behind your brand, not take anything for granted, there is evidence that you’ll go from strength to strength.”

Mr Hearn also cited Kleenex and Vaseline as examples of where a product’s originator had managed to hold on to its market-leading position despite a flurry of competition.

For A2, which has become a market darling, the imitation comes after years of combating criticism that it was spruiking bogus claims in regard to the benefits of the A2 beta casein protein.

In the late 1990s a delegation of A2’s founders travelled to Switzerland to convince food giant Nestle to produce its products. But after a month of intense scrutiny of the science, Nestle executives declined.

A few years later in the early 2000s, Fonterra — the world’s biggest dairy exporter — attempted to sue A2 Milk, then a dairy minnow.

“Fonterra were looking to sue A2 for what they thought were bogus claims. Then two years ago Fonterra signed a strategic agreement with us to manufacture the product because they wanted to be part of it,” Mr Hearn said.

“So, people coming in actually vindicates the proposition. If we do it well, it will reinforce our position as the original and best.”

The company is trading around all-time highs of $19.55. It is now mulling transitioning from being solely a brand owner to brand manufacturer and is scouting potential partnership opportunities. “We continue to need to be closer to our consumers than our competitors,” Mr Hearn said.