The word “diversify” is almost a cliché when it comes to business, but the modern manufacturer takes it much more seriously. In the consumer products space, the whims of a customer mean one or two trends can be enough to put a company out of business.
That’s why companies large and small are looking to expand their scope, which has resulted in some interesting pairings.
Take, for example, one of America’s favorite candy makers – Mars. It might surprise you to learn that Mars doesn’t live on M&Ms alone and that the majority of the diversified company’s revenue actually comes from pet-care services like veterinary hospitals. Huh?
That’s right. Mars, who outside of its chocolate treats produces scores of different pet food brands, has more recently entered the pet services space, purchasing several national animal hospital chains including Banfield and VCA.
And you can bet these hospitals serve as the perfect marketing avenue for Mars’-produced pet foods like Iams, Pedigree, and Whiskas.
Whether or not you’re comfortable with this approach, it seems to be working for Mars, as pet products and services are said to be a $70 billion per year industry in the U.S. alone.
The New York Times also recently reported on another diversification strategy, this time by a dairy processor in Massachusetts who was struggling to make ends meet selling milk.
Tired of getting beat up on price, with milk selling at historic lows, the Carter & Stevens Farm took its existing infrastructure, like sanitary tanks, and used them for brewing craft beer.
The New York Times says the resulting Stone Cow Brewery joins an industry of dairy-beer hybrids which use farmland to grow barley and/or hops and retrofit dairy tanks to store malt. Some milking parlors have even been transformed into taprooms, revitalizing operations that were facing some serious market headwinds.