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Gira Dairy Club: Opportunities in Emerging Market Dairy
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Gira Dairy Club: Opportunities in Emerging Market Dairy


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  • 1. GIRA Dairy Club Geneva 12 September 2011 Emerging Market Opportunities Peter Wennström President and Expert consultant The HMT was founded as a joint venture between global branding agency DesignBridge and marketing strategy expert Peter Wennström. ©2011 Healthy Marketing Team The vision is to give clients expert guidance in the increasingly complex global For more information, please contact: landscape of nutrition health and wellness ! from category direction to creative strategy. The mission is to help clients to better targeted launches and faster projects Website: by understanding the reasons for failures and successes. Find out more on Today the HMT is a team of global experts supporting clients in all parts of the worldTogether with hands on Consulting in Innovation, Marketing and BrandPositioning, we also support our clients with Inspiration and Training onHow to be a Winner in the Nutrition, Health & Wellness market B R I C How does DAIRY get it RIGHT in the Emerging Mass Market? The Emerging Consumers 1
  • 2. Phsychology of Market StagesAn emerging market?! TOMORROW WILL BE TOMORROW WILL BE I DON T CARE ABOUT LIKE TODAY BETTER! TOMORROWWhat does it mean for market drivers and NEWconsumer motivation? What will we expectto see?What is the difference between an emergingand a developed market? OLD 1. TRADITIONAL 2. EMERGING 3. DEVELOPEDDairy: It s significance for Mass Market Dairy: It s significance for Mass MarketConsumers Consumers Dairy is considered the GOLD STANDARD nutritional food for children in most emerging markets In China and SE Asia, while the Category Essence was traditionally not as strong as above, government education has started positioning Milk/Dairy as above In most of these markets, there is a strong consumer motivation too of investing in the child s future and hence ensuring that he/she gets a Healthy Head Start in life Hence, the opportunity to leverage above and innovate with Dairy in Mass Markets in these markets is significant.The Rules for a successful market entry Five key Market Entry Strategies1. Remember the Category Significance and Category Essence of Milk Five Market Entry Strategies with varying Innovation quotients & Market and hence Dairy in the new market. disruption ability:2. Understand the consumer s changing needs and how that impacts Market Entry Strategy Relevance for Mass Markets expectations from dairy Leveraging hidden nutritional assets3. Then determine the Role of the Brand as well as it s Market Entry Strategy to create a relevant and competitive dairy marketing mix to New category creation Not relevant for Mass Market serve the Mass Market consumer. New segment creation4. Innovate and create value by leveraging and fitting into established habits and category codes Category substitution A supporting strategy!!In sum The functional foods make-overKnow the Consumer! Listen to Her! Understand her Context! 2
  • 3. Leveraging Hidden Nutritional AssetsDairy in Emerging MarketsLHNA:Market the intrinsic healthiness that advances in nutritional scienceand awareness have uncovered in everyday foods and beverages.What does it mean for dairy:Huge relevance for Dairy in Emerging markets... This strategy enhances therelevance of foods and beverages that consumers are already familiar with byhighlighting the natural goodness within them thereby reassuring emergingmarket consumers about their familiar choices. The success of local dairies/milk co-operatives in many emerging marketsbears testimony to this strategy. Local dairies have also successfully branded traditional dairy categories byhighlighting the authentic goodness of milk-based categories Some brands have even tried to promote more foreign dairy categories likecheese in some emerging markets by leveraging the MILK quotient of cheese.New Segment in CategoryDairy in Emerging MarketsNSC: To give children the milk with the extra something to help them grow andCreate a new health proposition and a new segment within the develop..category. Mengniu is the trusted Chinese dairy .Bring a new health benefit into an existing category Future Star Milk fortified with DHA promises to give children the milk with the extra something to help them grow and develop..What does it mean for dairy:Creating new segments within the dairy category has huge potential toincrease the share of throat for dairy in emerging markets GUMs fortified with DHA with the promise of enhancing mentalsharpness of growing up children has been very successful in many emergingmarkets Flavoured Milk/yogurts to make MILK fun for children 3
  • 4. Functional Foods Makeover Dairy in Emerging Markets FFMO: A Me Too strategy where the later players offer the same benefits as the Early Entrants. What does it mean for dairy: In the West therefore the only differentiator in this strategy is Lower Price However In Emerging Markets, given the huge Mass Market opportunity as well as the Bottom of the Pyramid opportunity, this Market Entry Strategy can pay rich dividends for Dairy. Simply ensuring GOLD STANDARD quality and purity of milk at an affordable price can create significant brand loyalty and hence business value. The challenge is to create Better Value  price is only one factor. Accessible Milk Goodness in the Consumer s Hands is the key deliverable of this strategy  hence innovations in business models, pack innovations, formulation innovations, innovative education are all equally critical.Functional Foods Makeover Role of Brands in Dairy in EmergingDairy in Emerging Markets Markets Emerging markets have traditionally seen more uncertainty that their European/US counterparts. Hence, brands are powerful guarantors of reassurance and safety. Once a brand earns the trust of consumers, it gains the Right to Play in that category through multiple formats/extensions. Particularly in dairy which has strong NURTURANCE values in most emerging markets, brand credentials are a huge asset. Hence, a brand that has succeeded in setting a STANDARD in DAIRY can then innovate and lead the consumer to trying new formats and ranges within Dairy. 4
  • 5. Brands can take 3 Roles in Dairy in Brands can take 3 Roles in Dairy in Emerging Markets Emerging Markets Brand from abroad Glocal Brand International brand that leverages its Global Credentials particularly in Glocal brand that innovates by adapting it s Global expertise with Local Science Preferences The role of such brands will always be somehow limited in the Mass Market as they tend to earn the trust of the consumer by being the EXPERT BRAND, which comes at a price premium. Brands can take 3 Roles in Dairy in To recap: the rules for a successful Emerging Markets Market Entry in Emerging Markets National Pride Brand Choose a familiar dairy category Local brand that builds on it s local heritage and positions itself as the National Pride Enhance it s intrinsic Nutritional Quotient further (e.g. Fortify with micro-nutrients) Select the right business model Position it appropriately Different markets, different challenges Recipe for a successful dairy brand? Positioning examples Taste Bone Health National Pride Gold Standard Quality All Natural/ Real ImmunityHealthier/brighter kids, Milk Goodness Good for all Family Brighter future For Every Occasion Milk rights Nurturing your Child 5
  • 6. Thank youPeter WennströmPresident and Expert consultant©2011 Healthy Marketing TeamFor more information, please contact 6