Failures in Functional Foods and Beverages And What they Reveal About Success

Published by: New Nutrition Business

Published: May. 1, 2009 - 98 Pages

Table of Contents

Introduction: About this new edition

Functional foods definition

What do we mean by failure?

Executive summary

Part I: Rules for success

The Seven Golden Rules for success in functional foods and beverages

First, get the basics right

Rule 1: Successful brands are expert brands

Rule 2: Offer a relevant benefit and be a credible brand

Offer a credible brand

Rule 3: Aim for a benefit the consumer can feel

In hard times products without immediate benefits could see sales fall

A bright future for satiety and sports?

If they can’t feel the benefit - show it to them

Justifying a premium price in hard times

Rule 4: Remember that an ingredient is not a point of difference

Rule 5: A future of niches - focus on value, not volume

Focus on premium pricing in your niche

Rule 6: Differentiate using packaging design

Rule 7: Open new categories and segments - don’t be a me-too

New category creation

Brand extension or new brand?

Part II: Case studies

Cereals

1. Novartis Aviva - a “family” of functional foods

2. Nestlé’s prebiotic breakfast cereal

3. Quaker Oatmeal Nutrition for Women

Dairy

4. Unilever pro.activ blood pressure-lowering dairy drink

5. Danone Essensis beauty foods

6. Danacol UK - cholesterol-lowering and omega-3

7. Delamere Dairy - milk & joint health

8. Emmi Lacto-Tab - energy and CoQ10

Beverages

9. Enviga - sales collapse for Coca-Cola’s calorie burner

10. Naturally Gorgeous - new benefit not enough

11. Unilever Adez soy protein fruit juice

12. Minute Maid Heart Wise - a lesson about the crowed world of heart health

13. Sirco - heart health puts juice in an ultra-niche

14. Danone Activ - water & bone health

Market failure

15. Omega-3 - technology fails to fly as hoped

Abstract

The categories covered in this report are:

• Dairy drinks and yoghurts
• Breakfast cereals
• Water
• Juice drinks
• Soy drinks

The health benefit platforms covered include:

• Weight management (satiety and calorie-burning)
• Heart health (cholesterol-lowering, blood pressure-lowering)
• Bone health
• Joint health
• Beauty and skin
• Energy
• Digestive health
• Brain and eye development

Ingredients featured include:

• Probiotics
• Prebiotics
• Fibre
• Wholegrains
• Plant sterols and stanols
• Green tea
• Omega-3
• CoEnzyme Q10
• Protein
• Soy
• Calcium
• Glucosamine
• Antioxidants

The report is in two parts. Part I is a concise 40-page analysis setting out:

• Which brand strategies are most effective and why
• Which ingredient strategies are most effective and why

Part II consists of 15 detailed case studies which summarise:

• success factors, and common causes of failure
• common lessons for pricing, positioning and marketing
• key lessons in selecting ingredients
• key lessons in communicating benefits
• how to extend an existing brand
• how to create a successful new brand

Each case study is based on interviews with executives at the companies concerned. They speak with considerable frankness about challenges they have encountered. We have set their opinions in the context of our own analysis - which means that we do not always agree with some companies’ self-analysis - to create a template that will be useful to anyone trying to develop a new product with health benefits or devise a strategy in health.

Author Julian Mellentin is an acknowledged international expert on the business of food, nutrition and health - and his insights have been derived from 15 years of dedicated research in the area.

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