Content area
Full Text
Abstract
This paper is abstracted from Commercialising Innovation: The Food and Health Marketing Handbook by J.C. Mellentin and P. Wennstrom, published in March 2003. After nine years of field research, spanning 26 countries, the authors believe they have identified that all the corporate strategies for entering the business of foods, beverages, nutrition and health fall into one of five types. This article describes the five strategies.
After interviewing hundreds of companies over the years, it has become clear that corporate market-entry strategies in food and health almost always fall into one of five categories:
1. Leveraging hidden nutritional assets.
2. New category creation.
4. New segment creation.
3. Category substitution.
5. The functional foods makeover.
Of the five, two can be described as the defining strategies of the business of food, nutrition and health: leveraging hidden nutritional assets and new category creation. The former runs contrary to many of the early ideas of functional foods, i.e. of products with 'added' benefits. Nutrition science is also uncovering the intrinsic health benefits of many every day foods and brand-owners are increasingly - and successfully - marketing foods on intrinsic health. The latter can best be summed up as the strategy that creates new categories that usually can be found to combine innovations in packaging, distribution, marketing and merchandising, as well as in ingredients or formulation. The strategies are not mutually exclusive. Some companies can pursue two simultaneously with the same brand.
Companies often start out with one strategy and - as their market develops and competition intensifies - it evolves into another strategy. Sometimes local food cultures and markets also have an effect - making a strategy feasible in one country which might fail in others. Leveraging hidden nutritional assets, for example, is definitely 'made in the US', although it is now rapidly becoming more popular in Europe and Australasia. New category creation, on the other hand, is associated with product concepts whose roots lie in Asia and have migrated to the west. However, as the nutrition business develops, all of these strategies will, in time, become familiar in all markets.
Strategy 1: Leveraging nutritional assets
Definition
Leveraging nutritional assets is the strategy of marketing the intrinsic healthiness that advances in nutrition science have uncovered...