Swept the United States organic fruit and vegetable milk, China's high-end milk market, the next upstart?
Author: Peng Jiaying
Editor: Wilbur Zhu (WeChat: aotokuer), Anna Hu
On April 21, 2017, James Costa, founder and general manager of Sneakz Organic, attended the 2017 Food and Beverage Innovation Forum (FBIF2017) to share the opportunities and challenges of Sneakz's natural fruit and vegetable organic milk in the Chinese market.
James Costa, founder and general manager of Sneakz Organic
Sneakz Organic will be children usually do not eat carrots, cauliflower, sweet potatoes, beetroot and spinach with skim milk made good drink nutrition low-sugar milkshake. At present, Sneakz has a comprehensive distribution in the United States, will soon be settled in the Chinese market. Spotted the Chinese consumers in the melamine incident after the shock, but also coincides with the consumer transformation, Sneakz will target the market in China, it is not surprising.
2008 melamine incident, making milk, milk and other dairy products safety issues become a big heart disease. Not only that, now, more and more people concerned about the health and nutrition of products, natural, non-polluting, high-quality organic milk has gradually become a hot consumer dairy products.
China's organic milk in recent years maintained a high growth rate of more than 20%. According to statistics, in 2016 China's organic milk market reached 11.5 billion yuan, Yili's Jindian organic milk, holy livestock organic milk and Mengniu's special Lun Su and other national organic milk brand growth has been better, China's organic milk market is expected from 2015 to 2020 will maintain a compound annual growth rate of 16.2%.
China's organic milk market size
National organic milk market share
Source: China Industrial Information Network "2017 - 2022 China organic milk industry market operating situation and development prospects forecast report"
In the United States, 15% of the goods are organic, while China's organic food accounted for less than 2% . With the Chinese consumers on the growing enthusiasm of organic milk, aimed at organic milk market at home and abroad the growing size of the brand, but it is worth noting that the price of organic milk is also the price of non-organic milk twice.
According to research statistics, Zhong Chinese consumers are willing to pay three times the price to buy the security of natural and organic products. At the Kennedy Airport in the United States, you can see a lot of Chinese people who buy baby milk powder. why? The reason, China has not safely through the melamine crisis . Sneakz made statistics in China's 3200 households,80% of Chinese consumers said that domestic food is still not a hundred percent of their sense of security. The survey shows that the current Chinese consumers of foreign high-end organic milk of the green eye has increased, more encouraged by Sneakz attack the confidence of the Chinese market.
Pressure: this battle, the domestic dairy giant can play well?
1. Mengniu: special Lun Su
Mengniu's high-end liquid milk brand special Lun Su, since listing in 2005, more than 10 years has been double-digit growth rate triumphantly. According to industry analysis, the success of Trunsu not only includes brand positioning, quality assurance, marketing innovation and other reasons, but also because the product selection at the most appropriate time to meet and lead the pursuit of high-end consumer quality, conform to the dairy consumption Upgrade the development trend. According to the Minsheng Securities research data, high-end organic milk market in 2015, the special Lun Su accounted for 37% , less than one for the Yili Jindian, accounting for 26.6%.
2. Erie: Jindian
In 2007, Erie launched its first high-end sterilized milk --- Jindian, as Yili liquid milk the first high-end brand Jindi milk a listing, and Mengniu's special Lun Su started competition. In December 2013, for example, in this dairy sales season, Trunsu's market share fell by 1.8 percentage points, while the Yili's Jindian has increased by 1.2 percentage points.
In October 2010, Erie shares announced the acquisition of 37% stake in China's holy land, this move after Yili will become the largest shareholder of China's holy land. Erie said the acquisition of Chinese holy animal husbandry is the intention of its organic raw milk advantage. China Shengmu is China's largest organic dairy company, Nissan organic milk 1200 tons, equivalent to 20% of the world's total. This acquisition marks the Erie full force organic milk market , the future may replace Mengniu, organic milk field leader.
But only six months later, by the end of April 2017, Erie announced the termination of the acquisition of China's holy animal husbandry, organic milk first brand plan delay . Yili Fang said that the company to terminate the transaction, the company will not affect the current performance, the company will not be the future development strategy, business planning and normal production and operation adverse effects. Follow-up Erie will be any move, we do not know.
On the other hand, the industry to the Beijing Times reporter said that the reasons for the suspension of the acquisition or from Xu Yili fancy Huishan. Food industry commentator Zhu Dan Peng said: from the macro point of view, the state is revitalizing the northeast, Huishan as well-known northeast milk prices, the capital chain break does not affect its quality has been quality, the government can not sit idly by; , The Huishan capital chain break gap reached tens of billions, not the industry boss is difficult to have the ability to sell; In addition, since the Erie has given up the holy animal husbandry, it is possible to direct Huishan.
3. holy animal husbandry
Sansei annual report shows that in 2016, China's holy livestock and animal husbandry to achieve sales income of 3.466 billion yuan, an increase of 11.8%; net profit of 680 million yuan, down 15.0%. In the field of organic milk, Mengniu Yili two dairy giant's dominance is not surprising, but the performance of the sacred animal is particularly dazzling. Although its proportion and the giant can not be compared, but in the two mountains in the gap is not a small piece of cake, not so much a miracle of the market, as it is a holy animal husbandry business miracle.
In 2016, the founder of Yao Tongshan interviewed talked about the future planning of the sacred animal, he said that the history of holy and animal husbandry is short, but the next 10 years China's organic food industry will be a period of rapid growth. The construction of 20,000 tons of organic infant formula milk powder production project is expected to be completed and put into operation in October 2017, coupled with large enterprises and foreign enterprises to do organic children's products, to 2018, the sacred animal husbandry in the existing industrial base Will increase the scale of 50%, production capacity may increase by 150%, converted into output value of more than 12 billion.
Yao Tongshan also said, "We have the ability to create the best international organic milk." In April 2016, China Sheng Mu and a European dairy investment company invested 120 million US dollars in Inner Mongolia Hohhot to build China's largest organic child dairy processing base. There is also a company to negotiate the initiative, with our organic milk to do infant formula, product exports in Southeast Asia.
Holy animal husbandry in product development, cross-border cooperation and market forces, whether the organic milk market in the rapid development of its success for more market, let us wait and see.
4. Organic milk powder
According to the information consultation issued by the "China Organic milk market forecast and investment strategy research report 2017 edition" shows that China's organic milk market, the main business and brand Mengniu special Lun Su, Yili Jindian, Hebei Fucheng Ng Fung Food Fucheng and white gold, Holy wood full of organic milk, Shandong silver incense of the milk, Beijing to the original return to the original organic milk, three yuan extreme milk, Abbott's Jingzhi milk powder, Australia excellent ability of organic milk powder, Germany Tefu Fen organic milk powder.
In addition to the liquid organic milk situation changes, the organic milk powder market is dominated by the status of foreign brands will also improve the local infant formula milk powder first brand Feihe dairy industry with high quality milk powder also reached the organic milk market, become domestic organic milk powder Strong reinforcements.
Competition: domestic VS foreign brands, Yu Liang dispute, who died?
After 2007, after seeing the great potential of high-end milk market, domestic counterparts began to follow suit, but Mengniu's special Lun Su at the time still maintained a high industry share. Once occupied the high-end dairy more than 60% of the share. Old rival Erie through huge investment to create a gold court, and the sales gap with the special Lun Su gradually narrowed, and then such as Sneakz and other foreign high-end organic milk brand strong invasion, this time the special Lun Su has no absolute risk of riding a ride .
September 29, 2016, after all levels of quality inspection agencies and experts to strictly review and review the State Administration of Quality Supervision, Inspection and Quarantine issued a "notice on the acceptance of ecological origin of product declaration," announced the implementation of ecological products of origin products, Yili Jindi organic milk among them. Jindian became the only one in the country through the ecological origin of product protection assessment of organic milk, breaking the organic milk field certification 0 record.
Organic dairy market has great potential, although the first entry of course, with first-mover advantage, but later may not be able to catch up, like the Code of the special Lun Su, or the future foreign brands in the domestic brands.
James Costa, founder and general manager of Sneakz Organic, also shared Sneakz's competitive advantage at the FBIF2017.
1. Products: carefully crafted the ultimate organic fruit and vegetable organic milk
Sneakz organic milk contains much less sugar than other brands. Now the market chain of some brands did not add any vegetable ingredients, sugar content has increased 2-3 times. Sneakz only adds sucrose to ensure that consumers eat simply and eat cleanly .
James Costa compares a best-selling brand in the market, which contains 45 ingredients, while Sneakz has only 14 core components. How to maintain the value of 45 different ingredients and nutrition? Half of them even the name is not called out, must not be assured to buy. Sneakz for the sake of consumers, try to natural organic food to achieve the ultimate simplicity.
Because the cost of dairy products in the United States is 45% to 50% cheaper than that of China,Sneakz is still in China and will still choose to manufacture and sell in the United States , but all raw materials and processes will be certified by the Chinese government .
In the future, conventional share of vegetable milk will occupy more space, while the proportion of carbonated soft drinks will drop, Sneakz seize the opportunity to combine the vegetables and milk products.
Let the children eat happy and healthy, is the original intention of Sneakz. Sneakz to create a "drink a cup in the morning, drink a cup at night," the idea of the design of small cartoon characters on the package to the garden picking vegetables into the milk scene, so that children in the playground or car behind the time, you can As a toy to play, happy at the same time, drink milk, to meet the daily needs of organic fresh vegetables intake.
Speaking of manufacturing capabilities, channel distribution, packaging and quality certification, James Costa stressed that quality certification is the first. Companies continue to try, and ultimately the introduction of potassium, vitamin C and other nutrient substances peach mango combination products.
2. Location: young and old
In the United States, more and more older people began to enjoy fruit and vegetable organic milk products, skim milk on their intestinal tract will not produce pressure. And, Sneakz is included in the elderly health insurance mechanism, the purchase of products can be reimbursed, which is very beneficial for the elderly.
For room temperature products, Sneakz is concerned with comfort, adding calcium, and more protein to ensure that the product is natural and organic . In the packaging, the adult version of the product is given elegant features, as people like to walk like Starbucks coffee, Sneakz hope to achieve a similar effect, so that consumers are happy to show the enjoyment of the drink. Sneakz hope hope to build a home for all ages drink, and not just the child, so that everyone happy.
James Costa advocates real dairy products that improve children's bones through milk, brain development. To meet consumer demand, Sneakz is also developing non-dairy products, such as hazelnut, soybeans, almonds, is currently developing almond milk, very attractive to consumers.
For the Chinese market, in addition to 250mL prism packaging of high-end products, Sneakz is about to launch in August the price of the people's powder powder, better into the three or four lines of the city. In order to meet the needs of local Chinese children, 250ml packaging into 200ml.The company will soon be introduced to accept low-temperature sterilization of probiotics adult products, fully meet consumer demand.
3. Development and deployment: focus on brand effect
"Look at our name today, you may not think it pays special attention to organic food but sees the names of these companies like Coca-Cola and Pepsi, and naturally will think of them to produce sweet drinks. Sneakz's concern lies in organic and natural , and hopes to shape brand effects , It takes time for us to focus on the interests of consumers, rather than focus on the interests of investors or investors. "James Costa says.
Sneakz is for only 6 years old consumers, dealing with 6-year-olds, and this is one of the challenges. How does that deal with my mother? TV media, website or WeChat and other marketing methods can provide leverage. Line, to strengthen community cooperation, such as 5 km run, sample tasting activities, really into the children's family.
Compared to foreign brands focus on product quality and consumer experience brought about by the brand, domestic companies seem to be more inclined to advertising and marketing means to improve the brand's attention. Can not say that the practice of foreign brands must be more advanced in the Chinese market this huge and different from the Western market, perhaps the practice of local enterprises will be closer to the market. But one thing is certain, in order to obtain high-speed and long-term development, the focus on product quality must be indispensable.