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Considerations in Developing a Functional
Food Product & Making it Good for a
Successful MarketStart
Dr. R. B. Smarta
Managing Director
Interlink Marketing Consultancy Pvt. Ltd.
Honorary Secretary
Health Foods & Dietary Supplements Association (HADSA)
11th April 2014
Successful MarketStart
So Far we have discussed
Inside-Out Approach!!!
Lets now appreciate the
Outside-In Approach!!!
OUTSIDE-IN APPROACH
Outside-In Approach
Trends
Needs
Problems
Platform
Source: Innovation in Healthy & Functional Foods, Market –Focused Innovation in Food & Nutrition
10 UPCOMING TRENDS
10 Upcoming Trends
1. Emerging Economies
2. Value of Science
3. Increase in health consciousness
4. Awareness of Functional Foods
5. Increasing disposable incomes
SOURCE:
http://www.nutraceuticalsworld.com/issues/2014-01/view_editorials/10-trends-to-watch-in-2014/
6. Quality & Safety
7. New Rules & Regulations
8. Claims Enforcement
9. Sustainable Supply Chains
10. Personalized & Preventive
Medicines
The Market for Health Promoting Ingredients
CONSUMER FOCUSED
MARKET DRIVERS
Market Drivers focused on Consumers
 Rising Incomes
 Major Brands re-positioning towards more towards
Health
 Increasing incidence of Self-medication & Personal
responsibility
 Increasing Awareness of Medical Consumers &
Healthcare professionals
MARKET TRENDS BASED ON
CONSUMER NEEDS
Market Trends based on Consumer Needs
• Digestive Health
• Convenience Foods
• Benefit Foods
• Energy Yielding & Slow
energy releasing
• Fruit & Super fruit
• Weight wellness &
Gluten-free
CONSUMER DILEMMAS
Consumer Dilemmas
CONSUMER
DILEMMAS
What is the
price – value
equation?
How good is
product
nutritionally?
Does the product
call for longer
cooking time?
How is the taste
affected by
nutrition?
Source: Innovation in Healthy & Functional Foods, Marketing, PR, Ad & Media for Brand building of innovative Foods
& Nutritional Products
MARKET ENTRY BARRIERS &
OTHER CHALLENGES
Market Entry Barriers faced by the companies
• Lack of adequate Marketing & Product development
infrastructure
• Lack of adequate funding for R&D and overall
Business
• Regulatory policies/procedures/processes
Other Market-related Challenges
1. Conversion of Science to
Business
2. Value of Science a
Regulatory mechanism
3. Consumer behaviour,
Market mapping and
Product development
4. Barriers in Development and
Marketing
5. Viability and
Commercialization
6. Funding and Financing
KEY CHALLENGES IN DEVELOPMENT
Key Challenges in Development
• Ensuring that Healthy choice is
the Easy choice for consumers
• Assuring & Delivering Health,
Safety & Quality
• Achieving Sustainable food
production
• Managing the food chain
• Optimizing Communication,
Training and Technology transfer.
Source: New Developments in Novel and Functional Foods, Lisbeth Munksgaard, SM, Danisco A/S
5 CRITICAL SUCCESS FACTORS
5 Critical Success Factors
1. Notice-ability
2. Superiority
3. Compatibility
4. Practicality
5. No Complexity
MARKETING & BUSINESS STRATEGY
Marketing Strategy
• Strategy for ‘Targeted Market Segment’
• Strategy ‘In Societal Context’
• Strategy ‘To Meet the Future Demands’
Targeted Market Segments based on
Customer Needs
Sufferers
At Risk
Prevention
Mass Market
Source: Functional Foods for Added Value Developing and marketing a new product category, Cecilia Mark-Herbert
Strategy for Targeted Market Segment
Source: Functional Foods for Added Value Developing and marketing a new product category, Cecilia Mark-Herbert
Strategy In Societal Context
Factors to be considered:
 Legal systems
 Claims made on the label
 Politics
 Cultural norms and values
 Finances and other societal factors
Harmonized legal systems for food and medicines would
facilitate production and trade with these products.
Source: Functional Foods for Added Value Developing and marketing a new product category, Cecilia Mark-Herbert
Strategy to Meet Future Demands
Factors to be taken into considered:
 Extend product lines by combining the portfolio of existing
and new product forms with innovative new components.
 Follow a strong trend, to identify emerging growth
opportunities that can be accelerated into the mainstream
market through competencies in marketing and distribution.
Source: Functional Foods for Added Value Developing and marketing a new product category, Cecilia Mark-Herbert
Business Strategy
Building a Brand
Clinical
Studies
Proprietary
ingredient/product
Source: Functional Foods for Added Value Developing and marketing a new product category, Cecilia Mark-Herbert
Business Model
Source: Functional Foods for Added Value Developing and marketing a new product category, Cecilia Mark-Herbert
COMMERCIALIZATION
Process of Commercialization
Creation &
Commercializa
tion
Diffusion &
Absorption
Shifting out to
the global/local
frontier of
awareness,
knowledge,
exchange &
performance
Moving toward
the acceptance
of innovators&
early adopters
of the market
Product
Innovation
Product
Innovation
Marketing
Innovation
Commercial
process
Innovation
Better and cheaper products in global, national and local markets in
response to consumer needs.
Source: Innovation in Healthy & Functional Foods, Market –Focused Innovation in Food & Nutrition
Manufacturing
& Packaging
Industry
Nutrient and
Supplement
Suppliers &
Manufacturers
Confectionery,
Beverage &
Chocolate
Manufacturers
Ingredient
Manufacturers
& Suppliers
Equipment
Providers
Vegetables &
Fruits Suppliers
Cereals and
Grains
Suppliers
Equipment
Providers,
Processing
Industry
Stakeholders for Functional Foods Market
7 POINT CHECKLIST FOR SUCCESSFUL
MARKETING OF FUNCTIONAL FOODS
Checklist for Successful Marketing of
Functional Foods
1. Successful brands are expert brands
2. Offer a relevant benefit and be a credible brand
3. Aim for a benefit the consumers can feel
4. Remember - an ingredient is not a point of difference –
it must give Value Proposition
Source: http://www.nutraingredients.com/Industry/Learning-from-functional-foods-failures
Learning from Functional Food Failure 11 June 2009
Checklist for Successful Marketing of
Functional Foods
5. A future of niches – focus on value, not volume
6. Differentiate using packaging design
7. Open new categories & segments – don’t be me-too
Source: http://www.nutraingredients.com/Industry/Learning-from-functional-foods-failures
Learning from Functional Food Failure 11 June 2009
Mantra For Marketing
‘Filter the Promise from the
Challenge’
WHY PRODUCTS FAIL?
(Functional Foods line, Novartis)
CASE STUDY
WHY DO SOME PRODUCTS SUCCEED?
(Creamy yogurt containing Bifidus ActiRegularis1,
Danone, France)
CASE STUDY
Your Wellness is in Your Hands!
Any Questions?
Interlink’s Offerings to Clients
1.Market Mapping
Location / Therapy-wise
Organ Specific
General Management
Disease Care
2. India Entry Strategy
 Entry mode
 Regulatory & Product Deve.
 Communication & Health claims
 Positioning & Pricing strategy
 Partner search / alliances
 Licensing-in
Interlink Marketing Consultancy Pvt. Ltd.
3A, Central Plaza, 166, C.S.T. Road, Kalina, Santacruz (E), Mumbai - 400098
Tel: (022) 2666 6611 / 44
info@interlinkconsultancy.com
www.interlinkconsultancy.com
Enabling Corporates to succeed in competition!
In life you have either
Reasons or Results…
Thank You
for Your
Attention
AFRIS. AsianFoodRegulationInformationService.
We have the largest database of Asian food regulations in the world and it’s
FREE to use.
We publish a range of communication services, list a very large number of
food events and online educational webinars and continue to grow our Digital
Library.
We look forward to hearing from you soon!
www.asianfoodreg.com
adrienna@asianfoodreg.com

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Developing a Functional Food Product - Part 2

  • 1. Considerations in Developing a Functional Food Product & Making it Good for a Successful MarketStart Dr. R. B. Smarta Managing Director Interlink Marketing Consultancy Pvt. Ltd. Honorary Secretary Health Foods & Dietary Supplements Association (HADSA) 11th April 2014
  • 3. So Far we have discussed Inside-Out Approach!!! Lets now appreciate the Outside-In Approach!!!
  • 5. Outside-In Approach Trends Needs Problems Platform Source: Innovation in Healthy & Functional Foods, Market –Focused Innovation in Food & Nutrition
  • 7. 10 Upcoming Trends 1. Emerging Economies 2. Value of Science 3. Increase in health consciousness 4. Awareness of Functional Foods 5. Increasing disposable incomes SOURCE: http://www.nutraceuticalsworld.com/issues/2014-01/view_editorials/10-trends-to-watch-in-2014/ 6. Quality & Safety 7. New Rules & Regulations 8. Claims Enforcement 9. Sustainable Supply Chains 10. Personalized & Preventive Medicines
  • 8. The Market for Health Promoting Ingredients
  • 10. Market Drivers focused on Consumers  Rising Incomes  Major Brands re-positioning towards more towards Health  Increasing incidence of Self-medication & Personal responsibility  Increasing Awareness of Medical Consumers & Healthcare professionals
  • 11. MARKET TRENDS BASED ON CONSUMER NEEDS
  • 12. Market Trends based on Consumer Needs • Digestive Health • Convenience Foods • Benefit Foods • Energy Yielding & Slow energy releasing • Fruit & Super fruit • Weight wellness & Gluten-free
  • 14. Consumer Dilemmas CONSUMER DILEMMAS What is the price – value equation? How good is product nutritionally? Does the product call for longer cooking time? How is the taste affected by nutrition? Source: Innovation in Healthy & Functional Foods, Marketing, PR, Ad & Media for Brand building of innovative Foods & Nutritional Products
  • 15. MARKET ENTRY BARRIERS & OTHER CHALLENGES
  • 16. Market Entry Barriers faced by the companies • Lack of adequate Marketing & Product development infrastructure • Lack of adequate funding for R&D and overall Business • Regulatory policies/procedures/processes
  • 17. Other Market-related Challenges 1. Conversion of Science to Business 2. Value of Science a Regulatory mechanism 3. Consumer behaviour, Market mapping and Product development 4. Barriers in Development and Marketing 5. Viability and Commercialization 6. Funding and Financing
  • 18. KEY CHALLENGES IN DEVELOPMENT
  • 19. Key Challenges in Development • Ensuring that Healthy choice is the Easy choice for consumers • Assuring & Delivering Health, Safety & Quality • Achieving Sustainable food production • Managing the food chain • Optimizing Communication, Training and Technology transfer. Source: New Developments in Novel and Functional Foods, Lisbeth Munksgaard, SM, Danisco A/S
  • 21. 5 Critical Success Factors 1. Notice-ability 2. Superiority 3. Compatibility 4. Practicality 5. No Complexity
  • 23. Marketing Strategy • Strategy for ‘Targeted Market Segment’ • Strategy ‘In Societal Context’ • Strategy ‘To Meet the Future Demands’
  • 24. Targeted Market Segments based on Customer Needs Sufferers At Risk Prevention Mass Market Source: Functional Foods for Added Value Developing and marketing a new product category, Cecilia Mark-Herbert
  • 25. Strategy for Targeted Market Segment Source: Functional Foods for Added Value Developing and marketing a new product category, Cecilia Mark-Herbert
  • 26. Strategy In Societal Context Factors to be considered:  Legal systems  Claims made on the label  Politics  Cultural norms and values  Finances and other societal factors Harmonized legal systems for food and medicines would facilitate production and trade with these products. Source: Functional Foods for Added Value Developing and marketing a new product category, Cecilia Mark-Herbert
  • 27. Strategy to Meet Future Demands Factors to be taken into considered:  Extend product lines by combining the portfolio of existing and new product forms with innovative new components.  Follow a strong trend, to identify emerging growth opportunities that can be accelerated into the mainstream market through competencies in marketing and distribution. Source: Functional Foods for Added Value Developing and marketing a new product category, Cecilia Mark-Herbert
  • 28. Business Strategy Building a Brand Clinical Studies Proprietary ingredient/product Source: Functional Foods for Added Value Developing and marketing a new product category, Cecilia Mark-Herbert
  • 29. Business Model Source: Functional Foods for Added Value Developing and marketing a new product category, Cecilia Mark-Herbert
  • 31. Process of Commercialization Creation & Commercializa tion Diffusion & Absorption Shifting out to the global/local frontier of awareness, knowledge, exchange & performance Moving toward the acceptance of innovators& early adopters of the market Product Innovation Product Innovation Marketing Innovation Commercial process Innovation Better and cheaper products in global, national and local markets in response to consumer needs. Source: Innovation in Healthy & Functional Foods, Market –Focused Innovation in Food & Nutrition
  • 32. Manufacturing & Packaging Industry Nutrient and Supplement Suppliers & Manufacturers Confectionery, Beverage & Chocolate Manufacturers Ingredient Manufacturers & Suppliers Equipment Providers Vegetables & Fruits Suppliers Cereals and Grains Suppliers Equipment Providers, Processing Industry Stakeholders for Functional Foods Market
  • 33. 7 POINT CHECKLIST FOR SUCCESSFUL MARKETING OF FUNCTIONAL FOODS
  • 34. Checklist for Successful Marketing of Functional Foods 1. Successful brands are expert brands 2. Offer a relevant benefit and be a credible brand 3. Aim for a benefit the consumers can feel 4. Remember - an ingredient is not a point of difference – it must give Value Proposition Source: http://www.nutraingredients.com/Industry/Learning-from-functional-foods-failures Learning from Functional Food Failure 11 June 2009
  • 35. Checklist for Successful Marketing of Functional Foods 5. A future of niches – focus on value, not volume 6. Differentiate using packaging design 7. Open new categories & segments – don’t be me-too Source: http://www.nutraingredients.com/Industry/Learning-from-functional-foods-failures Learning from Functional Food Failure 11 June 2009
  • 36. Mantra For Marketing ‘Filter the Promise from the Challenge’
  • 38. (Functional Foods line, Novartis) CASE STUDY
  • 39. WHY DO SOME PRODUCTS SUCCEED?
  • 40. (Creamy yogurt containing Bifidus ActiRegularis1, Danone, France) CASE STUDY
  • 41. Your Wellness is in Your Hands!
  • 43. Interlink’s Offerings to Clients 1.Market Mapping Location / Therapy-wise Organ Specific General Management Disease Care 2. India Entry Strategy  Entry mode  Regulatory & Product Deve.  Communication & Health claims  Positioning & Pricing strategy  Partner search / alliances  Licensing-in
  • 44. Interlink Marketing Consultancy Pvt. Ltd. 3A, Central Plaza, 166, C.S.T. Road, Kalina, Santacruz (E), Mumbai - 400098 Tel: (022) 2666 6611 / 44 info@interlinkconsultancy.com www.interlinkconsultancy.com Enabling Corporates to succeed in competition! In life you have either Reasons or Results…
  • 46. AFRIS. AsianFoodRegulationInformationService. We have the largest database of Asian food regulations in the world and it’s FREE to use. We publish a range of communication services, list a very large number of food events and online educational webinars and continue to grow our Digital Library. We look forward to hearing from you soon! www.asianfoodreg.com adrienna@asianfoodreg.com