Learning from functional foods failures

By staff reporter

- Last updated on GMT

Related tags: Functional foods, Coca-cola

Eighty per cent of functional food product launches fail within 18 months, according to a new report that draws lessons from 15 high-profile failures from the likes of Danone, Emmi, Pepsico, Coca-Cola, Nestlé and Unilever.

Report author, Julian Mellentin, a functional foods branding and marketing expert, highlights 15 failures as case studies that include Unilever’s soy fruit juice, Adez (pronounced ‘Ah-dez’, not ‘Aydz’); a Nestlé prebiotic cereal; an Emmi CoQ10 beverage; an omega-3 drink and Coca Cola’s plant sterol-imbued Minute Maid Heart Wise orange juice.

In the case of Adez, Mellentin noted Unilever spent €14.4m launching its first major UK brand in over a decade only to see it earn €10.7m in sales before being pulled little more than a year after making its debut.

In assessing why some of these products have failed Mellentin outlined seven rules for success.

1. Successful brands are expert brands

2. Offer a relevant benefit and be a credible brand

3. Aim for a benefit the consumer can feel

4. Remember that an ingredient is not a point of difference

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

6. Differentiate using packaging design

7. Open new categories and segments – don’t be a me-too

The report, Failures in Functional Foodsand What They Reveal About Success,​ highlighted the difficulties of ingredient marketing.

“Of the above, number four – an ingredient is not a point of difference – has proven to be one of the most important. Many of the failures involve a company choosing an ingredient that is new to consumers and overlooking the fact that consumers buy products only for the benefit to them personally, not because of the ingredient used. In fact, consumer acceptance of new and unfamiliar ingredients is usually a very slow process.”

In the US, Coca-Cola and Nestlé’s calorie-burning drink, Enviga, saw sales plummet 65 per cent from €22 million in 2007 because of a concept that was “too difficult to explain."

Related topics: Markets, Ingredients

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