In a new report penned for New Nutrition Business (NNB), 'Failures in Functional Foods and Beverages', director Mellentin (pictured below) runs the rule over 19 recent functional food and beverage launches commonly reckoned to be failures, one of which is the world’s biggest food firm’s late 2010 launch Nesfluid.
The report also explores blunders from other big companies – Minute Maid Heart Wise cholesterol lowering orange juice and Unilever’s pro.activ blood pressure-lowering dairy drink are discussed as other functional ‘failures’ - as Mellentin aims to help firms avoid costly mistakes by studying where things went wrong.
His Top 5 failure factors are (1) Undue reliance on a health benefit (2) Overestimating the potential market (3) Targeting the mass market too soon (4) Brand/benefit/format mismatch (5) Failure to manage shareholder expectations in large firms that a ‘successful’ product should quickly be mass market with $100m+/year sales.
€10m+ spent on advertising but product soon pulled
“Nestle’s launch of Nesfluid was a textbook example of a brand whose marketers ignored every lesson about launching products with health benefits,” Mellentin writes.
“Even though the product was competitively priced and supported by a huge marketing investment, it achieved very modest sales and was withdrawn within 18 months of launch,” he adds.
Nesfluid was launched in France in September 2010 at a competitive €1.85/250ml bottle, and Mellentin says Nestle spent €10-12m on advertising and marketing a brand that clocked a paltry €3m in sales in its first year, he said, although it had retail penetration of 80%.
Despite a well-proven rule that multiple messages are muddled, and that successful brands start with a clear, single health benefit targeted at a receptive group, Mellentin says Nesfluid did the opposite.