Category: Marketing

Marketing and Product Development Professional

New Product and Expansion Development Process – What do I do? AND Not do?

New Product Development (NPD) is a process that is different for each organization. Some organizations take as little as 30 days to go to market and other organizations have a longer process taking from 6 months up to a year.

What is the right process?

The process depends on the organizational structure and the products/services they are offering. It is important to continuously look at the process because of the fast-moving technological world we live in. The duration from ideation to launching the product depends on the target audience, the goals of the organization, resources available and of course, as always, the budget and expected return on investment.

There are some key questions when deciding how long the process will take and what is needed for the product to succeed. Is the new product an enhancement of a current product? Is this a new product but to the current customers or a new customer base? What resources are needed internally and externally? What are the organization’s expectations? Is the product a soft or hard launch? Is the new product local, national or international?

A new product can increase the acquisition of new customers; growth of current customer ROI; open or broaden to a new market or industry; improve or push a company’s resources; increase market share within the industry.

There are obstacles and challenges in developing new products and there are times when the odds are higher than the successes. It is important for the companies and the employees to understand the consequences, the markets, the competitors and the target market. What are the costs to develop and launch new products? Is the organization capable of handling possible losses? Are there processes within the organization to review and approve next steps?

There are eight major steps in the product development process:
1. Idea Generation – What’s a good idea?
2. Idea Screening – How do we screen?
3. Development and Testing – Who and what is involved?
4. Development of Marketing Strategy – Getting leadership on board
5. Business Case Analysis – Make your case!
6. Product Development Tactics – Details!
7. Pilot/Test – What is the right timeline? How are results measured?
8. Launch/Commercialization – Yes!

For my next article, I will dive deeper into the eight steps of the product development process and what it involves.

Global Milk Industry Trend Analysis and Outlook

Industry Overview:

Milk is considered to be a complete food for human diet. For any mammal, milk is the primary source of nutrition, especially for infants, since this white liquid is easily digestible. Numerous health benefits associated with the consumption of milk include, but not limited to improved bone strength, stronger immune system, reduced risk of cardiovascular diseases, and healthier skin. Adequate consumption also aids in the deterrence of diseases such as dental decay, dehydration, obesity, and many other chronic diseases. Milk contains nutrients including Calcium, Vitamin A, B12, D, Phosphorus, Magnesium, Selenium, Protein, Riboflavin, Zinc, Carbohydrates, etc.

Milk accounts for around 14% of modern agricultural trade, along with its other products. Skimmed Milk Powder (SMP) and Whole Milk Powder (WMP) are the most demanded and traded commodities, whereas fresh milk accounts for only less than 1% of production traded. Infant Formula Milk is another highly demanded commodity with products such as Starting Milk Formula, Follow-on Milk Formula, Toddlers Milk Formula, and Special Milk Formula. According to Food and Agriculture Organization of the UN, by production tonnage, milk ranked third with a production of 770 billion liters and was the most demanded agricultural commodity in terms of value globally in 2013.

Global milk industry depends on breeding animals such as cows, goats, sheep, buffaloes, and camels for milk production. However, lactose-free alternatives such as soy milk and almond milk are also of significant demand in the milk industry. However, cow milk is estimated to hold an 80% share of the global milk production. Buffalo milk, although produced in fewer quantities than cow milk, is produced and traded mainly in countries such as Pakistan and India. The milk production system can be categorized into four, namely specialized landless system, market-oriented system, subsistence-oriented integrated dairy-crop systems, and pastoral systems.

Market Dynamics, Trends, and Outlook:

The global milk industry is driven by the substantial demand from countries with dietary guidelines recommending milk as a staple food. Milk provides an average 134 kilocalorie of energy per capita per day. It is also an affordable source of nutrition to meet the daily recommended levels. For instance, in the United States, 100 kilocalorie milk costs only around US$ 0.23, whereas other sources such as egg, vegetables, and poultry cost around US$ 0.41.

North America accounts for a major share in the global milk industry with the U.S, Canada, and Mexico contributing significantly to the growth. Whereas, in South America, Brazil and Argentina dominate the industry and countries such as Uruguay and Chile are projected to exhibit slow growth.The milk industry in Russia exhibits a stunning growth with around 40% of the gross product of animal husbandry. The largest milk producer in the world is India followed by the U.S., China, and Pakistan, among others.

Long-term demand for milk and its products is projected to register a substantial growth, which in turn will result in price volatility. The industry is expected to witness erratic changes in prices in the upcoming years. The changing lifestyle, food habits, population growth, etc. are some of the factors bolstering the growth of the global milk industry. In a nutshell, the hike in milk production and consumption worldwide is the key factor boosting the global milk industry growth.

For instance, the European Union was regulated by a milk quota system until 2015, according to which every member state had a national production quota. In case if any state exceeded its quota, it must pay a set penalty to the EU. The abolishment of this system has been affecting the global milk industry on a positive note, which in turn is expected to spur the growth of the global milk industry in the near future.

Introduction of a variety of flavors, attractive packaging, and availability in different forms elevate the consumption of milk globally. For example, in March 2016, Prairie Dairy Farms introduced two fresh flavors, namely Strawberry Créme and Orange Crème, of its Peeps flavored milk. The packaged milk with new flavors and colors has gained strong market demand in the developed countries. The key participants in the global milk industry are slowly shifting their focus toward the developing countries in order to explore the market opportunities.

Busy life schedule of citizens in developing countries opens up a gargantuan scope for the multinational companies to gain a foothold in such markets focusing on breakfast products. Selling products through advertisements highlighting easy breakfast and on-the-go options will propel the growth of the global milk industry. Growing health concerns encourage the consumers from abstaining from carbonated soft drinks and other juices, which in turn creates an opportunity for the milk industry.

Apart from the aforementioned factors driving flavored milk market, the rising awareness on healthy diet hinders the market growth to an extent. However, the unflavored milk market witness a steady growth in the global milk industry and the trend is expected to continue over the upcoming years as well.