New Nutrition Business: A true innovation tests the beauty hypothesis
Combining innovation in ingredients, technology, packaging, positioning, marketing and distribution, Nestlé’s Glowelle beauty drink is a rare example of a new launch that innovates from every angle. It even acknowledges the reality that functional foods are a high-value, low-volume niche. If it doesn’t work, the most likely reason will be that women may not yet be ready for beauty drinks.
1. Innovation in ingredients
Although it’s a product which represents the excellence of food technology skills, Glowelle in fact conveys a strong message about the “naturalness” of its ingredients, using imagery to reinforce messages such as that it contains, “the same amount of vitamin E found in 108 almonds”. The ingredient list also features cocoa extract, apple extract, pomegranate extract, green tea extract and others, while the flavours of the products are derived from fashionable fruit, such as pomegranate, raspberry and lychee.
And if the consumer isn’t sure what some of the ingredients are, such as quercetin, then Glowelle’s communications make it clear that it’s something found naturally in apples – each 260ml bottle providing as much quercetin as half a kilo of apples.
Moreover, women – the target market – are used to “natural extracts” being the basis of many personal care products and are seemingly willing to accept the ingredient list of these products also containing (in apparent contradiction of the “natural” message) other things that sound like the contents of a chemistry set. But when people are buying “hope” they are often willing to make compromises. A blend of naturalness with science seems to work best in topical skincare products, so why not skincare drinks too?
Thanks to the marketing of the cosmetics industry over the last five or more years, women are also well-aware of antioxidants in connection with skin health, and Glowelle connects to beliefs about antioxidants’ skin benefits with its message about being “the highest antioxidant beauty drink”.
The types of ingredients used in Glowelle figure in the strategies of an increasing number of ingredient companies, such as Cognis, which has created formulations with vitamin E, plant extracts, carotenoids and others for use in nutricosmetics. So, too, has DSM Nutritional Products, which has formulated vitamins, antioxidants, carotenoids and polyphenols for use in beauty beverages that claim to protect skin against UV rays and dryness. The success or failure of Glowelle will have an impact on their destinies.
2. Innovation in packaging
Both the 260ml bottle and the stick of powder, for adding to other drinks, recognize the reality that most foods and beverages for health are for individual consumption – not family consumption. The 1-litre gable-top carton is completely wrong for products like this. In our industry, however, an inability to innovate in packaging (or even achieve a point of difference) is one of the most common causes of failure.
The package design itself also looks right for a product that is in essence a cosmetic (or a “nutricosmetic” as L’Oréal refers to such products) with a slightly clinical look.
3. Innovation in distribution
Connected to the innovation in packaging, Nestlé is showing an admirable approach to innovation in distribution.
Supermarkets are often the worst place to sell a product. They expect brands to bring quick results while in fact doing little or nothing to help the brands they sell succeed. Your package can all-too-easily become invisible among the thousands of other products cluttering the shelves – and finding the right aisle to put your product in can be a nightmare.
Merchandising a beauty drink such as Glowelle in the beverage aisle alongside the Coca-Cola or in the chiller cabinet with the yoghurts priced at two-for-one would kill the upscale beauty image that Nestlé is trying to create. And neither aisle is a place that women go to with beauty on their mind (nowhere in the supermarket is). Many successful brands have been built without supermarket distribution – Red Bull and Yakult being two examples.
Where better to sell your beauty product than in the beauty and cosmetics section of a very upscale department store such as Neiman Marcus – a place where women do go with beauty on their mind and where they are used to taking the time to browse and sample?
As everyone knows, functional food brands are brands with a high content of information – there’s a lot to explain about what they are and how they work. That requirement to communicate and educate is particularly acute when the product and the benefit being offered are completely new and unfamiliar to consumers.
Hence Glowelle is being heavily sampled in the beauty area, where there will be knowledgeable staff on hand to explain the product – which is what consumers expect beauty brands to do. If you haven’t done this before, go to a department store and look for a range called Clinique (there’s a men’s range as well as a women’s, so male readers can go too) and experience how the sales assistants for this brand, forty years old this year, communicate the benefits. That’s the model for Glowelle – and it’s the best approach yet attempted in the embryonic beauty foods business.
The Glowelle strategy recognizes from the outset that “beauty” is a niche – perhaps an utra-niche – opportunity and the brand is priced accordingly. Priced at $7 (€4.90) for each 260ml bottle, that’s equivalent to an impressive $27 (€18) per litre. Put another way, on a price per litre basis Glowelle retails at:
• A 270% premium to a premium brand such as Pom Wonderful pomegranate juice
• A 1,045% premium to a mass-market superfruit brand such as Minute Maid’s Pomegranate-Blueberry juice
Given the very expensive array of ingredients and the marketing costs involved, that premium price is necessary.
While wobbles in America’s financial world and the mortgage woes of ordinary people might bite into the sales of mass-market products, in a country such as America there’s still a large niche of people whose wealth is at a level far, far removed from ordinary mortals. Let’s not forget that even in the Great Depression of the 1930s, alongside soup kitchens there was an echelon of society who dined at the Ritz and shopped at Cartier (see the glamorous movie “The Rich are Always with Us”, made in 1932, to learn about a lifestyle untouched by hard times). These people shop at Neiman Marcus.
The worst thing anyone could do now would be to aim such a product at the average person. Better by far to build up an elite following and leave moving into the mass market to some future date when conditions allow it.
The beauty experts?
Nestlé has the advantage of having already acquired experience in the beauty business through its part ownership of cosmetics giant L’Oréal, with which it has a small but successful “beauty supplements” business operating in nine European countries, as well as Brazil, trading under the Innéov brand.
The Innéov range, which are dietary supplements, has been around since 2003. Neither L’Oréal nor Nestlé will disclose Innéov’s sales, but industry sources estimate the brand to be worth over €70 million ($100 million) and growing and there’s no-one who disputes Nestlé’s claim that Innéov is Europe’s largest “nutricosmetics” brand.
Supermarket struggles for Essensis?
Danone’s Essensis is possibly Europe’s second-biggest beauty food brand. Like Nestlé, Danone does not disclose sales, but industry sources estimate that the range of spoonable yoghurts – launched in Italy, Spain, Portugal, France, Belgium and Ireland – peaked at no more than €50 million ($72 million) in retail sales in 2007, the brand’s first year on the market. If true (and some sources say the sales number is lower) that’s well short of the €100 million ($144 million) target which Danone said it was aiming for in January 2007. Industry executives say that in France the brand’s sales fell in early 2008, prompting a relaunch in mid-year. Overall, Essensis appears to have stalled.
Among the reasons may be that it is merchandised in the supermarket – alongside the regular yoghurt. That’s not a place where a brand can acquire any cachet or mystique. Moreover, it’s easy for consumers to see that it’s a brand that’s at quite a premium to regular yoghurts. French consumers have been tightening their belts in 2007 and 2008 – and Essensis, especially when compared to the Glowelle strategy, just isn’t differentiated enough to justify a price premium. Its only point of difference from other yoghurts is the beauty benefit – that aside there’s no innovation in packaging, distribution or merchandising.
Essensis is in fact showing signs of being a brand whose benefit has only ultra-niche appeal – as Glowelle is planned to be – but without earning Glowelle’s super-premium price.
When compared to Glowelle, Essensis looks like an opportunity that was missed.
If Glowelle succeeds as a super-premium, ultra-niche product, as we suspect it might, then the beauty foods market will be confirmed as a profitable niche opportunity for brands that are willing to innovate and obey the marketing rules of the cosmetics market.
If Glowelle fails, despite such an innovative approach, then it will present the question of whether beauty foods really have any future at all.
About New Nutrition Business
New Nutrition Business is a London-based research, publishing and consulting company which specialises in researching, analysing and forecasting developments in the business of food, nutrition and health around the world
The strategies and success factors it has identified in the 1990s have become the benchmarks for strategy development and brand positioning in the worldwide nutrition business.
It works with companies all around the world, from the United States to Australia and from Sweden to South Africa.
New Nutrition Business is headed by executive director Julian Mellentin, one of the world’s very few global specialists in the business of food, nutrition and health.
He is the editor-in-chief of New Nutrition Business and Kids Nutrition Report , the only industry journal in the world on the rapidly developing kids’ nutritional marketplace.
Julian is co-author of both The Functional Foods Revolution: Healthy people, healthy profits?, the first-ever book on the business of functional foods, now translated into Japanese, and Commercialising Innovation: The Food & Health Marketing Handbook.
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