May 2, 2024

Chinese Thirst for Safe Baby Formula Empties Australian Shelves

But the run on formula is not the result of a local baby boom. Instead, it is being attributed to Chinese visitors, who are apparently concerned about domestic food safety standards and are believed to be buying in bulk and carrying it home.

The run is one of the odder examples of how China’s thirst for high-quality products can upend faraway consumer markets, particularly amid concerns about the quality of its food supply.

A number of recent high-profile scandals involving tainted food products in China have shaken public confidence in the safety of domestic supplies. In 2009, two Chinese milk producers were executed for selling contaminated milk powder after infant formula and other products were found to have the industrial chemical melamine. Six children died and about 300,000 became ill, provoking a nationwide panic among parents.

Last June, China’s biggest milk producer, the Inner Mongolia Yili Industrial Group, was compelled to recall six months’ worth of production.

With about 16 million births a year, China is one of the world’s largest markets for baby food and infant formula, representing around 23 percent of the $41 billion global market, according to a recent study published by Euromonitor International, a research firm in London.

Concerns about the safety of domestic supplies have led to a sharp rise in demand for imported formula among urban middle-class households, sending prices of foreign brands soaring in Chinese supermarkets. According to the United States Department of Agriculture, the retail price of a 28-ounce package of imported formula is 290 to 350 renminbi, or $46 to $56 — about 50 percent higher than most domestic brands.

Hoping to stem the loss of market share to foreign competitors — and perhaps to reap the higher margins on foreign milk — some Chinese producers are investing in plants overseas. One of China’s leading makers of baby formula, Synutra International, announced plans in September to invest about $130 million in a new milk-drying plant in the western French region of Brittany that will be operated by Sodiaal, a French dairy cooperative.

The plant, which is expected to open in 2015, will produce around 100,000 tons of “high-quality” whey and milk powder a year exclusively for Synutra, the company said.

With Chinese visitors to Australia reaching record numbers in 2012, local merchants say it is common for these travelers to stock up on formula.

“This has been happening for maybe five years,” Edward Karp, who owns Pyrmont Pharmacy in Sydney, said in an interview. “Their pilots and their flight attendants used to stay at the hotel in the other block, and they used to come in and buy cartons of baby formula to take back home for their family and friends. They used to come in in their uniforms with the trolleys, put the bags on the trolleys, and off to the airport they’d go.”

The phenomenon is not unique to Australia. Mainland Chinese visitors to Hong Kong, for example, have put such pressure on formula supplies that retailers routinely limit purchases to four cans per customer, analysts say. Thousands of Chinese households are also placing international orders for formula online, either directly or through friends and relatives living overseas.

The shortages in Australia are primarily limited to the Karicare Aptamil Gold brand of formula, which is produced by a New Zealand-based subsidiary of the French food-product giant Danone. It remains unclear why that brand is in greater demand than others, but Australia’s leading supermarket chains, Coles and Woolworths, acknowledged this week that they were struggling to meet demand.

A spokeswoman for Woolworths, speaking on the condition of anonymity in line with company policy, said that while the chain had not instituted formal rationing, it would restrict the amount that customers may buy at any one time.

“Woolworths is not a wholesaler; we reserve the right to limit the number of identical products any one customer can buy during a single visit,” the spokeswoman said in an e-mailed response to questions. “While there is no specific limit set, our stores are encouraged to use a common-sense approach to ensure stock is only sold in retail quantities.”

Alistair Bradley, the general manager of Nutricia, which produces the formula at its New Zealand factory, told the newspaper The Australian on Friday that the company was struggling to keep its products on the shelves, despite having increased production to 20,000 tons from 5,000 in 2012 to cope with growing domestic demand.

“This, coupled with food safety concerns overseas, has generated an unexpected increase in demand for Karicare and Aptamil formula,” he said. “We are currently not always able to ensure that adequate amounts.”

In Perth, on Australia’s west coast, Richard McWatt, the manager of the Superchem Family Pharmacy, said by telephone that a customer had called him on Thursday to buy 100 cans of the formula. Similar stories have been reported in the Australian news media, although it is unclear how the products are being taken out of the country without the imposition of export duties.

“Some families will buy six tins at a time and send it back to their home country, but never that many at one time,” Mr. McWatt said.

Some of the purchases, though, could be the result of hoarding by residents fearful of shortages.

Nicola Clark contributed reporting from Paris.

Article source: http://www.nytimes.com/2013/01/09/world/asia/infant-formula-shortage-in-australia-tied-to-chinese-hoarding.html?partner=rss&emc=rss

Advertising: Bazooka Gum Overhauls Brand and Loses Comic Strips

Total domestic sales of bubble gum are projected to total $206.9 million in 2012, from $332.4 million in 2007, a drop of 38 percent, according to Euromonitor International, a market research firm.

Bazooka bubble gum, which was introduced in 1947, fell even more, from $17 million in 2007 to a projected $8.8 million in 2012, a drop of 48 percent.

Now, in what the brand is calling a reimagined Bazooka, it has overhauled its logo and packaging.

Gone is the red, white and blue color scheme and geometric design of the brand, replaced with more saturated hues like fuchsia and yellow, and with the splattered-paint look of graffiti.

The new packaging is by Goodwin Design Group, of Wallingford, Pa., which also undertook a less pronounced Bazooka package redesign in 2006. It will begin appearing in stores in January.

“What we’re trying to do with the relaunch is to make the brand relevant again to today’s kids,” said Anthony Trani, vice president of marketing at Bazooka Candy Brands, a division of the Topps Company.

Ken Carbone, a founder of the Carbone Smolan Agency, a Manhattan branding and design firm, reviewed the new Bazooka design, and said it “takes visual cues from comic books and skateboard culture and graffiti” and that it “feels right for today.”

But Mr. Carbone, the co-author with Leslie Smolan of “ ‘Dialog’: What Makes a Great Design Partnership,” questioned why the gum veered so far from its original design.

“I wonder if they couldn’t have taken more from what they had and re-energized it to make it look cool, like the Juicy Fruit model and Hershey’s model,” said Mr. Carbone, referring to the gum brand and chocolate bar that have tweaked their looks over the years but not metamorphosed. “I think this is a little bit of an overreach,” he said, “because they had some equity and authenticity” in their original design.

Bazooka, however, which has struggled to get shelf space in the last decade, said the bold approach was winning over retailers. Among those not carrying the brand now that will begin stocking it early in 2013 are Target, 7-Eleven and Kroger.

The gum originally sold for a penny in individual pieces on countertop displays in penny candy stores. The new standard package will feature 10 pieces of gum, five each of the original flavor and of a new flavor, blue raspberry.

A piece of the rectangular gum will increase in size to 6 grams from 4.5 grams, a mouthful compared with brands like Stride, with pieces at 1.9 grams, and Dentyne Ice, at 1.5 grams. (Along with being more elastic than typical gum, bubble gum generally comes in bigger pieces, giving chewers more to inflate.)

In recent years, sugarless gums have increasingly been marketed for functional benefits, like freshening breath, whitening teeth and strengthening teeth, with some brands even winning approval to carry the American Dental Association seal and a statement that chewing sugarless gum after eating helps reduce cavities.

But the draw for regular gum tends to be more indulgent, with 17.9 percent of those who chew regular gum doing so because they like the taste, in contrast to 15.1 percent of sugarless chewers, according to a 2010 report from the National Confectioners Association, an industry group.

The favorite flavor among consumers age 6 to 12, bubble gum drops to third place among those age 13 to 17 and to fifth for those 18 and older, according to the study. Frequency of gum chewing is highest among those age 13 to 17, who on average chew 314 times a year, in contrast to 234 times for those 18 to 24 and 211 times for those 25 to 34.

Bazooka is pitched to children from 10 to 13, according to the brand.

The brand, which said it had not advertised in more than five years, also will embark on a television and online advertising campaign. The campaign is by Flint Steel, a new agency in Manhattan, which also is redesigning the brand’s Web site. Commercials are expected to appear in March.

What adults may remember best about Bazooka, however, is disappearing. The tiny comic strip featuring the eyepatch-wearing brand mascot Bazooka Joe that has been wrapped around each piece of gum since 1953 is being replaced.

New inserts will feature brainteasers, like a challenge to list 10 comic book heroes named after animals, or activities, like instructions on folding the insert into an airplane. They also include codes that, when entered at BazookaJoe.com, will unlock content like videos and video games.

Bazooka Joe and his sidekick, Mort, who wears his turtleneck up over his mouth, will appear only occasionally as illustrations in the new inserts, but without the antics and corny jokes of the three-panel strips.

Only 7 percent of children age 6 to 12 are aware of the Bazooka Joe character, according to E-Poll Market Research, a brand and celebrity research firm that last collected data about the character in 2007. In contrast , an average 30 percent of children are aware of food product mascots, the firm said. Among children who are aware of Bazooka Joe, 41 percent liked the character, below the average likability for food characters, which is 54 percent.

Mr. Trani stressed that the brand was not discarding Bazooka Joe, who in the past has appeared not just in comics, but also on packaging, on store displays and in advertising.

“Instead of a cheesy joke,” Mr. Trani said, “we wanted to have a fun, engaging activity for kids, but the purpose wasn’t to not include Bazooka Joe.”

“To me it is all about doing one thing really well,” he said, “and that is refreshing the Bazooka brand.”

Article source: http://www.nytimes.com/2012/11/30/business/media/bazooka-gum-overhauls-brand-and-loses-comic-strips.html?partner=rss&emc=rss