Go

Breaking News on Supplements & Nutrition - North America EU edition

All feeds

News headlines > Consumer Trends

Text size Print Email this page

Branding to consumers is worth the investment, say suppliers

By Clarisse Douaud, 16-Feb-2007

Related topics: Consumer Trends

Branding functional ingredients is a long and costly process, according to two specialized manufacturers, but is worth it in order to stay competitive and ensure the long-term success of your ingredient.

Cognis has invested heavily in building brand awareness of its Tonalin CLA (conjugated linoleic acid) for weight loss, while Cyanotech Corporation has been targeting consumers directly with its BioAstin astaxanthin brand.

The companies have taken the approach of combining co-branding, investment in research, and investment in public relations to ensure the brands appear via numerous channels.

"Ingredient branding is expensive and requires a long-term commitment," Christine Peggau, senior marketing manager with Cognis Nutrition & Health, told NutraIngredients-USA. "When done well, it can really pay off for companies."

Cognis said the increased consumer awareness generated by its publicity has had a direct impact on sales. According to data from SPINS, Tonalin CLA's dollar market share grew 10 percentage points to 65 percent in the combined food, drug, mass channel and natural supermarket channel. Combined sales of other CLA products are reportedly experiencing double-digit decline.

"The branding process is a marathon," Bob Capelli, vice president sales & marketing with Cyanotech, told NutraIngredients-USA. "It is impossible to create a brand overnight – you must continue to invest in the brand over a long period of time."

Cyanotech said it built up its Spirulina Pacifica brand despite entering the market after other spirulina suppliers.

"…we did it over the course of many years, from 1984 until about 1996 by developing the highest quality spirulina, with higher levels of key nutrients and lower levels of contaminants such as heavy metals, and then consistently stressing our superior quality in all advertising and PR," said Capelli.

Along with consumer goods, ingredient branding became a prevalent marketing strategy in the 1990s, according to Peggau.

"It has become big business and is part of the global marketing strategy of many major corporations, so why do we not see more ingredient branding in the nutraceuticals industry?" asked Peggau. "Perhaps because it is not easy to develop brands, and it is costly."

Cognis has recently begun advertising Tonalin alongside its other branded ingredients, under the platform 'Newtrition'. This ad describes how 13 studies suggest Tonalin CLA reduces up to nine percent body fat and avoids fat regain.

"Research shows that 18 percent of a consumer's decision to purchase is determined by brand issues," said Peggau. "Customers will pay 19 percent more for a leading brand compared to a weaker brand and they have above-average loyalty, enabling companies with strong brands to achieve greater price/earnings ratios."

Cyanotech said it is only in the middle of bringing its BioAstin advertising full throttle and is using co-branding to bring consumers to the products of its bulk customers.

"We started in 2002 with a bit of advertising, but more recently we have hit very hard in educating consumers and retailers through more extensive advertising, but more importantly through a very aggressive investment in PR to make consumers aware of what BioAstin is and what it can do for them," said Capelli.

Cognis has also teamed-up with so-called host brands to advertise in consumer advertisements, editorials and point-of-sale materials.

The investment has brought Tonalin CLA into the mass media. The ingredient has appeared in articles in publications such as Prevention magazine, The Washington Post and Los Angeles Times.

"Well executed brands are worth millions of dollars in sales and shareholder value," said Peggau.