When Chinese infant formula manufacturer New Hope Group launched a new infant formula product line with a fair price, raw materials sourced in New Zealand, sold exclusively through e-commerce which also undercut most of its competitors it made rest of the industry sit up and pay attention. The ripple effect of this gambit has seen several famous manufacturers begin to adopt new product development and marketing campaigns as a countermeasure to New Hope’s strategy.
Some brands have followed New Hope’s lead by reducing product prices. However, in response to the gauntlet thrown down by New Hope the manufacturers of higher end brands have remained true to their core values and continue to focus on quality and development of nutritionally superior products. Biostime, Hengda Cowala and Friso have introduced new product lines focusing on products fortified with OPO.
Market data has clearly shown a shift towards higher end products. The comparatively high price tags attached to these products has not dissuaded Chinese consumers from demanding these products and these manufacturers are using new technology and new packages as their key selling points to combat the price cutting offered by other ecommerce based brands.
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