Infant formula the new gold —
Here 100% pure will have to mean it.

I can't for a moment support the idea of babies being tattooed with corporate logos but Australian artist Dietrich Wegner rams home a valid point about our affinity with brands and perhaps the moral dilemma we all have as professionals. Each generation is bombarded with more commercial messages than the one previous and it's time we began putting limits on ourselves. These babies covered with tattoos representing an amalgam of logos of famous brands, such as the influence of marketing on our innocence, are a beautiful reflection on the contradictions accumulated amidst the ideals of our society, but it's very dangerous country for the marketer, particularly to play on the heartstrings of mother.


This brings me to the observation of the frenetic race in New Zealand to brand infant formula milk powder for the middle classes of Asia. After the US, China is currently the largest infant formula market in the world - worth US$6 billion (NZ$7.43 billion) in 2011 - and is projected to double by 2016. It's a kind of new bonanza, which could see New Zealand dairy manufacturers and exporters at each other's throats, which is par for the course in the commodity industry. Multimillion dollar processing plants (some part or wholly Chinese-owned) are springing up in New Zealand to manufacture formula for China's rapidly expanding market, where a can of formula (costing around $20 in New Zealand) can sell for over NZ$70 a can. Recent moves by New Zealand dairy exporters toward exporting "added value", pre-constituted formula (rather than raw milk powder) has led to these high price margins, with some calling it the new gold rush.

Middle-class Chinese parents, with just one child to invest in, are willing to pay premium prices for formula from safe suppliers. On top of that, following China's 2008 melamine infant feeding scandal, infant food safety fears have led to demand for products from perceived "high quality" sources such as New Zealand. We have the raw material but do we have the ethics to brand something responsibly for a weaning mother. Each week I read about nefarious practices within China to procure this product and worry that our free enterprise behaviours in this space will be above board and orderly.

Indeed, how do we wean our primary sector off its delinquent behaviours in the marketplace against each other; after all its New Zealand Inc. we are selling here more than ever before. Unfortunately we have a Commerce Commission, which precludes discussion between competitors principally to do with price. However, given such an important export and one that promises to be highly valuable into our future I question how strong the fellowship is about positioning such a valuable product. Our Minister Nikki Kaye has announced a work plan to "protect and strengthen confidence" however, when you read the work program it looks to me that it might solve the scientific argument but fall well short of the collaboration and generic communications platform needed to manage reputation across the whole industry. Rather I would prefer to see, like the French commit to, an appellation or guild approach wherein the industry collaborates a lot more closely. After all this could be our Champagne in the dairy sector. New Zealand firms are notoriously bad at working together in the international marketplace and here is one product which without orderly behaviour and the right brand efficacy has the potential to go wrong in a serious way and never realise its true value in the marketplace.

Ethics, aesthetics and functionality should be central to this particular product's values and attributes, quite apart from the provenance story. How is the milk sourced? From what farms? What are the practices inside the farm gate? Even the pastures on which the animals are raised are important ingredients for healthy nutrition. Not to mention the manufacturing storage and distribution challenges in terms of their correctness. This product, in a burgeoning middle class society of both India and China, which is seeing mothers return to work more quickly than ever before, presents a significant opportunity for New Zealand's dairy industry to reverse the commodity slide of doing more for less. It will require a great deal more than traditional supply chain thinking to realise this opportunity.We are notoriously poor at capturing agricultural IP. We completely forgot to charge a premium when we invented spreadable butter, and we are only just beginning to capture a premium for merino wool. Our record in positioning meat is appalling; the list is endless of New Zealand primary sector companies failing to realise true values.

Dr. Truby King, a pediatrician in Dunedin in 1907 and the founder of our very own Karitane Association (later to become Plunket), developed the original infant formula, later publishing a book which became the definitive baby manual for infant care in many English-speaking countries for over 60 years. There is a depth and authority to draw on and there are, of course, many more contemporary nutritionists and experts these days within our university system that can help these companies. The world media have already highlighted the environmental costs of dairying in New Zealand. This could be compounded by potential charges of unethical infant formula marketing. In the same way the industry is making some effort to solve its environmental issues, the export superstar should support "best practice" child health policy globally and not undermine it.

It seems we could become world leaders in the category but here, 100% pure will have to mean it.

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