Marketing Branded Ingredients

September 20, 2011
Steven Hanson

How to develop and implement a branded-ingredient strategy.

Today’s supplement shoppers have more choices than ever. Which brand? What dose level is most effective? Which one is the best? Where should I buy it? With all of these choices, shoppers rely on what they know (or perceive) when selecting the most meaningful choice, the choice that best reflects what they want or need at a particular time. That’s where the power of brands becomes important. Great brands save time for the consumer, and consumers oftentimes equate the best brand with the best product.

Branded ingredients can strengthen perceptions of an existing brand, or add an entirely new set of brand attributes. Branded ingredients build brand equity, enhancing the product’s value and providing a stronger point of differentiation.

If you are an ingredient supplier, it is likely that you have an ingredient brand or have discussed introducing one. Companies such as Indena (Meriva), DSM/Kemin Health (FloraGLO), and Ocean Nutrition Canada (MEG-3) have had much success through careful development and execution of a branded-ingredient plan. This article highlights some of the important elements for ingredient suppliers-and their marketer customers-when developing and implementing a branded-ingredient strategy.

Establish an Identity

Building an effective ingredient brand means more than just devising a catchy name and a pretty logo. A successful ingredient brand will stand for something that is meaningful and relevant to its target audience.

An effective identity combines a name and logo with focused, consistent messaging. It allows you to own a concept in the mind of your target audience that’s significant and unique.

When developing your identity, consider messaging from the perspective of your target audience. Some questions to ask:

  • What makes your ingredient pertinent?

  • What is the most significant benefit your ingredient offers?

  • Within what category is your ingredient operating? Is there an opportunity to create a new category, and can it be differentiated from an existing one?

  • What unique place can you occupy in the audience’s mind that will set the ingredient apart from the competition?

  • How can we make the message as simple as possible-yet still meaningful?

  • Can the positioning remain meaningful for the duration of the product’s life?

The three most important elements to include in your ingredient brand’s position are:

1) Relevance: The association between your ingredient brand and the target audience that makes your ingredient pertinent. It establishes a “category” and is referred to as “the frame of reference” among marketers.

2) Differentiation: Research has shown that the single most important factor for product success is the establishment of an appropriate differentiating benefit or value proposition. The differentiating benefit and value proposition must be unique to your ingredient.

3) Reasons to believe: The factors that allow your target audience to believe that your value proposition is true. For example, scientific studies, patents, trademarks, etc.

Focusing on these three points will also help in developing a brand name and logo. Positioning is important in establishing focus and delivering a consistent message over time throughout everything you do.

How to Make It a One-Horse Race

The best way to win a race is to ensure your competition never gets close. That might seem like an impossible task in today’s saturated landscape, but it can be done. Here are some ways to make it happen.

Assume thought leadership for your category. If you act like a leader, people will follow you. You want your ingredient brand to always be gaining momentum and to be the one that everyone is talking about. This means breaking conventions and doing what your  competition isn’t. If your company is always talking about and following the competition, then you are probably not the leader. Leaders set the agenda for others to follow.

Fanatically differentiate your brand. You will never get noticed if your ingredient is the same as everyone else’s. Establish your point of difference, and communicate it in everything you do-differentiate with a vengeance.

Secure intellectual property and protect it. Intellectual property has become the hottest commodity in business today, and smart companies are ensuring that their ideas are safe and protected. Effective intellectual property plans include both patents and trademarks on a global scale. Just securing a patent or trademark isn’t enough, however; a company must also be willing to vehemently defend its intellectual property, even through legal action. Protecting your product from knock-offs and their claims can keep you on high ground.

Begin with the end in mind. Think you can run a consumer advertising campaign? If you are a company just starting out, doing so might be cost-prohibitive. However, from the start, you can map out a plan focusing on both trade manufacturers and consumers. For instance, you can develop a co-op advertising program in which manufacturers using your ingredient can feature your ingredient’s logo and messaging in their marketing. For example, the FloraGLO lutein logo is featured on several hundred products worldwide.

Additionally, your company can also establish a sales goal, and when the goal has been achieved, you can initiate a consumer marketing campaign. It may take several years to achieve your goal, but you must have the plan in mind so you are able to execute it. In order to be a truly successful ingredient brand for the long-term, one must focus both on the trade as well as generating consumer awareness. One ingredient brand that has had extreme success in generating consumer awareness is Ester-C. In fact, it was so successful that the brand was acquired and is only being sold in the United States now as a finished supplement.

Build Momentum for Your Brand: Help Manufacturers Help You

Now it’s time to create some leverage for yourself in the marketplace. If you are an ingredient supplier, this is where manufacturers can really help-if you work together. (Remember, manufacturers have something to gain by using your branded ingredient.) The following is a list of tips to help you create a strong presence in the marketplace by working with manufacturers.

Have a superior product-but don’t get seduced by it. Many companies (in all industries) think that their products are the greatest thing since sliced bread. Even if that’s true (and it rarely is), you can’t lose focus on customer service. Managing every aspect of customer contact can pay big dividends. But managing the customer is not enough. Great brands lead. For your ingredient brand, this may mean introducing a new delivery form, entering a new market segment, or developing your business in another country. Don’t rest on your laurels.

Develop co-branding programs with manufacturers. Make it easy for manufacturers to work with you so that they will want to feature your ingredient brand. This may include developing a joint scientific study on your ingredient, or developing a marketing program that helps increase sales. For co-op advertising efforts, do not try to direct all aspects of how and what needs to be done. Flexibility is critical and leads to success. This means not trying to alter a customer’s marketing program, but rather, working your ingredient brand into it.

Science counts. The more scientific information you can provide up front to your customers, the better. Proving that your ingredient does what it claims to do provides a competitive advantage. Continuing to invest in science for your ingredients will ensure long-term success.

Hit the road. Personal selling is still the best way to get people to buy your ingredient. The more face-time you have with potential customers, the more likely they’ll be willing to do business with you. Only by forging relationships and creating face-to-face contact can your ingredient brand achieve great success.

The Future of Branded Ingredients

Branded ingredients will remain a vibrant part of the nutrition industry. This is very positive, as most branded-ingredient manufacturers significantly invest in science, benefiting the industry as a whole. There is a peace of mind in knowing that a branded ingredient’s effectiveness has been proven. From this perspective, it’s vital that manufacturers support these ingredients by including them in their finished products.