quatro estratégias para criar e sustentar o valor em laticínios

Laticínios é um grande negócio - e ficando maior a cada ano. Isso não é surpresa. Ele satisfaz uma ampla gama de necessidades do consumidor, do aumento do consumo de proteínas e da saúde geral (principalmente para crianças em crescimento) a alimentos de indulgência e até conveniência. Os laticínios podem ser uma indústria global, mas também é muito regional, com um suprimento altamente fragmentado. Os mercados com maior potencial de crescimento também são os menos desenvolvidos na infraestrutura e na conscientização do consumidor. A logística tornou -se cada vez mais complexa. Novos segmentos de valor agregado e produtos alternativos decolaram com velocidade surpreendente, intensificando pressões competitivas e a necessidade de inovar constantemente. Como se isso não bastasse, as principais mudanças regulatórias estão alterando profundamente o ambiente operacional, mudando a vantagem em muitos mercados em todo o mundo. A análise aprofundada do BCG do mercado de laticínios em todo o mundo revela que a criação de valor hoje exige uma poderosa mistura de competências e disciplina. É preciso uma compreensão das características exclusivas do mercado e dinâmica de fornecimento e demanda, bem como suas restrições operacionais e regulatórias assustadoras. O sucesso depende tanto da excelência operacional quanto de identificar o caminho estratégico certo para o crescimento. Analistas projetam um crescimento anual de 10% nos próximos cinco anos, com as receitas atingindo mais de US $ 800 bilhões até 2020. O leite e o queijo representam 50% do mercado, mas vários segmentos de valor agregado também estão crescendo de forma robusta. Leite em pó, fórmula do leite e iogurtes, por exemplo, prometem taxas de crescimento de dois dígitos. (Consulte o Anexo 1.)

Yet as elemental as dairy is, its industry environment is anything but basic. Dairy may be a global industry, but it is also very much a regional one, with a highly fragmented supply. The markets with the greatest growth potential are also the least developed in infrastructure and consumer awareness. Logistics have become increasingly complex. New value-added segments and alternative products have taken off with surprising speed, intensifying competitive pressures and the need to innovate constantly. As if that weren’t enough, major regulatory changes are profoundly altering the operating environment, shifting advantage in many markets around the world.

For even the best and the brightest dairy processors, creating value comes with many challenges. BCG’s in-depth analysis of the dairy market worldwide reveals that creating value today calls for a powerful mix of competencies and discipline. It takes an understanding of the market’s unique characteristics and supply-and-demand dynamics, as well as its daunting operating and regulatory constraints. Success depends as much on operational excellence as it does on identifying the right strategic path to growth.

Dairyland Today: Surveying the Landscape

In 2015, with almost $500 billion in global revenues, dairy was the biggest revenue-generating—and the fastest-growing—category in the food and beverage sector. Analysts project 10% annual growth over the next five years, with revenues reaching more than $800 billion by 2020. Milk and cheese will account for 50% of the market, but several value-added segments are also growing robustly. Powdered milk, milk formula, and yogurts, for instance, promise double-digit growth rates. (See Exhibit 1.)

, mas diferentes segmentos de produtos produzem níveis muito diferentes de lucratividade. A chave para o sucesso em laticínios, portanto, reside em encontrar o ponto ideal de crescimento e lucratividade. Nos mercados maduros, o consumo per capita permanece alto, mas o crescimento do volume está estagnado e, em alguns casos, mesmo em declínio. Nos mercados emergentes, no entanto, a imagem é exatamente o oposto. O consumo per capita em toda a China, Oriente Médio e Sudeste Asiático, embora baixo, está crescendo rapidamente - mais rápido que o PIB. Os mercados emergentes devem representar 75% do crescimento do setor (em volume) nos próximos cinco anos. Somente a China deve representar aproximadamente 55% desse crescimento. (Veja Anexo 2.) Embora os laticínios estejam crescendo nesses mercados nascentes, os próprios mercados ainda são amplamente desenvolvidos, com transporte limitado, distribuição e infraestrutura de varejo e, geralmente, consciência limitada do consumidor. Mercados de laticínios emergentes Há bifurcação. A Índia, por exemplo, tem uma longa tradição de consumo de laticínios - especialmente iogurte - embora a produção tenha sido local e informal. Os meios de produção e consumo estão se modernizando à medida que o mercado evolui para produtos embalados industriais e variedade de produtos. A dieta chinesa e a maioria das dietas do sudeste asiático não incluíram laticínios, mas os benefícios indiscutíveis de saúde incentivaram uma mudança entre as últimas gerações para aumentar o consumo.

A Bipolar World. Growth across regions is anything but even. In mature markets, per capita consumption remains high, but volume growth is stagnating and in some instances even declining. In emerging markets, however, the picture is just the opposite. Per capita consumption throughout China, the Middle East, and Southeast Asia, while low, is growing rapidly—faster than GDP. Emerging markets are expected to account for 75% of industry growth (by volume) over the next five years. China alone is projected to represent roughly 55% of that growth. (See Exhibit 2.) Although dairy is booming in these nascent markets, the markets themselves are still largely undeveloped, with limited transportation, distribution, and retail infrastructure, and, generally, limited consumer awareness.

Yet even in emerging dairy markets there is bifurcation. India, for example, has a long tradition of dairy consumption—especially yogurt—although production has been local and informal. The means of production and consumption are modernizing as the market evolves toward industrial packaged products and product variety. The Chinese diet and most Southeast Asian diets have not traditionally included dairy, but the indisputable health benefits have encouraged a shift among the past couple of generations to increased consumption.

Nesta paisagem bipolar, a produção de laticínios permanece em grande parte um jogo local. Os custos de produção variam amplamente, e cada mercado é distinto nas características do suprimento de leite e no gosto do consumidor. Mesmo em mercados maduros, essas diferenças aparecem grandes: os EUA e a França desfrutam de superávits comerciais (8%), enquanto o Japão e a Rússia sofrem déficits (23%e 13%, respectivamente). Na França, as regras de queijo (52% do valor de mercado), enquanto no Japão, o iogurte predomina (41%). No Brasil, o leite supera todos os segmentos (79%).

Complexidades inerentes, desafios emergentes. Como perecível, os laticínios requerem operações e logística mais complexas-a chamada cadeia de frio-para garantir frescor e segurança. Muitas empresas descobriram soluções alternativas (como novos canais de distribuição) e outras soluções (como formulações ambientais, que podem ser armazenadas à temperatura ambiente), mas a necessidade de um suprimento seguro e uma infraestrutura de distribuição confiável ainda é forte. E em regiões onde os laticínios são bastante novos na dieta, a demanda do consumidor deve ser cultivada. Os preços do leite bruto estão se aproximando do recorde que eles atingiram em 2009. Desde junho de 2015, eles caíram 25% a 40% na Nova Zelândia, nos EUA e na UE. Esse declínio colocou uma tremenda pressão sobre os retornos já pequenos de produtores e cooperativas. Subsídios e suportes de preços, cotas de produção, restrições de importação e sistemas de gerenciamento de suprimentos tradicionalmente ajudaram a manter os produtores domésticos solventes e garantiram um suprimento seguro e constante. E o ambiente regulatório está em constante evolução. A recente abolição de cotas na UE, bem como acordos comerciais (principalmente a parceria transpacífica), criam novas oportunidades e novos desafios para produtores e processadores. (Veja "Vencedores e perdedores na era pós-Quota da UE".) The fundamental challenge in dairy is maintaining quality and quantity within a fragmented supply base. As a perishable, dairy requires more complex operations and logistics—the so-called cold chain—to ensure freshness and safety.

Fast-growing emerging markets pose additional challenges to dairy companies: underdeveloped retail channels and a hard-to-reach rural consumer base. Many companies have found workarounds (such as novel distribution channels) and other solutions (such as ambient formulations, which can be stored at room temperature), but the need for a secure supply and a reliable distribution infrastructure is still strong. And in regions where dairy is fairly new to the diet, consumer demand must be cultivated.

As a commodity, dairy is subject to input price volatility. Raw-milk prices are approaching the record low that they hit in 2009. Since June 2015, they have dropped 25% to 40% in New Zealand, the US, and the EU. This decline has put tremendous pressure on the already slim returns of producers and cooperatives.

Government intervention has a long history in developed dairy markets such as the US, Canada, the EU, Japan, and New Zealand. Subsidies and price supports, production quotas, import restrictions, and supply management systems have traditionally helped keep domestic producers solvent and ensured a safe and steady supply. And the regulatory environment is constantly evolving. The recent abolition of quotas in the EU, as well as trade agreements (notably the Trans-Pacific Partnership), create new opportunities as well as new challenges for producers and processors. (See “Winners and Losers in the EU’s Post-Quota Era.”)

O ambiente competitivo também é fragmentado. Existem poucas entidades globais e elas tendem a ser mais fortes em seus mercados domésticos. Outros participantes do mercado incluem empresas regionais (frequentemente cooperativas), fabricantes de queijos, grandes empresas de produtos de consumo, inovadores e entidades de nicho e empresas de saúde (normalmente fornecedores de fórmula infantil e suplementos nutricionais). Recentemente, os produtos de etiqueta privada, especialmente o leite, têm conquistado crescente participação de mercado, enquanto pessoas de fora do setor, como a Coca-Cola, estão fazendo incursões no setor. E alternativas, como soja, amêndoa, arroz e leites de coco, estão rapidamente ganhando terreno.

Como criar valor em laticínios? Os requisitos para o sucesso

Dairy podem ser o gigante da receita em comida e bebida, mas não é o líder de criação de valor do setor. De acordo com a análise da BCG, as empresas de laticínios tiveram uma média de 5% de crescimento do lucro anual entre 2009 e 2014, em comparação com o crescimento médio anual de 9% entre empresas de alimentos e bebidas embaladas. (Consulte o Anexo 3.)

Given dairy’s many idiosyncrasies, we believe it takes two overarching strategies to succeed. First, companies must have the right table stakes in place: fine-tuned, optimized operations and efficiencies across the entire value chain. In addition, they need a value-creating strategy to set themselves on a course to sustainable growth.

Mastering the Table Stakes

Efficient operations and optimized processes are important in every industry. In dairy, they are table stakes. Moreover, dairy companies need to pursue them across the entire value chain: in their upstream supply management, operations, and go-to-market approaches.

Nail upstream supply management. Perhaps more than any other food product, dairy products’ quality depends on upstream factors, from the very first input (the feed given to dairy cows) to supply variability to cold-chain management to shelf life. Yogurt and cheese, as bacteria-based products, are especially sensitive to quality control. When quality slips or fails outright, the impacts are severe and can hurt both consumers and the brand.

The melamine contamination of China’s milk supply in 2008 caused six deaths and sickened 300,000 babies. That year, China’s leading providers of milk formula saw market share plummet by as much as 40%. The contamination was largely a result of the country’s fragmented and unreliable milk supply. In fact, supply inadequacy plagues many emerging markets. Currently, Southeast Asia must import approximately 60% of its dairy products. Meeting growing demand in the region, as well as in China and India (where demand is projected to outpace supply through 2020), is a major concern.

Sound upstream supply management thus calls for securing a reliable, high-quality supply cost effectively (a special challenge for processors not part of a cooperative). Managing supply quality entails everything from importing powder to instituting rigorous quality controls and training programs. In mature markets especially, it also means keeping close tabs on the complex and dynamic regulatory environment.

Focus ruthlessly on operational effectiveness. Margins in dairy operations are slim, running from 0% to 5%. Considering that milk represents 25% of the value of a dairy company and 50% of its volume, there is little room for inefficiency. Raw-milk prices are volatile, and the perishable nature of dairy gives it a high potential for waste. Add in the costs associated with regulatory compliance, and the need for cost efficiency becomes even more apparent.

We have identified six broad approaches to controlling costs and enhancing efficiency. Each one can deliver as much as 25% savings against the addressable cost base.

• Seek tactical improvements in plant operations, such as by altering layout and improving the flow of materials, boosting equipment and material utilization, improving labor productivity, and enhancing logistics. Such improvements typically yield savings of 10% to 20%.
• Reduce business complexity by shedding less profitable SKUs and standardizing ones that are similar (for example, in size, packaging, or formula). Order-planning improvements, such as reducing wild swings in the timing or size of client orders, are also effective. Companies can wring 5% to 10% savings from such strategies.
• Review the plant network and sharpen the supply chain strategy in any number of ways: consolidating or relocating plants, investing in new technology, expanding scale, even reallocating production among plants. Savings from these measures can amount to between 10% and 20% of costs.
• Hone procurement practices, including negotiation strategies, supplier management, country sourcing, demand management, standardization, process improvement, and make-or-buy decision making. Some companies have saved as much as 25% through this approach.
• Restructure the organization where appropriate, whether in a postmerger integration or in the implementation of shared services. Restructuring can also be done to create new business units, benchmark and optimize the size of functions, or just redistribute tasks. Redesign approaches deliver savings of anywhere from 5% to 15% of costs.
• Implante Technologies Digital - Robóticos em fabricação, sistemas de automação de armazém ou análise avançada para previsão em vendas e planejamento operacional - para aumentar as eficiências da cadeia de suprimentos. (Consulte “Custos de creme para redugar o valor.”)

Using more than one of these approaches can compound or accelerate the savings. (See “Creaming Costs to Redouble Value.”)

Forge an efficient go-to-market strategy. Because of product perishability (raw milk lasts up to only about 72 hours), every processor’s farm-to-plant-to-retail distribution network must be rock-solid in efficiency. Optimizing the distribution network to ensure that products remain fresh—at the lowest possible cost—is critical.

In emerging markets, product strategy has typically served as a critical workaround in the absence of a cold chain. The market has shifted from powder-based products to ultra-high-temperature (UHT) processed milk, which requires no refrigeration and can travel up to 2,400 miles (4,000 kilometers). In fact, a UHT school milk pack that is distributed nationwide in Thailand and costs 5 baht (approximately $0.15) has helped promote dairy consumption in that nation. Now companies are exploring opportunities to develop and distribute fresh products with an extended shelf life. As consumers increasingly adopt fresh products, shelf life becomes a competitive feature: one company won market share by offering milk with a three-week shelf life rather than the two-week industry norm.

The dominant retail channels for dairy products vary dramatically from country to country. In France and the US, for instance, supermarket-type retailers represent more than 85% of sales outlets. In Russia, modern trade accounts for 65% of the market, and in China and Thailand, 60%. In India, however, only 7% of dairy products are sold through modern retailers, and smaller channels are the main distribution channel elsewhere in emerging markets. Here fragmentation makes economies of scale difficult, and reaching rural consumers and building an adequate distribution infrastructure are a challenge. Companies must choose the proper retail channels to ensure the necessary market penetration—and that means either building infrastructure (say, a cold chain), if necessary, or relying on product strategy. They may also capitalize on relationships and resources available through their involvement in other product categories. (See “How Snacks Paved the Way for Want Want’s Success in Milk.”)

Em mercados maduros, um cenário de varejo rápido e amplamente diversificado cria desafios e oportunidades adicionais para a estratégia de entrada no mercado. A distribuição de entrega de lojas diretas ganhou terreno por um bom motivo: é útil para produtos de alta velocidade com um curto prazo de validade e permite entregas mais frequentes, espaço de prateleira principal e gerenciamento mais próximo das vendas. Para empresas dispostas a pagar o prêmio, a entrega direta da loja pode oferecer vantagens importantes em um setor em que os inovadores são facilmente invadidos. O BCG identificou quatro estratégias principais que as empresas podem adotar para criar e sustentar o valor.

Choosing the Right Value-Creating Strategy

With table stakes secured, dairy companies must determine the strategic course that will enable them to thrive in their chosen markets. BCG has identified four core strategies that companies can adopt to create and sustain value.

Oportunidades de leite em mercados emergentes. fórmula e leites aromatizados e fortificados) são uma demanda particular entre os consumidores chineses. Embora os chineses não tenham sido tradicionalmente grandes consumidores de queijo, o consumo está crescendo em serviço de alimentação, graças a pizza e hambúrgueres. Mas o mercado de laticínios da China permanece predominantemente ambiental, pois suas redes de cadeia fria têm alcance limitado. Os processadores estrangeiros podem ganhar uma posição lá, reproduzindo a força e a reputação da marca de qualidade - vantagens que ressoam com os consumidores após os recentes escândalos de saúde. As empresas podem se isolar das interrupções do fornecimento, importando -se ou investindo na construção de fazendas leiteiras. Eles podem atingir as maiores cidades com produtos premium ou investir na construção de uma extensa rede de entrada no mercado que penetra nas áreas periféricas-mesmo realizando soluções alternativas como reformular produtos em pó com gordura vegetal para impedir a necessidade de uma longa cadeia de frio. Finalmente, para competir contra os principais titulares, eles podem investir na marca. A Frieslandcampina, com sede na Holanda, adotou todas as três abordagens para garantir a liderança de mercado no sudeste da Ásia. (Consulte “Frieslandcampina: Pensando de ponta a ponta em mercados emergentes.”) Considering that until 2020, emerging markets as a whole will account for three-quarters of dairy market growth, companies bent on substantial revenue growth need to seriously consider serving these markets.Value-added dairy products that offer health benefits (such as infant formula and flavored and fortified milks) are in particular demand among Chinese consumers. Although the Chinese have not traditionally been big cheese consumers, consumption is growing in food service, thanks to pizza and burgers. But China’s dairy market remains predominantly ambient, as its cold-chain networks have limited reach. Foreign processors could gain a foothold there by playing up their brand strength and reputation for quality—advantages that resonate with consumers in the wake of recent health scandals.

Generally, success in emerging markets hinges on three possible moves. Companies can insulate themselves from supply interruptions either by importing or by investing in building dairy farms. They can target the largest cities with premium products or invest in building an extensive go-to-market network that penetrates outlying areas—even undertaking such workarounds as reformulating powder products with vegetable fat to preclude the need for a long cold chain. Finally, to compete against leading incumbents, they can invest in branding. Netherlands-based FrieslandCampina has embraced all three approaches to secure market leadership in Southeast Asia. (See “FrieslandCampina: Thinking End-to-End in Emerging Markets.”)

Still, milking opportunities in emerging markets is easier said than done. The Western companies that have successfully penetrated these markets (such as FrieslandCampina and Danone) did so decades ago, first by importing and later by producing locally. However, over the past five to ten years, local companies have been growing fast and gaining share. Certainly their knowledge of local markets gives them an edge, but it is not the only reason for their success.

Companies such as Dutch Mill (in Thailand) and Vinamilk (in Vietnam) follow a rapid test-learn-refine approach to innovation. With speedier internal approval processes and a willingness to invest in establishing their position over the medium term, these local companies can bring new products to market faster. Given emerging-market consumers’ appetite for new products, demand can be stimulated faster. Foreign producers ought to take note of the benefits that agility has given locals and revisit their innovation and go-to-market strategies—not just for emerging markets but for developed ones as well.

Pursue M&A and strategic partnerships. With growth stagnant in mature markets, companies can pursue mergers and acquisitions and strategic partnerships as a way to grow—in both emerging and mature markets. From 2009 through 2015, several of the industry’s top performers grew through aggressive merger programs. Two of the most successful producers—a leading cheese maker and a European cooperative—more than doubled their annual revenue growth from 2009 through 2014 in this way. Inorganic growth accounted for half of each company’s total growth. And each company generated 10% total shareholder return—twice the industry average.

However, in successful M&A, “strategic” is the operative word. A company’s M&A moves should align with its market strengths, its operational capabilities, and above all, its growth strategy. If you want to be a low-cost producer, for example, divest the niche businesses, which are a costlier distraction. If innovation is the goal, consider losing the commodity lines that will only drag down your margin.

To buy scale, companies must be constantly on the lookout for advantageous strategic acquisitions. Similarly, they must continually reassess their portfolio for divestitures that make both strategic and economic sense. Forging partnerships with companies whose strengths, market know-how, or products are complementary is another important way of gaining entry into a new market or product segment. Coca-Cola’s partnership with Fairlife illustrates the company’s bet to gain a foothold in dairy through a more manageable (that is, ambient) product. Partnership has been a common path to penetrating emerging dairy markets, such as China. For example, a global company can provide its know-how or fine-tuned innovation process, while the local entity brings its knowledge of the local consumer and its market access—or even its agile innovation practices.

Shift to higher-margin products. Some companies have shifted from low-margin commodity products to focus more on higher-margin segments. In a three-year period, Mexico-based Grupo Lala doubled its earnings by veering away from milk and toward yogurt as well as cheese and other items. (See Exhibit 4.) Companies are also seeking pockets of greater profitability in another way: by shifting from fresh to ambient products (such as powdered or condensed milk), which offer fatter margins.

The margin levels of a given product category vary from market to market. In the US, for example, the coffee and tea segment is most profitable (with an EBIT margin of 20%), while in China, the toddler and kids segment (which excludes infant formula) is highest, with margins of around 16%. Moreover, the profitability levels of a category can shift over time. Leaders need to consider these variations, not only when deciding whether and how to enter a new market but also as they analyze their existing business. To focus effectively on the high-margin areas, it’s important to constantly monitor the portfolio, either by radically repositioning the whole portfolio (as Lala did) or by actively pruning out low-performing products and categories.

Those interested in pursuing this path should keep in mind two caveats. First, they need to redouble their efforts to increase sales in those value-added segments. In addition, they must recognize that this strategy is not sustainable indefinitely. Companies can change their portfolio only so much, and new sources of competition will always be nipping at their heels.

Innovate and seize on new trends. Whether a company wants to create an entirely new product or format or seize on a growing trend, innovation is obviously a time-tested route to successful growth. The rapid growth in several higher-margin subsegments, such as nondairy alternatives, fortified yogurt drinks, and sports nutrition products, demonstrates the potential for innovators and trend spotters. In the coming years, “superfunctional” ingredients that address health concerns (such as weight loss) will likely play a more important role in dairy foods. Combination products, such as milk and juice or milk and grains, are also expected to grow.

Considere as abordagens adotadas por alguns inovadores da indústria:

• Aventando -se em novos segmentos. Seu café pronto para beber está desfrutando de taxas de crescimento de dois dígitos. A inovação está incorporada na estrutura organizacional da empresa, com a inovação global de processos e unidades de insight de mercado relatando diretamente ao CMO da empresa. Whitewave rapidamente aumentou a produção de três aquisições: leite orgânico da Horizon e leite de soja de seda (adquirido em 2004, enquanto a empresa era uma unidade de Dean Foods) e um delicioso leite de coco (adquirido em 2014, após seu spinoff de Dean). As vendas da Horizon mais que dobraram em quatro anos. Além do horizonte e da seda, a Whitewave construiu três outras marcas líderes: Alpro (produtos lácteos orgânicos à base de plantas), International Delight (um creme de café) e Earthbound Farm (Salada Orgânica). O sucesso de Whitewave nos segmentos alternativos e orgânicos em rápido crescimento não passou despercebido; Em meados de 2016, a Danone anunciou sua aquisição da empresa por US $ 10,4 bilhões. Chobani revolucionou o mercado de iogurte dos EUA com o lançamento do iogurte grego. A empresa tornou-se uma sensação noturna, desencadeando o apetite dos consumidores pela forma de iogurte mais rica e mais alta que em apenas alguns anos ganhou uma participação de 35% no mercado de iogurte de colher dos EUA. Os novos produtos geralmente detêm participação de mercado por um ano antes de as marcas competitivas surgirem e começarem a capturar participação. A história de Chobani é uma lição de objetos. Danone rapidamente seguiu o exemplo com seu próprio iogurte grego (oikos) e pegou uma parte significativa do mercado geral de iogurte. Para manter a participação de mercado no segmento de iogurte grego, a Chobani lançou uma série de novos produtos, incluindo um produto de 100 calorias, um iogurte infantil e um produto combinado de grãos de iogurte. Em março de 2016, a empresa anunciou planos de expandir sua fábrica de Idaho (construída em 2013) e sua fábrica original em Nova York para atender às suas crescentes necessidades de produção. Isso significa manter um olho acentuado nas tendências do consumidor, bem como nos desenvolvimentos do mercado, melhorias tecnológicas e de processos e mudanças regulatórias. Mais do que isso, significa promover uma cultura de inovação, com todos os processos e práticas atendentes. O sucesso também depende de um ciclo rápido de entrada no mercado, com reviravoltas rápidas. E como a imitação é quase inevitável, os inovadores devem estar preparados para isso, seja lançando um novo produto ou investindo em produtos existentes, mas de crescimento rápido. Até os líderes de mercado mais estabelecidos entendem como o sucesso pode ser frágil. Convidamos os líderes a se perguntarem: Switzerland’s Emmi is keen on innovation, including developing new segments. Its ready-to-drink coffee is enjoying double-digit growth rates. Innovation is embedded in the company’s organizational structure, with global process innovation and market insight units reporting directly to the company’s CMO.
• Developing Dairy Alternatives. Denver, Colorado-based WhiteWave Foods, the market-share leader in US dairy alternatives, is keenly attuned to consumer trends. WhiteWave quickly scaled up the production of three acquisitions: Horizon organic milk and Silk soy milk (acquired in 2004 while the company was a unit of Dean Foods) and So Delicious coconut milk (acquired in 2014, after its spinoff from Dean). Horizon’s sales more than doubled in four years. In addition to Horizon and Silk, WhiteWave has built three other leading brands: Alpro (plant-based organic dairy products), International Delight (a coffee creamer), and Earthbound Farm (organic salad greens). WhiteWave’s success in the fast-growing dairy alternative and organic segments has not gone unnoticed; in mid-2016, Danone announced its acquisition of the company for $10.4 billion.
• Innovating in Yogurt. Australian-style yogurt maker Noosa tapped into the “indulgent” yogurt craze and saw revenues skyrocket in just three years. Chobani revolutionized the US yogurt market with the launch of Greek yogurt. The company became an overnight sensation, unleashing consumers’ appetite for the richer, higher-protein form of yogurt that in just a few years has won a 35% share of the US spoonable-yogurt market.

Innovation in dairy cannot be a sometime practice. New products generally hold market share for a year or so before competitive brands arise and begin capturing share. Chobani’s story is an object lesson. Danone quickly followed suit with its own Greek yogurt (Oikos) and nabbed a significant portion of the overall yogurt market. To maintain market share in the Greek-yogurt segment, Chobani launched a raft of new products, including a 100-calorie product, a kids’ yogurt, and a combination yogurt-ancient grains product. In March 2016, the company announced plans to expand its Idaho manufacturing plant (built in 2013) and its original plant in New York to meet its growing production needs.

Companies must treat innovation as a priority—a daily aspiration and constant effort. That means keeping a sharp eye on consumer trends, as well as on market developments, technological and process improvements, and regulatory changes. More than that, it means fostering a culture of innovation, with all the attendant processes and practices. Success also depends on a fast go-to-market cycle, with fast turnarounds. And because imitation is almost inevitable, innovators must be prepared for it, whether they’re launching a new product or investing in existing but fast-growing products.

A Value Creation Checklist

Creating and sustaining value in dairy require both mastering the table stakes and adopting a proven strategy—one that matches a company’s capabilities and goals. Even the most established market leaders understand how fragile success can be. We invite leaders to ask themselves these questions:

• Garantimos um suprimento de alta qualidade suficiente? Perseguindo metas e parceiros de aquisição apropriados (estratégicos)?
• Are we running our operations as efficiently as possible?
• Could we extend our consumer reach with new distribution channels?
• Do we have a plan to grow in emerging markets and China?
• Are we pursuing appropriate (strategic) acquisition targets and partners?
• Como podemos otimizar nossa mistura de portfólio? Realidade. Eles também agradecem a Jan Koch por escrever assistência e Katherine Andrews, Gary Callahan, Kim Friedman, Abby Garland, Gina Goldstein e Sara Strassenreiter por contribuições para a edição, design e produção.
• Are we addressing new and emerging consumer needs?
• Are we innovation oriented?

Companies that are not only thinking about but also acting on these questions will be well positioned to turn the promise of growth into reality.

Acknowledgments

The authors would like to thank their BCG colleagues Chloe Marceau-Gosselin, Sebastien D’Incau, Mark Abraham, Waldemar Jap, Oyvind Torpp, Dave Tapper, and Kelli Gould for their contributions to this report. They also thank Jan Koch for writing assistance and Katherine Andrews, Gary Callahan, Kim Friedman, Abby Garland, Gina Goldstein, and Sara Strassenreiter for contributions to editing, design, and production.