It’s 9am. With two heavy coolers on her back, Yuki Nakamura almost collapses under the weight and falls off her bicycle. She’s ready for her daily tour around Mitaka, one of the suburbs of Tokyo. For Yakult, she sells probiotic products, tea beverages and several other functional foods. ‘Yakult Ladies’ such as Nakamura make up Yakult’s oldest distribution channel.
They’re very important for the one to one communication from the manufacturer to its consumers. The Yakult Ladies system exists in all countries and regions where Yakult is on the market, except for Hong Kong, New Zealand, Europe, the US and Belize.
Nakamura has a long list of regular customers, ranging from office employees to housewives, managing directors and mechanics. The diversity of her customer base demonstrates that functional foods such as those developed by Yakult are common sense to Japanese individuals, no matter what their age, educational level or social status.
According to consumer studies by the Japanese business newspaper Nikkei in 2006, almost 29.8% of the Japanese population consume functional foods every day. 11.5% use such products 2-3 times a week, and 4.4% consume them 2-3 times a month. Fewer than one in five (17.9%) claim not to use any functional foods.
Hiroshi Narita, director of Yakult Honsha Co Ltd, confirms these figures: “Compared to other countries, people in Japan are relatively health-conscious. They consider food as a medicine, and as a way to protect themselves against disease. Therefore, functional foods are very popular among the population, and the popularity of these products is still on the rise. Japan is an ageing society and the government is taking measures to prevent illnesses in people, for example by education on healthy foods.”
Even among the relatively healthy Japanese, typical western diseases such as diabetes, obesity and cardiovascular disease are becoming more common.
“It’s said that one of the causes of a physical status like the metabolic syndrome, are westernizing of eating habits and eating too much”, says Narita.
There are almost six hundred different functional foods on the market that have been approved by the Japanese government.
“In 2005, the functional food market was valued at €4.16bn, and the market has increased since then,” says Narita. “In 2007, there were 755 approved functional foods on the market, with a market size of €5.44bn. The Japanese FOSHU regulation for functional foods, which was introduced in 1991, helps manufacturers to position their products on the market.
“Over the last three years, products for dental health and products that improve the triglyceride and cholesterol levels in the blood, have been the fastest growers. Sales turnover of products for dental health has increased from €14.73bn in 2001 to €75.12bn in 2007, for products that improve the fatty acid and cholesterol profile these figures are €11.97bn and €126.47bn respectively.
“The sales of products with gastrointestinal claims are growing at a constant rate, and products for diabetes patients are doing a good job as well. The number of products with a gastrointestinal claim increased from 167 in 2001 to 297 in 2007, while the market grew from €2.68bn to €2.78bn. Within the same period, the number of blood sugar normalising products was multiplied by five, from 19 to 100, with market sizes of €0.15bn and €0.17bn respectively.”
Within the fermented functional drinks segment, Yakult is leading with a market share of more than 55%. The second and third rankings belong to two other Japanese manufacturers: Morinaga and Nishin.
“Yakult distinguishes itself from these competitors by using the specific Lactobacillus casei Shirota strain for its probiotic products, and by offering a wide range of functional foods,” says Narita. “In addition to these products, we also specialise in cosmetics and pharmaceuticals. Moreover, responsible for 60% of our turnover, Yakult Ladies are the main way of distribution for our products, followed by supermarkets, food service and vending machines channel. Our competitors Morinaga and Nishin sell their products only through supermarkets and groceries.”
In other countries, Yakult may be known mainly for Yakult original (Light), while in Japan its name reaches far beyond these products.
“In addition to probiotic drinks, we also sell several probiotic yogurts, other functional drinks, coffee and tea beverages,” says Narita. “In total, we have 32 different FOSHU-approved functional foods on the Japanese market, and 122 ‘normal’ food products.”
The most successful functional food from the manufacturer’s selection is Yakult original, with a turnover of six million bottles a day. However, the blood glucose lowering drink Bansoureicha has proven to be successful, too.
In addition, the fermented drink Pretio (about 300,000 bottles a day) that decreases blood pressure and BF-1 (about 45,000 bottles per day) that fights the stomach-ulcer-causing bacterium helicobacter pylori are also doing well.
In September 2008, Yakult extended its assortment with three new products: Soy Milk, Purela Peach (a probiotic yogurt with aloe vera) and Yakult 400 LT. The latter contains the same lactic acid bacteria strains as Yakult original, but with almost seven times as many.
“Yakult original contains 6.5 billion lactic acid bacteria per bottle, while Yakult 400 LT counts 40 billion of them,” Narita says. “As many of our products contain a health claim, we put a lot of effort in collecting sound, scientific evidence to substantiate the effects of our products, and in giving solid consumer education rather than coming up with product promotions and price reductions.”
Lisette de Jong is a freelance writer specialising in the Japanese food and beverage market.
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