2017-12-15
JAPAN
Kagome breaks into the smoothie market with Tetra Prisma® Aseptic 330 Sq DreamCap™
The success story in brief
With demand for fruit and vegetable juices falling, Kagome – Japan’s biggest player in the segment – set out to recover category growth by launching a range of innovative, healthy 100% juice smoothies in an eye-catching and user-friendly package, Tetra Prisma® Aseptic 330 Sq DreamCap™. The new product has proved extremely popular both with young working women – the primary target audience – and with older consumers, and demand is increasing fast. The latest figures show that sales have more than doubled in the past 12 months.
Pioneers in the Japanese market
Kagome was established in 1899, and is considered a pioneer in the Japanese market for its tomato products and vegetable juices. Today, it has around 2,600 employees, an annual turnover of €1.6 billion and a product range that has grown to include fruit juices, lactic acid drinks and now smoothies. Overseas markets include the US and Australia, but around 70% of revenue comes from Japan, where Kagome remains the biggest player in the vegetable and fruit mixed juice market with a 54% share. Tetra Pak and Kagome have worked together since 1981, and we are the biggest supplier of cartons for their beverage business.
Carving a new niche in a challenging environment
The market for vegetable and mixed fruit juice – Kagome’s core business – had been declining for a couple of years, partly due to a lack of clarity among consumers regarding the benefits of drinking juice. Some consumers have switched to either eating fresh fruit and vegetables or making their own juices at home, while others favour alternative packaged drinks such as drinking yoghurt and soy milk, or the fresh coffee increasingly widely available in convenience stores. Kagome set out to recover category growth and attract new juice drinkers and lure back lapsed users by moving into a new segment with an innovative product formulation in an exciting and user-friendly package.
The perfect package for on-the-go consumption
Kagome launched its line of smoothies – including one with a mix of green vegetables, apples and other fruits, and two with added soy milk – in Tetra Prisma® Aseptic 330 Sq DreamCap™ in autumn 2015. The product was designed to appeal to young working women as a meal replacement or healthy snack. Smoothies in plastic cups were already proving popular with this demographic, but there was a clear opportunity to target them with a healthier, 100% natural (no additives) juice product that would also tap into the trend for fresh juice bars and juice-based detox regimes at a more affordable price point. It also offered novelty: this was the first time that Tetra Prisma Aseptic 330 Sq DreamCap had been used with a 100% juice product in Japan. The package was the right choice for a number of reasons: ideal for on-the-go consumption, the wide cap offered ease of drinking particularly with a thicker product, and the package can also be resealed to keep the product fresh and avoid waste.
Your drink, your way: targeted promotions
TV commercials for the new smoothies featured a popular male actor cutting up fruit and vegetables and creating personalised drinks, emphasising the product’s natural, healthy credentials. The smoothies are available in convenience stores as well as supermarkets, and kiosks have proved a popular outlet too: they are often sited at train stations, making them a great fit with the on-the-go consumption concept. The product commands a premium price: ¥160, compared with ¥110 or ¥120 for competitor products
Investing for the future
Consumers have embraced the new smoothies, to the extent that Kagome has found it hard to keep pace with surging demand. Sales have more than doubled, increasing by 124% to date in 2017, according to data provided by Intage. Kagome has decided to invest new lines at their production site in 2018. The product has also proved an unexpected a hit with consumers aged 60-plus; indeed, Kagome passed on positive feedback from a consumer in his 60s who had suffered a stroke, who commented that while he could no longer open a PET bottle he could easily manage the DreamCap opening.
Sharing lessons learned
Close partnership working was key to the success of the deployment – and to ongoing plans to expand this part of Kagome’s business. The Tetra Pak team shared extensive and wide-ranging information and worked with Kagome to build a strong concept for the new product, as well as meeting all their practical requirements. Work is ongoing to support further innovation: Tetra Pak has recently held a couple of sessions with Kagome, focusing on plans for expansion into new markets and developing the ambient portfolio, as well as a joint project team to work on a chilled portfolio strategy.
