Media Updates, page-14828

I must admit I was a bit skeptical of the lactose free move at first. I thought it might muddy the waters in terms of the 'A2' proposition and what is unique about A2.

Proposition 1: A1-free products may benefit people who thought they were lactose intolerant, but actually were just sensitive to A1-containing milks.

Proposition 2: A1-free and lactose-free products benefit those who are actually lactose intolerant.

It is a pretty fine line between those two propositions and would be lost on most. However, I reckon they have reached a point in the product innovation lifecycle (for A2 fresh milk) where the original proposition matters less because they have reached a saturation point in the market and there are less new customers to attract. The level of consumer awareness is probably high enough that there isn't as much to be gained from pushing Proposition 1 than there is from attracting new customers via Proposition 2.

This applies as much to the packaging, placement, marketing etc. as it does to the development of new products within the category. Of course a lot of this logic assumes people actually understand what A2 milk is (i.e. the original proposition), but the actual knowledge/awareness may be much lower than we think. People might instead just like the brand, the taste, or other reasons. It'd be interesting to see the survey results. However I doubt they would have been as successful as they have been without convincing a significant chunk of consumers that it is 'sciency' milk which is better for them, somehow.

If they launch into a new product in a new category - for instance, if they went into sports nutrition - the smart thing would be to lean more heavily into that original proposition again. But the pivot to lactose free - and potentially also to allergy tolerant products in the case of IF - I reckon presents further opportunities to branch off from that.