In: Operations Management
Sterilized milk & the Japanese Market
Dairy pride, a U.S. manufacturer of milk-sterilizing equipment, wants to introduce its equipment
into Japan but has encountered numerous problems. Sterilized milk is a recent innovation that
offers two main advantages over fresh milk: it can be stored at room temperature for up to three
months and has twice the refrigerated shelf life of ordinary milk after the package is opened.
Dairy pride has developed superior equipment for sterilizing milk that avoids the unpleasant side
effects of sterilization—a cooked and slightly burnt taste and a filminess that lingers in the
mouth after the milk is swallowed.
In searching for new markets for its equipment, the company sees Japan as a good candidate.
Japan has a large population, a low but growing rate of per capita milk consumption, and a
limited availability of fresh milk. As Dairy pride sets out to sell its equipment to large Japanese
dairies, it encounters the following obstacles:
It has to develop an advertising campaign to change Japanese milk consumption habits
and convince Japanese consumers of the advantages of buying and drinking sterilized
milk.
The Consumers’ Union of Japan opposes the product because of concerns about sterilized
milk’s safety.
Dairy farmers located near large cities oppose the distribution of sterilized milk. They
fear competition from faraway dairies, since sterilized milk has a long inventory life and
can be shipped long distances.
Several large retailers say they will not carry sterilized milk because of interest-group
pressure. Milk specialty stores, which thrive on home deliveries, also oppose the
introduction of sterilized milk.
The Health and Welfare Ministry and the Ministry of Agriculture and Forestry have
indicated they will wait and gauge consumer acceptance of sterilized milk before taking
action to approve or disapprove general distribution.
Please follow the steps outlined in Megamarketing and develop a plan for successfully managing
this difficult environment.
In mega marketing, steps must be taken by the organization to reach out to every party in the external environment and solve barriers related to each.
Hence, as the team of the brand, we have to solve barriers related to each external party involved. A cooperation campaign needs to be run for the Ministry of Health, a segmentation campaign for dairy farmers, retailers and manufacturers, and an educational campaign for the consumers in Japan.
The steps followed to overcome these barriers are:
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