Nurta Sweet Marketing Case
NutraSweet in China
Case Analysis
MK320-02
Professor Sethi
4 November 2009
Overall Analysis of the Chinese Market: The first step in determining whether or not it is profitable for NutraSweet to enter into the Chinese market is to analyze both the strengths and weaknesses of the current market. First of all, it should be noted that 40% of China’s 1.2 billion consumers spend their disposable income on food purchases. Furthermore, China economy has the fifth largest purchasing power and the economy is growing at a rapid rate of 10% per year. More specifically, in Hong Kong the economy is growing at 5% per year and citizens have an average yearly income of $18,000. Additionally, due to the post-Cultural Revolution, the Chinese have a liking for western products that represent luxury, quality, and freedom. Clearly, all of these facts are beneficial in the eyes of NutraSweet marketers. Finally, as a nation, the Chinese people tend to use natural food products and eat a healthy diet which is harmonious with the NutraSweet product. While these facts are encouraging for the NutraSweet product, there are many challenges facing thwarting penetration into the market. First and foremost, Chinese culture tends to have minimal sugar in their diets. It is reported that a Chinese citizen only uses 14 pounds of sugar on average per year. Comparatively, an America citizen uses 80 pounds of sugar per year. This large difference could prove an invaluable investment for NutraSweet, or it could prove to be a detrimental hindrance to NutraSweet successfully being introduced to the Chinese market. Moreover, the Chinese people would need to be educated on the benefits of the product, which would be costly for NutraSweet. Unfortunately, numerous other health-conscious products have been launched in Asian markets but have dismally failed. This is of high concern for NutraSweet. Also, it has been proven that most joint ventures from food and drink manufacturers in China were
Case Analysis
MK320-02
Professor Sethi
4 November 2009
Overall Analysis of the Chinese Market: The first step in determining whether or not it is profitable for NutraSweet to enter into the Chinese market is to analyze both the strengths and weaknesses of the current market. First of all, it should be noted that 40% of China’s 1.2 billion consumers spend their disposable income on food purchases. Furthermore, China economy has the fifth largest purchasing power and the economy is growing at a rapid rate of 10% per year. More specifically, in Hong Kong the economy is growing at 5% per year and citizens have an average yearly income of $18,000. Additionally, due to the post-Cultural Revolution, the Chinese have a liking for western products that represent luxury, quality, and freedom. Clearly, all of these facts are beneficial in the eyes of NutraSweet marketers. Finally, as a nation, the Chinese people tend to use natural food products and eat a healthy diet which is harmonious with the NutraSweet product. While these facts are encouraging for the NutraSweet product, there are many challenges facing thwarting penetration into the market. First and foremost, Chinese culture tends to have minimal sugar in their diets. It is reported that a Chinese citizen only uses 14 pounds of sugar on average per year. Comparatively, an America citizen uses 80 pounds of sugar per year. This large difference could prove an invaluable investment for NutraSweet, or it could prove to be a detrimental hindrance to NutraSweet successfully being introduced to the Chinese market. Moreover, the Chinese people would need to be educated on the benefits of the product, which would be costly for NutraSweet. Unfortunately, numerous other health-conscious products have been launched in Asian markets but have dismally failed. This is of high concern for NutraSweet. Also, it has been proven that most joint ventures from food and drink manufacturers in China were