MKT550: Global Marketing
Case Study for Final Exam_202315
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SUPER FOODS: CAMU CAMU IN PERU
Guadalupe Amésquita, Universidad Nacional Mayor de San Marcos and Juan Carlos
Schiappa-Pietra, marketing advisor of small business, Lima, Peru
‘Superfoods’ is a new term attributed to physician Steven Pratt who used it as a title
for his book in 2003. He pointed out that there are certain types of foods that are
beneficial to human health beyond the conventional nutritional values. Although there
is no legal or technical definition, ‘superfoods’ has become a trendy topic. A Google
search yields more than 6 million results. Superfoods promise an ideal goal sought by
many consumers: a product that improves life expectancy and also combats
increasing obesity that developed countries, such as the US, are facing. Superfoods
originated in Japan in the 1980s. Health authorities recognised that an increased life
expectancy should be accompanied by improved quality of life for the expanding
elderly population. Also, healthcare costs could be controlled through the consumption
of healthy food. Superfoods are a dynamic product within a larger market, called the
function foods market.
According to Health Canada:
A functional food is similar in appearance to, or may be, a conventional food that is
consumed as part of a usual diet, and is demonstrated to have physiological
benefits and/or reduce the risk of chronic disease beyond basic nutritional functions,
i.e. they contain bioactive compounds.
Functional foods and beverages account for roughly $40 billion of US retail sales.
For the past decade, several products have been showcased in the market with
emphasis on their nutritional properties. For example, Oprah Winfrey and Dr. Oz
raised the antioxidant properties of acai berries. Supermodel Miranda Kerr explained
her consumption of maca powder along with noni juice and acai berry powder as part
of her daily diet. In global terms, Japan is the leading market for these products,
followed by the US. The functional food and drink market is outpacing the conventional
food and drink market in terms of global growth by about 4 per cent per year, according
to a Leatherhead Food Research report from June 2011. The fastest growing category
within the functional foods market are beverages.
However, in spite of its growth, this segment suffers from a high rate of product
failure for newcomers; as many as 80 per cent of product launches fail to catch on due
to inadequate marketing, consumer, and trade education.
The Potential of Native Products: Camu Camu
Camu camu (Myrciaria dubia) is a small tree or shrub that grows in the Amazon regions
of Peru. It typically grows in the flooded areas near the river. Its fruit contains high
levels of natural vitamin C, ranging from 1500 to 2000 mg, and in some exceptional
cases 3130 mg of ascorbic acid per 100 grams of fresh pulp. To put this into context,
camu camu contains up to 30 times more vitamin C than an orange. In addition to its
antioxidative power, this fruit has proven to have anti-inflammatory properties, making
it effective at promoting a healthy diet. Other key properties include astringent, anti
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viral, emollient, and nutritive properties, and it contains natural beta-carotene, calcium,
iron, niacin, phosphorus, protein, riboflavin, thiamin, and the amino acids valine,
leucine, and serine. Camu camu has the potential to be used as a dietary supplement
as well as for functional beverages such as Coca Cola’s Minute Maid ‘Camu Camu &
Vitamin’ drink in Japan and the Super Fruits Mix variety of the Fanta brand that
includes a blend of camu camu with other fruits such as pomegranate, mangosteen,
and white grape. Companies in the natural ingredients sector are starting to capitalise
on the potential of camu camu as a ‘super-fruit’. An example of this trend comes from
Navitas Naturals, a US company that started with maca (another Peruvian ingredient)
and now sells a range of 25 products, all of which are functional foods.
Understanding Market Barriers
Although accessing international markets is not an easy path for ‘superfoods’, success
also has its complications. Even when a superfood, like camu camu, is known in its
country of origin, it is not necessarily easily accepted in other countries. The following
are examples of market access barriers that represent a challenge for making camu
camu a bigger star. The same rules apply to any other exotic food.
US Market
When entering the US, all products for human consumption must have an FD A
authorisation for the commercialisation of that product. The FD A’s website provides
for an interesting compilation of warning letters regarding compliance or
misclassification of products. The main barrier occurs when marketing the product. If
a company which wants to sell the product makes health claims, it must request
permission to sell the product as a drug with all paperwork and information that comes
with that request (such as scientific support). However, if the company sells it as a
food, or eventually as a dietary supplement under the Dietary Supplement Health and
Education Act of 1994 (DSHEA), then permissions are handled on a different basis.
Camu camu is currently sold in the US as a dietary supplement in the form of liquid
concentrate extract in capsules, juices, powder, as well as in chocolate bars and
milkshakes.
The European Union Market
Camu camu is considered a novel food in the European Union according to Regulation
EC258/97, which states the following: ‘Foods and food ingredients that have not been
used for human consumption to a significant degree in the EU before 15 May 1997
are “novel foods” and “novel food ingredients”.’ The above statement covers all exotic
foods coming from countries with a rich biodiversity. This regulation represents a
considerable challenge to any company that wants to sell novel foods or beverages in
any EU country. It must present a dossier of the product in its specific presentation
with supporting evidence of its safety. The cost of preparing a novel food dossier
ranges between US$390 000 and US$780 000, a sum unattainable for small
businesses. The novel food regulation does not cover uses of specific ingredients or
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products such as camu camu as a dietary supplement. The latter category is
monitored under Directive 2009/39/ EC. Firms need to recognise that:
• The role of governments to assure safety for their citizens, as well as the prevention
of false claims, is getting stronger.
• Consumers are increasingly informed. The internet has become not only a good
source of information but also a place where many people can find reports or
scientific support to any health.
• The ‘newer’ the product in a market, the more it will have to support its properties
with sufficient evidence or historical record of usage. Many products are based on
tradition and use by the native population for centuries.
Navitas Naturals’ Bet on Functional Food
Navitas is the Latin word for ‘energy’ and ‘zest’. According to its founder, Zach
Adelman, this word embodies the company spirit of bringing ancient power foods to
the modern consumer, and also how consumers feel after consuming these products.
Back in 2003, Incan nutritional wisdom was an unexpected discovery for Adelman.
His first encounter was with maca, an Andean tuber that grows in the high-altitude
regions of the Peruvian Andes. The promise of its nutritional value and properties
made it a commercial success.
The company began to grow rapidly. To remain true to its vision, it searched the
world for functional foods that have been used by traditional cultures for both medicinal
and nourishment purposes. Many of these foods have been consumed for thousands
of years.
New additions were cacao nibs, goji berries, and incan berries by 2005. Increasing
demand grew the product range to 26 over the past 5 years. Camu camu did not go
unnoticed. Navitas added the fruit to its products list in 2010 and named it ‘Camu
Powder’.
In July 2011, the company launched a healthy snacks line, combining the power of
all superfoods within their product range with camu camu as part of one combination:
the Citrus Chia Power Snack, along with chia seeds, maca, and lucuma superfoods,
as well as apricot, raisin, cashew, and coconut flakes.
Navitas started in a tiny facility on Hamilton Drive in Novato, California, back in
2003, but the steady growth forced it to move to larger quarters in Pamaron Way in
the same city in 2011. The firm achieved GM P /HACC P third-party certifications in
2009.
Nowadays, Navitas Naturals imports foods from Peru (maca, camu camu, lucuma,
yacon and cacao), Colombia (incan berries), Brazil (acai), China (goji berries), Mexico
(chia seeds), and Turkey (mulberries), while expanding its sales throughout North
America. Distribution channels include retailers such as Whole Foods or Mrs. Green’s
in the US and dietary supplement stores such as Manna Foods and Canadian National
Nutrition.
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Identifying A Strategy
It is important to note that with the increasing demand for healthy foods, consumers
are also seeking products with special certifications, such as ‘organic’, that signify truly
natural products. Functional foods comprise most often these types of products, as do
‘fairtrade’ products, which adds social sustainability into the equation.
Navitas Naturals’ strategy to capitalise on the functional foods market is clearly
aligned with the company’s philosophy:
• Provide high-quality superfoods.
• Special certifications as a differentiation element: Organic, Raw, Fairtrade, and
Kosher.
• Social responsibility approach.
• Consumer education in order to sustain market growth. As an example, the
company took advantage of internet tools such as YouTube to spread the
company’s story and values with short videos about its products.
• Mostly Wild Crafted (as an added-value feature).
Navitas’ mission is ‘to provide premium organic functional foods that increase
energy and enhance health’. Along with a healthy lifestyle comes also the
responsibility of buying from local businesses to give back to the communities
providing these resources. ‘An essential part of our mission is to create economic
opportunities among indigenous people in developing countries’, says Zach. The
company’s support of native agriculture helps to expand the development of global
organic farming practices and economic development among indigenous people by
increasing demand for the health-enhancing foods they produce. Thus the firm creates
a virtuous cycle for suppliers, consumers, and itself.
Source: Cengage, L. A., & Ronkainen, I. (2013). International marketing: Asia pacific edition.
Cengage Learning Australia.
Question 1 (600 words) – According to Case Study Above
What brand strategy is Navitas following to “adapt” camu camu to the US market? Support your answer
with some examples.
Question 2 (600 words) – According to Case Study Above
Would you recommend that Peru use the same brand strategy Navitas is using in the US and other
international Markets? Give some examples to support your answer.
Question 3 (600 words) – According to Case Study Above
What international marketing strategy would you recommend to Peru in order to promote camu camu in
the Cambodia market? Justify your answer.
Question 4 (200 words)
Discuss the project cycle for an international project with reference to both the borrower and the lender.
Give example to explain each stage.
Question 5 (200 words)
Discuss the various positioning strategies available to international marketers when entering new markets.
Should a company choose the same positioning strategy for each market entered? Why or why not? Provide
examples to support your answer.
Question 6 (200 words)
How importation are environment factors in determining an international price structure? Illustrate your
answer with examples taken from a specific country or product.
Question 7 (200 words)
What is mean by high-context and low-context cultures? What are some of the issues that can arise for
marketers in an international context when moving from one style of context to the other? Use examples to
support your discussion.