On July 6, Firmus (also called Feihe, Chinese name: 飞鹤) launched Zhuoran (茁然) children milk powder and formula [1]. This series includes four products [2], and they are Zhuohu (茁护), Xuehu (学护), Zhuanghu (壮护) and Beihu (蓓护), respectively. It targets children aged from three to six to offer them nutrition solutions.
Market Capability
From 2017 to 2019, the total number of births between 0 and 3 years old in China was 47.11 million [1], while the number of births between 0 and 15 years old in 2019 was about 249 million. Thus, it can be inferred that the population of children over three years old far exceeds that of infants and young children aged 0-3 years old, with a sizeable incremental space. It is estimated that the current capacity of children's consumption market is between five to seven billion yuan (approx. $ 1bn), and its size will exceed 10 billion yuan shortly.
Market Competition
The large consumer group, combined with the ever-expanding market, has made demands for children's milk powder on an upward trend, and is enticing more new entrants to roll out products. In March, Abbott announced the launch of Eleva (菁挚) organic milk powder for children aged 3-7 [3]. Later in May and June, Moohko (麦蔻) and Austnutria successively developed children's formula. In July, Chinese brand Wondersun (完达山) launched Zhuge (诸葛小将) series of children's formula milk powder. Besides, dairy brands such as Junlebao (君乐宝) and Yili (伊利) launched children's milk powder as well.
Song Liang [1], an expert in the dairy sector, points out that in the past two years, the registration system has dramatically raised the threshold for the production of infant and young children formula, and the concentration of the milk powder industry is also getting higher and higher.
Therefore, to realize the differentiated competition in this sector, dairy enterprises put different priorities in the layout. For example, Abbott's Eleva organic children's milk powder (stage 4), focuses on calcium absorption and bone density; Mead Johnson high-DHA formula aims at intelligence and brain development; and Wyeth added adequate lutein to help the development of the baby's vision.
Market Positioning of Firmus
Studies have shown that when children are about three years old, their resistance is only 60% of that of adults. In nutrition investigation, it is found that the problems of over-nutrition and micronutrient deficiency coexist in Chinese children [1]. Over-nutrition leads to obesity in children, and micronutrient deficiency is manifested in insufficient intake of vitamin A, vitamin D, calcium, and iron. In some relatively deprived areas, there are also problems such as growth retardation and childhood anemia.
Firmus concentrates on improving children's immunity. Although there are products in the market that focus on this kind of function, Firmus's formula emphasizes the synergistic effect of lactoferrin, yeast β-glucose, and probiotics Bb-12, which can improve children's immunity more effectively.
Firmus has been emphasizing that "it is more suitable for Chinese babies," and this brand has been deeply rooted in consumers' minds. On the other hand, as a domestic brand, Firmus has a considerable consumer base in lower-tier cities, which is beneficial for the newly launched children's milk powder products to occupy the market.
