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. Sterilizedmilk is a recent innovation that
offers two main advantages over fresh milk: it can be stored atroom temperature for up to three
months and has twice the refrigerated shelf life of ordinarymilk after the package is opened.
Dairy pride has developed superior equipment for sterilizingmilk that avoids the unpleasant side
effects of sterilization—a cooked and slightly burnt taste and afilminess that lingers in the
mouth after the milk is swallowed.
In searching for new markets for its equipment, the company seesJapan as a good candidate.
Japan has a large population, a low but growing rate of percapita milk consumption, and a
limited availability of fresh milk. As Dairy pride sets out tosell its equipment to large Japanese
dairies, it encounters the following obstacles:
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It has to develop an advertising campaign to change Japanesemilk consumption habits
and convince Japanese consumers of the advantages of buying anddrinking sterilized
milk.
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The Consumers’ Union of Japan opposes the product because ofconcerns about sterilized
milk’s safety.
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Dairy farmers located near large cities oppose the distributionof sterilized milk. They
fear competition from faraway dairies, since sterilized milk hasa long inventory life and
can be shipped long distances.
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Several large retailers say they will not carry sterilized milkbecause of interest-group
pressure. Milk specialty stores, which thrive on homedeliveries, also oppose the
introduction of sterilized milk.
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The Health and Welfare Ministry and the Ministry of Agricultureand Forestry have
indicated they will wait and gauge consumer acceptance ofsterilized milk before taking
action to approve or disapprove general distribution.
Please follow the steps outlined in Megamarketing and develop aplan for successfully managing
this difficult environment.
