There is a relatively new controversy over milk in New Zealand and Australia. The claim is that protein in regular milk (A1 protein) can make its way into the bloodstream, causing diseases such as autism, schizophrenia, juvenile diabetes, and heart disease. Scientists disagree whether this claim is valid. The benefits of A2 milk seem to be mostly hype at this point, but consumers that believe A2 milk is beneficial continue to purchase the more expensive A2 milk. A2 Corporation and Freedom Foods companies created a joint venture, A2 Milk Company, in order to take advantage of the hype and capture a share of the relatively small market. It’s interesting that they created a joint venture in order to spread out the risk between the two companies in case scientific evidence proves there is no benefit to consuming A2 milk instead of A1 milk, and the A2 milk market falls through.
To read the full report, go to the following link: http://www.abc.net.au/7.30/content/2010/s2866747.htm
Please leave comments on your thoughts!
nkounto2, 2 years ago | Flag
This article made me very curious to learn more about the A1 vs. A2 milk issue. Right now, it looks like many sources are in agreement that evidence supporting
the harmful effects of A1 milk is insufficie nt. Even so, I agree that health issues like this one tend to create a lot of hype. The A2 Corporatio n not only sells a trademarke d brand of milk, but it also sells the products used to test the cows. I think that with all this consumer hype, the corporatio n really chose the right time to make their move in the market. I agree that it will be interestin g to see what the A2 corporatio n will do if research proves them wrong. However, I am also interested in their reaction if this hype turns out to be short-live d--when consumers move on to the next diet trend that comes along and forget about this one.
ajohns43, 2 years ago | FlagI think it's a good plan for Freedom Foods and A2 Corporation to create a joint venture, as you mentioned, in order to have a fail-safe plan if the A2 milk does not sell. Especially since there is not much scientific evidence about the quality of the A2 milk product, the two companies are smart to create a (separate) joint venture. This A2 milk product has great potential to sell, due to the fact that A2 Milk Company is marketing its 'new and innovative' product to the public. A2 Milk can be promoted in such a way, stating that it's 'safe and free of antibiotics and other hormones' unlike other regular milk. This tactic will catch the eye of consumers, in general, because people are looking to buy healthy, organic, and even local products.
It definitely makes sense that the A2 Corporation and Freedom Foods established a joint venture in order to put their focus on one, single product. Although there is no scientific evidence to support these beneficial claims of the A2 Milk, I believe the company has great potential to grow and become very successful.
LISH786, 2 years ago | FlagAs a consumer, I consider the premium for A2 milk, along with the obviously limited extent of the related research ("this anecdotal evidence isn't supported by any clinical trials"), reason to maintain the status quo until I hear more compelling
evidence. Threats to consumers' health and well being have fueled many food industry trends, with varying ranges of legitimacy . As households across the country feel the pressure to limit expenditur es at this time, I doubt M2 will be a widespread success (referenci ng the niche market and hype you mentioned above). I would be curious to hear more about the comprehens ive business strategies of Freedom Co. and A2, to better understand the dynamics of the joint venture.
pjk56, 2 years ago | FlagThere are numerous claims regarding so called health foods. With so many people interested
in health these days, it seems like a lucrative market to pursue. Whether or not the claims are true, if you do a good job at marketing a product, you can sell it. A2 Milk has a product to sell and Freedom Foods provides the marketing tool.
lacook2, 2 years ago | FlagI think that a joint venture in this situation was a great idea. Even if scientific
evidence surfaces that proves the health benefits of A1 milk, I have to believe there will still be a market for A2 milk. Frankly, consumers will believe what they want to believe, regardless of whether their beliefs are supported by science or not. For this reason, I think that the creation of a joint venture is a very business savvy approach to capturing the A2 market. It makes even more sense considerin g that this is such a small market. Fragmentin g the A2 market between the two companies would be illogical and not nearly as profitable for either comapny.
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