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Infant Formula Marketing Scam Unravels in New Zealand

Posted by Abe Sauer on June 3, 2011 01:00 PM

In the wake of a tainted infant formula scandal that killed six babies and hospitalized 860 in China in 2008, a New Zealand-based company came up with a way to capitalize on the market's fear.

But when the company chose what it saw as a simple local logo to help the product seem more foreign, little did it know that forces were set in motion that would unravel the whole scam.

Thinking it would communicate its product's origins, Kiaora New Zealand International, which exports its baby formula to China, used the local Maori term "Heitiki" on cans of its infant mix.

The Maori community, not surprisingly, protested:



The nation's Associate Health Minister agreed, stating: "The use of heitiki, our traditional taonga, for the marketing of infant milk powder has been criticised as both disrespectful of tikanga Maori and representing the theft of cultural knowledge."

The New Zealand Herald
notes that "Huge demand for safe infant formula exists in China after the San Lu melamine tampering scandal, which killed children."

NZ, a hub of dairy production, represents a safe and excellent base for China-focused brands looking to export baby formula back home, where imported formula is seen as safer.

Reacting immediately, the brand's GM stated, "We deeply regret the cultural insensitivity on our part arising from our use of the Heitiki brand… We will be rebranding the product without reference to Maori culture but in a way that still promotes its New Zealand manufacture.”

Case closed for the brand. But wait, there's more.

The same day the brand apologized and committed to a rebrand, Chinese news agency Xinhua reported that "New Zealand agricultural produce regulators cleared an Auckland-based firm that exported infant formula to China of food safety concerns, just hours after confirming they had launched an investigation."

And while the brand passed scrutiny over the safety and quality of its product, the criticism of its marketing flared up in another area.

Turns out Kiaora New Zealand International was claiming in the Chinese marketplace that the company was "dedicated to sourcing and providing Kiwi mums with the best and healthiest infant formula available" and that its "Heitiki" formula had "become the new standard in New Zealand."

But as the New Zealand Food and Grocery Council points out, the brand is export-only formula. The Council released a perplexed statement: "It's hard to fathom how Heitiki is the 'new standard' when scan data shows New Zealand and Australian supermarkets do not sell the product at all." The Council called for a full investigation.

Kiaora New Zealand International, which had only been producing formula since March and clearly isn't aware of the WHO's global standards on infant formula marketing, appears to be watching in slow motion as its marketing scam unravels.

Not surprisingly, Heitiki.co.nz, which used to feature a prominent Heitiki banner front and center, is currently down for maintenance.

Cached versions of the site include a News sections about how popular the brand is in New Zealand as well as (what has to be fictional) "Customer Feedback" area. One point in the "Why Choose Us" sections reads "Many NZ parents are using Kiaora infant formula. Hear their story on why our baby formula is their preferred choice."

The scandal is exacerbated as health organizations in New Zealand have worked hard to promote the health benefits of breastfeeding. Mommy bloggers, of course, are outraged.

It would seem the jig is up for Kiaora.

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