As is becoming the case across the consumer products industry, millenials are wielding unprecedented power through irrational spending and influencer marketing. So it comes as no surprise that infant formula manufacturer Bubs (ASX: BUB) has launched a new natural A2 beta-casein protein product to quench their demand.
The new product is an extension of Bubs’ existing infant formula range but combines A2 beta-casein protein milk with a “super premium” formulation which Bubs CEO and Founder Kristy Carr is confident will “have strong consumer appeal.”
“With the launch of Bubs SupremeTM A2 beta-casein protein range in our most profitable business segment, we are now able to cater to a more significant share of the addressable infant formula and toddler milk market, thereby strengthening our position in the total category to build widespread recognition of Bubs® as a brand synonymous with clean, high quality infant nutrition,” said Carr.
“We listened to Australian families and collaborated with Willis Trading, our brand equity-linked partner in the Daigou Channel, to better understand the needs of Chinese millennial mothers.”
The new product will be marketed as Bubs Supreme Toddler Milk and is labelled by the Company as their most advanced formulation which is enriched with higher levels of Omega-3 (plant-based DHA) and Omega-6 (ARA), a symbiotic blend of prebiotics and probiotics, lutein to support normal eye health, as well as vitamins and minerals for optimum nutrition.
Bubs Supreme is expected to hit Coles Supermarket shelves from May 2022 onwards and continues the longstanding relationship between the two which first commenced in 2008. At the same time, Coles will also commence stocking a range of Bubs Organic toddler snacks and teething rusks.
The conceptualisation and launch of Bubs Supreme is part of Bubs’ innovation strategy which has been identified as a key driver behind their high growth ambitions. These ambitions took a major hit at the start of the COVID-19 pandemic when international travel restrictions had an adverse impact on revenue.
Since then, BUBS has undergone a business restructure which has included an equity partnership with Willis Trading who is now the lead distributor of Bubs products in the China market.
Through the new Supreme products, Bubs gains access to the global A2 beta-casein protein milk market which currently generates USD $1.23 billion in annual global sales. This figure is expected to reach $2.6 billion by 2026.
Willis Trading’s first Purchase Order for Bubs Supreme products is valued at $32.9 million, which will be produced and distributed to China over the next six months.
“Bubs is already the fastest growing infant formula manufacturer in Australia, experiencing a record 31 percent increase in scan sales and doubling market share to 3.9 percent,” said Bubs Chairman, Dennis Lin.
“The launch of an A2 beta-casein protein formula range presents an additional opportunity to increase Bubs domestic market share growth and consolidate our position as the lead challenger brand in all key premium specialty formula segments.”
Alfred Chan is a Business Reporter at The Sentiment specialising in ASX-listed small cap companies, a bloodstock enthusiast and former equities analyst.
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