I only write about food politics occasionally. But today I’m choosing to depart from my more usual decadent adult topics to write about the crucially important issue of the nutrition and marketing by multinational companies of infant formula milk for babies, and what impact that stands to have globally for health, and those in poverty.
If you feel moved to do something about it after reading this blog post, then there is currently a SumOfUs petition running. It is based on the Changing Markets report outlined, but specifically aimed at the CEO of Nestlé, as the biggest of the four big baby milk multinationals. You can sign it here.
I’m writing about this because:
- Earlier this year I worked as a nutrition research consultant to help shape a report on this topic, which was published last week by Changing Markets Foundation. Their mission is to expose irresponsible corporate practices and drive change towards a more sustainable global economy through thoroughly-researched and authoritative campaigns.
- Last month I was in Vietnam, and I’m thinking and writing about it at the moment. So it’s salient for me that Vietnam happens to be one of the emerging economy countries where the report highlights a need for change. Underhand marketing tactics by manufacturers who want to grow the Asian baby milk market persuades parents to choose to buy infant formula instead of breast-feeding, despite it sometimes representing a huge percentage of their salaries.
- Infant nutrition creates the foundation on which everything else I more frequently bang on about nutrition-wise should be based. We understand more and more why the quality of nutrition in the first months of life can make a massive difference to a person’s subsequent health status as an adult, and their propensity e.g. to develop obesity, and other chronic diseases. So this topic is hugely important.
- For babies fed exclusively on infant formula milk, it is their sole source of nutrients up to six months old. So given this and the health implications, it’s crucial that manufacturers put nutrition science and infant health before profits. They say they do, but it is far from clear that that is actually the case.
The report’s main findings (click to jump to details):
1. Baby milk is the fastest growing packaged food product globally.
2. Manufacturers use underhand marketing tactics to promote sales growth, especially in developing countries like Vietnam.
3. Manufacturers’ claims about particular health benefits are unproven by nutrition science. And nutrition claims made by manufacturers are undermined by their enormous number of products.
4. Despite a widespread belief that infant formula composition is heavily protected, industry self-regulates what goes into it.
5. There are big, unjustified, price differences between products. The consequent cost to parents in some countries is a huge percentage of their salaries, which exacerbates poverty & anxiety.
6. The global nutrition & health implications are enormous.
7. So what happens now? Petition!
The Changing Markets Report: Milking It: How Baby Milk Multinationals Are Putting Profit Before Science
The rest of this blog post is based on the findings of the Changing Markets (CM) report, and you can find full referencing throughout that report rather than here. The title photo for this post is mine, and all the other photos are CM’s.
What did the Changing Markets report look at?
CM say that their report, published in October 2017, represents the first investigation into the four largest global manufacturers (Nestlé, Danone, Mead Johnson Nutritional and Abbott) of over 400 of the most popular cow’s milk formula products for infants under 12 months old.
Among other things, the report looks at the price differences between these products in 14 countries across the world.
These are the Report’s Troubling Main Findings:
1. BABY MILK IS THE FASTEST GROWING PACKAGED FOOD PRODUCT GLOBALLY
- The milk formula market is highly profitable – worth US$47 billion per year, and projected to increase by around 50% by 2020, according to market reports in 2015 and 2016.
- Most sales growth will be in Asia, with mainland China, Hong Kong, Indonesia and Vietnam projected to be the leading markets.
- With growth like that at stake – and with the market dominated by only six major global companies and their subsidiaries – it’s not surprising that the CM report finds they are using fierce marketing tactics to seek competitive advantage to maximise profits and market share in these countries.
2. MANUFACTURERS USE UNDERHAND MARKETING TACTICS TO PROMOTE SALES GROWTH, ESPECIALLY IN DEVELOPING COUNTRIES LIKE VIETNAM
- Breastfeeding is best for a baby (see health implications section 6. below) – but it is being undermined by manipulative marketing.
- The history of infant formula has been rife with scandals e.g. Nestlé has been the subject of boycotts over many years, especially in developing countries like Vietnam, where formula feeding is strongly associated with increased mortality.
- The International Baby Food Action Network has for decades been reporting the big four baby milk multinationals’ regular breaches of the International Code of Marketing of Breast-milk Substitutes – which promotes responsible, accurate and ethical marketing of these products.
- Nestlé, who have the biggest baby milk market share, scored just 36% in the Access to Nutrition Foundation Index that measures compliance with the Marketing Code. And the other four big manufacturers were worse – with Danone scoring 31%, and Abbott and Mead Johnson each scoring under 10%. Even where companies have policies in place to comply with the Marketing Code, they have been found to be breaching them on the ground.
- Here’s a Vietnamese case study from CM’s report, which highlights how parents are directly targeted by marketing:
- Viet gave birth to her daughter, Khan Chi, in a public hospital in central Hanoi, Vietnam. “There were people from milk companies there who asked for our names and contact details. They said they would have a gift for me, and so we signed up.”
- Weeks later, Viet received a call from Nestlé asking how her baby was developing and if she felt she had enough milk. The Nestlé representative also asked if she had chosen an infant formula yet, and encouraged her to attend a conference where she would get more free samples.
- Viet tried various brands and was frustrated. Her daughter rejected some; others did not produce promised height and weight benefits. She eventually became convinced that Aptamil, a Danone brand from Germany, was the answer.
- Viet earns around US$160 a month in her part-time job as an accountant. Her husband works full time. For one can of formula, they have to pay up to US$35, and they need four cans per month – US$140, which is nearly her whole income. They also have to pay their rent and fuel bills etc. Viet says they are spending half of their income on meeting their daughter’s needs. But she says it’s worth it, because she believes that “Aptamil is the BMW of formula”.
3. MANUFACTURERS’ CLAIMS ABOUT PARTICULAR HEALTH BENEFITS ARE UNPROVEN BY NUTRITION SCIENCE
AND NUTRITION CLAIMS MADE BY MANUFACTURERS ARE UNDERMINED BY THEIR ENORMOUS NUMBER OF PRODUCTS
- Product development plays a major role in manufacturers’ aggressive marketing tactics. Mothers who do not breastfeed are faced with an overwhelming and ever-expanding range of infant formula milk products.
- Manufacturers now flood the market with new products – claiming they are based on state-of-the-art science and compositionally ever closer to breastmilk. Health claims that are unproven scientifically are used for marketing and to justify high prices e.g. on the superior nutritional quality of each product, or its ability to solve common infant behaviours (colic, reflux, crying, indigestion, sleeplessness, stomach upsets etc.).
- But CM’s report finds that companies are not basing their different formulations on science, but are instead guided by a desire to increase market share and profits. Rather than nutrition science, they are using very sophisticated market research, social listening, and infiltration of online communities, to tailor products to consumer preferences and parents’ worries and concerns,
- Indeed, CM argue that the wide variety of products on sale within and between countries, and the lengths companies go to to push expensive premium products, especially to high-growth Asian markets, call scientific claims into question.
- Marketing leads parents to think that much more expensive “premium” formula is better for their babies’ health. But there’s no scientific basis for this.
- Sometimes explicit health benefit claims aren’t made, but brand names like Nutrilearn or Profutura are instead clearly aimed at subtly suggesting a health advantage from purchase of a particular product.
- Even worse though, adding extra ingredients which allow manufacturers to make spurious health claims about their products may not just have no beneficial effect, but may make formula nutritionally worse for babies.
- Despite legal requirements on the nutritional composition for infant formula, CM’s research identified over 400 products globally in the top four manufacturers’ ranges, including similar products being sold under their own and subsidiary brands as part of product differentiation strategies.
- Confusing product differentiation includes:
- an increasing and overlapping range of products for different age groups (1–12 months, 1–6 months, 1–3 months, etc.);
- that includes ‘follow-on’ formulas (for children 6-36 months) which were arguably introduced to circumvent the World Health Organisation (WHO) Marketing Code, and subsequent World Health Assembly (WHA) resolutions, as some countries only prohibit the advertising of infant formula products (i.e. for babies up to 6 months old). But WHO states that follow-on formula is unnecessary and its marketing may mislead parents.
- products with additional nutrients, which are not required by law, e.g. omega fatty acids such as DHA (an Omega-3) and ARA (an Omega-6), prebiotics and probiotics, nucleotides, etc.;
- and products with raw ingredients and flavours to cater for wider consumer preferences and concerns e.g. claiming to be free of genetically modified organisms or palm oil, or using organically sourced ingredients etc.
- an increasing and overlapping range of products for different age groups (1–12 months, 1–6 months, 1–3 months, etc.);
- The fact that companies are placing products with different formulations in different markets suggests that there is little nutritional science and few health considerations behind their product ranges. e.g. Nestlé is the only company that sells products in all 14 countries that CM investigated, with a total of 165 products. However, it is obvious that there are many variations in the composition of its most widely available NAN product range in different markets.
4. DESPITE A WIDESPREAD BELIEF THAT INFANT FORMULA COMPOSITION IS HEAVILY PROTECTED, INDUSTRY SELF-REGULATES WHAT GOES INTO IT
- For babies who are not breastfed, it is the responsibility of manufacturers and public food safety authorities to ensure infant milks are as safe and nutritionally complete as possible, and that their development is strictly based on science.
- The nutrients that must be included in baby milk are set by a WHO global trading standard and national legislation in most countries. But controls on its nutritional quality are largely dependent on industry self-regulation.
- The WHO composition standard sets minimum requirements for levels of macronutrients (carbohydrates, protein, etc.) and micronutrients (minerals, vitamins, etc.) in infant and follow-on formulas, and the types and levels of nutrients specified are broadly similar in most countries’ legislation. But required and/or permittable ingredients and labelling restrictions may vary.
- There is very little independent oversight of the nutritional composition and compliance with regulatory standards of infant milks sold around the world. Although infant milks are perceived as a highly controlled product, authorities are heavily reliant on industry self-regulation.
- Powdered infant milks are not sterile products, and the presence of pathogenic microorganisms (e.g. Enterobacter sakazakii and Salmonella) has been regularly reported.
- But compliance, or lack of it, with the nutritional compositional requirements, or broader quality issues, is reported less frequently. CM argue that this seems a significant oversight by government food safety regulators – particularly for infants under 6 months old, who rely solely on the formula for all their nutritional needs in a crucial phase of their development.
5. THERE ARE BIG, UNJUSTIFIED, PRICE DIFFERENCES BETWEEN PRODUCTS
THE CONSEQUENT COST TO PARENTS IN SOME COUNTRIES IS A HUGE PERCENTAGE OF THEIR SALARIES, WHICH EXACERBATES POVERTY & ANXIETY
- Manufacturers behave very differently in different markets, and often their products are closer to those of their direct competitors within the same market than their own products elsewhere. CM argue that the conclusion that multinationals are putting profits before nutrition science is easily drawn from this observation.
- CM say that market research – focussed primarily on consumer affordability and willingness to pay – also suggests there is no clear scientific justification for the very large price differences observed within brands in each market, and also within brands across different countries.
- In the face of baby milk multinationals’ desire for increased profits – through growth in emerging markets in particular – parents across the world who want the best for their children are not necessarily receiving the clearest information, nor the best possible products, at a fair price.
- The product differentiation highlighted above is used as a way to raise prices and increase profit margins. There is huge, unjustified disparity in the cost of infant formula, both within and between countries. Marketing of so-called premium products is having a signicant financial impact on families, especially in Asian countries.
- Some of the countries with the lowest incomes have to cope with the highest prices e.g. Aptamil Profutura 1 (Danone) is sold in the UK, Germany and China. Despite being one of the most expensive powdered cow’s-milk-based infant formulas available in the UK – it costs more than 3x times the price in China. It costs:
- 13 GBP per 800g (around US$17) in Germany,
- nearly 20 EUR for 800g (around US$24) in the UK, but
- 365 RMB for 900g (around US$55) in China.
- Feeding a baby on top-priced formula costs per month:
- US$82 in the UK
- US$264 in the US
- US$286 in China
- As a percentage of an average parent’s salary, feeding a 2–3-month-old baby costs:
- 1–3% in the UK, France and Germany
- 4–7% in Poland
- Up to 40% in China (if buying ‘super-premium’ infant formula, but even the lowest-priced foreign formula costs around 15%)
- Up to 70% in Indonesia (if chosing to buy Mead Johnson Nutrition’s Enfamil A+ brand).
- In the UK, the most expensive product CM found (Aptamil Profutura 1) is 1.6x more expensive than the cheapest (Cow & Gate First Infant Milk 1), despite both being manufactured by Danone, and the Aptamil product offering no advantage over any other infant milk according to First Steps Nutrition. In fact, unnecessary ingredients added for marketing advantage may actually make it a worse choice, because it places an increased processing burden on an infant’s developing body.
- In China and Hong Kong, the four multinationals’ most expensive baby milk is nearly 3x the price of their least expensive.
- In Indonesia, the most expensive infant formula CM’s report found (Enfamil A+ by Mead Johnson Nutrition) was 4.5x the price of economy brand formula (SGM Ananda Presinutri 1 by Danone). But the economy brand should by law already contain all the baby needs:
- Indonesian case study: CM’s report cites the case of Umi, an abandoned single mother in a poor neighbourhood in North Jakarta, Indonesia. She breastfeeds, but her nephew bottle feeds her baby when she’s at work.
- Umi wanted to give her baby the best, which for her, meant feeding her daughter Nestlé’s premium Lactogen product, which she believes is enriched with vitamins that other products don’t have (although it shouldn’t be).
- But Umi now feels like a failing mother because Lactogen became too expensive, so she had to switch to an Indonesian brand (SGM, made by a Danone subsidiary), which she worries is inferior nutritionally. And even so, she is spending almost 10% of her income on SGM.
- The situation in China also illustrates the global issues.
- As the Chinese middle class has grown, so has the Chinese preference for ‘premium’ infant milks. Although Chinese brands are widely available, Chinese parents prefer foreign brands – both because of the premium image of foreign brands, and because of food safety concerns with domestic brands e.g. Nestlé is now a leading brand in China, including its ‘super-premium’ brand ILLUMA.
- Chinese parents, however, pay a hefty price for foreign brands. In 2013, a Chinese government price-fixing probe resulted in companies agreeing to lower prices, but they still remain up to double that of the same product in many other countries.
- Unsurprisingly, Chinese parents have begun buying infant milks abroad, in person or via e-commerce. The trade in infant milks has also contributed to the daigou phenomenon: overseas professional shoppers who buy them at cheaper prices, and then either send them via post in small shipments, or bring them to China repacked in suitcases to avoid import tariffs.
- In 2013, the Hong Kong government intervened to address the constant flow of traders and tourists buying formula at reduced prices, which resulted in shortages. Travellers attempting to leave HK with more than 1.8kg of formula now face penalties of up to 500,000 HKD (US$64,000) and up to two years in prison. Nevertheless, more people were arrested for smuggling infant milk than drugs in 2013, and in 2014 alone there were over 5,000 prosecutions.
6. THE NUTRITION & HEALTH IMPLICATIONS ARE ENORMOUS
- Adequate nutrition in infant and young child feeding is critical for improving child survival globally, promoting healthy growth and development, and preventing illness later in life.
- The first 1,000 days of a baby’s life have huge implications for their subsequent health. Across the world, suboptimal nutrition leads in one year to 155 million stunted, 41 million overweight, and 52 million babies with wasting disease.
- WHO says optimum breastfeeding could save the lives of 820,000 children under the age of five every year.
- Although the WHO strongly recommends breastfeeding as the optimal way of feeding infants – and despite overwhelming evidence that breastfeeding provides them with optimal nutrition – WHO stats show that globally, only about 36% of babies under six months are exclusively breastfed.
- Many women cannot, or (in some cases, because of influence by marketing) choose not to, breastfeed their children. And many mothers who want to breastfeed lack support from qualified lactation experts, and/or their employers and communities. In all those cases, parents are faced with an ever-increasing variety of milk formulas which are nutritionally suboptimal to breastfeeding, despite their various health claims.
7. SO WHAT HAPPENS NOW? PETITION!
In conclusion, CM’s report calls for formula manufacturers to:
- Ensure that all infant milk products placed on the market are safe, as compositionally complete as possible, and solely guided by the best available science.
- Limit the number of products on the market to those based only on unequivocal, robust scientific evidence, and highest-quality ingredients.
- Eliminate any health claims that are not 100% proven.
- Fully respect the WHO Marketing Code and subsequent WHA resolutions across all countries, and relevant national legislation where this is in place.
- Ensure that products are fairly priced across global markets.And it calls for policy-makers to:
- Strengthen global marketing and compositional standards to ensure that clear rules on the marketing and composition of infant milks adequately cover the current product range, including special medical products.
- Adopt a conservative approach to the approval of new compositions of infant milks.
- Regulate the use of health claims, and allow only those claims that have been clearly verified with independent evidence.
- Implement and strengthen marketing and compositional standards into national legislation, and ensure proper and regular enforcement.
- Introduce restrictions on over-the-counter sales of formulas for special medical purposes.
- Step up reports regarding the monitoring and enforcement of rules on the marketing and composition of formula products.
If you feel moved to do something about it after reading this blog post, then there is currently a SumOfUs petition running. It is based on CM’s report, but specifically aimed at the CEO of Nestlé, as the biggest of the four big baby milk multinationals. You can sign it here.