How can a soap-and-cosmetics maker succeed in selling a cooking oil at twice the price of its competitors in this time of economic belt-tightening?
The answer is easy. It’s for people who actually want to tighten their belts — by losing weight.
Tokyo-based Kao Corp., known for its detergents, body-care products, cosmetics and toiletries, is now cleaning up in the cooking oil market with its Econa Health Cooking Oil, whose active ingredient, diacylglycerol, works to reduce fat deposits, according to Mitsuko Zama, a spokeswoman for Kao Corp.
A 600-gram (648 ml) bottle sells for 600 yen. In comparison, a 400 gram bottle of salad oil by rival Nisshin sells for around 300 yen.
Econa debuted on the market in 1999, becoming the first cooking oil of its kind in the nation. Kao has since introduced another diacylglycerol-based oil for cutting so-called bad cholesterol, selling a 500-gram bottle for 748 yen, that has attracted diet-conscious consumers.
“Unlike the cooking oils of our rivals, the Econa Healthy Cooking Oil has been attracting a larger number of middle-aged men who are looking for effective ways to reduce weight,” Zama said.
The diacylglycerol in Kao’s cooking oil works to curb the level of neutral fat, or triglycerides, in the blood that usually increases after eating, much to the dismay of people getting on the scales.
This feature has won Kao’s cooking oil the “food for specified health use” designation by the Health, Labor and Welfare Ministry.
“Sales of healthy cooking oils, including our Econa, have been growing yearly, accounting for 20 percent of the entire cooking oil market in Japan now,” Zama claimed.
With the original cooking oil’s success, Kao Corp. expanded its Econa-brand lineup to include not only Econa Healthy Cooking Oil Plus for lowering cholesterol, but also Econa Healthy Dressings and Econa Healthy Mayonnaise.
Kao Corp. posted 25 billion yen in sales from its Econa-brand products in 2002, up 120 percent from the previous year.
“We were initially concerned about the higher price of the cooking oil, but consumers are placing more importance on preventing weight gain,” Zama said.
Kao originally produced a cooking oil that it called Econa in 1928 in the process of researching oil as an essential material for soap. The early oil, different from the current type, was distributed only to restaurants, not to food retailers.
The advent of diacylglycerol led Kao to shift its cooking oil strategy to the general retail market. But it took about 15 years to develop the oil, including gaining scientific data from research organizations about the product.
During the development phase, various Kao employees were involved in the project.
“About 40 employees, for example, voluntarily joined a test to check the weight-control effects of the cooking oil. They were under strict watch for three months to check their weight while eating only foods cooked with the cooking oil,” Zama said.
Kao also had difficulty in developing sales networks because sales staff had no connection with food retailers and no knowledge about cooking oil. The company, for example, held lengthy lectures about how its oils differ from its rivals.
“Some salesmen who had never cooked at home started going to cooking school to obtain basic knowledge of various uses for ordinary cooking oil,” Zama said.
Kao is now poised to peddle its cooking oil in the United Sates. The company has test marketed Econa Healthy Cooking Oil in Chicago and Atlanta since February. It also established a joint venture with Archer Daniels Midland Co., a firm involved in procuring, transporting, processing and marketing agricultural products.
“The American food culture is different from that in Japan, although many Americans are eager to control their weight,” Zama said. “We are carefully watching the development of our cooking oil business in the U.S.”
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