Yili to continue international marketing strategy

Leading Chinese dairy producer Yili Industrial Group Co Ltd will continue its international marketing strategy while maintaining its domestic presence, according to its executive president.

"We will go abroad but China is the biggest dairy market in the world," Zhang Jianqiu said. "As international brands enter this market, we have no reason to retreat and switch our focus overseas. It will be a competition between gentlemen."

Zhang was talking to China Daily at Yili's headquarters in Hohhot, capital of North China's Inner Mongolia autonomous region.

Yili was a sponsor of the Beijing Olympics in 2008 and the 2010 World Expo in Shanghai, which Zhang said attracted widespread international attention.

The brand again caught the eye with a product placement advert appearing in the American movie Transformers: Dark of the Moon in 2011 and in the TV series The Big Bang Theory earlier this year.

"It's only a trial," Zhang said. "I was not sure what the response of the audience would be beforehand. We will definitely continue such innovative overseas promotions in the future. If possible, you will see more such advertisements."

However, he did not disclose specific plans, due to privacy concerns.

Yili joined hands with the Walt Disney Company in 2011, introducing Disney's cartoon images in its product promotion, and became the only dairy supplier to Chinese athletes at this year's London Olympics.

Nevertheless, Zhang said the melamine scandal in 2008 placed a great deal of pressure on domestic dairy producers, who now tend to import milk.

Melamine-tainted milk killed six infants and left more than 290,000 others with kidney damage, making China question the quality of domestically produced dairy products. After a decline in sales and more efforts in quality control, the cost of milk has surged.

Zhang says a metric ton of milk from New Zealand costs about 12,000 to 13,000 yuan ($1,924-$2,084) when it arrives in Tianjin, but a small dairy producer in Northeast China's Heilongjiang province will charge nearly 20,000 yuan to collect a ton of milk from individual domestic suppliers.

Still, Zhang prefers to better manage domestic sources. "Yili was only an ice-cream producer before," he said. "No matter how we reform, we only want to upgrade our product quality to match market needs. Otherwise, we will not own what we have today."