Snacks - China
Report description
“China’s snacks market has grown strongly thanks to increased consumer spending power, busier lifestyles and increasingly varied leisure pursuits. Consumer interest in new products has fuelled a massive expansion in the number of companies and products involved in the market. But that growth has now created such a bewildering mass of products and brands that all of the products now struggle to stand out from the crowd. Consumers faced with a wall of products come to view all of the products as the same, leading to many sectors becoming viewed as just commodities.
This market covers the roasted nuts and seeds, dried/preserved fruit and vegetables snacks, dried/preserved meat and seafood snacks, rice-based puffy snacks, potato-based puffy snacks and other puffy snacks sectors in the People's Republic of China.
That has left the door open for snack food retail chains and modern grocery chains to develop retail brands and private-label brands that compete successfully where manufacturers’ brands have stalled. They provide uniformity of brand image that stands out from the crowd in a way the manufacturers’ brands mostly had not, and the manufacturers now face competition from retailers as well as each other, raising the competitive temperature.
Consolidation in the snacks industry is therefore inevitable. We are already seeing leading snacks makers gear up for that consolidation by beginning to innovate in their branding, packaging, marketing and advertising. They are also already showing signs of having identified key consumer groups to target, and adapting their products and strategies to focus on increasing consumer interest among those key groups so as to establish much more sustainable market share in the future.”
– Matthew Crabbe – Asia-Pacific Research Director
In this report we answer the key questions:
Who the key consumer groups for snacks are and how their differing lifestyles shape their demand for snacks?
How the industry needs to face imminent and inevitable consolidation with creative branding and marketing to engage better with the key consumer groups.
What the threat from snack food retail chains and modern grocery chain private label is doing to the competitive landscape in the snacks market.
Whether the snacks industry is meeting the health demands of Chinese people in light of increased worries among consumers about food safety, obesity and nutrition
Are manufacturers beginning to understand how premiumisation could raise their profile and appeal amongst consumers, and help them to survive the oncoming period of consolidation?
This market covers the roasted nuts and seeds, dried/preserved fruit and vegetables snacks, dried/preserved meat and seafood snacks, rice-based puffy snacks, potato-based puffy snacks and other puffy snacks sectors in the People's Republic of China.
Table of contents
Introduction
Definition
Executive Summary
The market
The forecast
Figure 1: Forecast – Volume sales of snack foods in China, 2006-16
Figure 2: Forecast – Value sales of snack foods in China, 2006-16
Companies
Figure 3: Forecast – Value sales of snack foods in China, 2011
Issues
High fragmentation hinders market differentiation
Figure 4: Repertoire of brands of potato chips every bought in the last 3 months, December 2011
Changing lifestyles create more snacking opportunities
Figure 5: Location of eating snacks, December 2011
Potential snacking Super-brands begin to emerge
Figure 6: Brands of potato chips ever bought in the last 3 months, December 2011
Building snack brands on a health proposition
Figure 7: Top 10 health claims by new product launches, 2009-11
Premium products begin to rise above the throng
Figure 8: Attitudes to bulk and discount buying of snacks, December 2011
The Market: A Snapshot
The slowing of rapid snacks market growth means significant, imminent consolidation
Figure 9: China – Snacks: Market volume and value annual growth, by sector, 2007-11
Figure 10: China – Snacks: Market volume and value, by sector, 2007-11
The leading companies
Figure 11: Total snacks market shares, 2009-11
Figure 12: China: Leading potato snack company total market shares, 2009-11
China’s snacking target consumer groups
Figure 13: The key target snacks consumer groups, December 2011
Figure 14: The key target snacks consumer groups’ snacking attitudes, December 2011
Fragmentation Hinders Market Development
Key issues
Snack products proliferate without a clear strategy
Figure 15: Breakdown of new products surveyed, by type, 2007-11
Figure 16: Brands of potato chips bought in the last 3 months, December 2011
Figure 17: Repertoire of brands of potato chips bought in the last 3 months, December 2011
Figure 18: Percentage points growth/decline in significance within new product launches, 2007-11
Figure 19: % breakdown of snacks volume & value sectors and percentage point growth/decline, 2007-11
Figure 20: Period sector value & volume growth rates, 2007-11
Fragmentation hinders brand loyalty
Figure 21: Key snack markets value growth compared with snacks, 2007-11
Figure 22: Snack product launches, by type of launch, 2008-11
Figure 23: Snacks annual % growth rates, by sector, 2007-11
Case study: Laiyifen and commodity snack retailing
What does it mean?
Changing Lifestyles Create More Snacking Opportunities
Key issues
The snacks market gears up for a change in consumer habits
Figure 24: Total snacks market value and annual growth, 2007-11
Breaking with traditional snacking habits
Figure 25: Frequency of snack consumption, by consumer groups, December 2011
On-the-go snacking still in its infancy
Figure 26: Location of eating snacks, December 2011
Figure 27: Frequency of eating snacks, by income group, December 2011
Functional benefits appeal to women
Figure 28: % of new product launches with product claims targeting women, 2007-11
Making snacking manly
Snacks for children
Figure 29: % of new product launches with product claims targeting children, 2007-11
Snacks to suit every lifestyle
Figure 30: New snacks product launches based on usability claims, 2007-11
What does it mean?
Snacking Super-brands Begin to Emerge
Key issues
Brand share development has huge potential for growth
Figure 31: Total snacks value market shares, 2009-11
Figure 32: Total nuts and seeds snacks value sector shares, 2009-11
Figure 33: China leading potato snack company total value market shares, 2009-11
Case study: Qia Qia revamping its tired brand
Making packaging stand out from the crowd
Case study: advertising the new message – follow the PepsiCo lead
Figure 34: Brands of potato chips bought in the last 3 months, December 2011
Figure 35: Repertoire of brands of potato chips bought in the last 3 months, December 2011
Tingyi/Calbee New JV Set to Make a Significant Snacks Market Entry
Private label: the emerging challenge to brand shares
Figure 36: Retail formats where snacks have been bought in the last 3 months, December 2011
Figure 37: China top 100 retailers’ forecast sales and private-label sales compared, 2010-14
Figure 38: Private-label % of new snack product launches, 2009-11
Figure 39: Top 20 companies based on new product launches, 2009-11
In-store promotions remains key area
Deepening brand penetration through new channels
What does it mean?
Building Snack Brands on a Health Proposition
Key issues
Snack consumers really do care about health as an issue
Figure 40: Consumer attitudes to healthy snacking, December 2011
Figure 41: Attitudes towards snacks consumption, December 2011
What are considered healthy snacks
Healthy and ethical products – recent development
Figure 42: Top ten health claims, by new product launches, 2009-11
Figure 43: Attitudes towards snacks consumption, December 2011
Figure 44: % of total new product launches making health claims, 2011
Figure 45: % of total new product launches making ethical claims, 2009-11
The profound effect of food scares
GMO-free
No additives
Marketing health to snackers
Figure 46: Snacks consumption frequency survey results, December 2011
What does it mean?
Premium Products Begin to Emerge
Key issues
Improved quality driving increased consumer spending
Product price and the premium shift
Figure 47: Average unit price per kg for snacks, by sector, 2007-11
Figure 48: Attitudes towards bulk and discount buying of snacks, December 2011
Figure 49: Average snacks product prices, by sector, 2008-11
A miscellany of premium features
Premiumisation through packaging
Special-occasion gift packs
What does it mean?
Future of the Snacks Market in China
The market will slow but remain strong
Figure 50: China – Forecast volume market for snacks, 2006-16
Figure 51: China – Forecast value market for snacks, 2006-16
The industry will continue to consolidate
Consumers will respond to more targeted marketing
Appendix – Market Data
Figure 52: Value sales of snack foods in China, 2011
Figure 53: Market size, value 2007-11
Figure 54: Snack market size, volume, 2007-11
Figure 55: Snack market size, value, 2007-11
Figure 56: Snack market share, 2009-11
Appendix – New Product Launches
Figure 57: Proportion of new product launches by snack category, 2006-11
Figure 58: Top 10 health claims by new product launches, 2009-11
Figure 59: New product launch type, 2006-11
Figure 60: % of ’healthy ingredient’ new product launches, 2006-11
Figure 61: New product launch claims, 2006-11
Figure 62: New product launches, by company, 2009-11
Appendix – Consumer – Consumption Habits
Figure 63: Frequency of eating snacks, December 2011
Figure 64: Frequency of eating snacks, December 2011
Figure 65: Location of eating snacks, December 2011
Figure 66: Location of eating snacks, by demographics, December 2011
Figure 67: Time of day snacks are typically eaten, by demographics, December 2011
Figure 68: Time of day snacks are typically eaten, December 2011
Figure 69: Frequency of eating snacks, by time of day snacks are typically eaten, December 2011
Figure 70: Most popular frequency of eating any snacks, by demographics, December 2011
Figure 71: Next most popular frequency of eating any snacks, by demographics, December 2011
Figure 72: Most popular frequency of eating nuts, by demographics, December 2011
Figure 73: Next most popular frequency of eating nuts, by demographics, December 2011
Figure 74: Most popular frequency of eating seeds, by demographics, December 2011
Figure 75: Next most popular frequency of eating seeds, by demographics, December 2011
Figure 76: Most popular frequency of eating preserved fruits, by demographics, December 2011
Figure 77: Next most popular frequency of eating preserved fruits, by demographics, December 2011
Figure 78: Most popular frequency of eating meat snacks, by demographics, December 2011
Figure 79: Next most popular frequency of eating meat snacks, by demographics, December 2011
Figure 80: Most popular frequency of eating dried fish/seafood snack, by demographics, December 2011
Figure 81: Next most popular frequency of eating dried fish/seafood snack, by demographics, December 2011
Figure 82: Most popular frequency of eating potato chips, by demographics, December 2011
Figure 83: Next most popular frequency of eating potato chips, by demographics, December 2011
Figure 84: Most popular frequency of eating rice-based snacks, by demographics, December 2011
Figure 85: Next most popular frequency of eating rice-based snacks, by demographics, December 2011
Figure 86: Most popular frequency of eating other puffed foods, by demographics, December 2011
Figure 87: Next most popular frequency of eating other puffed foods, by demographics, December 2011
Appendix – Consumer– Purchasing Habits
Figure 88: Source of buying snacks, December 2011
Figure 89: Most popular source of buying snacks, by demographics, December 2011
Figure 90: Next most popular source of buying snacks, by demographics, December 2011
Figure 91: Average weekly spending on snack, December 2011
Figure 92: Brands of potato chips ever bought in the last 3 months, December 2011
Figure 93: Brands of potato chips ever bought in the last 3 months, by most popular frequency of potato chips, December 2011
Figure 94: Brands of potato chips ever bought in the last 3 months, by next most popular frequency of potato chips, December 2011
Figure 95: Brands of potato chips bought most often, December 2011
Figure 96: Brands of potato chips bought most often, by most popular brands of potato chips bought second most often, December 2011
Figure 97: Brands of potato chips bought most often, by next most popular brands of potato chips bought second most often, December 2011
Figure 98: Most popular brands of potato chips ever bought in the last 3 months, by demographics, December 2011
Figure 99: Next most popular brands of potato chips ever bought in the last 3 months, by demographics, December 2011
Figure 100: Most popular brands of potato chips bought most often, by demographics, December 2011
Appendix – Consumer – Attitudes
Figure 101: Attitudes towards snacks consumption, December 2011
Figure 102: Most popular attitudes towards snacks consumption, by demographics, December 2011
Figure 103: Next most popular attitudes towards snacks consumption, by demographics, December 2011
Figure 104: Agreement with the statements ‘I try to avoid snacks with artificial ingredients’ and ‘I try to limit the amount of snacks I eat’, by demographics, December 2011
Figure 105: Agreement with the statements ‘I eat them as a meal replacement’ and ‘I tend to buy in bulk to save money’, by demographics, December 2011
Figure 106: Agreement with the statements ‘I trust Chinese branded snacks more than foreign brands’ and ‘I tend to buy what’s on special offer’, by demographics, December 2011
Figure 107: Agreement with the statements ‘I prefer fried over non-fried snacks’ and ‘I tend to avoid MSG when buying snacks’, by demographics, December 2011
Appendix – Repertoire Analysis
Figure 108: Repertoire of brands of potato chips every bought in the last 3 months, December 2011
Figure 109: Repertoire of brand preference, by demographics, December 2011
Appendix – Cluster Analysis
Figure 110: Target groups, December 2011
Figure 111: Target groups, by demographics, December 2011
Figure 112: Frequency of eating snacks, by target groups, December 2011
Figure 113: Location of eating snacks, by target groups, December 2011
Figure 114: Time of day snacks are typically eaten, by target groups, December 2011
Figure 115: Source of buying snacks, by target groups, December 2011
Figure 116: Brands of potato chips ever bought in the last 3 months, by target groups, December 2011
Figure 117: Attitudes towards snacks consumption, by target groups, December 2011
Definition
Executive Summary
The market
The forecast
Figure 1: Forecast – Volume sales of snack foods in China, 2006-16
Figure 2: Forecast – Value sales of snack foods in China, 2006-16
Companies
Figure 3: Forecast – Value sales of snack foods in China, 2011
Issues
High fragmentation hinders market differentiation
Figure 4: Repertoire of brands of potato chips every bought in the last 3 months, December 2011
Changing lifestyles create more snacking opportunities
Figure 5: Location of eating snacks, December 2011
Potential snacking Super-brands begin to emerge
Figure 6: Brands of potato chips ever bought in the last 3 months, December 2011
Building snack brands on a health proposition
Figure 7: Top 10 health claims by new product launches, 2009-11
Premium products begin to rise above the throng
Figure 8: Attitudes to bulk and discount buying of snacks, December 2011
The Market: A Snapshot
The slowing of rapid snacks market growth means significant, imminent consolidation
Figure 9: China – Snacks: Market volume and value annual growth, by sector, 2007-11
Figure 10: China – Snacks: Market volume and value, by sector, 2007-11
The leading companies
Figure 11: Total snacks market shares, 2009-11
Figure 12: China: Leading potato snack company total market shares, 2009-11
China’s snacking target consumer groups
Figure 13: The key target snacks consumer groups, December 2011
Figure 14: The key target snacks consumer groups’ snacking attitudes, December 2011
Fragmentation Hinders Market Development
Key issues
Snack products proliferate without a clear strategy
Figure 15: Breakdown of new products surveyed, by type, 2007-11
Figure 16: Brands of potato chips bought in the last 3 months, December 2011
Figure 17: Repertoire of brands of potato chips bought in the last 3 months, December 2011
Figure 18: Percentage points growth/decline in significance within new product launches, 2007-11
Figure 19: % breakdown of snacks volume & value sectors and percentage point growth/decline, 2007-11
Figure 20: Period sector value & volume growth rates, 2007-11
Fragmentation hinders brand loyalty
Figure 21: Key snack markets value growth compared with snacks, 2007-11
Figure 22: Snack product launches, by type of launch, 2008-11
Figure 23: Snacks annual % growth rates, by sector, 2007-11
Case study: Laiyifen and commodity snack retailing
What does it mean?
Changing Lifestyles Create More Snacking Opportunities
Key issues
The snacks market gears up for a change in consumer habits
Figure 24: Total snacks market value and annual growth, 2007-11
Breaking with traditional snacking habits
Figure 25: Frequency of snack consumption, by consumer groups, December 2011
On-the-go snacking still in its infancy
Figure 26: Location of eating snacks, December 2011
Figure 27: Frequency of eating snacks, by income group, December 2011
Functional benefits appeal to women
Figure 28: % of new product launches with product claims targeting women, 2007-11
Making snacking manly
Snacks for children
Figure 29: % of new product launches with product claims targeting children, 2007-11
Snacks to suit every lifestyle
Figure 30: New snacks product launches based on usability claims, 2007-11
What does it mean?
Snacking Super-brands Begin to Emerge
Key issues
Brand share development has huge potential for growth
Figure 31: Total snacks value market shares, 2009-11
Figure 32: Total nuts and seeds snacks value sector shares, 2009-11
Figure 33: China leading potato snack company total value market shares, 2009-11
Case study: Qia Qia revamping its tired brand
Making packaging stand out from the crowd
Case study: advertising the new message – follow the PepsiCo lead
Figure 34: Brands of potato chips bought in the last 3 months, December 2011
Figure 35: Repertoire of brands of potato chips bought in the last 3 months, December 2011
Tingyi/Calbee New JV Set to Make a Significant Snacks Market Entry
Private label: the emerging challenge to brand shares
Figure 36: Retail formats where snacks have been bought in the last 3 months, December 2011
Figure 37: China top 100 retailers’ forecast sales and private-label sales compared, 2010-14
Figure 38: Private-label % of new snack product launches, 2009-11
Figure 39: Top 20 companies based on new product launches, 2009-11
In-store promotions remains key area
Deepening brand penetration through new channels
What does it mean?
Building Snack Brands on a Health Proposition
Key issues
Snack consumers really do care about health as an issue
Figure 40: Consumer attitudes to healthy snacking, December 2011
Figure 41: Attitudes towards snacks consumption, December 2011
What are considered healthy snacks
Healthy and ethical products – recent development
Figure 42: Top ten health claims, by new product launches, 2009-11
Figure 43: Attitudes towards snacks consumption, December 2011
Figure 44: % of total new product launches making health claims, 2011
Figure 45: % of total new product launches making ethical claims, 2009-11
The profound effect of food scares
GMO-free
No additives
Marketing health to snackers
Figure 46: Snacks consumption frequency survey results, December 2011
What does it mean?
Premium Products Begin to Emerge
Key issues
Improved quality driving increased consumer spending
Product price and the premium shift
Figure 47: Average unit price per kg for snacks, by sector, 2007-11
Figure 48: Attitudes towards bulk and discount buying of snacks, December 2011
Figure 49: Average snacks product prices, by sector, 2008-11
A miscellany of premium features
Premiumisation through packaging
Special-occasion gift packs
What does it mean?
Future of the Snacks Market in China
The market will slow but remain strong
Figure 50: China – Forecast volume market for snacks, 2006-16
Figure 51: China – Forecast value market for snacks, 2006-16
The industry will continue to consolidate
Consumers will respond to more targeted marketing
Appendix – Market Data
Figure 52: Value sales of snack foods in China, 2011
Figure 53: Market size, value 2007-11
Figure 54: Snack market size, volume, 2007-11
Figure 55: Snack market size, value, 2007-11
Figure 56: Snack market share, 2009-11
Appendix – New Product Launches
Figure 57: Proportion of new product launches by snack category, 2006-11
Figure 58: Top 10 health claims by new product launches, 2009-11
Figure 59: New product launch type, 2006-11
Figure 60: % of ’healthy ingredient’ new product launches, 2006-11
Figure 61: New product launch claims, 2006-11
Figure 62: New product launches, by company, 2009-11
Appendix – Consumer – Consumption Habits
Figure 63: Frequency of eating snacks, December 2011
Figure 64: Frequency of eating snacks, December 2011
Figure 65: Location of eating snacks, December 2011
Figure 66: Location of eating snacks, by demographics, December 2011
Figure 67: Time of day snacks are typically eaten, by demographics, December 2011
Figure 68: Time of day snacks are typically eaten, December 2011
Figure 69: Frequency of eating snacks, by time of day snacks are typically eaten, December 2011
Figure 70: Most popular frequency of eating any snacks, by demographics, December 2011
Figure 71: Next most popular frequency of eating any snacks, by demographics, December 2011
Figure 72: Most popular frequency of eating nuts, by demographics, December 2011
Figure 73: Next most popular frequency of eating nuts, by demographics, December 2011
Figure 74: Most popular frequency of eating seeds, by demographics, December 2011
Figure 75: Next most popular frequency of eating seeds, by demographics, December 2011
Figure 76: Most popular frequency of eating preserved fruits, by demographics, December 2011
Figure 77: Next most popular frequency of eating preserved fruits, by demographics, December 2011
Figure 78: Most popular frequency of eating meat snacks, by demographics, December 2011
Figure 79: Next most popular frequency of eating meat snacks, by demographics, December 2011
Figure 80: Most popular frequency of eating dried fish/seafood snack, by demographics, December 2011
Figure 81: Next most popular frequency of eating dried fish/seafood snack, by demographics, December 2011
Figure 82: Most popular frequency of eating potato chips, by demographics, December 2011
Figure 83: Next most popular frequency of eating potato chips, by demographics, December 2011
Figure 84: Most popular frequency of eating rice-based snacks, by demographics, December 2011
Figure 85: Next most popular frequency of eating rice-based snacks, by demographics, December 2011
Figure 86: Most popular frequency of eating other puffed foods, by demographics, December 2011
Figure 87: Next most popular frequency of eating other puffed foods, by demographics, December 2011
Appendix – Consumer– Purchasing Habits
Figure 88: Source of buying snacks, December 2011
Figure 89: Most popular source of buying snacks, by demographics, December 2011
Figure 90: Next most popular source of buying snacks, by demographics, December 2011
Figure 91: Average weekly spending on snack, December 2011
Figure 92: Brands of potato chips ever bought in the last 3 months, December 2011
Figure 93: Brands of potato chips ever bought in the last 3 months, by most popular frequency of potato chips, December 2011
Figure 94: Brands of potato chips ever bought in the last 3 months, by next most popular frequency of potato chips, December 2011
Figure 95: Brands of potato chips bought most often, December 2011
Figure 96: Brands of potato chips bought most often, by most popular brands of potato chips bought second most often, December 2011
Figure 97: Brands of potato chips bought most often, by next most popular brands of potato chips bought second most often, December 2011
Figure 98: Most popular brands of potato chips ever bought in the last 3 months, by demographics, December 2011
Figure 99: Next most popular brands of potato chips ever bought in the last 3 months, by demographics, December 2011
Figure 100: Most popular brands of potato chips bought most often, by demographics, December 2011
Appendix – Consumer – Attitudes
Figure 101: Attitudes towards snacks consumption, December 2011
Figure 102: Most popular attitudes towards snacks consumption, by demographics, December 2011
Figure 103: Next most popular attitudes towards snacks consumption, by demographics, December 2011
Figure 104: Agreement with the statements ‘I try to avoid snacks with artificial ingredients’ and ‘I try to limit the amount of snacks I eat’, by demographics, December 2011
Figure 105: Agreement with the statements ‘I eat them as a meal replacement’ and ‘I tend to buy in bulk to save money’, by demographics, December 2011
Figure 106: Agreement with the statements ‘I trust Chinese branded snacks more than foreign brands’ and ‘I tend to buy what’s on special offer’, by demographics, December 2011
Figure 107: Agreement with the statements ‘I prefer fried over non-fried snacks’ and ‘I tend to avoid MSG when buying snacks’, by demographics, December 2011
Appendix – Repertoire Analysis
Figure 108: Repertoire of brands of potato chips every bought in the last 3 months, December 2011
Figure 109: Repertoire of brand preference, by demographics, December 2011
Appendix – Cluster Analysis
Figure 110: Target groups, December 2011
Figure 111: Target groups, by demographics, December 2011
Figure 112: Frequency of eating snacks, by target groups, December 2011
Figure 113: Location of eating snacks, by target groups, December 2011
Figure 114: Time of day snacks are typically eaten, by target groups, December 2011
Figure 115: Source of buying snacks, by target groups, December 2011
Figure 116: Brands of potato chips ever bought in the last 3 months, by target groups, December 2011
Figure 117: Attitudes towards snacks consumption, by target groups, December 2011
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