Plant Protein Drinks - China - January 2013
“Since its economic reform 30 years ago, China has enjoyed decades of extraordinary growth with urbanisation growing at a pace faster than most of the other developing economies in Asia. As income levels and spending power continue to improve, China's beverage market, which includes any forms of liquid drinks sold to consumers via on-trade or off-trade channels, grew in tandem. Over the last ten years, the Chinese beverage industry has grown consistently by over 20% annually. It is forecast that the Chinese beverage industry will grow at a steady rate of 12-15% over the next five years."
– Eileen Ngieng – Senior Research Analyst
Some questions answered in this report include:
What is the current state of the plant protein drinks market, and how is the market expected to develop in the near future? What are the key market drivers and restraints?
What are the distinctive consumer behaviours and attitudes towards plant protein drinks?
What are the attributes consumers pay most attention to in choosing plant protein drinks? In light of consumer attitudes, what areas offer future potential for product development?
Since its economic reform 30 years ago, China has enjoyed decades of extraordinary growth with urbanisation growing at a pace faster than most of the other developing economies in Asia. As income levels and spending power continue to improve, China's beverage market, which includes any forms of liquid drinks sold to consumers via on-trade or off-trade channels, grew in tandem. Over the last ten years, the Chinese beverage industry has grown consistently by over 20% annually. It is forecast that the Chinese beverage industry will grow at a steady rate of 12-15% over the next five years.
Chinese consumers are traditionally more used to plant protein drinks than cow’s milk, partly reflecting the high prevalence of lactose intolerance. Among plant protein drinks, soymilk is the most popular, partly thanks to its longer history in the market compared to other drinks which are all relatively new to the market.
As plant protein drinks are often seen as ’natural, environmental friendly, nutritious, healthy’, they have been able to tap into the trends in the wider beverage market, to enjoy compound annual growth rates of around 19% since 2007. The emphasis on health benefits and natural ingredients can encourage consumer engagement and thus drive the plant protein drinks market forward.
The increase in disposable incomes of consumers, fuelled by GDP growth in China, increasing urbanisation and increasing health awareness, has also contributed to the blooming plant protein drinks market, and should continue to support growth going forward. In addition, due to the cow’s milk scandal in China in 2008, consumers have lost trust in the safety of cow’s milk, causing shifting back towards plant protein drinks which are seen as more natural and containing no artificial ingredients.
Flavour is another area worth exploring as it is a key consideration for consumers when purchasing plant protein drinks. Consumers’ willingness to try new flavours suggests new opportunities for developing local and exotic flavours.
The growing middle class with increasing disposable incomes is also helping to drive sales of plant protein drinks in the on-trade, this group being more willing to dine out and spend on food and beverages. To better compete with the on-trade, brands in the retail channel will need to re-engage with consumers through better product placement and marketing.”
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