“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.
– 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?
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. 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
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