Chocolate Market in China

China’s Imported Chocolate Market

Now the China market has already become the engine for the global chocolate market. Its 30% annual growth and its large population have attracted chocolate marketers from all corners of the world. A profound understanding of the market, customers and the right marketing strategy is the key to penetrating the massive China chocolate market.

1

Chocolate in China

Status quo of Imported Chocolate market

Seen as an exotic food product, it has taken decades for Chinese people to accept chocolate. Now the Chinese market is ready for chocolate from the taste and the culture,
According to the data from Association of Chinese Chocolate Manufacturer, Chinese consumes 70 grams of chocolate per capita every year. This data is dwarfed by 2 kilos that of Japan and Korea, needless to say 7 kilos of one European. However, multiplied by 1.3 billion the size of the market which is ¥3.5 billion is a huge potential as well.

3

That also explains why the Chinese market can witness a 40% annual growth in 2008 when the global growth is only 10% and report from Bain estimates that the annual growth will stay around 11% in the next 5 years and it looks quite negative compared with that of 30% fromAC Nielsen report. No matter which one comes true, the huge potential of the market has been recognized by everybody. The huge population means a big potential to drive the chocolate business up when chocolate consumption per capita reaches 1 kilo.

4

So far, the top 20 chocolate makers have already presented in the market. In a common supermarket in Shanghai, you can easily find chocolate of over 70 brands. Most of them are foreign brands. The study on consumption habit of Chinese chocolate consumers also indicates that foreign brand chocolate is more popular in the market.

  • 1% of the consumers prefer foreign brands
  • only 22.2% like local brands more

And local companies still need time to improve this totally imported food product. As a result, about 90% of the market is occupied by foreign brands. The big four (biggest four companies in China chocolate market: Dove, Ferrero, Cadbury and Leconte) have taken over 70% of the market. Only Leconte is a local brand. Among the three foreign brands, only Dove has taken one-third of the market.

And these four brands have held the high class market. Then following brands such as UHA, Meiji and Lindt & Sprüngli take medium-to-high class chocolate market and the rest of the market is taken by local companies.
Good news for imported chocolate is that the new generation of consumers has much deeper understanding of chocolate including its taste, making process and culture. This trend will probably increase the daily consumption of chocolate which means the market will expand greatly.

Selling Points of Imported Chocolate

Why more and more Chinese become fans of chocolate, a foreign imported food product?
What are the factors to getting Chinese people buying chocolate ? A report shows that the No.1 factor Chinese consumers consider is the taste; following by brand (18%) and price (7%).

  1. Taste

From the slogans of big foreign brands, we can see that taste is the key factor those big companies consider:

  • Dove: 牛奶香浓,丝般感受(Sweet-smelling milk as silk tasting)
  • Ferrero: 溶在口味,回味无穷(melt in mouth, a lasting flavor)
  • Cadbury:顺滑(smooth)

5

It’s true that in China, taste is the most important factor, but compared to western consumers, Chinese consumers don’t care about the taste nearly as much. A report shows 66% western consumers put taste as the most important factor while only 30% consumers think it’s the most important factor.
With the deeper understanding of chocolate, Chinese consumers will consider more and more about the variety and the taste.

  1. Brand

When chocolate came to China’s market, it was branded as an exotic food product which is an added extra value.
And now the brand has become even more important.

6

First of all, a big part of imported chocolates purchased in China are for gifts or ceremonial use like wedding candy.

For young Chinese men, chocolates, especially luxurious delicately packed chocolates have become a must to show their love to their girlfriends. During the Chinese Valentines’ Day this year, half of the top 10 items sold online were chocolates.
That’s why imported chocolates are sold as high class food product.

7

Apart from its decent look, imported chocolates also enjoys a fame of high class ingredients. With the growing concern for health and food safety, consumers are becoming more careful about the ingredients of chocolates and imported chocolate are trusted for containing more coco or milk.

  1. Price

When chocolate first appeared in China, the price for a box of imported chocolates was sky-high. Today, chocolate has become a common food product that most people can afford. But some chocolate brands are still famous for their high price such as Ferrero because Ferrero targets on high class chocolate market where price is an important tool to show its value.
A Chinese consumer can easily find reasons to buy a box of imported chocolate for its taste, brand and price. And what chocolate makers need to do is to produce nice chocolate, promote its brand and label with a suitable price.

Branding

If you already have the products, why not sell them in China? But before that, you will need to know how Chinese think about the taste of your chocolate and build your brand first. To reach these two targets an integrated strategy of both online and offline marketing will be good.
As shown in a survey by China Internet Network Information Center (CNNIC), 85% of the interviewees choose Internet as their choice for information, following with TV 66.1%, then newspaper 61.1%.
For new comers in the Chinese chocolate market, online marketing and branding is a suitable strategy. It has the following four advantages:

  1. cost efficiency
  2. precise marketing
  3. easy reputation control
  4. feedback from the market.

There are mainly two ways to promote your chocolate in China online: Special designed website and SNS promotion

  1. A website in Chinese

8

With a website in Chinese, you can

  1. increase the popularity of your brand
  2. influence consumers by content and design
  3. create a company image

After creating a website for your chocolates, the promotion of it is also important. A good website without people visiting is a waste. To promote a website by SEO and SEM is the most popular solution now.

  1. SNS promotion

9

Social Networking Service or Social Networking Sites (SNS) has become an important source for people to get information. Now half of the Chinese internet users have registered in Weibo (micro blog). As “2012 Corporate Weibo White Paper“by Sina and CIC introduces, there are about 5000 food products manufacturers opening accounts on Sina Weibo. Some of them have opened very professional Weibo accounts.

Other SNS sites like Douban where high educated Chinese are and RenRen (China Facebook) are also important.
The benefit of promoting your chocolates on SNS is that you can

  1. get feedback about the taste, brand and price quickly from them;
  2. build a community surround your company;
  3. reach your target people precisely;
  4. creating a more friendly company image;

and people accept information from SNS faster.

  1. Community management

10

Besides its taste, the concept of chocolate culture has also been accepted by Chinese. Chocolate Salon has already been held three times in Shanghai and gained a lot chocolate fans and build a high-class image for this food product.

Question:

Chocolate has very high calorie,so women think that eating chocolate will make them fat,and it could not help them to keep in shape.

If you are the marketing manager which want to attract more women to eat chocolate,what do you think you need to adjust on the integrated marketing communications of chocolate?

Advertisements

33 thoughts on “Chocolate Market in China

  1. I think Australian women already accept that chocolate is bad for the waste line but that hasn’t reduced consumption. Is it something about Chocolate being a comfort food and a kind of guilty pleasure. Would marketing it as an high prestige indulgent consumption work in China? I also find the commentary on the lack of importance on taste interesting. As an emerging market it may be possible for companies like Cadburys to manufacture using Palm Oil a strategy they used elsewhere to reduce costs but had to reverse in light of consumer backlash at the taste.

    Like

    • You’re right
      To reverse in light of consumer backlash at the taste is very important.
      More Chinese women are willing to eat chocolate as a new food.
      However, they do not regard chocolate as a snack to be long-term food, or to control eating chocolate for keeping their body.

      Like

  2. I would emphasize on Chocolate being a sensual upmarket treat. Linking chocolate to the feeling of being loved. With chocolate having active ingredients to create the feeling of love, this would be the main communication. I would conduct marketing research through the form of quantative surveys (to reach a large target population as chocolate can be consumed by many). Through my findings of what appeals to female Chinese consumers, I would design an advertising campaign to capture the attention of consumers in the form of emotional advertising. I would incorporate IMC firstly through mainly traditional channels of TV, print ads and billboards to gain reach and high exposure, using a female protagonist in a romantic scene. The next stage I would integrate digital advertising and social media to engage in consumers through a competition and forum.

    http://www.medicinehunter.com/chocolate_love_drug

    Like

    • Thank you for your suggestion
      With the rapid development of modern network technology, undeniably, social media has had more impact on people’s lives.
      Attention to social media marketing for businesses is becoming more important.

      Like

  3. Thanks for the blog. Chinese market is a totally different market, and we cannot underestimate the buying power over there. China e-commerce giant Alibaba has set US$8.18 billion (RMB50 billion) as its 2014 target of single-day transaction value for the November 11 online shopping festival. I don’t know how many people have heard about this, but surely it’s incredible!

    Like

  4. Pana Chocolate. It is one of the more organic types of chocolate, its low in sugar/fat, and is very rich- it is not enjoyable to eat alot of this as it is very rich. Being selective with the “type” of chocolate you wish to market is an important phase. With so many different types of chocolate out there, some higher is calories than other, some said to increase metabolism- thus “weight loss” chocolate has many health benefits when consumed in portions.

    As an integrated marketing manager wishing to increase the communications of chocolate within the Chinese Market first you need to change the “typical” association of chocolate within your market. Chocolate is a treat, and is needs to be marketed and communicated that way.

    All highly processed food is high in calories, thus is abut eating the right type and just the right amount.

    Liked by 1 person

  5. Interesting blog. I agree with atownsen2015, Chocolates in China can be promoted as love gifts and make females feel being loved. I personally think celebrity branding will work well for chocolate marketing. Women, especially young girls, tend to follow celebrities’ behaviors and styles etc. Marketers can come up an impressive love story, get it starred by celebrities, then advertise it on TV, internet, social media and roadside billboards. Remember, in most cases women don’t buy chocolates for themselves, men buy for them. So the ads should also get men’s attention in terms of advertising channels. Once the message is spread out, the ads will trigger brand association when people see them, making women think of “love”, and making men think that they should buy chocolates to make their girlfriends/ wives feel loved.

    Secondly, create more varieties of packaging, especially love themed ones, for Valentine’s Day, anniversaries and Christmas etc. Also you can consider small wedding themed packaging for wedding treats market.

    Like

    • Your idea reminds me of the diamond marketing strategy.
      It has been said diamond sales are very good, smart businessman and eternal love it together, it created a lot of sales in the diamond industry.

      Like

  6. Interersting blog and comments. It is often said that women have an emotional relationship with chocolate, so by marketing it as a guilty pleasure or as a product to receive for being loved will in general work I think. However, as mentioned by chloechanelle, there are so many different types of chocolates. So depending on which chocolate you chose to market a different type of IMC should be used. E.g. smalI pralinés in boxes I would communicate chocolate as a luxurious delicacy for boyfriends who want to give it as a gift for their girlfriends; chocolates with a high percentage of cocoa can be communicated as a premium chocolate with an “intense” chocolate flavour for the real chocolate lovers, health benefits of cocoa might also be highlighted when consumed in small portions; milk chocolate (possibly with flavors like vanilla) can be communicated as something to be eaten when consuming tea or coffee or just as a self-rewarding snack.

    Like

  7. Chocolates contain ingredients that can make people feeling happier, I think companies should emphasize this advantage if they want to attract more women to purchase because women are quite emotional sometimes.

    I agree that building up a website is a good way to communicate with the target customers and to promote the products nowadays. Although using SEO or SEM to promote a website will let the company reaching more potential customers, it will be an extra cost to the company and this should be carefully considered.

    Like

    • Although,if the company pioneering social media tools, it will be an extra cost to the company.
      But I think for a chocolate company which is excellent value for money investment.

      Like

  8. Interest posting! In my view, if I were a marketing manager, I’d like to focus on the advertising of this production is a new generation one in some extent. This is because that the new one is low-sugar one!This will lead to it is helpful for women’s health.
    In addition, if there is a permit conditioned, I would like to do a promotion in supermarkets such as buy one get one free.
    Last but not least, I would like to design a more beautiful design on the official website. Which is focus on more low-sugar. Besides, I’d like to show the ingredients of the production to prove that it is low-sugar and best for health!

    Like

    • Exactly right
      There is nothing like taking change from raw materials to complete,
      Of course, for a company which will increase costs, but I think this is the best way.
      Using the right marketing strategy is more particularly important, let more people realize that chocolate has become a health food.

      Like

  9. Good entry! I think dark chocolate is a good choice for women. If you buy quality dark chocolate with a high cocoa content, then it is actually quite nutritious.It contains a decent amount of soluble fiber and is loaded with minerals. Of course, 100 grams (3.5 ounces) is a fairly large amount and not something you should be consuming daily. All these nutrients also come with 600 calories and moderate amounts of sugar.For this reason, dark chocolate is best consumed in moderation. Dark Chocolate is a Powerful Source of Antioxidants as well. The flavanols in dark chocolate can stimulate the endothelium, the lining of arteries, to produce Nitric Oxide (NO), which is a gas – so dark choclate seems to be a good choice for living healthy 😛 😛 😛

    Like

    • I think I understand what you mean. To make female customers to establish the idea of ​​dark chocolate will not gain weight, will allow more women are willing to eat dark chocolate.

      Like

  10. Interesting article. I love chocolate and also know that it is good for body and spirit. Chocolate is surprisingly good for health, especially for the heart. In this case, we need to change Chinese women’s perception about chocolate effects, which is the goal should be archived. To reach awareness, a research would be conducted to explore which media decision should be made. Depend on the goal, we pop-up the ads to suit Chinese culture with key ads are TV and magazine. Company also can use marketing mix to attract more customers.
    As many comments which state that making chocolate become love status can be good solution. However, in my opinion, marketer should focus on local taste and using PR persons who are famous and thin could be a potent stimulus. Women who look at these ads can change their perception about themselves to be thinner.

    Like

    • Establish a positive perception of women is particularly important for chocolate, but I think the star to find a very thin and not particularly good advertising effect. Because some people are not particularly easy to get fat, chocolate may not be convincing not fattening.

      Like

  11. Thanks for blog. Chinese women like chocolate and besides this, it’s becoming trendy to receive chocolate gifts on special occasions. It’s a western trend and everything that’s popular in the West is being adopted by Chinese people quite fast.
    The only problem is the Chinese culture that emphasizes slimness in women, not sure Chinese women will ever eat sweets very often.

    Like

    • No matter which country women, I think, would like to eat sweets. Sweets will make people feel happy, is not it? But Chinese women are more willing to reduce or control weight and eat sweets.

      Like

  12. Thank you for your blog, although women are very well aware of the consequences, it wont be reducing consumption rate at all. However, as far as i know there are some types of Chocolate that provide very good nutrition but its not as good taste as normal Chocolate anyway.

    Like

  13. It is true that chocolate has always been sold in a gender specific way. I think more than half of the ads about chocolate are about a woman in the silk pyjamas who locks herself away where she won’t be interrupted such as having a bath, and enjoy a confectionary moment.
    For decades, chocolate has been sold as woman’s pleasure, but now the industry is changing, not only men established an image such as giving chocolate as a gift to a wife or lover, but today men eat roughly the same amount of chocolate as women and yet so many products are still designated ‘female’.
    Chocolate marketed towards women falls into two categories, pastel colours that suggest a sense of lightness and a low-calorie, with purple and pinks coming up often. And dark, rich colours like brown, black and burgundy that represent indulgence. This is a shift away from chocolate for men, with its strong and jarring blue and orange combination or children’s chocolates, with their bright colour clashes.”

    Like

  14. As a women, i like chocolate and I appreciate your question, it very funny as well as instructive. As a customer, I would like to choice safe and healthy food. There is no doubt that when girls eating chocolate afraid overweight about their body, so maybe this company of chocolate can seek similar materials to replace chocolate.

    Like

    • Maybe your idea is right. But the new materials to replace the chocolate might therefore costs, which could lead to the original decline in sales. This is not a chocolate company want to see。

      Like

  15. chocolate market, even though has a huge potential for China, may not be as easy unless they take up a different sect of marketing strategies. European manufacturers already competes fiercely here, and is an innovator in marketing strategies in this sector.

    Like

  16. Very good blog.
    Firstly, imported chocolate is luxury gift for girls in China, especially for some special days such as Valentine’s Day, Christmas. Secondly, chocolate is actually healthy, it can improve energy levels and make people smarter and happy, coco can improve physical performance, it is very welcome for young people who are under stress, such as uni students who is preparing exams, office ladies. Thirdly, the chocolate company who wants to enter the Chinese market, they should know how important to localise their products for Chinese, the chocolate would be less sweet and with a gorgeous package to cater to Chinese taste.

    Like

  17. Thank you for sharing. For now,due to obesity problems consumers are continue to reduce demand for chocolate. Now the good chocolate sales strategy should be more focus on the meaning of terms and chocolate packaging. A beautifully packaged chocolate is a good ways to attract customers. Valentine’s Day, Mother’s Day is a symbol of culture of chocolate. So chocolate strategy in the Chinese market should be based packaging products.

    Like

  18. I think it is implausible to link chocolate consumption and weight gain related issues. As previously commented, some data suggests men consume chocolate equivalent to women. However marketing chocolate as a decadency or luxury associated with a special occasion or social event (eg dinner) may resonate more with women. Additionally, where the product is positioned for purchase and how it is presented (packaging and price) may be more successful.

    Like

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s