2017 Chinese Consumption Concept of Food and Beverage

Change of consumption concept: from ‘spending money unwillingly’ to ‘paying for convenience’

The soaring economy of China determines the huge gap between generations in terms of consumption concept. The influence of frugality is weakening, for the new generations prefer moderate or even excessive consumption as long as their economic conditions allow. Consumers are willing to pay for better quality, service and convenience. Change of consumption concept: from ‘advocating frugal life’ to ‘paying for high-quality life’.

Change of concept: from ‘preferring oily food high in sugar and calorie, and believing being thin is being unhealthy’ to ‘preferring food low in sugar and slender figure’

The young generations prefer food low in sugar and slender figures, therefore the health functional food and natural food enjoy a great market in recent years. For instance, China’s beverage market grew merely by 1% in 2015, but the market of functional beverage increased by 7.6%, that of juice increased by 4.7%, and that of the less healthy carbonated beverages kept declining. In dairy product market, organic milk, imported milk and yoghourt featured with safety certificate increase faster than the general milk.

The new generations are very sensitive to additive and calorie. They identify additive, high calorie and fat as unhealthy and protein, original as healthy. The healthier NFC juice (Not from Concentrate Juice), light beverage, enzyme beverage (vinegar beverage), etc.

As for food and beverage market, bottleneck of unit consumption overlays and poverty decreases, and the national food consumption increases on the whole.

1) The old generation holding the concept of frugal life, stocking up and preferring good quality to large amount are gradually influenced by the concept of the young group and female white-collars.

2) People born in the age of famine have entered middle and old age, therefore consumption per capita of this group declines and the influence of their consumption concept is weakening.

3) The consumption concept of the young group has become the mainstream and there is large space for the growing consumption owing to the large number of single children.

4) Traditional family pattern of men outside and women at home has changed, and women have more consumptive power than ever.

5) Dietetic symbols of the new generation: health, good flavor, soft addiction, preferring expensive and high-quality products to cheap and low-quality products.

 

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According to CRI, the sales revenue of functional drinks increased from CNY 25.71 billion in 2011 to CNY 60.6 billion in 2015 with the CAGR of 23.9%, far exceeding the growth rate of the market size of the soft drink industry during the corresponding period.

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