Meat Snacks - China - April 2021

OVERVIEW
What you need to know
Covered in this Report
Definition
Excluded
EXECUTIVE SUMMARY
The market 
Retail sales experienced a big increase in 2020 
Figure 1: Meat snack sales and growth vs total snack and in-home food, 2018-20
Figure 2: Top five snack segments by value share in total snacks, 2018-20
Future growth expected to surpass snack category level
Figure 3: Retail sales forecast of meat snacks, 2021-25
Growth is supported by various factors
Companies and brands
PepsiCo’s acquisition of local brand shows ambition of international brands in this market 
Figure 4: Leading players’ market share by sales value, 2018-20
Major brands compete by leveraging pillars in marketing mix 
Private labels enter meat snacks 
Healthy and “green” packaging are top claims in new product development
Figure 5: Top 10 claims in China market’s new product launch for meat snacks, 2017-2020
Innovation trends suggest products will become more sophisticated
The consumer
Salty flavour preferred over sweet for snacking 
Figure 6: Snack preferences (any selected), February 2021
Tier one cities drive consumption
Figure 7: Meat snacks consumption, February 2021
Snacking for craving not as meal replacements 
Figure 8: Reasons to eat meat snacks, January 2020 vs February 2021
Quality of meat most discourages consumption  
Figure 9: Barriers of eating meat snacks, February 2021
Buying from familiar channels 
Figure 10: Purchasing channels, February 2021
Leading brands not responding to the key consumption drivers 
Figure 11: Brand perception – Correspondence analysis, February 2021
What we think
ISSUES AND INSIGHTS
Craving for good taste is not sufficiently addressed
The facts
The implications
Scope for new brand entries: focusing on specific sub-segments 
The facts
The implications
THE MARKET – WHAT YOU NEED TO KNOW
Retail sales of meat snacks increased by 32.8% in 2020 
Meat snacks’ growth outlook exceeds snack category level
Flavour preferences boost meat snack consumption 
Food safety concerns urge 
MARKET SIZE AND FORECAST
Sales growth going stronger over 2018-2020
Figure 12: Retail sales and growth of meat snacks, China, 2018-20
Figure 13: Growth rate of meat snacks, total snacks and in-home food, 2018-20
Figure 14: Share of major snack segments in total snack sales, 2018-20
Growth will sustain in the future, outperforming food and drink average 
Figure 15: Retail sales forecast of meat snacks, 2021-25
MARKET FACTORS
Chinese consumers prefer salty over sweet snacks
Diversified purchasing channels make it more convenient to buy
More at-home leisure time create occasions for snacking
Food safety concern
Figure 16: Top five most concerned issues in life, 2020 April and 2021 January
KEY PLAYERS – WHAT YOU NEED TO KNOW
Changing landscape: PepsiCo enters meat snacks via Be&amp;Cheery 
Leading brands investing actively in distribution expansion, advertisement and new product development   
Retailers actively launch home brands
Innovation highlights
MARKET SHARE
PepsiCo enters meat snack category via Be&amp;Cheery
Figure 17: Leading players’ market share by sales value, 2018-20
Private labels join  
COMPETITIVE STRATEGIES
Internet-based brands no longer rely solely on e-commerce 
Target specific demographic 
Snacks developed to cater to children’s nutrition
Figure 18: Bestore’s products targeting children
Targeting fitness consumers: Keep differentiates by its “expert image”
Figure 19: Meat snacks targeting fitness consumers
Specialised brands focus on nutrition, while private labels highlight economy 
Figure 20: Top 10 claims used in meat snacks new product launch, by brand types, January 2020-March 2021
Brand awareness building
Figure 21: Marketing communication of key players, 2021
WHO’S INNOVATING?
Health and environmental-friendly in spotlight
Figure 22: Top 10 claims in China market’s new product launch for meat snacks, 2017-2020
Targeting fitness consumers in China makes high protein and low fat the fast-growing claims
Figure 23: Top 5 growing claims in China’s new product launch for meat snacks, 2018-2020
Innovation highlights 
Serve snacks warm 
Figure 24: Top 10 claims for meat snack new products in major overseas markets, 2020
Figure 25: Meat snack products in South Korea, 2020-21
Plant-based meat snacks   
Figure 26: Plant-based duck meat snack launched by Zhou Hei Ya, October 2020
Flavour blends inspired by natural ingredients
Figure 27: Creative flavour blends for meat snacks, 2020-2021
THE CONSUMER – WHAT YOU NEED TO KNOW
Salty flavour preferred over sweet 
Consumption driven by tier one cities
Food craving motivates consumption
Meat quality concern is the main barrier
Consumers buy from familiar channels
Major brands are yet to improve association with being “delicious”
SNACK PREFERENCES 
Overall, consumers prefer salty flavours over sweet 
Figure 28: Snack preferences – Any selected, February 2021
Meat snacks are preferred under different occasions in a day
Figure 30: Top three snack preferences by occasions, February 2021
Figure 29: Prefer cooked food – any selected, by age, February 2021
CONSUMPTION TREND
Consumption pattern remains the same as before COVID-19 
Figure 30: Meat snacks consumption, February 2021
Figure 31: Meat snack consumption – % of eat more, January 2020 vs February 2021
Meat snack consumption is not replacing meat consumption through main meals
Figure 32: Eat more beef jerky snacks, by red meat consumption frequency at main meals, February 2021
Figure 33: Eat more chicken feet and seafood snacks, by poultry and seafood consumption frequency at main meals, February 2021
Eating meat snacks mainly driven by tier one cities
Figure 34: Meat snack consumption – % of eat more, by city tier, January 2020 vs February 2021
More consumption of chicken feet and duck neck among males
Figure 35: Chicken feet - % of eat more, by age and gender, January 2020 vs February 2021
Figure 36: Marinated duck neck - % of eat more, by age and gender, January 2020 vs February 2021
REASONS TO CONSUME
Consumption led by indulgence, especially among Gen-Zers
Figure 37: Reasons to eat meat snacks, January 2020 vs February 2021
Figure 38: Reasons for consumption – Food craving, by age, 2020 vs 2021
Mid-to-high income consumers more appealed by health benefits
Figure 39: Reasons to consume – health-related factors, by monthly household income, February  2021
BARRIERS TO CONSUME
Food quality concern discourages consumption
Figure 40: Barriers to eating meat snacks, February 2021
Figure 41: Food quality concern, by demographic, February 2021
Figure 42: Food quality concern, by those who have eaten less or not eaten selected meat snacks, February 2021
Consumers, in general, tolerate different types of meat and taste
Figure 43: Barrier to consume – Taste and meat type, by respondents who have eaten less or not eaten meat snacks, February 2021
Young people are pickier about meat snacks
Figure 44: Selected barriers to consume, by age, February 2021
PURCHASING CHANNELS
Buying from familiar channels for quality reassurance
Figure 45: Purchasing channels, February 2021
Internet-savvy young people use traditional offline channels as well
Figure 46: Young people’s purchasing channel, February 2021
Young people want convenience in addition to familiarity
Figure 47: Usage of food delivery apps and convenience stores, by age, February 2021
BRAND ASSOCIATION 
 “Delicious” –a key driver of snack consumption – is yet to be addressed by leading brands
Figure 48: Brand perception – Correspondence analysis, February 2021
Bestore and LYFEN are competitive targeting young consumers
Figure 49: Brand perception among consumers aged 18-24, February 2021
APPENDIX – MARKET SIZE AND FORECAST
Figure 50: Meat snack consumption forecast, 2021-25
APPENDIX – METHODOLOGY AND ABBREVIATIONS
Methodology
Abbreviations