Biscuits, Cookies and Crackers - China - March 2015

INTRODUCTION
Definition
Methodology
Abbreviations
EXECUTIVE SUMMARY
The market
Market size and forecast
Figure 1: Retail market volume size of biscuits, China, 2009-19
Figure 2: Retail market value size of biscuits, China, 2009-19
Market segmentation
Figure 3: Volume share of total biscuits retail market, by segment, 2014
Companies and brands
Figure 4: Value share of biscuits retail market, by company, China, 2013 and 2014
The consumer
Favourite biscuit brand
Figure 5: Favourite biscuit brand, November 2014
Average monthly spending on biscuits
Figure 6: Average monthly spending on biscuits, November 2014
Consumer perceptions of savoury and sweet biscuits
Figure 7: Consumer perceptions of savoury and sweet biscuits, November 2014
Interest in biscuit flavours
Figure 8: Interest in biscuit flavours, November 2014
Important factors in buying biscuits as a gift
Figure 9: Important factors in buying biscuits as a gift, November 2014
Attitudes towards and purchase behaviours of biscuits
Figure 10: Attitudes towards and purchase behavious of biscuits, November 2014
Key issues
Do men have a sweeter tooth than women?
How to use savoury biscuits to increase usage at on-the-go occasions?
Is biscuit with food therapy concept a trend to sustain or a fad?
What we think
ISSUES AND INSIGHTS
Do men have a sweeter tooth than women?
The facts
The implications
Figure 11: Examples of biscuit innovations with functional benefits, US and Brazil, 2013-14
Figure 12: Examples of sweet biscuits targeting men, France, Australia and Portland, 2012-14
How to use savoury biscuits to increase usage at on-the-go occasions?
The facts
The implications
Figure 13: Example of cereal bar packaging innovation that is easy to open, France, 2013
Is biscuit with food therapy concept a trend to sustain or a fad?
The facts
The implications
TREND APPLICATION
Minimise Me
Sense of Intense
Make it Mine
Figure 14: Examples of candy kit that can be customised with a candy writing pen, Canada, 2014
MARKET SIZE AND FORECAST
Key points
Growth opportunities come from increasing usage at less common occasions and consumers trading up
Figure 15: Biscuits retail market volume and value sizes, China, 2009-14
Biscuit market feels pressure from other snacks categories
Figure 16: Retail market volume growth, by snack category, China, 2010-14
Value growth greatly slowed down in 2014 due to a steadier price rise
Figure 17: Growth rate of producer price index of selected crops, China, 2010-13
Key market drivers
Consumers’ strong willingness to trade up to more premium imported variants
Figure 18: Imported biscuits, by volume, China, 2011-14
Figure 19: Top five countries/regions that China imported most biscuits from, by volume, 2014
Busier lifestyles of consumers lead to greater demand for biscuit consumption to fill hunger
The fast-growing online retailing enables smaller brands to reach more consumers in lower tier cities
Market volume size forecast to grow at steady pace
Figure 20: Retail market volume size of biscuits, China, 2009-19
Figure 21: Retail market value size of biscuits, China, 2009-19
Forecast methodology
MARKET SEGMENTATION
Key points
Sweet biscuits held greater share in the market
Figure 22: Volume share of total biscuits retail market, by segment, 2014.
A shift in consumer demand towards snacking led to more active NPD in sweet biscuits
Figure 23: Biscuits retail market volume sizes, by segment, China, 2009-14
Sweet biscuit market is expected to grow slightly faster leveraging its advantage over indulgent snacking
Figure 24: Biscuits retail market volume sizes, by segment, China, 2014-19
MARKET SHARE
Key points
The biscuit market is quite fragmented
Figure 25: Value and volume share of biscuits retail market, by company, China, 2013 and 2014
Mondelēz and Tingyi had a slump in shares signalling a declined consumer preference over sandwich biscuits
Orion came in third position in value share with more specific demographic targeting
Domestic brand Jiashili felt greater pressure from premium brands
WHO’S INNOVATING?
Key points
Consumers demand more flavoured biscuits
Figure 26: Share of top flavours of biscuits, China, February 2012-January 2015
Smaller unit pack size packaging takes a rise
Figure 27: Share of biscuits with small unit pack size, China, February 2011-January 2015
Coarse grain and wheat bran are emerging ingredients in biscuits
Figure 28: Share of biscuits claiming coarse grain and/or wheat bran, China, February 2012-January 2015
JZJT launched Hou Gu Biscuits, leveraging the popularity of TCM concept
Opportunities to develop biscuits with food therapy concept
Oreo launched Delight Thin Series in China
Oreo launched Red Velvet Sandwich Biscuit limited edition in the US for Valentine’s Day
COMPANIES AND BRANDS
Mondelēz International
Latest developments
Orion Group
Latest developments
Tingyi Holdings Limited
Latest developments
Jiangzhong Group
Dali Group
Mayora Group
THE CONSUMER – FAVOURITE BISCUIT BRAND
Key points
Oreo has a clear lead in consumer preference, followed by Master Kong and Hao Chi Dian
Figure 29: Favourite biscuit brand, November 2014
Figure 30: Selected favourite biscuit brand, by gender and age, November 2014
Foreign brands are more favoured in tier one cities
Figure 31: Selected favourite biscuit brand, by city tier and region, November 2014
Local brands achieve higher preference in Southern cities like Guangzhou and Zhanjiang
Imported biscuit brands are more popular in tier one cities
THE CONSUMER – AVERAGE MONTHLY SPENDING ON BISCUITS
Key points
Classification of consumer groups based on average spending and monthly household income
Figure 32: Average monthly spending on biscuits, November 2014
Figure 33: Definition of Low/Mid/High-MHI groups
Women in their 30s are most generous spenders
Figure 34: Average monthly spending on biscuits, by gender and age and monthly household income, November 2014
Income drives biscuit spending
Figure 35: Agreement on selected consumer purchase behaviours statements, by average monthly spending on biscuits, November 2014
Consumers in Chengdu, Zhanjiang and Guangzhou tend to spend more
Figure 36: Average monthly spending on biscuits, by city, November 2014
THE CONSUMER – CONSUMER PERCEPTIONS OF SAVOURY AND SWEET BISCUITS
Key points
Sweet biscuit market needs to catch up with healthier variants
Figure 37: Consumer perceptions of savoury and sweet biscuits, November 2014
Figure 38: Share of new biscuit product launches, by segment, China, February 2014-January 2015
Figure 39: Share of new product launches of sweet biscuits, China, UK and US, February 2014-January 2015
Savoury biscuit is weaker in flavour variety and dry taste
Use different flavour type to capitalise hunger-filling occasion by city tier
Figure 40: Agreement on “suitable for filling hunger”, by city tier, November 2014
THE CONSUMER – INTEREST IN BISCUIT FLAVOURS
Key points
Chocolate and milk garner the highest level of interest
Figure 41: Interest in biscuit flavours, November 2014
Figure 42: Share of selected flavours in new product launches, China, Japan, UK and US, February 2013-January 2015
Young consumers prefer fruit flavours while older consumers prefer nut flavours
Figure 43: Interest in selected biscuit flavours, by age, November 2014
Females are more interested in hazelnut, raspberry and caramel while males prefer milk and honey
Figure 44: Interest in selected biscuit flavours, by gender, November 2014
Peanut butter, hazelnut and raspberry can sustain higher price points
Figure 45: Interest in selected biscuit flavours, by monthly personal income, November 2014
THE CONSUMER – IMPORTANT FACTORS IN BUYING BISCUITS AS A GIFT
Key points
Food safety, health benefits and brand are top consideration factors for gifting
Figure 46: Important factors in buying biscuits as a gift, November 2014
Different demographic groups value different product features
Figure 47: Selected important factors in buying biscuits as a gift, by age, November 2014
Over-35s are more conscious of naturalness
Use premium ingredients to target the older gift buyers
Young consumers in their 20s are more interested in customisation
Play around with ingredients to premiumise the offering
Figure 48: Selected important factors in buying biscuits as a gift, by monthly personal income, November 2014
THE CONSUMER – ATTITUDES TOWARDS AND PURCHASE BEHAVIOURS OF BISCUITS
Key points
Make texture features clear in biscuit name and marketing
Figure 49: Attitudes towards biscuits, November 2014
Enhance taste perception of coarse grain and wheat bran biscuits
Make it “human”
Men in their 30s like sweet biscuits better
Figure 50: Agreement with “I prefer sweet biscuits to savoury ones”, by gender and age, December 2013 and November 2014
Buying from bakeries and cafés is more popular among young consumers aged 20-24
Figure 51: Purchase behaviours of biscuits, November 2014
Biscuits still considered a good gift option, particularly in Eastern and Southern regions
APPENDIX – MARKET SIZE AND FORECAST
Figure 52: Retail market volume size of biscuits, China, 2009-19
Figure 53: Retail market value size of biscuits, China, 2009-19
APPENDIX – MARKET SEGMENTATION
Figure 54: Retail market volume size of savoury biscuits, China, 2009-19
Figure 55: Retail market volume size of sweet biscuits, China, 2009-19
Figure 56: Retail market value size of savoury biscuits, China, 2009-19
Figure 57: Retail market value size of sweet biscuits, China, 2009-19