For the last 20 years, China has changed a lot. Whether it’s economically, ideologically, or about its tastes, the country has been experiencing very fast growth. China is evolving into a consumer society and new products, including candy & confectionery, are getting more and more present among Chinese daily consumption. The rising average income and constant exposure to western and international cultures and cuisines are influencing the confectionery goods and their development within supermarkets.
Candy and confectionery market in sum up:
- The market was estimated to be $21.21 billion in 2018
- Research estimate that China will see a compound annual growth rate of 5.1% between 2020
- China is soon to become the second-largest confectionery market in the world, with an expected volume of 1.4 billion kilograms
Candy consumption in China:
- The average per capita consumption is around 5.2kg in 2019, meaning a great increase in potential
- There are currently 593 candy enterprises in China
- 42 companies got a year-on-year growth rate of 10.63%
- Total revenue in 2019: $52,343 million
Market leaders:
- Mars
- Nestle
- Perfetti Van Melle Confectionery
- The Hershey Group
- Ferrero
New trends for candies
- Health-care oriented candy
- Low-sugar oriented candy
- Fun-oriented candy
- Ecotype candy
In China, among confectionery products priority is given to high-end indulgences with quality ingredients and reduced sugar. Consumers are mostly seeking confectionery products with better ingredients, superior taste, and attractive packaging.
Indeed, keep in mind that China is another culture, and consumers are increasingly educated on health and nutrition. As a consequence, consumers’ behavior is reflecting on that. They are running away from artificial ingredients and looking instead for high-quality premium products.
Health concerns have contributed to the robust growth of functional candies such as throat-shooting or vitamin C candies.
Demographic fact
Female consumers that looked for indulgent treats have contributed to China’s confectionery market growth. A report highlighted that Chinese women accounted for 30.4 billion consumption occasions in 2015, compared to 28.7 billion by men.
Confectionery as an all
Among the three main confectionery categories, sugar confectionery has recently been the most popular, while representing 67% of total confectionery in 2016. Chocolate confectionery represented 18% while the gum category represented approximately 15%.
Although sugar products are expected to continue leading the confectionery market in China, it’s anticipated that chocolate products will grow in value at a compound annual growth rate of 7% from 2017 to 2021.
How to sell candies in China?
Importance of your Brand image
For a long time, China has been suffering from its “low-quality product” reputation, but also as a counterfeit market. But now, the time has passed and things have changed. They’re trying hard to get rid of this reputation, at a point that whether they’re dealing with local or international companies, a trust relationship will have to be built. Without trust, no business.
Why is trust so important?
In the past, fake and harmful products got commercialized. And more than losing money, some people’s health got jeopardized because of the greediness of some businessmen. Also, consumers don’t want to be cheated on anymore. They don’t want to buy an appealing product and realize later on that the quality is very bad, or the product itself is harmful.
In China, branding is everything. People are ready to buy ten times the price of a product for a branded one, compared to a non-branded product.
Also, before buying anything or establishing any kind of business relationship, Chinese people are now checking online information about the company/product they may deal with. They’ll be looking for the company info to be sure the brand is real, but also online reviews and comments to know what the previous consumers thought about your product.
Being visible and developing a strong reputation is a must-do in China.
China got a close communication system. They do not have Google, Facebook, Instagram, and other Western social media.
What process should be followed in China?
Step 1: Develop your visibility.
In China, people don’t have access to our main media and social network. Also, they may have never heard about your company regardless of your international fame. And if you want them to cooperate with you, give them a chance to know who you are.
- Develop a new Website in Chine
Use a Chinese domain name, and build your design following the cultural trends.
- Open a Weibo account
It corresponds to the Chinese version of Twitter. Extremely popular in China, it’s also a great tool to develop a KOL strategy. Very useful if you plan to target a large audience and interact with your customers.
Step 2: Build your reputation.
You won’t get anything from them without showing that you’re already well-known in China.
Remember that they’re afraid of fake companies and fake products. They don’t trust corporate communication. And the only way for them to be sure of your credibility is to see that other people purchased your product and are talking good about you.
How to do?
- WeChat: the “Chinese Facebook”
A great messenger APP that gets a “moment” system allowing people to share content (messages, pictures, videos) and personal feedback. Moreover, people can use a “Group Chat” option to discuss divers problems and solutions, but also their favorite products and where can they get discounts. Although it’s not very efficient for advertisement, it’s a great tool for community management.
- Douyin: The Video King
A short video-sharing app allows you to generate content and spread it to a wild audience. More intuitive and fun than WeChat and Weibo, this app is also an amazing tool for KOL.
- Baidu: the Chinese Google
Having a Chinese website is good, but not enough. Before doing anything, Chinese people will check very carefully about your brand/product.
For example, a Chinese woman willing to buy baby products can check information online for 6 months before deciding anything.
So, here is a list of things to develop through Baidu, and strengthen your e-reputation:
- Baidu Zhidao & Zhihu: a good way to deliver information.
- Baidu Baike: it’s kind of the Chinese Wikipedia. And they trust it a lot here. So, we advise you to make up your own page.
- Forums: it’s important to develop your online presence. The more people talk about you, the better.
- PR: if you’re a good quality product consumed by a lot of people, then there should be articles about you. If not, it means you’re not worth it.
- Comments/reviews: Chinese people are always giving comments or reviews about what they bought. And you’ll need plenty of positive comments to convince distributors or potential customers.
How to sell your candies in China?
Online sales are probably the easiest way to make money in China. And here are some reasons why:
- Chinese people are always looking for a product to buy online, even candy.
- Easy to buy. Your potential clients can buy your products from anywhere. They’ll just need access to a phone or computer.
- If they are satisfied, they’ll buy from you again.
- If you’re turning out to sell a lot of products on the E-commerce Platform, offline distributors will contact you by themselves.
To distribute your product online, you’ll get two ways to operate:
- Cross-border E-commerce (Tmall Global, JD Global, etc.)
- Chinese E-commerce platforms (Taobao, Tmall, JD.com, etc.)
Cross-border E-Commerce: the entry gate in China
It’s about the importation of goods through sellers from foreign countries.
Let’s see how to sell your product through this model:
As an online e-commerce business model, you’ll need to have a platform. The main ones in China are currently Tmall Global and JD Global. Once you decide which platform you want to operate with, you’ll just need to set it up. Here’s the process:
- Pay a deposit (like usual)
- Build a nice store (well design)
- Advertise a lot (at the beginning)
- Pay commission per sale (if you can)
- Pay daily operation management (high cost)
- Need an active marketing campaign
The good part of cross-border e-commerce is that you don’t need to have a Chinese business license or any certification. The main disadvantage is that it’s pretty expensive.
For more information, you can check our CrossBorder guide here
Chinese E-commerce Platforms
If you have the possibility to establish your business directly in China, and therefore get a Chinese business license and the required certifications, you can use Chinese e-commerce platforms such as Taobao, Tmall, JD.com, etc.
It’s cheaper than cross-border and the time to deliver your product is faster. The main problem is that you’ll need to understand Chinese or hire someone that can deal with it on your behalf. Because all the stores will be in Chinese. Otherwise, the process to open your store is similar to the one for a cross-border platform.
- Deposit
- Build a store, design pages
- Advertise it
- Participate in special events (double 11, 618, 12/12, etc.)
- Manage daily operations
- Store supported by your branding
To resume, the sugar confectionery market in China is a growing market. People tend to consume more and more “candy” every year. And if you want to enter the Chinese candy market and maximize your chance of success, you’ll have to:
- Make your brand visible
- Develop a strong reputation
- Open an e-commerce platform
If you want to check more about exporting food to China click here
If you have any questions about the confectionary market and how to develop your brand in China, feel free to contact us.
We are the GMA, your Strategic Partner in China
- the Chinese Digital Marketing Expert
- Professional in the E-commerce industry
- Candy lovers
For more information, please feel free to check our case studies.